With the announcement that China intends to retaliate against the latest proposed U.S. tariffs, hard-working U.S. farmers and agribusinesses are clearly in the line of fire from what looks more and more like an escalating trade war with China.
U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) believe wheat farmers are going to get hurt by the 25% tariffs China quickly proposed after the U.S. government announced new tariffs on $50 billion of imported Chinese goods on April 4, 2018.
“People may not know that China imported more than 61 million bushels of U.S. wheat in marketing year 2016/17, making it our fourth largest buyer in the world,” says USW Chairman Mike Miller, a wheat farmer from Ritzville, WA. “Farmers across the country have invested a lot of money and time over the years to develop a Chinese market that has great potential to buy even more American wheat. Now that effort is in jeopardy at a time when big global supplies have already pushed farm gate wheat prices down to unsustainable levels.”
“America’s wheat farmers are experiencing several hardships and adding a 25% tariff on exports to China for U.S. wheat is the last thing we need during some of the worst economic times in farm country,” states NAWG President Jimmie Musick a wheat farmer from Sentinel, OK. “Continued drought, low prices and trade uncertainty adds pressure to passing a Farm Bill on time as well as creating uncertainty for producers and lenders. In a trade war, agriculture is always the first target. The administration can support rural Americans by working with Chinese officials to avoid these damaging tariffs.”
USW and NAWG want their organizations to keep fighting for fair opportunities to compete in China and other countries. They would prefer, however, to see our government do that within the processes already in place by challenging China's domestic support and tariff rate quota policies through World Trade Organization (WTO) dispute cases.
"We have said that the proposed U.S. tariffs represent unilateral actions that violate WTO rules," says Musick. "We urge the administration to pull back from this dangerous course that puts vulnerable U.S. industries like wheat production at risk and in a larger sense undermine the established rules-based global trading system."
American Farm Bureau Federation President Zippy Duvall also weighed in on the recent Chinese tarfiff actions.
“Farmers and ranchers are, by necessity, patient and optimistic," he says. "We know markets ebb and flow. But China’s threatened retaliation against last night’s U.S. tariff proposal is testing both the patience and optimism of families who are facing the worst agricultural economy in 16 years. This has to stop.
“Growing trade disputes have placed farmers and ranchers in a precarious position," he continues. "We have bills to pay and debts we must settle, and cannot afford to lose any market, much less one as important as China’s. We urge the United States and China to return to negotiations and produce an agreement that serves the interests of the world’s two largest economies.”
