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Posted on Jul 18, 2018 in Featured, News Releases

Farmers can ill afford timing of trade retaliation

Farmers can ill afford timing of trade retaliation

Agriculture is bearing the brunt of retaliation by trading partners at a time when farmers can’t afford it, the president of Texas Farm Bureau told a Congressional panel on Wednesday.

Russell Boening, a farmer and rancher from Poth, testified to members of the U.S. House Ways and Means Subcommittee on Trade that he commends current efforts to address decades-old trade problems. But, he stressed, blowback from the Trump administration’s decision to place tariffs on trading partners comes at a time when he and other U.S. growers are facing low commodity prices, high input costs and unpredictable weather.

The subcommittee’s hearing in Washington, D.C., focused on the effects of tariffs on U.S. agricultural and rural communities.

“International trade is a major driver of Texas’ agricultural economy,” Boening said. “We rely on trade each and every day to market the products we work so hard to grow. In fact, about 25 percent of U.S. farm income is derived from selling agricultural products internationally.”

Boening is also a member of the American Farm Bureau Federation’s (AFBF) board of directors and chair of the AFBF Trade Advisory Committee.

“Net farm income has also dropped 52 percent in the last five years, making it extremely difficult for farmers and ranchers to continue operating,” he said. “The addition of a trade war comes at a time they can ill afford it.”

Crop prices fell sharply after announcements of U.S. tariff actions, with new-crop corn and soybean futures showing extreme volatility. Boening added the impact will only get worse as the trade fight drags on and harvest season continues.

Boening said while agriculture is bearing the brunt of retaliation for things that have absolutely nothing to do with agriculture, it’s not unfamiliar territory. In fact, he said, for years the agricultural community has been highlighting the egregious tariff and non-tariff trade barriers being erected by our trading partners.

“If the president is successful, and we desperately want and need him to be sooner rather than later, this could be a tremendous opportunity for agricultural trade. Absent a successful outcome, farm and ranch families like mine will suffer,” Boening said. “No one wants the administration to be successful in this effort more than we do, but it’s important to know these decisions have the potential to greatly damage our livelihoods.”

Texas exported nearly $703 million worth of agricultural products to China in 2017. Exports of agricultural products last year also added $1.5 billion to the Texas economy and provided nearly 11,000 jobs for Texans.

China is a significant market for Texas agricultural products. About 46 percent of the cotton exported to China originates in Texas, along with 25 percent of grain sorghum, 16 percent of pecans and 13 percent of beef.

Agriculture has traditionally been a bright spot in the nation’s overall balance of trade. In 2017, the U.S. exported $140 billion in farm products, $21 billion more than were imported.

Farm Bureau urges U.S. trade officials to engage in discussions to resolve trade concerns before resorting to tariffs.

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