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Senate questions trade reps on negotiations and markets

By RACHEL LANE

WASHINGTON, D.C. — Trade concerns continue to build, and the U.S. Senate Agriculture Committee is demanding answers.

Canadian and U.S. negotiators continue to try to reach an agreement, but issues concerning dairy, poultry, grain, wine and other products remain an issue, as the United States wants more access and equality between the two countries, while Canadian negotiators have said no deal is better than a bad deal and the U.S. needs to be more flexible.

Congress, in the meantime, was officially notified of the new trade agreement with Mexico on August 31. At the end of November, the current Mexican president should be able to sign the agreement – the day before he leaves office. The North American Free Trade Agreement remains in effect, but President Donald Trump has said he will be withdrawing from the trilateral pact.

Trade with China remains expensive, as tariffs are in place in both countries. Trump has announced he has plans for billions more in tariffs, which would increase the costs of about 90 percent of all Chinese imports to the U.S.

China’s retaliatory tariffs have focused strongly on agricultural products. As a result, the value for the U.S. farm products has declined. Farmers who didn’t arrange sales of this fall’s harvest in the early spring will likely have to decide if they want to sell their crops at a loss or try to store what crops they can until prices improve.

During a hearing of the Senate Ag Committee on Sept. 13, members had the chance to question Gregg Doud, chief agricultural negotiator at the Office of the U.S. Trade Representative; Ted McKinney, under secretary for Trade and Foreign Agricultural Affairs at the USDA; and Robert Johansson, chief economist at the USDA.

Sen. Joe Donnelly (D-Ind.) said many farmers in Indiana, and the country, are in danger of losing their family farms. The day of the hearing, he said farmers are making less than $8 for a bushel of soybeans, but the cost to produce is over $9. Before the tariffs were put in place, farmers were making about $10.70 per bushel.

“We have people who are going to lose everything unless something changes,” Donnelly said. “My farmers keep coming in and asking – it’s about as valid a question as we can get – when is this going to end?”

McKinney said the goal is short-term pain for long-term gain. It is difficult to hear some people might lose their farms, he said, but there are trade issues with many countries, especially with China, that need to be addressed.

“It seems that the light at the end of the tunnel is a train coming at our farmers,” Donnelly said. “Those are not regrets. Those are our neighbors … losing their dreams … This is completely self-inflicted.”

McKinney said the USDA is working to form relationships with new countries and to expand trade with existing trade partners. When asked specifically about Japan, he said he has maintained the relationship with that government and when it is ready to form an agreement with the U.S., the USDA will be ready.

Sen. Joni Ernst (R-Iowa) said hog prices have hit a 15-year low. Producers are throwing away pork organs that used to be sold to China, which used to be expensive.

Doud said Japan is a possible place to sell the hog meat, but Japan wants the U.S. in the new Trans-Pacific Partnership (TPP-11). If the U.S. can get bipartisan agreements with Japan and with Vietnam, he explained, we will have agreements with almost every country in the TPP-11.

Japan is particularly important because three other countries will have tariffs decrease, while the U.S. imports remain the same.

“Tariffs Hurt the Heartland” – led by Farmers for Free Trade (founded by former Sens. Richard Lugar and Max Baucus) and Americans for Free Trade – is a new bipartisan campaign that includes approximately 80 national agriculture organizations joining with other industry and retail groups to speak against the tariffs and to spread the word about the importance of trade, not just to farmers but to the U.S. economy.

“American companies will be forced to lay off thousands of workers, American farmers will lose access to crucial foreign markets and American families will face higher prices for the everyday goods they rely on. We urge President Trump to stop his disastrous trade war before it is too late,” the group stated.

The group includes a searchable online map that allows visitors to learn about job losses, deferred investments, higher prices and other consequences it outlines farmers and businesses in communities. The map can be found at http://tariffshurt.com

9/19/2018