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OFU not on board with tariffs, but not all producers dislike it

By CELESTE BAUMGARTNER

OXFORD, Ohio — The Ohio Farmers Union (OFU) has for decades opposed the United State’s free-trade policy; however, it is not in support of President Donald Trump’s decision to impose tariffs.

“We think that the tariff scenario that has unwound under the Trump administration is counterproductive and it is a blunt instrument,” OFU President Joe Logan said. “We also would have preferred to have the Trans-Pacific Partnership (TPP) reconsidered and tweaked rather than just thrown in the trash can.”

The OFU remains hopeful that Trump’s hardball approach to negotiating trade agreements is going to be successful, but members are not confident it will, he said. They are concerned the Chinese will be able to play hardball over a longer time frame and perhaps more effectively than the United States.

Ohio corn and soybean farmer Tim Hesselbrock supports Trump’s policies but thinks corn growers got the short end of the stick. The administration will send $4.7 billion in direct payments to farmers hurt by the ongoing trade war; most of that will go to soybean producers.

 “I think imposing the tariffs was absolutely necessary,” he said. “When you start looking at the numbers of what these countries were doing to us on tariffs, we were smiling and letting their products come in here for free, more or less.”

The approximately $1.65 per bushel that soybean growers received to offset their losses because of the tariffs is decent, he said. “But the corn people only received a penny a bushel, and both of those are paying 50 percent upfront and the second 50 percent will be paid later.

“I said to one individual that a penny is what you leave for a bad waitress at the end of a meal. Is that what the government thinks of the farmer?” Hesselbrock said.

OFU agrees that agriculture is suffering the brunt of this trade war, and that is not good for rural America, Logan said. The rural community has largely supported the President.

“Our concern is that it is going to be a large and protracted effort, and I’m not sure that we’re going to get the outcomes that are desired,” he explained. “The new NAFTA agreement has very few changes that will affect agriculture. We want the President to consider some other options.”

One option OFU likes is the Market Access Charge (MAC) proposed by World Bank veteran Dr. John Hansen and the Coalition for a Prosperous America. Congress would have to adopt MAC, which would give the federal government an opportunity to add a minimal charge to any transaction a foreign nation makes when it wants to get access to the U.S. market.

“So when a Chinese corporation wants to buy Smithfield Foods, they would add a percentage charge to the Chinese to compensate for variances in environmental factors, variances in currency value and other things that give the Chinese a leg-up in the market. place,” Logan noted.

But beyond trade, Hesselbrock also looks at the bigger picture. This year produced a bumper crop, and there is an issue about where is it all going to go.

“The thing is, no matter whether China buys it from us or somebody else buys it, there is only so much grain. Even though we had a big crop year across the world, it’s not excessive; the world is not drowning in crops,” he said.

“Most of the time it is used up and we’ve got less than a month’s supply left. What if the harvest would be delayed for some reason here in the United States?”

12/18/2018