Let’s pause to consider the above headline. First, it’s a quote. I didn’t write it.
That’s important because the third rail of today’s ag journalism — the deadly, high-voltage topic that can burn your career — is Donald J. Trump. Question a Trump-related topic like tax cuts, tariffs or immigration and you’re quickly tagged a Trump hater or, worse, a liberal.
The headline and its fact-centered claim comes courtesy of that bastion of wild-eyed ag uniformity, the farmdoc daily team at the University of Illinois (UI), reporting the on-farm results of a second Trump-promised trade war if the former president is elected Nov. 5.
The Oct. 17 analysis begins hard and hot.
“United States corn and soybean farmers could lose billions of dollars in annual production value in the event of a potential new tariff-induced U.S.-China trade war…”
Then, like me, the UI writer reaches for a towel to dry their hands of any responsibility for a perceived attack on Trump. The report, he notes, is “according to a new economic study commissioned by the American Soybean Association and the National Corn Growers Association…”
Wow, two of Big Ag’s most powerful commodity groups commissioned a detailed analysis of Trump’s threatened trade war. What they found was “that ‘U.S. soybean farmers (could) lose an average of $3.6 to $5.9 billion in annual production value’ while ‘U.S. corn farmers would lose an average of $0.9 to $1.4 billion in annual production value’ depending on how China would respond to increased U.S. tariffs.”
But “this burden is not limited” just to American corn and soybean growers. There will be a substantial “ripple impact… In rural economies where farmers live, purchase inputs, utilize farm and personal services, and purchase household goods.”
In fact, the “total economic contribution of soybean and corn production could drop between $4.9 billion and $7.9 billion annually…”
While American producers and their suppliers are two of the trade war’s biggest losers, two of its biggest winners are one of our best customers, including China and one of our most aggressive competitors, Brazil.
According to the ASA/NCGA study, “‘(I)f China cancels its current waiver,’” a tariff dodge put in place during the first Trump term, “‘and reverts to tariffs already on the books, U.S. soybean exports to China would… On average decline of 51.8% from baseline levels expected for those years… [While] U.S. corn exports to China would fall… An average… 84.3% from the baseline expectation.’”
On top of that catastrophic “‘loss of over 25 million metric tons of soybean exports to China and nearly 90% of corn exports to China … Brazil gains an average of 8.9 million metric tons of annual soybean plus corn exports over the projection timeline.’”
What will happen to U.S. farmers if an election-winning Donald Trump sticks to his “tariffs-are-beautiful” policy that, according to the ASA and NCGA, will deeply undermine future U.S. farm income?
If the past is prologue, a second Trump Administration will reprise its unprecedented government spending to bandage over the self-inflicted hemorrhaging again caused by trade-killing tariffs. In an Iowa campaign stop last January, the former president bragged about that earlier spending by shouting, “Twenty-eight billion for the farmers!”
In fact, Reuters reported that total ag spending during the Trump years was “about $217 billion in farm payments, including crop support, disaster and aid programs. That’s about $73 billion more than in any prior four-year period since 1933…”
So, yeah, tariffs work just fine—if the White House again sends farmers taxpayer money at least as fast as they lose export markets.
