The American Soybean Association is frustrated by the lack of progress between the U.S. and China in resolving the trade war, which continues to pressure soybean prices.
“The U.S. has been at the table with China 11 times now and still has not closed the deal. What that means for soybean growers is that we’re losing. Losing a valuable market, losing stable pricing, losing an opportunity to support our families and our communities. These trade negotiations are serious for us. Farming is our livelihood,” said Davie Stephens, soy grower from Clinton, Ky., and ASA president.
Related: Trump raises Chinese tariffs to 25%
The soybean industry realizes the administration’s reasons for trying to force China to make structural changes to its predatory economic policies, including forced technology transfers, intellectual property theft, and subsidies to state-owned enterprises. Yet, ASA has and continues to recommend that the U.S. achieve these goals through coordinated actions with like-minded developed countries.
“We’ve been understanding during this negotiation process, but we cannot withstand another year in which our most important foreign market continues to slip away and soybean prices are 20% to 25%, or even more, below pre-tariff levels,” said John Heisdorffer, ASA Chairman and Keota, Iowa, soy grower. “The sentiment out in farm country is getting grimmer by the day. Our patience is waning, our finances are suffering, and the stress from months of living with the consequences of these tariffs is mounting.”
Related: Twice-delayed tariffs now enacted
The administration decided on May 10 to increase tariffs on $200 billion in Chinese goods, from 10% to 25%, in order to increase pressure on China to make structural changes to its economic policies, and is also taking steps to impose a 25% tariff on the remaining $325 billion in annual imports from China. In turn, China has announced plans to retaliate. With this further escalation in trade tensions and no end in sight, the situation for U.S. growers is dire.
“The soybean market in China took us more than 40 years to build, and as this confrontation continues, it will become increasingly difficult to recover. With depressed prices and unsold stocks expected to double by the 2019 harvest, soybean farmers are not willing to be collateral damage in an endless tariff war,” said Stephens.
China’s Ministry of Finance said the new tariffs would impact $60 billion in U.S. imports and would range from 5% to 25%. The tariffs would take effect June. 1. At the White House, President Trump told reporters he was fine with China taking some retaliatory action. – USA Today
Trump, who campaigned on cracking down on what he calls unfair trade practices, has stirred trade conflict in China, Canada, Mexico, the European Union and Japan. He faces pivotal moments in his crusade to reshape U.S. trade relationships ahead of the 2020 election. – CNBC
President Trump said he plans to meet with Chinese President Xi Jinping next month when he travels to Japan for a summit. – The Wall Street Journal