Ag Groups Voice Concern Over Trump’s Tariffs03/02/2018
The American Soybean Association (ASA) voiced its extreme concern today as President Donald Trump announced the decision to impose steep tariffs on imported steel and aluminum.
Trump plans to impose tariffs of 25 percent on steel imports and 10 percent on aluminum to protect both industries, which he states poses a threat to national security. These tariffs will be applied across all countries including China. China is not only U.S. soy’s largest customer, but also the top market for U.S. soybeans, purchasing more than all our other customers combined, accounting for $14 billion in sales and more than a third of total U.S. soybean production.
These tariffs could lead to retaliation from China and would significantly endanger the current trade relationship between the U.S. and China for soybeans.
“The tariffs announced today by the administration will put the interests of other domestic industries over farmers,” said John Heisdorffer, ASA president and Iowa soy grower. “Prior to today’s announcement, China has indicated that it may retaliate against U.S. soybean imports, which would be devastating to U.S. soy growers. Our competitors in Brazil and Argentina are all too happy to pick up supplying the Chinese market.”
Retaliation from China would add significant further injury to an already-hobbled farm economy. Prices are down 40 percent and farm income is down 50 percent, and we simply can’t afford for those numbers to get worse.
Soybean farmers urge the White House to move forward with a China strategy that strengthens the competitiveness of our domestic industries, while at the same time growing our export opportunities.
Wheat groups disappointed
U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) are extremely disappointed in the decision announced today to impose sweeping tariffs on imports of steel and aluminum. We have repeatedly warned that the risks of retaliation and the precedent set by such a policy have serious potential consequences for agriculture. It is dismaying that the voices of farmers and many other industries were ignored in favor of an industry that is already among the most protected in the country.
If the United States is taken to dispute settlement at the World Trade Organization (WTO) for imposing these tariffs, we call on the U.S. Trade Representative (USTR) to avoid invoking the essential security exception under GATT Article XXI. The recent Department of Defense memorandum made it clear that imported steel and aluminum did not threaten its ability to acquire enough from domestic suppliers to meet its needs. The USTR should not take the extraordinary step of invoking Article XXI to defend what we believe is protectionism.
At NAWG’s board of directors meeting this week, a new resolution was passed urging the Administration to avoid imposing national security-based trade barriers on commonly traded products. NAWG’s newly instated President Jimmy Musick, a wheat farmer from Sentinel, Oklahoma, said “at such an economically hard time for wheat growers, we do not want to see trade barriers brought against us from some of our top customers who are impacted by this decision.”
Wheat farmers battling a market in which China holds almost 50 percent of world ending wheat stocks can sympathize with steel and aluminum workers on the economic effects of Chinese policies leading to global oversupply. However, we hope that our legitimate concerns with this action are heard and taken into consideration in this process.