The Trump administration announced its plan to aid farmers in the escalating trade wars, but just how farmers can prove harm — and just how much each will get — is still to be worked out.
Details will be announced after Labor Day, but soybean farmers — who are big exporters — are expected to benefit the most, said USDA Chief Economist Robert Johansson. In addition, farmers won’t know until harvest how much assistance they’re actually eligible for, reports Pro Trade’s Adam Behsudi.
Low-down on the plan: The three-part, $12 billion plan, first reported Tuesday morning by POLITICO’s ag and trade teams, will aid farmers through programs focused on payments, purchases and trade promotion efforts, Agriculture Secretary Sonny Perdue said. It will incorporate functions of the Farm Service Agency, Agricultural Marketing Service and the Foreign Agricultural Service.
The USDA is relying on mechanisms authorized under the charter act of the Commodity Credit Corporation, a government-owned bank used to support or stabilize farm incomes and prices, so it doesn’t require approval from Congress. However, the specifics of the plan will be subject to a federal rulemaking process.
Looking for long-term solutions: Perdue promised that “this is obviously a short-term solution that will give President [Donald] Trump time to work on a long-term trade policy and deal to benefit agriculture as well as all sectors of the American economy.” But many are already looking for more permanent fixes.
“As farmers, we want access to markets, which will allow us the ability to compete on a level playing field but support these payments if this stands as our only recourse,” said Mark Recker, president of Iowa Corn Growers Association. “Ultimately, resolving trade differences and repairing relationships with our trading partners must be our top priority.”
Confidence is up: Soybean futures for November delivery settled more than 1 percent higher, while Deere & Co. and other farm equipment stocks also jumped in response to the administration’s plan, TheStreet.com reported.