With U.S. shipments of agricultural commodities slowly beginning to resume after a lengthy hiatus due to the a trade war with China, farmers are relying on U.S. President Donald Trump’s negotiating skills to close a deal with China. That’s no small feat as, the deal includes not only a resumption, but also an increase in agricultural trade with China. With countries such as Canada agreeing to double agricultural trade with China by 2025, U.S. farmers want to hold the trade ground that their industry has worked diligently to secure.

With the global economy expected to slow in the latter half of 2019, Chinese President Xi and President Trump must see the possible big consequences of a trade war that lingers into the latter half of the year. With the relatively quick pace to the talks, questions abound on whether the U.S. will be able to achieve the structural changes that it set out to achieve in the first place. In the short term, farmers want a resumption of trade and would benefit from an immediate shallower deal that focuses more on agricultural trade flows. In reality, a majority of U.S. farmers that I spoke with support the president’s desire to create real structural change originally set out and supported by the president, USTR Robert Lighthizer and Director of Trade and Industrial Policy, Director of the White House National Trade Council, Peter Navarro.

READ: Trump and China— Real structural change or shallow remedies?

Recently Shaun Haney appeared on RFD-TV’s Market Day Report to discuss the U.S. and China dynamic. You can catch Shaun on the Market Day Report every weekday at 10 am central time.

The health of the North American agricultural market depends on significant trade with China. To achieve the significant structural changes in China those trade flows will be threatened in the short term to achieve the bigger long term goals.  So far American farmers are willing to take that risk.

With China’s economy clearly slowing, the chances are increasing that a shallower deal is possible which will be good for soybean exports in 2019 and farmer’s chance at profitability.

As planting for the 2019 season gets closer, many growers will be looking to determine if it’s best to hold firm on their corn and soybean mix or make adjustments based on possible trade disruptions.

Leave a Reply


This site uses Akismet to reduce spam. Learn how your comment data is processed.