Wednesday, March 3, 2021

Sid Salter: China Tradeoff Resolution Critical for Mississippi Farmers

 For Mississippi farmers, the transition between the administrations of former President Donald Trump and President Joe Biden could not be more impactful on any topic more so than in agricultural trade with China.

China is the third leading trading partner for Mississippi exports behind Canada and Mexico, with $759 million in value in 2020 – with that number representing a 63.8 percent increase over the previous year. That grow came after 2018-2019 tariffs standoff between China and the Trump administration led to hundreds of millions in lost export revenues to Mississippi producers.

A 2020 study by Business Roundtable found that international trade supported 326,200 Mississippi jobs in 2018. The same study found that in 2018, trade with China supported 64,000 Mississippi jobs – which highlighted the need for China to abide by the commitments under the “phase one” trade agreements.

Writing in Foreign Policy on Oct. 27, 2020, Clark Packard framed the U.S. China trade standoff succinctly: “Trump’s aggressive trade war with China took things from bad to worse for U.S. farmers. Over the course of about 18 months, Washington and Beijing engaged in a back-and-forth volley of escalating trade restrictions, including Chinese retaliatory tariffs on more than 1,000 categories of U.S. agricultural products such as pork, soybeans, dairy products, and nuts.

“In January 2020, the two sides signed a detente, but it’s only a temporary reprieve to a conflict that continues to fester and is likely to resurface in the near future. As part of the so-called phase one agreement, Beijing agreed to purchase about $32 billion worth of U.S. agricultural products over two years,” he observed.

Why should this matter to Mississippians? China’s path to superpower status is blocked most readily by their struggle to produce enough food to feed its own 1.4 billion population and also influence and alleviate regional concerns over hunger and food insecurity.

China has been able in recent years to produce rice and wheat sufficient to meet the nation’s needs, but still must import soybeans and corn as feedstuffs sufficient to satisfy the population’s growing taste for meat.

Not only is China’s massive population problematic in producing hunger and food insecurity issues, but pollution, water aquifer depletion, and the impacts of climate change are also threatening future internal abilities to feed that nation and her allies. The loyalty of regional neighbor nations dependent on food aid also remains in the balance moving forward.

In reaction to the U.S.-China trade standoff, Mississippi (along with Indiana, Illinois, and Nebraska) in 2019 cut a trade deal with Taiwan for them to import about $2 billion in soybeans and corn in 2020 and 2021.

But prior to the trade war, about 80 percent of the state’s soybean production was being sold to China. Under Biden’s new Secretary of Agriculture, initial reports are that China is living up to most of its pledges on the “phase one” trade deal. That deal called for China to buy $12.5 billion in American agriculture products in 2020 and another $19.5 billion in 2021.

Vilsack blames the COVID-19 pandemic as an obstacle to China’s meeting the deal but says he’s optimistic and with apparent evidence on his side. Politico reports that U.S. farm exports are projected to hit a record $31.5 billion during Biden’s first year in office – some $4.5 billion than projected in November 2020.

Mississippi farmers producing soybeans and corn hope those projections are accurate and that Biden’s national security and trade advisors can restore American access to vital Chinese markets.

Despite global concerns over the future of shipping, trade and maritime security issues in the South China Sea, it remains advantageous for China to keep imports of food and feed grains coming to supplement what they can’t successfully produce on their own.

Before the Trump trade wars, two of every three Mississippi soybeans were sold to China. Mississippi farmers would like to see that trade relationship restored.

 

Sid Salter is a syndicated columnist. Contact him at sidsalter@sidsalter.com.

 

12 comments:

Anonymous said...

Does the US Taxpayer also subsidize the farmers and agricorps that export to China and other places?

Anonymous said...

8:40 - if it were not for taxpayer subsidies to farmers you would be paying $10 for a gallon of milk and $8 for a loaf of bread.

Anonymous said...

I wonder how many jobs would be created in the US if we stopped importing all that cheap crap from China that has made Walmart a super retail power and started making higher quality items here at home. Yes they would cost more, but in the long run we would be better off and safer from pressures to our economy that China will one day impose.

Anonymous said...

Funny....every farmer voted for Trump....and Trump was poison for them.

What a bunch of stupid people

Anonymous said...

@10:01
You mean the failures of capitalism would be more apparent if it weren’t for the USDA socialism?

And my question was very specific....

Do the Chinese also get the benefit of the US taxpayer funded subsidies?

Anonymous said...

10:18, Why do you hate or freedom?
America, love it or leave it!

Anonymous said...

I was born into a farm family in the Delta. I am 75 years old and the two best presidents for the American farmer were LBJ and Barack Obama. Their administrations were very pro-farmer. They were both Democrats. Not getting political but just stating the facts.

Anonymous said...

Not getting political but just stating the facts.

Without specific examples to buttress your argument you're only stating opinions, not facts.

Anonymous said...

10:18 I'm saying what I am saying. And that is if the Fed government did not subsidize farmers your cost of eating would go way up. I'm not commenting on capitalism vs socialism and I have no idea if China benefits from US farm subsidies.

Anonymous said...

Sid, Sid, Sid, man I’m sure glad we have your opinion here from time to time. How else could not see a democrat in your words. But it’s just an opinion and others may think differently. Yes China is a major trading market. And Mississippi farmers can make a bundle opening up their markets to the CCP. But sometimes Sid, a people have to decide between what’s really good for them monetarily and what’s good for them morally. Yeah I know, money or morals is a tuff road to hoe. It’s hard to eat morals. It’s something inside that most Americans these days have abandoned as fast as a used condom. But for some it’s still there inside. That feeling you get in your gut when you realize that some people that buy your food and products really in fact want to kill your fucking ass.

It’s deep inside so I don’t expect you to feel it Sid. For you, and a ton of other Americans it’s just business as usual. But it shouldn’t be. Not anymore anyway. That awesome feeling that farmers get when they cash Chinese checks is now paid for in American blood. Yes I know it was just a little virus that killed over 2.5 million people worldwide, and 500k Americans. It Locked down the country for a year, and destroyed millions of small businesses. But it’s no biggy let’s jump back into bed with the bastards. They’ll do better next time!

Anonymous said...

What appears to be missing from Sid's calculations, and from most of the comments here, was the amount of subsidy given to farmers during the Trump trade war to offset their lost sales overseas.

Nothing new in those subsidies - like the delta farmer above said about LBJ and Obama, but leaving out the details - the measure of a farmer's love for a President or an administration is how much subsidy can they get, what farm programs are enhanced, the loan restrictions that are removed - all designed to make more for planting and working less.

Surprised the delta farmer didn't include Jimmy Carter who made many delta farmers millionares through increased disaster loans and reorganization loans, only to eventually turn them into tenant farmers for the insurance companies that ended up with their mortgaged land.

Anonymous said...

@2:39p- You do realize that taxpayers FUND the FEDERAL government... you do, right?? To not realize that subsidies and food prices are all coming out of US tax-payer pockets makes you extremely ill-informed. We ARE paying higher prices for food if we are subsidizing farmers.

Simple-minded Americans are too silly to realize they are ALREADY paying WAY more than retail for food... with both our tax dollars and our health!!


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