Reports Circulate in Washington and in Farm Country About Help From the Trump Administration for Farmers Hurt by the Trade WarTue, 24 Jul 2018 11:42:12 CDT
Social Media is alive with word that the Donald Trump administration is expected to announce today a plan to send billions of dollars in aid to farmers hit by trade retaliation. The Washington Post has signaled that it could be as much as twelve billion dollars in assistance to thoseproducers getting slammed by the retaliatory tariffs imposed by countries like China, Mexico and Canada in response to tariffs thrown at them by President Donald Trump.
And the $12 billion in aid to the ag community will apparently be handed out several ways- "Under the White House plan, the money will be disbursed in at least three ways, coming through direct assistance, a food purchase and distribution program, and a trade promotion program."
More specifically, fellow farm broadcaster Todd Gleason, based in Illinois, speculates that one delivery vehicle could be the Commodity Credit Corporation Non Recourse Loan program. He believes that the USDA might offer a higher than normal loan for a commodity (above market price) and that could be the subsidy that the farmer could use to keep his operation solvent until the trade war is complete.
According to the website Business Insider- "Soybean prices jumped Tuesday after reports indicated the Trump administration is rolling out a $12 billion plan to aid the farmers that have been hurt as a result of its tariff faceoff with major trading partners including China, the world's largest soy importer.
"Soybeans were up 0.94% to $8.56 a bushel at 10:58 a.m. ET. Prices have fallen to near-decade lows, shedding 20% since the Trump administration announced plans to penalize China for alleged intellectual-property theft and what the president sees as unfair trade practices.
"Politico first reported the Trump administration is set announce billions of dollars worth of aid to farmers affected by tariffs as soon as Tuesday. The plan will be funded by the Department of Agriculture's broad authority and two components of the farm bill.
"The Trump administration enacted a 25% tariff on roughly $34 billion worth of Chinese goods earlier this month and has another $16 billion pending ahead of a public hearing. Beijing quickly retaliated with tariffs on $34 billion worth of American products, including soybeans.
"The aggressive crackdown on free trade has prompted frustration among American farmers, some of the most loyal supporters of Trump who could decide if his party will keep majorities in Congress come November.
"Under the tariffs, China's government has been pursuing measures to reduce domestic reliance on American soybeans. Kevin McNew, an economist at Farmers Business Network, told Business Insider that China has bought at least 2.5 million metric tons of soybeans on forward contracts he expects will be cancelled following the tariff implementation.
Soybeans are down 15% this year."
It's unknown exactly how the Administration might attempt to make the pork industry whole as they, along with soybean farmers, have felt the most pain to this point in the early days of the Trump Trade War.
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