American farmers: Trump "took away all our markeds"

Source

The White House recently announced that it would be providing an additional $16 billion in aid to American farmers affected by the trade war between the U.S. and China.

But the problem for American farmers has becomes bigger than something a bailout can fix.

“This trade thing is what’s brought on by the president and it’s really frustrating because he took away all of our markets,” Bob Nuylen, a farmer from North Dakota who grows spring wheat and sunflowers, told Yahoo Finance. “We live in an area where we’re kind of in the middle of nowhere. It costs us a lot of money — over $1 a bushel to get our grain to markets.”

Since trade tensions began in 2018, farmers have faced major financial challenges, since China was once a major U.S. agriculture buyer.

And losing customers has become a major issue. Soybean farmers have been dealing with this, as China has turned to other countries like Brazil for soybeans. Nuylen said this is also happening for wheat farmers, as China has begun importing wheat from Russian regions.

“All these countries went to different countries to get their grain,” Nuylen said. “How are we going to get the relations back with them to buy our grain again and be our customers?”

Between 2016-2017, China was the fourth-largest wheat buyer in the world, importing more than 61 million U.S. bushels. In 2019, the top U.S. export destinations for wheat include Mexico, the Philippines, Japan, and Nigeria — China is not even among the top 10.

“Our prices are probably as low as I’ve seen them in a long time,” he told Yahoo Finance. “We were losing just about $70 an acre just by putting our crop in [the ground] this spring.”

While a deal between the U.S. and China would take months to be reached, farmers are remaining “cautiously optimistic,” Glenn Brunkow, a Kansas-based corn and soybean farmer said.

“Our hope is that the playing field is leveled up and these tariffs on the other side are taken away,” Brunkow said. “We feel like with the technology we have, the advantages we have, we can produce the crops as economically as anyone else in the whole world.”

This isn’t the first time that the USDA has doled out aid to struggling farmers. The Trump administration pledged two installments of a farmer bailout program. The first round of payments totaling $4.7 billion was paid in September 2018, while the second round was distributed in December. By February 2019, the total aid payments reached $7.7 billion.

“Payments are a welcome help for the bottom line of Missouri farmers,” Blake Hurst, president of the Missouri Farm Bureau, told Yahoo Finance in an email statement. “Although the trade payments vary widely from county to county, they’ll keep more than a few farmers in business for another year. ...

“Having said all that,” the statement added, “farmers are profoundly wary of the trade war, embarrassed that ad hoc government subsidies are all that stands between many of us and financial ruin, and ready for the return of more normal times.”

The Wall Street Journal reported in February that farm bankruptcies in three major farm regions reached their highest level in at least 10 years. Much of this is because crop prices have been dragged down dramatically due to a decrease in consumers. Overall, U.S. farm debt soared over $409 billion in 2017, which is “the largest sum in nearly four decades and a level not seen since the 1980s,” WSJ wrote.

And it doesn’t help that farmers are facing unprecedented severe weather. Flooding has damaged crops across the Midwest. When combining that with bankruptcies, lower prices, and trade war struggles, mental health problems among rural Americans are becoming more prevalent than ever before.

“People think that farmers are just loaded with money but … just about every dollar a farmer makes, he puts back into the economy and their state and in the nation, because our inputs are so high,” Nuylen said. “We spend just about all the money we make back into the communities. If we’re struggling, everybody’s struggling.”

He added: “We kind of get a bad picture that we’re all big money and drive all this big equipment. In reality … these are record low incomes for farmers in the last couple of years. It’s getting tough out there. We’re going to start seeing a lot of suicide and a lot of farmers going out of business. So, that’s not a good thing.”

The concern is that farmers may reach a breaking point as things drag on.

“It’s going to be a scary situation if it doesn’t turn around pretty soon,” Nuylen said.

TL;DR: China used to import lots of soybeans and wheat from US farmers. After Trump's tariffs China is no longer in the top 10 for US exports. Bailouts helps temporarily, but nothing would help more than return of normal times.

I'm not surprised by this. Maybe it will get some farmers to vote differently next election.

Trade negotiations are tough. But it doesn’t mean you don’t try to do what’s best for your country. Trump is a business man so trust he has a plan. Lord knows he’s got the experience.

Reap what you sow.

@Sevenizz: Bankrupt like 5 times. That's not a viable strategy for a country.

LOL bankruptcy is now a plan...….

Maybe Trump's administration will finally bury the notion that being a businessman is adequate experience for running a country.

@Sevenizz: what experience this presidency is his first ever position in politics. He's filed for bankruptcy more than once and some of his business ventures went belly up.

dude, do you even know what bankruptcy is for a business? its a restructuring, and the mans had over 500 successful businesses, and some of those that needed restructuring failed to earn enough profits due to competition with other businesses he owned.. 5 out of 500+ is better results than you're ever going to have at anything, but the fake news you read probably didnt tell you that part, did they?

im not much of a trump fan, i just call out the lies and bullshit when i see it

Bankruptcy for a business means they cannot pay their debt. They are in the red. That is NOT a good business strategy at all.

its to restructure that business in a manner to pay down a debt, and 5 out of over 500 is pretty damn good odds, and why he's a multi billionaire and you're not

It's bad business...…solvent business does NOT get itself into debt problems and need restructuring. It's ridiculous to think that is good business policy. Restructuring costs important assets to any business that has to do it. They do NOT come out in a better position than before. It also shows potential investors the company has ZERO ability to run the business in a profitable way. No matter what spin you put on it. IT'S A NEGATIVE.

I wonder how it became like that in the first place. They are vastly different.

It's an option that does not exist for countries.

We're an oligarchy that worships money.

Trump would be more rich if he had invested Daddy's money (where he got his wealth from, mind you) into an index.

https://www.vox.com/2015/9/2/9248963/donald-trump-index-fund

I dont understand is China breaking rules or something?

Yeah. They stole Winnie The Pooh. As retaliation against Trump's tariffs, they stopped buying some product from US.

But with only focus on the next quarter it seems.

@horgen: Yeah, that's a big pet peeves of mine regarding the short tenure and compensation packages of execs. Short term gains, even if merely mirages, are prioritized over longevity.

Leaving before they can show any results.

I bet monsanto banked a lot.

If the plan was to push China to get soybeans and wheat from other nations rather then the US, I'd say the plan is a success.
Not sure where the benefit for the US is if the farmers who grow such crops has lost a large market though.

But the plan seems to be working.

the same people screaming about foreign influence in our country are the same people screaming that we have to bend our knee to china cause of a few farmers.. **** china

I'm not sure if I prefer a future with megacorps supplanting the governments in cyberpunk fashion or a return to feudal blood line lineages of inheritance and capital/land ownership!

With a weak or absent inheritance tax, you don't have to choose!

Truly, if you have children I encourage you to think about wealth generationally. Otherwise, you're setting them up for likely failure in our current system.

Problem is Trump has no goodwill from other countries, apart maybe from North Korea and Saudi Arabia. There's no good reason for China to panic, Trump is a 4 year thing, at worst 8. They just have to turn to other markets, and the longer Trump stays as president the weaker the US will be, as new alliances will start to solidify.

Truth be told, China does implement very unfair trade practices. They artificially depress their currency, steal patent technology, and use state sponsored corporate espionage. But Trump's tarriff plan just doesn't work and hits the wrong people.

1. Huh? who? Foreign Influence being a problem is bipartisan. You're the fringe.

2. Who said bend the knee to china? Economists disagree with Trump's method.

Oh they do. I am a bit unsure on some details, but if you wish to build a factory there, Chinese owners must own at least 51% of it while also being given (them or the government) all the details on how to produce what the factory is meant to produce.

Libs on Trump: "Bu bu but, teh 5 bankruptcies!?"

Nevermind the hundreds of succesful businesses he created.

How many has he actually created, and not just a part of the board (or whatever it is again).

He is good at certain things. He knows how to play the media, and as far as I know did a good job with Miss Universe and The Apprentice. But that isn't the same as being President.

Most of the farmers I've came across haven't been nice at all, and the Chinese do work incredibly hard, so i'm with Trump on this.

They still vote for him in 3... 2... 1...

Hurting the US is good? I guess you and trump need to move. That is his recommendation to haters.

How many farmers do you randomly come across? I live in a very agricultural area of California and I don't stumble across many farmers.

I do have a hard time feeling sorry for the farmers though. They got what they wanted when they helped put him in office.

@Treflis: There’s bigger issues at play here. Like the hundreds of billions that China has robbed the US of - for decades.

Ah hyperbole.

@comp_atkins said:

@joebones5000 said:

Trump is an idiot. It's amazing that everyone can't see that.

Man I never thought I relate to Frank Grimes so much.

Because American companies chose to have their factories in China due to lower cost yet knowing they also had give up their IP to the Chinese, as well not being allowed to own more than 49% of the business in China...?

Ssh....don't try logic. It's all one sided.

Or maybe the farmers can see that the tariffs are needed to compete with a corrupt nation like China who has long taken advantage of people being too scared to do anything.

Farmers are facing the consequences, when Trump wanted to hurt companies which outsourced their factories to China for increased profits.

Couldn't he have used taxes to try bring some of the outsourced work home? Like increased taxes on companies which are based in US but produces everything in China? China has played the free marked to their advantage.

China is still technically classified as a developing nation/3rd world country I think, Trump could persuade the international community/western countries to classify them as a 1st world country. That alone would even the playground a little.

really? and what if those companies cannot afford to produce goods in the US while keeping the costs of their products low enough to compete with foreign made goods?.. then what? you're punishing US based companies, but not foreign ones, who do you think is able to sell at a lower price and then undercut the US based competition?

there are two ways you can even the playing field.. first, make it cheaper to produce things in the US, which then makes it cheaper to sell those things here.. or put tariffs on competing imports which raises the cost of buying foreign made products.. of course with that scenario the consumer will be paying more for their needs

you people scream "he's helping the rich" if he tries to lower corporate taxes to incentivize domestic production, and you scream "oh the poor farmers" if he goes the tariff route.. you cant have it both ways

@horgen: "Because American companies chose to have their factories in China due to lower cost yet knowing they also had give up their IP to the Chinese, as well not being allowed to own more than 49% of the business in China...?"

It always strikes me as funny that patriotism is only demanded of the small and powerless.

So Trump's Farmer Socialism failed?

It isn't socialism, duh :P

The companies can afford it. It would force companies in US to innovate more. I think it was shown a few years ago that iPhone would maybe cost 10% more to produce in US. Knowing US companies, they would attack work safety and wages to make it cheaper to produce in US, not trying to get the upper hand in other ways. Stronger consumer laws could also make people prefer paying the few extra dollars it costs for US made compared to import.

Also, it is possible to attack this problem in more than one way. Use taxes on American companies that have outsourced, tariffs on foreign companies that import. Maybe that is a stupid idea, maybe it is a smart idea.

That would probably solve a lot of the problem right there.