Published: Wed, July 25, 2018
Markets | By Josh Butler

Trump pumps up the volume ahead of Juncker visit

Trump pumps up the volume ahead of Juncker visit

Republican candidates in the upcoming congressional elections in November, however, have expressed deep concern about their states' farm economies. President Trump urged patience on the trade spat.

The size of the direct payments to farmers as a result of trade shortfalls would be unprecedented, said Scott Irwin, an agricultural economist at the University of IL. Unfortunately, America's hard-working agricultural producers have been treated unfairly by China's illegal trading practices and have taken a disproportionate hit when it comes illegal retaliatory tariffs.

Agriculture Secretary Sonny Perdue says, "This is President Trump's promise kept for producers".

The Market Facilitation program will distribute the bulk of the money to farmers and ranchers producing commodities directly impacted by the tariffs, including soybeans, sorghum, corn, wheat, cotton, and pork.

Trump did not specifically reference the plan during a speech to veterans in Kansas City, but asked for patience as he attempts to renegotiate trade agreements that he said have hurt American workers.

Jeff Mertz, president of the North Dakota Grain Growers Association, hadn't read up on the program's details but said it appeared to be a sign Trump was looking out for farmers.

And the general reaction from farmers, many of whom would benefit from the payments, is that it's a short-term fix that won't work in the long run. Rural voters - many who have deep ties to farming - helped catapult Trump to the presidency in 2016, and China's retaliatory tariffs specifically targeted politically important states and areas.

Some were quick to denounce the proposal.

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"This trade war is cutting the legs out from under farmers and the White House's "plan" is to spend $12 billion on gold crutches", said Senator Ben Sasse, a Nebraska Republican who frequently criticizes the president, a fellow Republican. "This administration's tariffs and bailouts aren't going to make America great again, they're just going to make it 1929 again".

Senator Rand Paul, a Kentucky Republican, tweeted on Tuesday: "If tariffs punish farmers, the answer is not welfare for farmers".

She said her bill would come at "no additional cost" while Trump's plan will only scratch the surface of farmers' losses. "We need access to the export market".

"We gotta fight it", he said, referring to "disaster" trade deals. Soybean futures 0#S: , hit hard by China's retaliatory tariffs, rose 1.2 percent and hit their highest in two weeks as traders bet farm aid would improve demand, reducing a current surplus supply.

With congressional elections coming soon, the government action underscored administration concern about damage to USA farmers from Trump's trade tariffs and the potential for losing House and Senate seats in the Midwest and elsewhere. Those affected economies have in turn targeted US agricultural products, including soybeans, dairy, meat, produce and liquor.

Some manufacturers will view the subsidies to farmers as "frustrating", according to a representative of a manufacturing coalition working on trade issues, speaking on condition of anonymity pending the official announcement. When the conditions were agreed upon, the USA favored a 25 percent tariff on European trucks and SUVs, to protect that US industry. He hoped "free, fair and reciprocal trade is in our near future".

Mr Kirchner said it was unclear what affect the trade wars would have on agricultural exports.

"My farmers are desperate, they need to make sure they have a lifeline", Heitkamp said.

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