Earlier this week, the Trump Administration announced a $12 billion farm aid package for farmers. This comes as a result of the escalating trade war with China and low commodity prices.
“Since the tariffs have been imposed, soybean farmers in Minnesota have lost hundreds of millions of dollars’ worth of possible income and with harvest looming, we need to know that we’re going to be able to make up those losses,” says Minnesota Soybean CEO Tom Slunecka.
The $12 billion farm aid package contains three components: direct payments to farmers to mitigate lower prices resulting from the tariffs; direct commodity purchases by the USDA; and a program similar to the current Market Access Program (MAP) and Foreign Market Development (FMD) program. The total will be divided across multiple commodities, including soybeans.
“We’d rather have trade,” says Bill Gordon, Minnesota Soybean Growers Association (MSGA) director and American Soybean Association (ASA) treasurer. “We want to see more trade and compromise. This includes NAFTA and new bilateral trade agreements. As a farmer, we just want to sell the product we’ve worked hard to grow.”
Currently, soybeans are America’s leading agricultural export, with sales of $27 billion last year. Minnesota exports nearly $2 billion in soybeans each year, with one out of every three rows of soybeans exported to China.
“We appreciate that the Administration acknowledges our hurt, but this isn’t sustainable,” says MSGA President Michael Petefish, who farms near Claremont, Minn. “If you are not already in the red, this will push you into the red for this year.”
Petefish says the low commodity prices and high input costs from the last five years, now worsened by the tariff impacts, could potentially drive farmers out of business.
“We don’t know what the outcome will be in five years, but unfortunately, some farmers won’t be able to survive that long,” he says. “Young or old. This could be a breaking point.”
ASA continues to call for a longer-term strategy to alleviate mounting soybean surpluses and continued low prices, including a plan to remove the harmful tariffs.
“We can only continue advocating for additional trade opportunities,” Slunecka says. “U.S. farmers produce some of the best soybeans in the world. There’s no question there. But they need a level playing field in order to be successful.”
Minnesota soybean farmers have been outspoken on the latest announcement. Click the links below to view the interviews where they were featured.
CNN Video – Aid package a “band-aid on a broken leg”