Since U.S. President Donald Trump signed two executive orders regarding the so-called "reciprocal tariff" on April 2, the U.S. has continuously increased the tariff rate on Chinese products, triggering multiple retaliatory measures from China. According to a report by CNN on April 13, the "tariff war" between China and the United States is likely to first have a heavy impact on American farmers, who are also an important electoral base for Trump.
American agricultural products will lose competitiveness in the Chinese market.
According to CNN reports, despite the overall trade deficit of about $30 billion between the U.S. and China, the Chinese market remains very important for the U.S. in specific areas such as agriculture. For example, soybeans are the largest commodity imported by China from the U.S. In addition, America's oilseeds and grains are also exported in large quantities to China.
However, the exports of American agricultural products to China have already been heavily pressured by tariffs. For instance, American soybean exports to China will face a total tariff of 135%, including the 10% tariff retaliated against by China in response to the "fentanyl tariff" on March, as well as the recently announced "125% retaliatory tariff." This has almost completely eliminated the market competitiveness of American agricultural products in China.
Caleb Ragland, chairman of the American Soybean Association and a farmer from Kentucky, told The New York Times, "If this continues for a long time, quite a number of farmers will go bankrupt... We still bear the scars left by the last trade war." The American Soybean Association has been urging the Trump administration to reach a new trade agreement with China to avoid a prolonged trade war.
Meanwhile, China has already begun diversifying its agricultural imports, so the decline in American soybean imports is not a major problem for China. After all, during Trump's first term, there were sharp trade frictions between China and the U.S. Brazil and Argentina's soybeans may become substitutes for American soybeans, with Brazilian soybeans having already largely filled the gap left by American soybeans exiting the Chinese market during the first trade war.
Farmers who voted for Trump will be hit hard.
In response to China's countermeasures, U.S. Treasury Secretary Scott Beason tried to downplay the situation when interviewed by Fox News, saying, "So what?" However, The New York Times pointed out that for American farmers, the trade war between China and the U.S. means significant losses.
According to the American Soybean Association, during the Sino-U.S. trade war in 2018, the U.S. agricultural sector suffered losses amounting to approximately $27 billion, of which about 71% was related to soybeans. The New York Times reported that during his first term, Trump had taken $23 billion from a fund established by the U.S. Department of Agriculture as subsidies, hoping to compensate farmers for their losses. However, this has created issues of fairness in subsidy distribution, making some farmers feel "betrayed."
Among the ten states that produce the most soybeans in the U.S., only Illinois and Minnesota chose Harris, while the rest supported Trump. Republican Congressman Darin LaHood also publicly stated that although he personally appreciates Trump's efforts to address long-standing "trade barriers," his constituents are worried: "When I talk to farmers, I find they are very anxious, under great stress, and feel uncertain about the future. Because when we enter a trade war, agriculture is usually the first to be affected."
CNN statistics show the top ten states in U.S. soybean production, where the majority are "red states" supporting Trump. CNN
The Trump administration may restart agricultural subsidies.
The Trump administration is also considering continuing to use subsidies and relief measures used during his first term to alleviate farmers' pressures. U.S. Agriculture Secretary Brook Rollins said on the 9th, "Everything is being considered."
But it is also this same Rollins who, at a White House cabinet meeting, claimed that despite the pressure on farmers, they support Trump's economic policies: "You want to use tariffs to ensure our progress, putting America first. No one understands this better than our farmers and ranchers... They know your vision will lead us into an era of prosperity."
Other representatives of American farmers, however, do not share the optimism of the agriculture secretary. Regarding the issue of subsidies, Caleb Ragland, chairman of the American Soybean Association, stated that in this situation, American farmers may have to rely on relief from the federal government: "If we continue to be used as a bargaining chip, we will become sacrifices for the greater good. There must be a comprehensive economic plan to help us maintain our livelihoods."
This article is an exclusive contribution by Guancha Zazhi (Observer Network), unauthorized reproduction is prohibited.
Original source: https://www.toutiao.com/article/7493037169196532260/
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