Iowa leaders react to federal handout to farmers to offset trade war damage

WASHINGTON – Iowa leaders reacted this week after the Trump Administration announced up to $12 billion in welfare handouts to farmers to offset the apparent damage done to their pocketbooks by trade wars.

U.S. Secretary of Agriculture Sonny Perdue Tuesday announced that the U.S. Department of Agriculture (USDA) will take several actions to assist farmers in response to trade damage from “unjustified retaliation”. President Trump directed Secretary Perdue to craft a short-term relief strategy to protect agricultural producers while the Administration works on free, fair, and reciprocal trade deals to open more markets in the long run to help American farmers compete globally. Specifically, USDA will authorize up to $12 billion in programs, which is in line with the estimated $11 billion impact of the unjustified retaliatory tariffs on U.S. agricultural goods. These programs will assist agricultural producers to meet the costs of disrupted markets.

“This is a short-term solution to allow President Trump time to work on long-term trade deals to benefit agriculture and the entire U.S. economy,” Secretary Perdue said. “The President promised to have the back of every American farmer and rancher, and he knows the importance of keeping our rural economy strong. 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. USDA will not stand by while our hard-working agricultural producers bear the brunt of unfriendly tariffs enacted by foreign nations. The programs we are announcing today help ensure our nation’s agriculture continues to feed the world and innovate to meet the demand.”

Background:

Of the total unjustified retaliatory tariffs imposed on the United States, a disproportionate amount was targeted directly at American farmers. Trade damage from such retaliation has impacted a host of U.S. commodities, including field crops like soybeans and sorghum, livestock products like milk and pork, and many fruits, nuts, and other specialty crops. High tariffs disrupt normal marketing patterns, affecting prices and raising costs by forcing commodities to find new markets. Additionally, there is evidence that American goods shipped overseas are being slowed from reaching market by unusually strict or cumbersome entry procedures, which can affect the quality and marketability of perishable crops. This can boost marketing costs and discount our prices, and adversely affect our producers. USDA will use the following programs to assist farmers:

• The Market Facilitation Program, authorized under The Commodity Credit Corporation (CCC) Charter Act and administered by Farm Service Agency (FSA), will provide payments incrementally to producers of soybeans, sorghum, corn, wheat, cotton, dairy, and hogs. This support will help farmers manage disrupted markets, deal with surplus commodities, and expand and develop new markets at home and abroad.
• Additionally, USDA will use CCC Charter Act and other authorities to implement a Food Purchase and Distribution Program through the Agricultural Marketing Service to purchase unexpected surplus of affected commodities such as fruits, nuts, rice, legumes, beef, pork and milk for distribution to food banks and other nutrition programs.
• Finally, the CCC will use its Charter Act authority for a Trade Promotion Program administered by the Foreign Agriculture Service (FAS) in conjunction with the private sector to assist in developing new export markets for our farm products.

U.S. Sen. Chuck Grassley of Iowa, a family farmer, released a statement on the matter, saying, “Many U.S. products face market barriers abroad. I don’t fault the President for trying to get a better deal for Americans, but it’s not fair to expect farmers to bear the brunt of retaliation for the entire country in the meantime. I’ve had several White House meetings with President Trump to express my concerns in strong terms. Every third row of soybeans in Iowa is exported. We also export large amounts of pork and beef. That means farmers depend on access to foreign markets to make ends meet and provide for their families. The President’s announcement of billions of dollars in aid that will be made available to struggling farmers later this year is encouraging for the short term. What farmers in Iowa and throughout rural America need in the long term are markets and opportunity, not government handouts. I look forward to reviewing the details of the President’s proposal and continuing to work with the Administration to find permanent solutions that will give confidence and certainty to our farmers as soon as possible.”

In April, Grassley said, “If the federal government takes action on trade that directly results in economic hardship for certain Americans, it has a responsibility to help those Americans and mitigate the damage it caused.”

Congressman Steve King, a member of the House Agriculture Committee, releases the following statement applauding the Trump Administration for taking action to address the economic harm that unjustified trade retaliation is causing to the farm economy. The United States Department of Agriculture (USDA) announced this afternoon that it would be making up to $12 billion in assistance available to farmers who have experienced recent market disruptions. This amount more than offsets the expected $11 billion impact of foreign retaliatory tariffs on American goods. Importantly for the 4th District, the USDA assistance will specifically benefit producers of field crops like corn and soybeans, and livestock products like pork. Congressman King views today’s announcement as the President confirming his intent to deliver on a promise he personally made to King to hold agriculture harmless as he worked on addressing foreign trade.

“President Trump personally promised me that agriculture would be held harmless as he worked on trade, and today’s announcement of $12 billion in USDA assistance for disrupted markets confirms his intention to keep his promise to me,” said King. “Importantly, the USDA intends to use a Trade Promotion Program to develop new export markets for American agricultural products. These new export markets will remain when the current disputes over trade are settled on terms more favorable to American producers. I applaud the Administration for taking this needed action, and I am confident that President Trump, Secretary Perdue, and Ambassador Branstad are all working diligently to open China’s markets to greater trade in Iowa’s agricultural products.”

Gov. Kim Reynolds issued the following statement Tuesday on the U.S. Department of Agriculture’s “trade aid” announcement – $12 billion to help farmers hurt by tariffs.

“The $12 billion in farm aid announced today will provide a short-term fix, but it’s not a long-term solution. As I’ve said all along, nobody wins in a trade war. We must continue to expand and open markets, protect the Renewable Fuel Standard and allow Iowa products to be sold across the globe. Iowa farmers are the most productive in the world and will always win when they have unrestricted access to markets. I will never stop fighting for Iowa families affected by this trade war.”