Missouri farmers are upset about President Donald Trump’s trade policies that are driving down commodity prices but they haven’t turned on the man they voted overwhelmingly to elect president, leaders of two major agricultural associations said this week.
The U.S. Department of Agriculture on Tuesday announced how it would spend $4.7 billion to mitigate “trade damage from unjustified retaliation by foreign nations.” For corn farmers, the payment will be one cent per bushel, payable after they have completed this year’s harvest. For dairies, the payment will be 12 cents per hundredweight, or about one cent per gallon.
The Missouri Corn Growers Association called the payments “adding further insult to injury” because the amount doesn’t come close to the 44 cents per bushel they expect farmers will lose due to the trade war and the state corn crop is severely curtailed by drought. The Missouri Dairy Association said it “is very disappointed” with payments that will cover less than 10 percent of the losses due to retaliatory tariffs by Mexico and China.
Anger with the department’s decision hasn’t translated into anger at Trump, said Gary Marshall, CEO of the corn growers association.
“The farmers have an amazing amount of patience with the president on these issues,” he said.
The political impact of the trade disputes could be felt as early as November, when voters will choose between incumbent U.S. Sen. Claire McCaskill, a Democrat, and Attorney General Josh Hawley, a Republican. McCaskill is highly critical of Trump’s actions on trade while Hawley backs Trump.
“Missouri’s farmers are hurting, and between the drought and the ongoing trade war, they’re worried that they’ll end up underwater with this year’s crop,” McCaskill said in a statement issued by her Senate office. “These payments may help some folks on the margins, but what I’ve heard from our agriculture producers is they won’t even help them break even, and instead of bailouts they want markets—so I’m going to continue fighting to end this trade war.”
At a campaign stop in Columbia on Tuesday, Hawley said Trump’s action to impose new tariffs was justified by years of unfair trade practices.
“This trade war was started by China, it was started by our opponents and it has been going on for years,” Hawley said. “Now, finally, we have a president who has said I am not just willing to lay down and be defeated.”
Trump on June 15 imposed a 25 percent tariff on $34 billion worth of Chinese imports, which resulted in China imposing a 25 percent levy on imports of agricultural products and other goods from the United States. As a result, agricultural prices have plummeted, with soybeans down 25 percent from their February peak, corn down almost 16 percent and milk down 5.5 percent since June.
There has been some good news, including tentative deals with the European Union and Mexico, but prices have not rebounded.
The plunge in prices comes as corn growers are expecting a 23 percent decline in yields due to drought and hay prices have shot up because pastures have stopped growing.
Missouri has been losing dairy farms for decades and this year’s problems will probably cause more farmers to quit, said Ted Sheppard, president of the Missouri Dairy Association. The average dairy herd in Missouri is 80 cows and the payment under the trade mitigation plan would be about $960, based on average production for each cow, he said.
“If you bring it down to that size farm level and what that is going to do on the farm, that may buy one tractor tire, if it is not too big a tractor,” Sheppard said.
So far, he said, members of his organization aren’t directly blaming Trump for their losses this year. How long that will last, he said, is uncertain.
“I think the patience comes from a long-time thinking that things need to change and finally we have an administration that is trying to change things,” Sheppard said.
The dairy association endorsed Hawley in the Senate race, as did many other farm organizations. The corn growers are an exception and will remain neutral in the Senate race, Marshall said.
Hawley and McCaskill each met with the corn growers’ board, he said.
“They both did a very good job of articulating their positions,” Marshall said. “Our guys tend to be a little more conservative. Both the attorney general and the senator acquitted themselves very well in talking with our growers.”
So far, the plunging prices haven’t been felt by many Missouri farmers because the growing season is not over and much of their past production remaining on the farm has been sold under futures contracts for prices above current levels. In July, soybean farmers received $9.28 a bushel for beans, according to a monthly USDA report, while spot market prices were about $8.50 a bushel.
The same report, however, shows that overall, farmers who grow grain and oil seeds are receiving only 65.8 percent of the prices they enjoyed in 2011 and dairy farmers are being paid only 76.6 percent of 2011 prices. Farm costs are 8.7 percent higher than in 2011, the report states.
Rural reaction to trade policies can change the political landscape for decades. In 1980, President Jimmy Carter imposed an embargo on grain shipments to Russia over the invasion of Afghanistan, turning many farmers away from the Democratic Party.
Marshall remembers the grain embargo, he said. The reaction to the small relief payments hasn’t hurt Trump yet, he said.
“Farmers believe that is coming from USDA, it may or may not be coming from the president,” he said. “What they announced isn’t anything what they were hoping to see.”