By former USDA Secretary John R. Block.
All reports from the heartland tell us that this year’s crops look good. Corn and soybeans on my farm are as good as I can remember. However, they are not ready to harvest. A hot dry August could do some serious damage. Besides watching the weather, we keep an eye on the markets. China has been an aggressive buyer of our corn, soybeans, pork, and beef. The pork production in China is still suffering from swine fever. They are 20% below one year ago. The big question that we have is – will China meet, or even come close, to buying the volume of our farm products they promised?
Jamieson Greer, former Chief of Staff to the U.S. Trade Representative had this to say, “I don’t think it’s going away. The Chinese really need this deal and the Trump Administration has every incentive to keep it.” A column in the Wall Street Journal informs us that China wants to keep trade matters separate from other frictions in the relationship. President Trump has not been soft on China. Blaming China for the “Chinese” virus, intellectual property thefts, human rights violations and more. China’s crackdown on Hong Kong has the U.S. and other countries pushing back. We called China’s aggressive action in the South China Sea “completely unlawful.”
With an election coming up both Republicans and Democrats are fighting to see who can be toughest on China. So far, the trade deal seems to stand alone. If China does follow through and buy the huge volume of our ag products agreed to, that would be terrific. In addition, they have promised to buy an additional $200 billion of U.S. products by the end of next year.
I was not happy to read what President Trump had to say, “The trade deal with China means less to me now than it did when I made it.” Well, the trade deal means a lot to American agriculture. We don’t want it to go up in smoke. Hopefully, we can keep our trade relationship away from the other long list of disputes. After the November election the winner needs to sit down with China and find a way to live together. We don’t need a Cold War.
John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill. If you would like to review his radio shows going back more than 20 years, just go online to www.johnblockreports.com.
