By Mark Weinraub, P.J. Huffstutter
U.S. farmers finishing their harvests are facing a big problem – where to put the mountain of grain they cannot sell to Chinese buyers.
Across the United States, grain farmers are plowing under crops, leaving them to rot or piling them on the ground, in hopes of better prices next year, according to interviews with more than two dozen farmers, academic researchers and farm lenders. It’s one of the results, they say, of a U.S. trade war with China that has sharply hurt export demand and swamped storage facilities with excess grain.
U.S. farmers planted 89.1 million acres of soybeans this year, the second most ever, expecting China’s rising demand to give them better returns than other bulk crops.
But Beijing slapped a 25 percent tariff on U.S. soybeans in retaliation for duties imposed by Washington on Chinese exports. That effectively shut down U.S. soybean exports to China, worth around $12 billion last year. China typically takes around 60 percent of U.S. supplies.
Farmers are feeling the pinch. Those in central Illinois could pay up to 40 percent more than in previous years to store crops over the coming weeks, agricultural consultant Matt Bennett estimated.
That amounts to between 3 cents to 6 cents a bushel, Bennett said, a painful expense for a crop that was already expected to deliver little income to farmers.
Donald Trump’s $12 billion bailout of farmers who were hurt by his trade wars has been a big failure
In fact, the Times estimates, just $838 million of the $6 billion worth of bailout funds that have been authorized so far has been paid out.
Among the problems with the program, the paper reports, is that farmers cannot apply for relief funds until they complete their harvests for the season, which has harmed farmers whose harvests have been delayed due to bad weather.
If Trump can’t bring the trade wars (he initiated single handedly) to a satisfactory conclusion soon, Republicans may have to answer to an angry rural electorate in 2020.