At least 11,000 Texas farmers believe they have suffered because of tariffs and trade disputes erupting amid President Donald Trump’s get-tough stance with China, which buys about half the cotton grown statewide, according to the Waco-based Texas Farm Bureau and the U.S. Department of Agriculture.
Thursday, Valentine’s Day, was the deadline for agricultural producers to sign up for the USDA’s Market Facilitation Program, launched in September to help producers “suffering from damages due to unjustified trade retaliation,” according to a USDA press release.
USDA spokeswoman Brenda Carlson said in an email response to questions that the USDA-Farm Production and Conservation Business Center in Texas had processed about 11,000 applications through Thursday. Farmers and ranchers statewide had received direct assistance totaling $72 million, Carlson said.
But applications received during the 35-day government shutdown, when applications were accepted in-person but not online, may remain in the processing stage, she said.
Nationally, 864,000 producers had applied for assistance between the start of the program and two days before the Thursday deadline, receiving an estimated $8 billion in payments, according to a USDA press release.
“Farmers are very resilient, and these payments are helping agricultural producers meet some of the costs of disrupted markets in 2018,” USDA Under Secretary Bill Northey said in the press release sent before the deadline. “We view it as a short-term solution to help America’s farmers, and we encourage impacted producers to apply.”
Carlson said she does not have data on the number of Central Texas farmers who applied for help.
Texas Farm Bureau spokesman Gene Hall said farmers and ranchers have mixed feelings about the Trump administration, tariffs and the best approach to dealing with China.
“China is a very bad actor, involved in currency manipulation, cheating on subsidies and abusing World Trade Organization rules,” Hall said. “There is a lot of support for taking aggressive action against that country. But a trade war could not have come at a worst possible time. It is being felt most acutely in the Midwest, but we’re having problems here, too. These market assistance payments are helpful, but no one considers them a long-term solution.”
Hall said farmers generally find Trump appealing. He said the president gained favor by championing efforts to abolish the Waters of the United States Rule enacted in 2015, under President Barack Obama’s administration. It sought to define rivers, streams, lakes and marshes that fall under the control of the Environmental Protection Agency and the U.S. Army Corps of Engineers.
“Trump rolled back regulations, particularly that rule, and farmers are grateful,” Hall said. “A lot of the goodwill farmers have for him is tied to that. Is their patience wearing thin? I’m not prepared to say that yet. But there is a limit to how far he can go with tariffs. They may be a helpful tool to settle things when you have someone such as China that ignores every rule. But we’re also talking about tariffs on steel and aluminum from other suppliers. Lots of things on the farm are costing more. They’ve displayed a lot of patience with Trump, but there is no question, some of his policies create hurt at home.”
To ease that pain, the Market Facilitation Program was enacted. It targeted producers of corn, cotton, dairy products, hogs, shelled almonds, sorghum, soybeans, fresh sweet cherries and wheat, according to the USDA.
Nationally, producers of soybeans, corn, wheat, dairy, sorghum and cotton, in that order, are leading in requests for federal assistance, Carlson said. A breakdown specific to Texas was not available.
Texas is not a major soybean producing state, a fact serving as a “firewall” in this duel involving tariffs and reaction to them, Hall said.
The temporary truce between Trump and China may reduce tension, “but this is still not a good situation, not even close,” said Luis Ribera, an associate professor of agricultural economics at Texas A&M University.
The Trump administration has set March 2 as the deadline for reaching a comprehensive trade deal with China and threatened to raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent if it is missed. But Trump on Friday repeated for the second time in a week that he would extend the deadline if negotiations between U.S. and Chinese officials were progressing satisfactorily, according to a New York Times report.
Trump started targeting China with tariffs in summer 2018, and it responded by releasing a list of more than 130 items it would slap levies on.
“Looking at this from both sides, China’s economy is not doing well, and our commodity prices are low,” Ribera said. “China is a country that needs quality food, and we have it. Citizens there spend 25 percent of their income on food. Truce or not, China needs our agricultural products. They’re buying soybeans from Brazil, and they are a lot more expensive. I would hope that common sense would play out, but when politics get involved, you never know.”
He said U.S. farmers indeed are facing hard times. Commodity prices have fallen as economies have softened outside the United States, and exports comprise a third of farm income. Meanwhile, rising prices for inputs including fertilizer and machinery, for example, hang around longer than falling revenues.
“China is involved in things I would not call playing fair,” Ribera said. “Something needed to be done, but I would hope this would be something we could sit down and renegotiate terms instead of applying tariffs.”