Trump’s farmer bailout just hit $7.7 billion – but 'it no way makes us whole'
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As the Trump administration continues trade talks with China, the U.S. Department of Agriculture (USDA) has paid out a total of $7.7 billion in aid to farmers to offset the effects of tariffs.
The aid “certainly was appreciated,” Blake Hurst, a soybean farmer and president of the Missouri Farm Bureau, told Yahoo Finance’s On The Move. He noted that the money particularly helped at a time when farmers are renegotiating their loans and talking to lenders.
However, Hurst added, “it’s not enough in the sense that it no way makes us whole for what we suffered from these trade disputes.”
‘A lot of things can happen’
When the trade war went into full effect in 2018, the Trump administration pledged two installments of a farmer bailout program through the USDA. The first round of payments, which came to about $4.7 billion, was paid in September, while the second round commenced in December. Although part of the bailout program hit a snag during the government shutdown, aid resumed without issue after Congress and the White House reached a deal.
Two days into trade talks, China bought two million tons of U.S. soybeans in a sign of good faith. And on Friday, U.S. Agricultural Secretary Sonny Perdue tweeted that “the Chinese committed to buy an additional 10 million metric tons of U.S. soybeans. ... Strategy is working. Show of good faith by the Chinese. Also indications of more good news to come.”
The U.S. stated that the deadline of a deal would be March 1, though that might not happen. Trump recently says that he could extend the deadline while keeping current tariffs in place, adding that March 1 “is not a magical date. A lot of things can happen.” If no deal is reached, then U.S. tariffs on Chinese imports are scheduled to go from 10% to 25% on $200 billion worth of Chinese imports.
‘A tremendous backlog and surplus of soybeans’
China has reportedly offered to buy an additional $30 billion a year of U.S. agricultural products, according to Bloomberg. Hurst stressed that this likely would not be exclusive to soybean farmers.
“I would assume that the $30 billion would include other products besides soybeans, although we have a tremendous backlog and surplus of soybeans on hand,” Hurst said. “I’m sure that they’re talking about perhaps ethanol, perhaps beef, perhaps wheat, cotton as well, so there’s lots of agricultural products that could be included in that $30 billion, were it to happen.”
The backlog that Hurst is referring to is the U.S. soybean inventory, which is projected to reach an estimated 955 million bushels in 2019, almost double the amount of the year prior.