U.S. lawmakers skeptical of promises to shield farmers from trade dispute

By Tom Polansek

OVERLAND PARK, Kan. (Reuters) - U.S. lawmakers and the farm industry were skeptical of the Trump administration’s promise to shield farmers from the rapidly escalating trade dispute between the United States and China, concerned about the lack of details in protecting the U.S. agricultural export sector now embroiled in the back-and-forth.

Major farming states supported U.S. President Donald Trump in big numbers in the 2016 election, but lawmakers from those states were harsh in their criticism on Friday of proposed tariffs that have unsettled both the industry and agricultural trading markets.

It is unclear what types of options exist to protect the sector, though expectations were that the omnibus farm bill, the U.S. government's main food and agricultural policy tool, could include crop insurance and potentially other subsidies that could address the concerns. That bill is up for renewal this year.

"This is not a good situation. It just isn't," said U.S. Senator Pat Roberts, a Kansas Republican who heads the Senate Agriculture Committee.

However, no specific proposals for protecting farmers have been suggested, and farming industry representatives were leery of tariff relief.

"We have heard no specific proposals and haven't offered any," said Will Rodger, director of policy communications at the American Farm Bureau Federation, the largest farm lobby group in the nation. "Our preferred outcome is a negotiated solution so that neither China nor the U.S. actually imposes tariffs."

Beijing rattled markets on Wednesday by threatening extra levies on U.S. goods including soybeans, the most valuable U.S. farm export to China, in retaliation for earlier U.S. trade actions. Fears later eased as many cited China's reliance on U.S. soybeans.

But on Friday, China warned it was fully prepared to respond with a "fierce counter strike" if the United States follows through on Trump's latest threat on Thursday to impose tariffs on an extra $100 billion in Chinese goods.

White House economic adviser Larry Kudlow said the dispute might be resolved in a matter of months but that Trump's threat was not a bluff. U.S. stocks tumbled on Friday as investors worried about an escalating trade war.

The administration has said it would find a way to protect farmers, but U.S. Department of Agriculture Under Secretary Bill Northey told Reuters on Thursday there were no specific plans yet. "There's a lot of different options out there," he said.

U.S. Senator Jerry Moran of Kansas, a Republican, said on the sidelines of a commodities conference in Kansas on Friday that he would support help for farmers, even though taxpayers would have to foot the bill for additional support for agriculture. Kansas was the nation's largest producer of wheat and sorghum in 2016, according to the U.S. Department of Agriculture.