A tit-for-tat tariff dispute between the Trump administration and China has piled on pressure in an already strained Farm Belt, leaving an increasing number of growers unable to stay afloat.Farmers filed 580 Chapter 12 bankruptcy filings between January and September, according to the American Farm Bureau Federation, the largest farm advocacy group in the country. That was a 24% increase from the previous year and the highest level since 2011, when there were 676 filings.China placed steep tariffs on US farm products last year to retaliate against punitive moves by the Trump administration, adding to challenges for farmers already faced with harsh weather conditions and low commodity prices. Those have sent exports sharply lower and made it difficult for growers to plan the next harvest. - Business Insider
Monday, November 4, 2019
Farm bankruptcies jump, thanks to Trump
I say, that title rhymes, did you notice? But this is in fact nothing to be lighthearted and clever about.
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Some bullet points :
ReplyDelete-- The number of bankruptcies by state put Minnesota in fifth place with Wisconsin at first, followed by Georgia, Nebraska and Kansas
NOTE : Trump won those states and is targeting Minnesota in 2020
-- Farm debt in 2019 is projected to be a record-high $416 billion
NOTE : On November 1, the U.S. Treasury indicated that America’s National Debt breached $23 TRILLION for the first time in the country’s history. The National Debt was $19.9 Trillion on Trump Inauguration Day.
-- Roughly $33 billion of farmers income is from the taxpayers (i.e. Trump bailout using monies from the Market Facilitation Program for trade war damages, disaster assistance, the farm bill and insurance indemnities.)
NOTE : Not all commodities are treated the same under MFP and not all farmers qualify. As a result, an increase the farm bankruptcy trends could continue.
-- 2020 is an election year, so farmers are expecting Trump to announce another round of MFP payments.
-- The USMCA (the NAFTA replacement) is more of Trump rallying cry than actual improvement using farm products as a prop. The US complaints over NAFTA was of mfg jobs losses, the need for stronger labor and environmental protections, and a change to pharmaceutical protections. The USMCA still has not been presented to Congress because of these issues. Canada still has not approved it ... only Mexico. Thus, Mexico sees this as an advantage for them. This is proven out by a survey, conducted by Wakefield Research for the TMF Group, a global business consultancy. 55% of US respondents think the USMCA will be good for the economy within the next two years while 70% of Mexicans think it will be good and 45% of Canadians see benefits.
NOTE : U.S. total exports of agricultural products to Canada totaled $24 billion in 2018 while U.S. total exports of agricultural products to Mexico totaled $20 billion in 2018 ... or $44 billion.
U.S. total imports of agricultural products from Canada totaled $23 billion in 2018 while U.S. total imports of agricultural products from Mexico totaled $26 billion in 2018 ... or $49 billion.