Trump seems to pledge more trade aid for farmers after USDA predicts China won't buy as much as promised - Entrepreneur Generations

President Trump seemed to promise American farmers more trade bailout money in a tweet on Friday, likely in reaction to U.S. Department of Agriculture economists' prediction that China will not buy as much agricultural goods as promised in the recent phase one trade agreement.

At the USDA's Agricultural Outlook Forum on Friday, the department's chief economist, Robert Johansson, projected that China would buy about $14 billion in U.S. farm products by the end of Sept. 30. China had promised in the trade deal to buy about $40 billion this year though. Johansson told The Washington Post that some of the discrepancy came because he was talking about the fiscal year, which meant China's purchases for October through December weren't counted in his estimates. But at the same event, Agriculture Secretary Sonny Perdue said that he remains concerned about enforcing China's purchase commitments, and said that variables like the coronavirus and Asian swine flu made predictions difficult.

"If our formally targeted farmers need additional aid until such time as the trade deals with China, Mexico, Canada and others fully kick in, that aid will be provided by the federal government, paid for out of the massive tariff money coming into the USA!" Trump tweeted in all caps.

"He also added, erroneously, that the money for the aid would come from tariffs his administration has slapped on billions of dollars of imported goods. Economists have shown that U.S. businesses and consumers are paying those duties, rather than China," Ryan McCrimmon reports for Politico. "Trump’s dangling of extra bailout money stands in contrast to his recent boasts that farmers should start buying more land and 'bigger tractors' to keep up with the historic boom that he promised his new trade agreements would deliver."

The tweet also seemingly flies in the face of Perdue's repeated statements that farmers shouldn't expect any more trade aid, now that the U.S. and China have reached a trade deal, McCrimmon reports.

With spring planting just around the corner (or already starting), farmers may factor the possibility of more aid in their decisions. Aid last year was tied to acres planted, so farmers could be encouraged "to plant more land this spring than would otherwise be justified," Chuck Abbott reports for Successful Farming.

Agriculture Undersecretary Ted McKinney said at the Agriculture Outlook Forum that Trump's tweet "was a surprise to us" but said the department will support his decision, Abbott reports.

from The Rural Blog https://ift.tt/37WBuH3 Trump seems to pledge more trade aid for farmers after USDA predicts China won't buy as much as promised - Entrepreneur Generations

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