Trump and Agriculture
“Many farmers looked at Trump and saw a president who was business-oriented and was looking to reduce regulation, which is a popular thing in agriculture,” says Chad Hart, agricultural economist at Iowa State University. “If there was an area they were concerned with, it was probably in the aspect of trade, and that’s going to be one of the areas we watch very closely.”
Trade is one of the most important economic driver of American agriculture and an issue that industry experts will monitor closely as President-elect Donald Trump takes office.
“It is well known within agriculture that 25 percent to 30 percent of farm income is related to international trade and exports,” says Veronica Nigh, economist at American Farm Bureau Federation. “Our industry is significantly more dependent on international trade than other sectors of the economy.”
“The goal of Trans-Pacific Partnership (TPP) was to reach a comprehensive, high-standard agreement that will improve the conditions of trade in the region and boost economic activity in all participating countries,” according to the American Farm Bureau Federation. The TPP would deepen economic ties, minimize tariffs, and ultimately bolster trade relationships with 11 countries including Canada, Japan, and Mexico.
The TPP could also impact the U.S.’s relationship with China, who is the world’s biggest buyer of soybeans and the biggest soybean market for the U.S.
Trump recently chose Iowa Governor Terry Branstad to serve as an ambassador to China. Branstad has a good relationship with China’s president, Xi Jinping, and he understands the importance of trade. Pair that with an understanding of agricultural interests in the Midwest and the choice is a good sign.
“We are very excited about that announcement, and it’s going in the right direction for having a good productive relationship with our number-one customer for U.S. agriculture products internationally,” said Nigh.
As the Trump presidency inches closer, agricultural stakeholders from coast to coast are holding their breath to see if Trump will hold true on his promises to rural America.
Soybean Prices are a Proxy for How the Trade War is Going