It sounded like the return of Agriculture Secretary Earl Butz, who urged farmers to plant fence row to fence row, when Commerce Secretary Wilbur Ross was asked about the uncertainties created by President Trump’s plan to renegotiate trade pacts, says DTN. Ross responded, “If I were a farmer, I would plant as much as I can logically plant in today’s environment.”
Ross further said it would be silly to hold back on crop production “just because there’s going to be some renegotiation.” Exports provide 20 cents of each $1 in farm income. Some analysts say the export market is the best option for generating farm revenue considering the huge U.S. stockpiles and low domestic prices.
“The fact is that most of the rest of the world is incapable of feeding itself,” said Ross, so if the United States loses one customer, someone else will replace it. “I think it’s highly unlikely that worldwide consumption will go down just because we renegotiate trade agreements.”
Farm groups are less sanguine and were alarmed last week when President Trump suggested he was going to cancel NAFTA. A DTN analyst said competitors might expand their production to take advantage of a market opening while holding on to current customers.
The administration plans a systematic review of trade agreements to see if they need an overhaul because of abuses.