tariff payments

Although most producers say Trump tariff payments will "completely or somewhat" relieve the impact of the Sino-U.S. trade war on their operations, farmer confidence is plummeting, according to a Purdue University poll released Tuesday. The Ag Economy Barometer, a gauge of the health of the agricultural economy, fell from a record high of 153 in July to the lowest reading — 124 — since May.<strong>(No paywall)</strong>

Farmers and ranchers will receive a projected $10.7 billion in Trump tariff payments this year, the major reason that direct federal payments will amount to 22 percent of net farm income, say USDA economists. The trade war payments would be twice as large as last year's $5.1 billion, when the administration created the stop-gap Market Facilitation Program to mitigate the impact of the Sino-U.S. trade war on the agricultural sector.

The Trump administration enabled multimillion-dollar payments to some large operators in this year’s round of trade war payments by obliterating the usual limits on farm subsidies, said the president of the National Farmers Union on Thursday.

A day after President Trump scoffed at wheat exports to Japan — “They don’t even want our wheat,” he said — U.S. wheat growers called out the president for maligning an important trade relationship. It was one of the first times farmers have talked back to Trump since they helped elect him to office.

The Trump administration can pay billions of dollars in trade aid to farmers and ranchers this year, and in 2020, too, if it wishes, because Congress quietly and reliably replenishes funding for the Commodity Credit Corp., sometimes referred to as the “USDA’s bank.” (No paywall) <strong>(No paywall)</strong>

The Trump administration has spent notably less than commonly described on its package to mitigate the impact of the trade war on 2018 agricultural production. This year’s version may come closer to the $16 billion maximum trumpeted by the president because of more accommodating payment rules.

The Trump administration will send more than $7 billion in trade war payments to farmers this summer, a total that could soar to more than $14 billion if the Sino-U.S. dispute persists into the winter, said officials on Thursday. For the second year, agriculture is the only sector of the U.S. economy to receive trade mitigation payments.

If China eliminated its punishing trade war tariffs on U.S. soybeans, net farm income would climb by nearly $3 billion this year and $4 billion in 2020, said three university economists in examining one aspect of the Sino-U.S. trade war. The two countries will resume trade talks next week in Shanghai.

Two months after President Trump announced a $16-billion package to buffer the impact of the Sino-U.S. trade war on farmers and ranchers this year, the first driblet of the money is flowing — $100 million for market development. The awarding of the funds, announced by the USDA over the weekend, suggests the rest of the program could swing into operation in the days ahead.

Farmers can expect a deluge of federal payments in the weeks ahead to cushion the effect of farm exports lost to the trade war and plantings washed away by the rainiest spring in a quarter-century, say analysts. "It's probably going to be August" when the biggest shower of payments begins, the multibillion-dollar, stop-gap Market Facilitation Program, according to Agriculture Undersecretary Bill Northey, who oversees farm subsidies.

Some growers may collect three or even four payments on land where they were unable to plant a crop this spring due to persistent rain and flooding, but no one is going to get rich off of it, said Agriculture Secretary Sonny Perdue on Wednesday.