ISA: Soybean farmers will suffer if trade war escalates

     The Iowa Soybean Association’s 22 directors have jointly issued a statement on July 6 about the potential of a trade war with China.

     The statement reads as follows:

     “The U.S. soybean industry’s worst fears are coming to pass today (July 6) with the implementation of tariffs on Chinese imports. This aggressive action positions Iowa and America’s soybean farmers directly in the crosshairs of a full-scale, multi-national trade war if China, as it has promised, imposes tariffs on U.S. soybean imports.

     “Short- and long-term consequences are significant. U.S. soybean prices are already far below the cost of production will continue to erode, placing additional pressure on farm families who have already experienced a nearly $2-per-bushel decline since March.

     “Long-term, a full-blown trade war risks entrenching anti-American sentiment in a country that consumes nearly 60 percent of global soybean trade and about one of every three rows of U.S. soybean production. It will incentivize additional trading partners, including Canada, Mexico and the European Union, to do business absent the United States. It’s clear that our competitors are working diligently to grow their capabilities and overcome any shortcomings, both logistically and economically. This is of great concern to the nearly 42,000 Iowa soybean farmers who derive their livelihood from an industry built on the ability to do business internationally.

     “There are winners and losers in every trade war. The soybean industry is a loser if we become a residual, rather than primary, supplier of soybeans to China. Iowa is disproportionately impacted because of the tremendous volume of soybeans produced here and the need to move our product to international customers.

     “Iowa farmers are resilient, resourceful and accustomed to dealing with situations out of their control. We recognize and fully appreciate the legitimate issues involving U.S. and Chinese trade relations. As we prepare to harvest another substantial soybean crop this fall, we urge U.S. and China officials to engage in full and transparent dialogue to resolve these issues quickly. Time is of the essence.”

 

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