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U.S.–China Trade Dispute and Potential Impacts on Agriculture

Choices magazine | Posted on June 28, 2018

This trade dispute is important to U.S. agriculture, because China has been the United States’ top agricultural export market outside of North America since 2009 with an annual sale of nearly $20 billion in 2017. In 2017, top U.S. agricultural exports to China included soybeans, cotton, hides and skins for leather products, fish, dairy, sorghum, wheat, nuts and pork. Noting the theory of comparative advantage and that China has one-fifth of the world’s population—four times that of the United States—but only one-tenth of the world’s arable land, China primarily exports labor-intensive manufactured products to the United States (e.g., electronics), and the United States primarily exports land-intensive agricultural commodities to China (e.g., soybeans). While the United States has a large trade deficit with China, it has a trade surplus in agricultural products. This issue has articles on the impact of hte trade dispute on agriculture and wine.


Fear grows of long-lasting damage from Mexican ag tariffs

Agri-Pulse | Posted on June 28, 2018

U.S. farmers are already hurting, thanks to Mexico’s retaliatory tariffs for U.S. import taxes on steel and aluminum, but the pain is expected to increase sharply in the weeks and months to come. U.S. exporters have become accustomed to the zero duties under the North American Free Trade Agreement, but the new tariffs are still equal to or below what Mexico charges most other major suppliers. That means the U.S. can still compete thanks to the closeness of the two countries, both geographically and in shared supply channels.“Trade is not going to stop right away,” said one U.S. industry official. “We’re going to continue to sell.” But on July 5, those tariffs will rise to a range of 20 to 25 percent, and that’s expected to do severe damage – perhaps lasting damage – to U.S. dairy farmers’ largest foreign market. “A 10-15 percent jump from zero – especially since other trading partners don’t have zero percent access – that’s not the end of the world,” another dairy industry representative said. “Certainly that’s going to bite a lot more once we’re up closer to levels that (other foreign exporters) have to pay, in the 20-25 percent range.” That threat prompted dozens of dairy companies and groups to send a letter to President Donald Trump on Tuesday, pleading for him to suspend the steel and aluminum tariffs on Mexican exporters. U.S. potato farmers are also being hurt by Mexico’s retaliatory tariffs on frozen french fries while Mexican consumers will likely not suffer at all, National Potato Council CEO John Keeling told Agri-Pulse. “They know that it hits the U.S. and they can still get all the french fries they need because they’re all going to come from Canada,” he said. “What happens in the short run is that volume shifts to Canada. In the long term, those shifts will become permanent.”


Judge: USDA failed to justify Idaho wildlife-killing plans

US News and World Report | Posted on June 27, 2018

A federal agency's justifications for killing coyotes and mountain lions and other predators in Idaho to protect livestock and other wildlife such as elk violate environmental laws because they lack a scientific review, a federal court has ruled. U.S. District Court Judge B. Lynn Winmill said the U.S. Department of Agriculture's reasons for not doing the scientific review "were not convincing or objective." The Agriculture Department's Wildlife Services kills and removes predators that kill livestock in many states, especially in the U.S. West. In Idaho, the agency killed nearly 4,000 coyotes in 2016.


ADM, DuPont partner on enzymes for ethanol from corn kernel fibre

Renewables Now | Posted on June 26, 2018

US-based agricultor processor Archer Daniels Midland Co and DuPont Industrial Biosciences, a division of DowDuPont Inc, are partnering to provide cellulase enzymes for grain-based ethanol plants. The companies said on Wednesday they will develop, produce and market the enzymes that help make ethanol from corn kernel fibre, allowing grain-based fuel ethanol producers to make better use of existing feedstocks. Ethanol produce from corn kernel fibre could qualify for D3 RINS under the US' Renewable Fuel Standard programme, the companies noted.    Initial product prototypes have successfully been proved in laboratory and ethanol plant scale testing and the pair now plans more evaluations. The two companies are already collaborating on high performance renewable bio-materials


Record farm fine slashed in half by judge

Capital Press | Posted on June 26, 2018

A record fine levied against a northwest Washington blueberry farm for missed rest breaks and late meals has been cut in half by a judge. Whatcom County District Judge Pro Tem David Cottingham reduced Tuesday the amount Sarbanand Farms will pay in state and county fines to $74,825. The state Department of Labor and Industries originally imposed a penalty that totaled $149,650.


Iowa nitrogen pollution in the water is getting worse, despite hundreds of millions of dollars in spending, study shows

Des Moines Register | Posted on June 25, 2018

Nitrogen pollution flowing out of Iowa to the Gulf of Mexico has grown by close to 50 percent over nearly two decades, a new report shows, despite hundreds of millions of dollars spent to stem nutrients entering the state's waterways.A University of Iowa study shows the state's contribution to the Gulf dead zone spiked 47 percent to 618 million pounds in 2016, based on five-year running annual averages."Just based on water quality data, I think we can say we’ve not made much progress over the past 20 years in terms of nitrogen," said Chris Jones, a research engineer at the UI's IIHR–Hydroscience & Engineering.Environmentalists say the study raises new questions about the effectiveness of Iowa's approach to improving water quality and its reliance on voluntary ag compliance."We've been pouring state and federal money into cutting nutrient pollution for decades, and this highlights the fact that the voluntary approach is not working," said Jennifer Terry, executive director of the Iowa Environmental Council.


Trump gets ready to slap China with investment restrictions, export controls

Politico | Posted on June 25, 2018

Round two of President Donald Trump's trade assault on Beijing is expected by the end of this week, when the Treasury Department rolls out new restrictions on Chinese investment in the United States and on the technologies that can be sold to China.After an internal debate, the administration appears to have settled on more aggressive restrictions favored by U.S. Trade Representative Robert Lighthizer and White House trade adviser Peter Navarro over a more conservative approach favored by Treasury Secretary Steven Mnuchin, two private-sector sources privy to the deliberations said.Like the tariffs that Trump imposed on $50 billion in Chinese imports — and those he has threatened to impose on $400 billion more if Beijing retaliates — the new investment restrictions and export controls are intended to pressure China to stop unfair trade practices that threaten the United States’ technological leadership. Trump is expected to invoke his emergency powers to protect national and economic security to put the restrictions in place.But the administration is already getting pushback from bureaucrats who think it would be a misuse of the export control system, and from businesses that fear the approach will further disadvantage U.S. firms trying to enter the Chinese market.


Double whammy: U.S. pork, fruit producers brace for second wave of Chinese tariffs

| Posted on June 21, 2018

U.S. producers of pork, already saddled with duties enacted in an earlier round of the escalating trade dispute with China, are bracing for further pain after Beijing hit the products with additional tariffs due to come into effect next month.  China implemented a 25 percent duty on most U.S. pork items on April 2, and a 15 percent tariff on a range of fruits and nuts, in response to U.S. tariffs on Chinese steel and aluminum products. Last week it included both categories in a second round of tariffs to be imposed on July 6. No other products have been listed twice.  Pork now faces cumulative import duties of 71 percent, not including value added tax, according to a formula published on the website of China’s finance ministry last week. Cumulative duties on fruit amount to 50 percent.  “The additional tariff will put us out of business,” said Zhong Zheng, founder of China-based Heartland Brothers, which sells U.S.-produced Berkshire pork to Chinese supermarkets and restaurants. The United States shipped $489 million worth of pork to China last year, and had the biggest share of import volumes in the first quarter of 2018, at about 117,000 tonnes, according to Chinese customs.


PA Senate passes measures to overcome dairy crisis

WJACTV | Posted on June 21, 2018

The Pennsylvania state Senate has passed three legislative measures to help combat the dairy crisis.The Senate passed Senate Bill 819 to allow for agritourism activities such at farm tours, hayrides and corn mazes on farms that are part of the state's farmland preservation program."This bill provides consistency for farmers throughout the state while protecting their farmland preservation status as they host these educational and entertaining events," said Senate Majority Leader Jake Corman. HARRISBURG, Pa. - The Pennsylvania state Senate has passed three legislative measures to help combat the dairy crisis.The Senate passed Senate Bill 819 to allow for agritourism activities such at farm tours, hayrides and corn mazes on farms that are part of the state's farmland preservation program."This bill provides consistency for farmers throughout the state while protecting their farmland preservation status as they host these educational and entertaining events," said Senate Majority Leader Jake Corman.In addition, the Senate passed two resolutions with first urging the Food and Drug Administration to prevent misleading labeling of non-dairy products and a second directing the Legislative Budget and Finance Committee to conduct a study and issue a report of recommendations for initiatives to assist the state's dairy producers.


U.S.–China Trade Dispute and Potential Impacts on Agriculture

Choices magazine | Posted on June 21, 2018

Threats of Chinese tariffs on U.S. agricultural imports shook the U.S. agricultural sector. Attention focused on the potential loss of farm income, with a surge of short articles published in the popular media. To help provide a deeper analysis on the trade policy impact, we organize this China theme issue with five articles: Zheng et al. and Taheripour and Tyner estimate the loss on multiple relevant crops using a partial equilibrium model and a general equilibrium model, respectively. Both studies focus on soybeans, while wheat, pork, and a few other commodities are also considered. Hansen et al., Countryman and Muhammad, and Liu et al. examine sorghum, wine, and cotton, respectively, and point out potential export reductions as a result of such tariffs. Although the current trade dispute continues to evolve, it is valuable for us to understand the potential negative impact and to be informed of possible consequences. It is our sincere hope that U.S. and Chinese negotiators will reach an agreement, since both countries ultimately lose with a trade war, as seen from the 1930s Smoot–Hawley Tariff.


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