Issues of concern to people who live in the west: property rights, water rights, endangered species, livestock grazing, energy production, wilderness and western agriculture. Plus a few items on western history, western literature and the sport of rodeo... Frank DuBois served as the NM Secretary of Agriculture from 1988 to 2003. DuBois is a former legislative assistant to a U.S. Senator, a Deputy Assistant Secretary of Interior, and is the founder of the DuBois Rodeo Scholarship.
Wednesday, February 15, 2017
The trade war comes to the prairie
Doyle Lentz has grown barley, wheat, soybeans and canola for decades on his land in North Dakota, a farm that has been in the family for generations.
Just outside of Rolla, North Dakota, a town of about 1,300 people west of the Red River Valley, his rolling, fertile land might seem a world away from coastal ports, international business deals and the very idea of "globalism." But when he sells his barley, it’s not a local proposition: About two-thirds of his crop is shipped some 2,000 miles to brewers in Mexico. The deal with his Mexican customers – he contracts with them directly, and has it malted in Minnesota along the way – is a chance to make a little more money from a commodity crop. That’s been especially important to his bottom line over the past few years, as world commodity prices have hit seven-year lows.
Heartland American farmers like Lentz are among globalism's prime beneficiaries. Agriculture is North Dakota’s top industry, and it gets a significant boost from the $4 billion in farm goods, including wheat, soybeans, barley and sorghum, sent across borders every year. And they often travel much farther than Mexico: More than 90 percent of the state’s soybeans are exported, mainly to China.
The vast quantity of agricultural products that North Dakota exports is a story shared by farm states across the country. American agriculture sent $129 billion worth of goods abroad in fiscal 2016 – more than 20 percent of all the food grown in the United States. That number has more than doubled over the past decade, making agriculture a rare bright spot in the U.S. trade accounts. When President Donald Trump and free-trade critics fret about the United States’ $500 billion trade deficit, it’s often lost that American farmers run a large and growing surplus, and have been since the 1960s. Last year the surplus was $16.6 billion. The USDA projects it will rise to $21.5 billion this year. The Trump administration has come out of the gate seemingly gearing up for a trade war -- withdrawing from the Trans-Pacific Partnership, threatening to pull out of NAFTA and rattling relations with Mexican President Peña Nieto with talk of paying for a wall along the southern border by imposing taxes on imports. The goal is to restore U.S. manufacturing jobs in languishing industries like steel, and help the Rust Belt factory workers who turned out to vote Trump. But farmers and ranchers have a lot to lose, and they’re are starting to worry their entire industry will be collateral damage in Trump’s trade experiment. Lentz already lost $200,000 in new malted barley business he was expecting this year after one of his customers in Mexico cancelled plans to expand their brewery due to escalating tension between the countries.
A coalition of more than 130 U.S. agricultural groups has anxiously sent letters to President Trump expressing eagerness to work on modernizing NAFTA, but in a way that protects the United States’ $38.6 billion in farm exports to Canada and Mexico – its largest trading partners...more