What a farmer thinks about Trump's proposed bailout

Farm Economy Snapshot [0:39]

• Overall farm income is down slightly.
• Livestock, particularly cattle, are doing very well.
• Crop farmers, like the speaker's farm, are operating at a loss.

This section highlights a bifurcated farm economy, where livestock producers are thriving while crop farmers are struggling financially. The contrast between the two sectors is stark, with crop farmers facing significant difficulties.

Well, we're uh overall farm income is down slightly. Uh but that's a tale of two different economies. Uh livestock, particularly cattle are doing very well. Uh crop farmers like our farm are operating at a loss.

Crop Farmer Losses and Price Declines [0:58]

• Crop farmers are operating at a loss because prices for corn have dropped from $7 per bushel three years ago to $4 today, while costs have remained the same.
• Soybean prices have seen a similar, possibly worse, percentage drop.
• This has led to a tremendous drop in profitability for crop farmers.

The speaker explains the direct financial impact on crop farms, detailing how falling commodity prices, specifically for corn and soybeans, coupled with stable costs, have eroded profit margins.

Because uh our prices three years ago for the bushel of corn was $7. Today it's $4. Uh our costs have remained the same. Uh same same percentage drop for soybeans are probably a little worse. Uh so we've seen a tremendous drop in our profitability.

Impact of Reduced Exports to China on Soybean Farmers [01:28]

• Over the past few years, China purchased 25% of U.S. soybeans.
• In the current marketing year, China has contracted for zero U.S. soybeans.
• Typically, 10% of the crop would be marketed to Chinese buyers, but this year, zero has been sold.
• This has significantly weighed on prices and creates concern about how to market this year's good soybean crop.

This segment details the direct consequences of trade policy shifts, specifically the cessation of Chinese soybean purchases, on American soybean farmers and market prices.

Uh over the past few years, China has purchased 25% of US soybeans. Uh this year, this marketing year, which starts in the fall, October 1st, uh they have contracted for zero.

Soybean Price and Break-Even Point [02:07]

• Soybean crops are selling for around $10 per bushel.
• This price is just barely break-even for soybeans.
• Two or three years ago, prices were $13 or $14 per bushel.

The speaker provides specific figures to illustrate the current precarious financial situation for soybean farmers, emphasizing the steep decline in prices from historical levels.

Well today right around $10. Uh and that's just barely break even on soybeans. uh again two or three years ago was 13 or $14 a bushel.

Trade War's Exacerbating Effect on Farming Challenges [02:25]

• Farming is cyclical with previous price drops.
• However, the current situation has been definitely made worse by the trade war with China.

This point clarifies that while cyclical price drops are normal in farming, the current economic difficulties are significantly amplified by the ongoing trade dispute.

So So farming is cyclical and uh this isn't our first rodeo with a drop in prices, but it has definitely been made worse uh by the trade war with China.

Potential Impact of a U.S.-China Trade Deal on Farmers [02:45]

• A deal with China to buy U.S. soybeans would be a tremendous boon to the industry.
• However, if tariffs hadn't been imposed initially, a deal wouldn't have been necessary, and farmers would be operating in a normal market economy.
• Farmers are paying the price for the chosen trade route.

The speaker outlines the potential positive impact of a trade agreement but also critically points out that the need for such a deal stems from the initial imposition of tariffs.

No, it would it would be a tremendous boon to the industry if we got a deal. Of course, if we hadn't put our tariffs on in the first place, we wouldn't have needed a deal.

Skepticism Towards Administration's Trade Reform Narrative [03:35]

• Tariffs on China were first put on in 2018, and the Biden administration kept them in place.
• After seven years, the trade experiment is seen as a complete bust.
• Recent trade deals, such as the one with Taiwan, are not yielding better results than the status quo. For example, a deal to sell $10 billion in agriculture goods over four years is less than the $12 billion purchased in the previous four years.
• There has been no improvement in the U.S. position as exporters.

This section expresses a strong critique of the administration's trade policy, arguing that it has failed to deliver promised benefits and that recent agreements are not translating into tangible improvements for farmers.

Uh we have seen the administration announced a couple trade deals. Uh the most recent one with Taiwan and they said, "By golly, we're going to sell Taiwan 10 billion dollars of agriculture goods in the next four years." The problem is in the last four years, they bought over 12 billion dollars. So their the deal that they're uh that they're trumpeting is no better than the status quo.

Criticism of Tariff-Funded Aid to Farmers [04:38]

• If a check is sent, it will be spent, but the situation seems crazy.
• The administration collects money from tariffs and then uses that money, collected from American consumers (including farmers who buy imported goods), to give to the industry hurt by those same tariffs.
• It would make more sense to eliminate the middleman, drop the tariffs, and resume normal trade relations.

The speaker questions the logic of the proposed aid, highlighting the circular and seemingly inefficient nature of taxing consumers and then redistribuing that money to the very sector harmed by the tariffs.

Uh, but it seemed rather I mean, it's crazy when you think about it. We put on tariffs, collect money, and then we take that money, which we've collected from American consumers, including farmers who buy imported goods. We take that money and give it to the industry that's been hurt by those very same tariffs.

Farmer Support for the Current Administration [05:16]

• Recent polling indicates that 70% of farmers support the current president.
• This support is attributed to farmers being conservative and liking the president's actions in other areas.
• Farmers are willing to give him a chance, but time is running out for the trade policy.

Despite facing financial hardship due to trade policies, a significant majority of farmers continue to support the administration, a phenomenon explained by broader political leanings and a willingness to give the president the benefit of the doubt.

Uh the most recent polling I saw said uh 70% of farmers uh support our present trade.

That's a very good question. Um, it's because I think we're conservative. We like a lot of the things that President Trump has done in in other areas. We're willing to give him a a chance, but uh time time is not on our side and it's certainly not on the side of the Trump trade policy.

Impact of Deportation Policies on Farming Labor [05:59]

• The impact of deportation policies depends on the type of farming.
• Farms relying heavily on machinery and less on labor are not as affected.
• However, greenhouse businesses and farms that grow crops requiring hand-picking (like apples or strawberries) use H2A labor (legal workers from Mexico) and are significantly concerned about labor shortages due to deportations.

This section differentiates the labor needs across various farming operations, showing that while some sectors are insulated, others heavily dependent on migrant or temporary labor face severe consequences from deportation policies.

Well, that's the difference of what uh kind of farming we're uh I'm standing in a combine today. Turned it off for a minute to to visit with you. Uh so we use a lot of machinery and we're able to do most of our farm uh jobs with uh with machinery and so we don't depend on migrant or uh temporary labor. As it turns out, we have a greenhouse business and we do use H2A labor. They're they're legal, but we do use uh we do use uh workers from Mexico. So So I've seen both sides of the story. And for those farmers that uh have a lot of apples to pick or or strawberries or or any other crop that's picked by hand, uh the the deportations are a real concern, I'm afraid.