Hoosier farmers are taking a collective sigh of relief after ongoing negotiations between President Donald Trump and China have appeared to reach a stalemate.
Each country has made concessions—the latest coming as China says it will reduce an import tariff on American automobiles from 25 percent to 15 percent beginning July 1. That’s likely in response to the United States loosening regulations against China-based ZTE.
A recent Purdue University study predicted that soybean exports to China could fall 33 percent if a tariff between 10 and 30 percent were adopted.
Indiana Farm Bureau National Government Relations Director Bob White says soybean prices rebounded in the weeks following the initial announcement, and the latest news has pushed prices even higher.
“In the short term for Hoosier farmers it is a win,” White says. “Yesterday the market moved, nearby soybeans and future soybeans both moved about a quarter.”
Despite the positive news now, White says farmers should still be cautiously optimistic.
He says he needs more details to adequately decipher a tweet from President Donald Trump stating that China agreed to buy “massive amounts of additional farm/agriculture products.”
China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products - would be one of the best things to happen to our farmers in many years!— Donald J. Trump (@realDonaldTrump) May 21, 2018
White says he needs more clarification because it is common for farmers to export more during the harvest season. Indiana farmers are on pace to plant more soybeans than corn for the first time in more than two decades.