California farmers welcomed the Trump administration’s announcement Tuesday of a $12 billion agricultural relief package, but are still anxious about the impact and duration of a trade war.
Ryan Jacobsen, CEO of the Fresno County Farm Bureau, told the local Fresno affiliate of CBS that farmers in the stressful peak of their summer harvest season appreciated President Donald Trump’s expressions of concern for their well-being, and see the fund as lessening the financial blow of a growing trade dispute.
Jacobson stated: “Right now we’re kind of on the front edge of it. So many of our crops are either in harvest or coming in to harvest here very soon with crops that are going to be affected by these tariff issues.” But he also noted that once a trade war got going, it could last for several years.
Trump has vowed to address the staggering trade deficit with China. Earlier this year, China’s Vice-Premier Liu He met secretly with the president at the White House, then announced, “The two sides reached a consensus, will not fight a trade war, and will stop increasing tariffs on each other,” according to the Xinhua state-run news agency.
Liu told Xinhua that China promised to provide “meaningful increases” in U.S. agriculture and energy exports, but he warned: “At the same time it must be realized that unfreezing the ice cannot be done in a day, solving the structural problems of the economic and trade relations between the two countries will take time.”
Impatient with progress, President Trump initiated $50 billion on Chinese manufactured goods three weeks later, and threatened to increase the tariffs against China to cover $200 billion in imports in mid-June. China, trying to threaten President Trump’s voter base, retaliated on July 6 with $34 billion in tariffs against U.S. exports, mostly focused on agricultural products.
China lashed out against U.S. farms and ranches because the United States is by far is the world’s largest food producer and processor, with $316.2 billion in revenue and $118.3 billion in exports — almost twice the $177.5 billion of number two China, according to the Investopia blog in 2016.
The engine that drove that dominance was California agriculure, with exports including pistachios, almonds, wine, oranges, dairy products, and hay.
The Atlantic reported that California agriculture received good news on July 25, when President Trump and European Union Commission President Jean-Claude Juncker emerged from a closed-door White House meeting for an impromptu press conference announcing a breakthrough trade deal that President Trump called “a big day for free and fair trade.”
President Juncker pledged that the European Union would import more American soybeans and liquefied natural gas. President Trump agreed that the U.S. would not impose any additional tariffs against imports of European cars. In a surprise move, Trump said the U.S. and EU will work together to “address unfair trading practices,” including forced technology transfer, intellectual property theft, and overcapacity.
Although neither Junker or Trump mentioned China, the South China Morning Post ran a banner headline, “Donald Trump Set to Turn all Trade War Fire on China After US Deal With EU To Suspend Tariffs.” The Chinese media tried to play down the importance of the agreement, but indicated the EU has now aligned against China in the trade war.