In a recent interview on CNBC’s SquawkBox, U.S. Department of Agriculture Secretary Sonny Perdue indicated that his Agency is studying the complex situation regarding how the Trump Administration’s trade disputes are impacting commodity prices. The Administration’s plan to mitigate price disruption has not been revealed. USDA says that Secretary Perdue is attempting to reassure farmers that they will not have to bear the brunt of China’s retaliatory tariffs resulting from trade disputes. USDA indicates that President Trump has been holding China accountable for its history of unfair trade practices and intellectual property theft.
“They’re patriots, but they also know that patriotism can’t pay the bills,” Perdue said about farmers during an interview that aired live on June 28th.
“There is legitimate anxiety when you see prices depressing. But farmers are resilient, they understand that China has not been playing fair,” Perdue said. “The President has told me to tell [farmers] that he's not going to allow them to bear the brunt of these trade disruptions and to make a plan for mitigation unless we are unable to resolve the trade issue. That's obviously what farmers would prefer. They would like to have trade. They want to sell their products, they're the most productive in the world. They've come to depend on exports, and that's their first choice. But if they don’t, they have to pay their bills like everyone else.”
Using the U.S. Trade Database and information from the U.S. Census Bureau, Politico has determined that 68% of Illinois exports (total, not just agriculture) go to key trading partners that are currently embroiled in the ongoing trade disputes.
When asked how the government will follow through on President Trump’s promise to make things right with farmers, Perdue said, “The USDA has tools in our toolbox. We are not disclosing all those right now. The market’s dynamic. We have to determine what are trade disruptions and what are normal market volatility.”
“We’re calculating the component of trade disruptions on a weekly basis and making the Administration (aware),” Perdue said.
“When there are trade disruptions, that’s the component piece that we’re calculating to determine the mitigation effort,” the Secretary added. “It’s a complex calculation.”