When Does ‘Do No Harm’ Actually Hurt Ag Trade?

08:35PM May 07, 2018
Are U.S. farmers playing it too safe when it comes to trade?
( Farm Journal )

You may have never heard of Ray Starling, but he has an impact on agriculture policy like few others. His office sits in the White House complex where he advises President Donald Trump on any manner of issues that impact agriculture and rural America.

U.S. Farm Report Host Tyne Morgan recently sat across from Starling in that Pennsylvania Avenue office and, among other things, talked trade. Starling gets it. Farmers are concerned. “Do no harm,” they say. But that attitude, Starling said, may ultimately be what harms them the most.

“In the Ag world we feel like, notwithstanding the inequities and the unfairness around the world with regard to the conversation about free trade, we have still done pretty well,” Starling admitted.  “We are selling a lot of our product elsewhere and we are worried that we will upset the apple cart with regard to keeping those markets open. I think a point that we don't make enough and that we don't talk about enough is we should actually be doing a lot more.”

Watch Tyne Morgan's interview with Ray Starling on U.S. Farm Report below.

China is a big target for the Trump Administration, and it should be. The U.S. sold $19.6 billion worth of Agricultural goods to that country in 2017, a figure that moved China down to second on the list of U.S. ag export destinations. On the whole, China spends about $170 billion in all U.S. goods in a year, but that’s less than half of the story. The total picture of the two-way trade is $684 billion. We buy a lot more iPhones and parts and trinkets than we sell them soybeans and pork.

For the moment, U.S. soybean growers continue to ship $14 billion worth of beans to China annually. And that number has been growing. But Starling said farmers should be concerned.

“I think if we look at the numbers of soybeans that China is importing, that number continues to go up,” he said. “The US percentage of that market continues to appear to be in decline. That's something we need to reverse. We are still selling them more and more soybeans every year in terms of pure number of bushels, but as a percentage of their market we should be nervous that we are not growing along with their market.”

The White House says we want our fair share. It’s a lofty goal, but are we willing to lay all of our chips on the table in order to play that hand? If we win the trade battle, it could erase a lot of the challenges from the last four years. If we lose, we lose the farm.

Fortunately, there are positive signs. First, a high-level team of economic and trade advisors traveled to Beijing last week without the usual Twitter bluster of a full-blown Trump trade spat. Little progress was reported, but the talks continue with China’s trade team slated to visit Washington next week.

What’s more promising is that the rhetoric around NAFTA and Korea has died and serious talks have taken place. Rumors circle about a resolution to NAFTA 2.0 soon. We need it. President Trump needs it. A win under his belt with a trade deal that truly is better for American farmers and other sectors would quickly change the narrative on the trade talks in China and elsewhere.

If you’re going all in, it’s good to be holding an ace.