Donald Trump has announced billions in subsidies to help agriculture. Photos / Getty Images
From the start, President Donald Trump's combative trade strategy towards China has carried the promise that short-term pain inflicted on farmers would be worth the longer-term gains for American producers, from agriculture to technology.
As the trade war intensifies, faith in that proposition among the President's most stalwart rural fans is being tested more than ever.
"How long is short-term?" Shane Goplin, a sixth-generation farmer growing soybeans and corn in west-central Wisconsin, wondered as he manoeuvred his 16-row John Deere planter.
China was the largest buyer of American soybeans until tit-for-tat tariffs all but halted the flow. And this month, souring prospects for a trade deal again sent prices tumbling. Trump responded last week by announcing a US$16 billion package to help those hurt by the dispute.
The strategy may help shore up farmers' support for Trump before the 2020 election, but it leaves them with a perplexing question: what does success ultimately look like?
Despite the strain on Goplin's family bank account and peace of mind, he backs the President's tactics. "I get why he's doing it," he said over the tractor's whir and beeps. "America has been bullied." And if the trade war persisted through the election next year, he added, "I would be OK with that."
Federal help is "very important", Goplin said. The Administration's previous US$12 billion package of emergency aid meant the difference between profit and loss on his soybeans.
Judging whether an agreement will prove worth the cost, though, is trickier to calculate. Several farmers said that if Trump declared he had struck a good deal with China, they would take his word for it.
"I don't think he'll flinch until he gets what he wants," said Lorenda Overman, a crop and pig farmer in eastern North Carolina. "He doesn't mind playing hardball."
Other growers suggested that a bump in soybean prices or a drop in the country's trade deficit with China would signal a victory.
Like other farmers throughout the Midwest and South, Goplin worries, as the standoff with China continues, that soybean producers like Brazil and Argentina could permanently displace American suppliers.
That is a risk, he said — like the extreme weather, tight credit and volatile prices that have whipsawed farmers' fortunes over the past decade. And with declining profits, heavier-than-normal debt loads and rising farm bankruptcies in the Midwest, Goplin, 45, understands that for some growers, it is already too late.
He had finished planting 200 hectares of soybeans this month, a few days after the President announced on Twitter that he was imposing additional tariffs on China. Now, under a postcard-perfect cerulean sky, Goplin was spending 16 to 18 hours a day getting corn into 810ha of soil. After he completed a patch, he folded the retractable 6m-long planting tubes as if they were butterfly wings and got ready to drive to the next field.
For him, one measure of success would be a sharp reduction in the nation's soybean surplus — known as the crop carry-over. In April, the Department of Agriculture forecast that the soybean carry-over would reach 895 million bushels in September, more than twice what it was in 2018.
In that sense, American farmers are victims of their own success, producing more grain and food than the world market can absorb. At the same time, farmers in other countries, sometimes aided by government subsidies or import quotas, are scrambling for a share of the market, further pushing down prices.
Goplin talked about the tangle of trade and oversupply with his friend Joe Bragger, a sixth-generation dairy farmer in nearby Buffalo County.
They sat at Bragger's kitchen table drinking bottles of Moon Man beer as Bragger's wife, Noel, prepared burgers and potato salad. A teacher, she also cares for the farm's 32,000 pullets.
Joe Bragger, 53, a large man with an infectious laugh, has a voice that squeaks like a backyard swing set when he gets excited. He had just returned from Altoona, Wisconsin, where he listened to Vice President Mike Pence speak at what Bragger called a "pep rally."
"We've been in it for — how long, Shane? — two years now, squabbling and tweeting," Bragger said of this Administration's brawling over trade. "I can tolerate a few more. "
Goplin laughed. "Last Sunday's tweet, it cost ..." He paused, recalling that the day after Trump warned on Twitter that he was putting additional tariffs on Chinese goods, the price of a bushel of soybeans dropped more than 10 cents.
"How much did it cost you?" Bragger asked.
Goplin replied: "$40,000. It was a $40,000 tweet."
Pence used his trip to Wisconsin to make a pitch for the Administration's trade deal with Mexico and Canada, a pact awaiting congressional approval that the Vice President said would help farmers.
To Bragger, who with his family owns 330 cows and 530ha where he plants corn, soybeans and hay crops for his livestock, this latest North America trade deal is a "distraction". For a dairy farmer, he said, the difference between the previous trade treaty with Canada and the Trump Administration's new one could be produced by a single large Wisconsin farm.
That doesn't mean he is against the new treaty. He just thinks it is insignificant compared with the real problem, oversupply.
Yet the comparison with the Canadian deal raises a question: Could the prolonged dispute with China produce a similar outcome, a relatively trivial gain — only in this case, one that carries devastating costs for some soybean farmers?
"At the end of the day, fixing some of these other trade deals for the rest of our country, I'm OK with it," Bragger said. "I'm not going to say don't finish it," he said of the China conflict. "The whole world is watching. I'll support the trade war to the end."
Bragger and Goplin acknowledged that other farmers were in worse shape. Goplin, for example, locked in higher prices on much of this year's corn and soy crops.
"If I didn't market anything right, and didn't have any protection on the majority of my farm, I'd be scared to death," Goplin said.
Many farmers are. In North Carolina, Overman, 57, said she could not handle another bad year. Last season, she lost US$450,000 when most of her wheat and soybeans were wiped out by a hurricane, the second in three years.
Her son and son-in-law have both come home to farm. "But neither of them wants to plant one grain because they see no future in it," she said. "They would be seventh generation, but they're tired of going to the bank and getting a loan and not being able to pay it back."
Each bushel of soybeans costs her about US$10.35 to grow, she said. The sale price last week, when her family finished planting 600ha of early beans, was US$8.03. This month, after exhausting their credit, Overman and her husband had to borrow on their life insurance to pay the bills.
"I'm feeling more like this short-term pain is already long-term pain," she said.
Overman thinks the President will get a good deal with China, but she worries that it will not be in time for her farm. "The way to make it worth it," she said, "is to sign a deal, and then backtrack to try to compensate for losses."
Goplin, too, said he believed that Trump would do all he could to help. "It makes me feel really good to hear Trump say farmers are important to this country," he said. "That's what makes me want to stick with the President."
For now, he is grateful that he has only to walk across the road to sell half of his corn crop to his neighbour, a dairy farmer who uses the chopped cobs to feed the cows. As for his soybeans, he will sell them to the local co-op and has no idea where they end up in the global supply chain.
"The happiest day of the year for me is when I get the crop loan paid off," Goplin said. "That means I can live to farm another day. If I can farm another year, I won."
Written by: Patricia Cohen
© 2019 THE NEW YORK TIMES
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