Amidst Trade War, Proposed 25% Tariff on Soybeans Puts Pressure on Market
In the shadow of a proposed 25% tariff on U.S soybeans by the People’s Republic of China, it appears citizens on both sides of the world are concerned about the impact it will have on farmers and the soybean market.
These concerns were the focus of a discussion that Brad Kremer, owner of Hillcrest Farms in Pittsville, had April 14 with a news crew from XINHAU news agency, the largest media organization in China, during their Wisconsin stay.
“They were really concerned about what we were thinking here as farmers about the proposed tariffs,” said Kremer, Wisconsin’s National Director on the American Soybean Association board of directors.
The news crew braved the weekend snowstorm, and despite getting stuck multiple times, made it out to Hillcrest Farms to see Kremer’s operation. With his wife, he farms 2,000 acres of soybeans, corn and wheat, and owns a 200 cow dairy.
What struck Kremer the most was the heavy concern the Chinese crew showed about the impact of the tariffs. “Not only are us farmers concerned, but Chinese citizens are extremely concerned,” he said.
According to Kremer, China accounts for 60% of American soybean exports, and one in every three rows of beans goes to China. Losing 25% of that revenue would be “catastrophic.”
The American Soybean Association had a large part in developing that market by spending millions of farmer-donated dollars, something Kremer hopes lawmakers remember as the issue develops.
“Farmers developed the market with their own money and own time. Lawmakers need to realize that,” he said. “We don’t want to lose all the association has put in for me. It’s really important for us to keep the talks open. We have to make sure that we ensure all the work we’ve done isn’t put to the wayside.”
The news crew was amazed at the size of the farm and the major investment it takes. “They were surprised how much effort it is to run a farm and how much capital it takes, how much risk it is,” said Kremer. “They realized that American citizens are much like their citizens, and people in both countries just want to raise their families.”
Kremer can trace his farming roots back to both great-grandparents and grandparents, and saved the money to buy his uncle’s farm by building houses. Over time, he built up the farm to its present size, which he’s content to stay at despite the difficulties facing family farms. “Farmers can’t take much more stress. We’re at the breaking point right now,” Kremer said.
While always concerned about the effects of the proposed tariff, there’s still optimism. “At the end of the day they have a desire for our product, and we want to fill it,” he said.
Whether or not the tariff talks are just posturing, he cites the Chinese news crew visit as an example that the issue is important on both sides. “Certainly the talks have parked conversation, and that speaks volumes to me.”