Ag Secretary Sonny Perdue used a football analogy to describe the process of passing the U.S.-Mexico-Canada Agreement. He calls passage more of a “field goal” than a touchdown. Perdue says the reason for the difficulty is the administration hasn’t yet removed the Section 232 tariffs on steel and aluminum imports from two key North American trading partners.
Perdue told reporters this week that he’ll consider it a “touchdown, a more certain success when we get those tariffs removed.” When the trade pact negotiations were moving along smoothly, Canada and Mexico were exempt from the tariffs. However, when things stalled, that exemption came to an end. As was expected, Mexico and Canada both hit back with retaliatory tariffs. Mexican tariffs have hit American agriculture hard on cheese, pork, apples, and potatoes.
Perdue also says the tariffs need to go as they accomplished the goal of getting Mexico and Canada to the negotiating table. “Once you’ve achieved your goals with the tariffs, then it’s probably time to look at other ways,” Perdue says. He realizes that the tariffs remain a thorn in the process of getting the deal ratified in all three countries.
A group of industry and agriculture companies and associations have launched the USMCA Coalition, an effort to see the U.S.-Mexico-Canada trade agreement through ratification. The USMCA Coalition is a collection of more than 200 organizations, including the U.S. Chamber of Commerce, the American Farm Bureau Federation, and the Association of Equipment Manufacturers, with an objective “to secure congressional approval” of the trade agreement.
A coalition of more than 50 farm groups is asking lawmakers to safeguard crop insurance. The organizations, including the American Farm Bureau Federation, warned in a letter to top-ranking House and Senate budget leaders this week that “An overreliance on budget savings from the agriculture community and from crop insurance will unquestionably undermine rural economies.”
The Trump 2020 budget proposal will include “big cuts” to the Department of Agriculture, according to Agriculture Secretary Sonny Perdue. The budget request will propose cutting non-defense programs by five percent. However, Politico reports USDA is likely to face steeper budget cuts.
The Environmental Protection Agency will conduct a long-delayed study to assess the impact ethanol-blended fuels have on air quality. Reuters reports the EPA agreed to conduct the study late last week, as the Sierra Club had filed a lawsuit against the EPA last year in an effort to compel the agency to conduct the study. The organization states the study was supposed to be done roughly eight years ago.
The recent announcement by China to purchase more U.S. soybeans fails to make up for trade war losses. The American Soybean Association welcomed the announcement made last week, but says the industry needs “structural reform that leads to China rescinding its tariff on U.S. soybeans and fully reopening the market,” according to ASA President Davie Stephens of Kentucky.
President Trump has delayed additional tariffs on China with more talks expected. Trump extended the March 1 deadline to allow for talks to continue as China also announced an additional 10 million metric ton purchase intention of U.S. soybeans. China proposed last week in talks to increase purchases of U.S. commodities by $30 billion a year more than pre-trade war levels.