Farmers Hope For China Trade Deal, But For Now They Worry About Tariffs' Impact At the Big Iron Farm Show in North Dakota, the usual concerns about crops have been heightened by another big worry: a trade war with China that's already driven soybean prices down sharply.
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Farmers Hope For China Trade Deal, But For Now They Worry About Tariffs' Impact

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Farmers Hope For China Trade Deal, But For Now They Worry About Tariffs' Impact

Farmers Hope For China Trade Deal, But For Now They Worry About Tariffs' Impact

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DAVID GREENE, HOST:

All right. The start of the harvest season has brought a new concern this year for a lot of farmers in the Midwest. The Trump administration's trade policies have helped drive down the prices for all crops, as foreign markets such as China pull back on their purchases. NPR's Jim Zarroli is attending one of the biggest agricultural shows in the Midwest this week, and many farmers there are worried about whether these markets are going to come back.

JIM ZARROLI, BYLINE: Each year, the Big Iron Farm Show attracts thousands of visitors to a dusty fairground in West Fargo, N.D. Dozens of farm equipment makers come to show off their latest products. Acres of threshers, combines and tractors gleam in the hot September sun. Among the farmers who turned out this year, the No. 1 topic of conversation has been the big drop in farm prices, especially for corn, wheat and soybeans - America's largest crops.

CHRIS JOHNSON: Oh, it's a devastating loss. Soybeans are my largest acreage crop.

ZARROLI: Chris Johnson farms 3,300 acres in the southern part of the state. Much of what he grows gets exported to Asia. This spring, the Trump administration imposed tariffs on Chinese imports. China retaliated, and soybeans were among the first crops targeted. Almost right away, prices fell by a fifth. It's a huge loss for Johnson.

JOHNSON: On my farm, that's close to $150,000 that, you know, we have to make up.

ZARROLI: And farmers here can't easily find other markets to sell to. The rail lines that transport crops head to the Pacific Northwest to serve the vast Asian market. With prices falling, farmers face a dilemma - do they sell off their crops now and take a big loss, or do they try to store them and hope to sell them later at a higher price? Dan Younggren (ph) farms 6,500 acres in far northern Minnesota.

DAN YOUNGGREN: I can't afford to sell my soybeans at what would be $6.50. So I've got to put them in the bin. How long do I have to leave them in the bin? I don't know.

ZARROLI: Like a lot of farmers here, Younggren is hoping that the current crisis is part of some negotiating strategy, and Trump is getting ready to announce some kind of new trade deal with China that will bring prices back up. But he worries that a trade relationship that was carefully cultivated over the years has already been damaged beyond repair.

YOUNGGREN: It took decades to get these markets in place with these - with China and whatnot. And the marketplace is not going to come back overnight. It's just not.

ZARROLI: John Snyder is with Hurricane Ditchers (ph), a small Indiana company that makes machines that smooth out drainage ditches on farms. The machines use a lot of steel, and the company already faces higher costs because of the steel tariffs. So far, it's managed to keep prices from rising.

JOHN SNYDER: We're a luxury item. We're not a tractor or combine plant, or we're not a necessity.

ZARROLI: But this is Trump country, and although people here are on the frontlines of the trade war, many people, like Snyder, believe the president is doing the right thing by taking on China.

SNYDER: I believe in the administration and what they're trying to do. I just wish it would have started 40 years ago so we could have gradually gotten here. There's going to be a lot of suffering to get to where we need to be.

ZARROLI: Ironically, this has been a pretty good year for farmers here. Crop yields have been better than average, but with their largest markets suddenly closed off, farmers are having trouble selling their bounty. And no one knows when that will change. Jim Zarroli, NPR News, Fargo, N.D.

(SOUNDBITE OF WHISKEY COUNTY BAND'S "SUMMER COUNTRY HITS")

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