Sonny’s Big Adventure
Posted on May 17, 2017
Those Wisconsin dairy cows at the center of another trade kettle now boiling between the United States and Canada, a friend suggests, aren’t really black-and-white Holsteins.
They’re tiny, yellow canaries, he opines, and their tweets—not President Donald J. Trump’s—are a warning that America’s reign as the world’s ag export superpower is fading and U.S. farmers and ranchers are ill-prepared for what comes next.
“This (was) the first time milk was left and not picked up at any price,” explains the friend, after more than 60 Wisconsin dairy farms were notified by their Canada-based milk buyer that they would be dropped.
That shocking news meant “We better make some decisions on the future of dairying real quick (because) every farm is expanding …to leverage survival.” Grain farmers, too, plow “every acre to plant more corn and beans to be sold below the cost of production.”
And, he adds, “This is insane.”
He’s right. More importantly, he isn’t the only one to hear canaries when he looks at the longer-term American ag picture. On April 21, a front-page story in the Wall Street Journal gave facts, figures, and dates on how and why America’s dominance in global ag export markets is not just slipping but flagging.
“With 43% of the [soy] export market,” explained the Journal, “up from just 12% 30 years ago, Brazil can sway global prices…” Additionally, “It’s projected to be the second-largest corn exporter, on the heels of the U.S. this season.”
But it’s just not big, growing Brazil, continued the Journal. “As of the last crop year, Russia now beats America in shipments of wheat.”
That trend likely will continue. On April 13, the U.S. Department of Agriculture reported that 2016/17 total U.S. wheat acres would fall to 46.1 million, the lowest since 1919, only because that’s “when U.S. wheat production records began.”
Into this ongoing global ag realignment comes the almost perfectly paradoxical farm team of President Donald J. Trump and Sonny Perdue, his long-in-waiting secretary of agriculture. A more polar opposite pair would be hard to find.
Like a rooster, Trump sends Twitter threats to America’s biggest trading partners—Canada is our largest ag customer—with each sunrise.
Worse, he’s not kidding. In stone-faced silence American farmers watched as Trump withdrew the U.S. from the nearly completed Trans-Pacific Partnership (TPP), a multinational trade deal, shortly after taking office. He now plans to redo—or withdraw: who knows?—the long-standing, “very unfair” North American Free Trade Agreement, or NAFTA.
The other half of the team, Secretary Perdue, is a full-throated ag trade evangelist who, after his first White House meeting April 25, happily announced that American ag trade is “going to be my task, to go around the world with Commerce Secretary Wilbur Ross, with our U.S. trade representative and our undersecretary for trade to make sure American products are on tables all over this world.”
The secretary should pack a very big suitcase because he will be on the road a long time given America’s slipping hold on the global farm trade and his boss’s very clear, very tough anti-trade stances on Canadian lumber, imported steel, exported milk, the TPP, NAFTA, the European Union, China, and Mexico.
Of course, there is one sure way to better compete in the race-to-the-bottom global commodity biz—cheaper prices—and Perdue appeared to commit to that path in a press release USDA sent right after his first White House meeting.
“It used to be that people in agriculture feared disease and drought as the greatest threat to their livelihoods…” said the new secretary. “While those hazards remain, too often now it is the government—through interference and regulation—that poses the most existential threat to American farming. We aim to put a stop to that.”
Which is exactly what canaries did when the hazard they were guarding against became existential; they stopped.
Breathing, that is.
© 2017 ag comm