Trade agreements may offer some relief for local farmers

Published 6:32 pm Thursday, January 30, 2020

For farmers in eastern North Carolina, the farming business starts in local soil, but the end goal of selling commodity crops is largely subject to the whim of global market forces. In recent years, trade disputes and tariffs, coupled with hurricanes, drought and a series of bad harvests, have made life tough on the farm.

Two trade agreements brokered by the Trump administration, one between the U.S. and China, and another between the U.S., Canada and Mexico, may offer local farmers some relief in the long term. But Beaufort County Cooperative Extension Service Director Rod Gurganus predicts it may be a while yet before local farmers see positive gains from the deals.

“The hope is soy beans are going to be a bright spot here,” Gurganus said. “China was buying a ton of soybeans from the United States prior this trade war. Now those numbers have really dropped down and we had gotten used to them as a market for these soybeans. We’re hoping that comes back.”

In terms of trade with China, Gurganus says there are still some complicating factors. For one, the recent Coronavirus outbreak has impacted China’s commodity markets in addition to public health.

“A lot of people are waiting for these big purchases to start right now, and that’s nor likely to happen,” Gurganus said. “From everything I read and see, this is going to be a drawn out process. …The timing right now with the Coronavirus and the Chinese New Year probably hampered some of this from happening too quickly.”

Gurganus went on to say that a second disease, African Swine Fever, has killed 40% to 50% China’s hog population, which once offered a large market for American soybeans and corn to feed livestock. On the flip side, the disease may mean new market opportunities for American pork, beef and poultry producers.

“We operate in a world economy today,” Gurganus said. “Things that happen half a world away can impact us directly. If you’re growing that crop or commodity, it’s no longer just selling it up the road.”

Because food production goes hand in hand with national security, and being able to feed the country, Gurganus says both the federal and state governments have taken steps to help keep farmers to weather both storms and unstable economic times. In the long run, those dollars have helped keep the economy of Beaufort County moving.

“Farming is important for our local economy, because these local dollars from the sale of corn, soybeans, cotton, tobacco, wheat and all these other crops, those dollars roll over many times in the county before they leave,” Gurganus said. “That’s a $120 million injection into the local economy every year, just from the sale of those crops from Beaufort County.”

At the state level, North Carolina Commissioner of Agriculture Steve Troxler offered the following on the deals: “It has been an encouraging few weeks for North Carolina farmers with the signing of the first phase of a trade agreement with China and now the passage and signing of the U.S.-Mexico-Canada agreement. I believe these are good signs for the agricultural economy and our farmers welcomed this positive news on trade with our three largest trading partners. We are thankful to the administration for prioritizing these important agreements.”