Commerce secretary urges North Dakota ag producers to hang tough in trade war
FARGO — Top Trump administration officials urged representatives of North Dakota's farmers and ranchers to hang tough in coming months, saying battles over trade with the European Union, China, Canada, Mexico and other countries can be won with patience and resolve.
Commerce Secretary Wilbur Ross said America's trade partners are targeting agriculture when they retaliate on tariffs placed by the administration, because that's where they feel America is weakest.
"They're hoping to put enough political pressure on the president that he'll back off and they'll never again have to deal with America trying to get free, fair and reciprocal trade," Ross said during a news conference Thursday, Aug. 23, at the Fargo campus of the North Dakota State College of Science. "That's the only Achilles heel that we have, is any sign of weakness to these other countries."
Ross later told The Forum's Editorial Board that he understood the worries of ag producers.
"Fear of the unknown is the worst fear," he said. "I can very well understand their concerns."
At the press conference, Ross said the nation's overall economy doesn't appear to have suffered, despite the tariffs being levied on products such as steel, aluminum, washing machines and solar panels.
"We just had 4.1 percent growth in the June quarter. We're going to have another very good quarter in September. There's no sign that the world is coming to an end because of the tariffs," Ross said.
Rep. Kevin Cramer, R-N.D., who hosted Ross' visit, said that since the tariffs have been put into place, formerly shuttered steel and aluminum plants are reopening. We can't return to 50 percent of the market share, "but certainly we can get up from 5" percent, Cramer said.
Cramer said President Trump won't ease up on tariffs until he is satisfied that the U.S. is getting a fair shake on trade.
"This president will be done with tariffs when the people he's negotiating with get serious," Cramer said. "This president does not make idle threats. He uses leverage. For us to be done with tariffs, the countries we're dealing with will have to get a lot more serious - especially China."
Ross, who was joined by U.S. Department of Agriculture Deputy Secretary Stephen Censky, took part in several events in Fargo, including an open town hall at the NDSCS building.
Ross said that over the years, the United States' trade partners have swelled their trade surpluses. He said the trade deficit with China grows by $1 trillion every three years, with some of that money being plowed into creating a stronger, more aggressive military.
"These trade actions have been a long time coming," Ross said, and they have gotten the European Union, Japan and China to discuss trade.
"This is a one-time fight that we have to win," Ross said.
Censky said the U.S. wants a modernized NAFTA, and is hoping that once a new deal is struck with Mexico, that Canada will return to the bargaining table. But he also recognized that farmers are the "tip of the spear" in this trade war.
"Patriotism doesn't pay bank notes. It doesn't pay operating loans," Censky said. That's why, in addition to the more than $12 billion in aid planned for farmers, the USDA will be putting other programs into place, such as buying commodities to redistribute to food banks, schools and other organizations.
There is plenty of nervousness over how the trade war is affecting North Dakota's farmers as the harvest gets into full swing.
The North Dakota Trade Office says two foreign trade missions to the state have been canceled and a higher-than-normal number of visas sought by international buyers hoping to attend this year's Big Iron Farm Show have been denied by immigration officials.
Both are examples of trade "opportunities lost" for North Dakota companies and farmers, said Simon Wilson, executive director of the trade office.
In advance of Ross's visit, a group called Farmers for Free Trade purchased billboard and radio ads during the week of Aug. 20, with eight billboards in Fargo featuring the message, "Secretary Ross, Tariffs Hurt ND Farmers."
Radio ads that highlight the impact of tariffs on North Dakota farmers were also to run Thursday in the Fargo market.
"Farmers and manufacturers have been patient, giving time to the president to see if these will work. But prices are plummeting and export markets have been taken over by foreign competitors. We hope that Secretary Ross hears from North Dakota farmers, manufacturers and workers that it's time to end the trade war, so America's heartland can start thriving once again," said Brian Kuehl, executive director of Farmers for Free Trade.
North Dakota exports roughly two-thirds of its annual $2 billion soybean crop to China.
Also, the North Dakota Democratic-NPL party held a news conference at a farm in rural Horace.
The four farmers who spoke said the trade war with China has depressed the prices of soybeans and other crops, and halted orders for soybeans that normally ship through the Pacific Northwest.
Jim Dotzenrod, a Wyndmere farmer running for North Dakota Agriculture Commissioner, said soybean prices dropped to $7.33 a bushel, so far, with $9 a bushel being a break-even point for many farmers.
"There's no Pacific Northwest bid" for soybeans, Dotzenrod said. "Those markets have dried up."
Dotzenrod praised Sen. Heidi Heitkamp, D-N.D., while calling on Cramer, who's trying to unseat Heitkamp, to back away from support for President Trump's trade strategy.
Dotzenrod also pointed to the latest round of $16 billion in tariffs on Chinese goods that kicked in just after midnight Thursday. Those tariffs were immediately met by China with retaliatory tariffs on $16 billion in American goods.
The American Soybean Association later issued a statement urging the administration to rescind the tariffs, saying they could have a long-lasting impact on the Chinese market share for U.S. farmers.
Mike Clemens, who grows corn, soybeans and wheat near Wimbledon, N.D., said people forget about the effects of the grain embargo President Jimmy Carter put into place against Russia in 1980, after the Russians invaded Afghanistan.
The embargo was lifted in 1981 by President Ronald Reagan, but the economic losses set off the farm crisis of the early 1980s, Clemens said.
"Our reputation (as a trade partner) has been damaged," Clemens said. "I feel like I am a soldier in the field. I got drafted, and didn't want to be there."