The plight of American farmers is an ongoing concern they are shrinking in number. From bad weather to foreign competition, if it’s not one challenge it’s another. And in the end, their struggles affect the prices we pay for food. President Trump has promised long-term solutions for our farmers through tough trade negotiations with the main competition: China. Scott Thuman reports on the impact of it all-- from Temple, Texas-- at the start of spring planting season.
Just outside Temple, Texas, midway between Dallas and Austin, it's wet...a minor delay for planting season. But across the Midwest, it's disastrous. Torrential rains mean some farmers may not be able to plant at all - with flooding forecast over the next 2 months. It’ll be another difficult year for farmers who grow what the world needs. The latest in a string of challenges, and not just from the weather.
Scott: How would you say the state of farming is right now?
Richard Cortese: Well, I would say that agriculture right now is in the worst economic situation it's ever been in.
Scott: Richard Cortese and his family have worked this land for generations. He’s still waiting to sell the corn in his storage silo--hoping for a better price. He’s weathered bad years before, but the unusually low numbers over the last few years have hit hard.
Scott: you were selling at $3.50 a bushel.
Richard: It was half of what we were selling it for five years ago, six years.
Scott: Half price?
Richard: Half price. So going up to $4.20. We've got some we're selling this year for $4.25. I've been offered $4.40, $4.50 for some of this a bushel, which is in the right direction.
Scott: But not where you need it to be.
Richard: Not where we need it to be. While there are countless and complex reasons for that - a big one these days, is China. Specifically, the Trump Administration’s trade war, in which the US slapped higher taxes, known as tariffs on Chinese aluminum and steel last September. China, retaliated...Upping the taxes on US farm goods from pork to cotton. Soybean sales to China, dropped by roughly 80 percent. A separate but also damaging trade fight with Canada and Mexico, hitting some of the same products.
Trump: Then you wanna do something about it and you get attacked. Oh that’s not nice, that’s not free trade. The war was lost on trade many years ago. When they say not free trade, I say no...the war was lost. We’re gonna win it because we have all the cards.
To help American farmers endure the trade war, the US Government handed out eight billion tax dollars in aid last year, not enough to save everyone. Official projections say there will soon be fewer than 2 million farms, for the first time since the pioneers moved west.
Scott: We're seeing chapter 12 bankruptcies as high as we've seen in more than a decade in the circuit that oversees your state, Kansas. So 59% over the last 10 years. What's your message to the farmers who are feeling this crunch because of this fight between the administration and China?
Mike Pompeo: Yeah, that's not the reason. Remember, there's a long history of China not treating our farmers well. The State Department for frankly the first time in a long time has taken a serious effort at cracking these markets open. And sometimes it's tough. Sometimes you've got to go break a little glass to get to the right outcome.
Secretary of State Mike Pompeo grew up in a farming family. He recently returned to the heartland to assure them, their interests are at the heart of the trade war.
Mike Pompeo: We're going to reduce these barriers. We're gonna let our farmers compete all across the world. And when these competitions take place against the backdrop of free markets and technology and quality, the things that American farmers do really well, I'm very confident that the future for American farmers will be great. We have to get access to these markets for our, for our farmers.
It might be good news for consumers, but three years of low prices for their crops have been bad for American farmers, many of whom also face rising costs, especially for new equipment. That’s helped push total US farm debt to more than 400 billion dollars this year.
Farmer: Come on, girl!
Richard Cortese: When you're working six or seven days a week and you're struggling all the time, you stump your toe with a bad crop one year, it hurts for a long time. And I don't mean the toe. I mean it hurts financially.
It is hardly the first time US farmers have faced a crisis. Back in 1979, Richard’s father was one of the thousands who rode their tractors all the way to Capitol Hill, pleading for help from a government they felt didn’t understand the struggles they faced
Scott: Do you feel sometimes that Washington is listening to your worries, your concerns?
Richard Cortese: I think that it's frustrating dealing with Washington, as probably everybody in the United States would say the same thing.
Scott: Tense negotiations are currently underway with China. Their Deputy Premiere visited Washington just this week. And a new North American trade deal - rewriting what was known as NAFTA - is being debated too. Texas cotton farmer John Evans, says if one isn’t struck soon, his ranch could become a statistic.
Scott: Talk to me about the trade war.
John: The most drastic I think has been in cotton, though.
Scott: And you farm cotton.
John: I do. We had about 800 acres of cotton this year.
Scott: And how did it go? John: No very well. It was a rough year. Thank goodness for insurance.
John: If it hadn't been for that, we would've really been in trouble.
Scott: Will the president walk away from a China deal if it's not a perfect deal?
Pompeo: Yes. President is determined to make sure that he protects his first client. His first obligation to the American people. And in this case, the American farmer, this has to work for America. If it doesn't work, we'll keep banging away at it and we're going to get to the right outcome.
Scott: So are you glad that this fight is happening?
Richard Cortese: I think it needed to happen- we weren’t gonna fix it without doing something --and the deal with Canada Mexico NAFTA needed to be updated.
Scott: Richard and others out here admit that the trade war has hurt them but he says that this is a fight, a fight over the future of farming, that either way had to happen.
John Evan: Any time you're in a market, whether that's local or national or worldwide if there's somebody that's not playing by the rules you gotta straighten 'em up.
In the farm belt that helped deliver Trump the White House, the political winds have yet to turn against him. The farmers are supportive but their patience, just like a bad crop, could dry up.
Richard Cortese: From an agricultural standpoint most of us would say we needed to do something. I think that we knew that to get some of those tariffs we already had on, to give us a level playing field, we were going to have to get into a battle with them with tariffs. I think a lot of agriculture is saying, "Okay, we're with you but we got to get it done. We can't carry this on for five or six years."
A global agreement--a solution, he says is needed now, as both money and time are running out.
The forecast this year is for farm incomes - was good--about a 10 percent, increase...but that was before this flooding. As for the trade negotiations, the Trump administration says they’re very close to a deal with China, and the one between Mexico and Canada has been done...it’s just stuck in Congress.