TEXAS — Since the beginning of President Donald Trump’s second term, the United States has been in a trade war with several countries, most notably Mexico, Canada and China. The administration says foreign trade practices under former President Joe Biden's administration created a national emergency. Trump is using tariffs in an effort to strengthen American-made production.
As of late October, a trade deal between the U.S. and China was reached, putting a pause on the escalating tensions between both nations. Despite the tariff back and forth with other countries, economists say the president’s tariffs have impacted several industries including automobiles, retail and agriculture.
Jeremy Reed’s family arrived to Kress about 130 years ago, farming the land for generations.
Jeremy Reed grows a few different types of crops, with cotton being the primary one. His wife is also involved in the farming business and their two children help out.
“We have seen lots of changes and lots of things going on, but farming is like any business,” Reed said. “It's very cyclical, but we have definitely been in some very suppressed economic times.”
He says many factors impact the agriculture industry, ranging from the weather to politics. With Trump leveraging tariffs as a tool, Reed says that can impact production costs.
“Every time you have tariffs, it runs up the cost of our equipment or it is affecting the price of our equipment and our other inputs as far as fertilizer and chemical,” Reed said.
According to a Texas A&M extension economist, John Robinson, about 85% of America’s cotton is exported all over the world. Trump’s trade war with China back during his first term impacted the amount of cotton China imported from America.
“They had tariffs on importing our cotton,” Robinson said. “We had tariffs on importing their textile products, and while that was happening, Brazil stepped in and took a lot of our market share just from China.”
Even though China imposed retaliatory tariffs on U.S. cotton in March, Robinson explains the industry is seeing more indirect effects as a result of Trump’s most recent trade war.
“To the extent that these tariffs worldwide slow economic growth, that in itself is, indirectly, is a bad thing for cotton consumption or it won't help, certainly,” Robinson said.
Tariffs are one piece of a large economic puzzle. Farmers all the way from the Panhandle to South Texas have been struggling to get by for years.
“With average yields in South Texas and the prices we have right now, you're looking at a $300 an acre loss on cotton, and if you're an average-sized cotton farmer in South Texas, that means before you put a seed in the ground, you're going to lose $1 million,” said Jeff Nunley, the executive director of the South Texas Cotton & Grain Association.
He says the trade war with China can be traced back to 2001 when the country joined the World Trade Organization.
“I think my producers support the efforts to gain a better trade deal,” Nunley said. “At the end of this, farmers are going to be better off than when we started.”
A trade deal between the U.S. and China was reached on Oct. 30. Nunley is hopeful that it will make the market more stable.
Even in the face of uncertainty, farmers like Reed continue to persevere.
“Agriculture is a way of life,” Reed said. “It is a great place to live, to raise a family, lots of values, lots of great things are instilled.”
Πηγή: spectrumlocalnews.com