Here & Now

Trade Talks Lead to Farmer Uncertainty

Frederica Freyberg:
A first look tonight at how the U.S. trade war with China is heating up and has Wisconsin farmers in the cross hairs. President Donald Trump just raised tariff rates on $200 billion of Chinese imports to 25% and threatens to impose way more. China has retaliated in kind, targeting $60 billion worth of U.S. goods including commodity crops like corn and soybeans for its own import tariffs. Tonight, we check in with president of the Wisconsin Farmers Union, Darin von Ruden, he’s in La Crosse. Thank you for being here.

Darin von Ruden:
Thank you, Frederica.

Frederica Freyberg:
Now I understand these new Chinese tariffs would go into effect in June. Which farmers in Wisconsin would be most affected?

Darin von Ruden:
Certainly, as you mentioned, the corn and soybean producers are going to be most affected directly, but in the whole scheme of things, pretty much all of agriculture’s going to be affected because when you look at what the drop in prices that farmers are going to receive here for those commodities that also affects everything else around them, dairy, beef, pork, chickens. They are all going to see something eventually from this action.

Frederica Freyberg:
How big a crop are soybeans and corn in Wisconsin?

Darin von Ruden:
So Wisconsin corn is, you know, it’s nothing compared to what Iowa or Nebraska has, and here in state, too, a lot of our corn actually gets fed back into the dairy herds or the beef herds, but there’s been an increasing pressure on the — especially on the corn side, the ethanol industry has seen — and will probably be seeing what this newest round of tariffs that are going into effect, based on a lot of by-products from the ethanol industry to China for animal feed consumption over there. And that’s going to be one of those targeted markets. That’s not going to be able to do that anymore. So that’s going to put downward pressure on prices to farmers that are producing the corn here in the state.

Frederica Freyberg:
Now, these latest tariffs are on top of U.S. tariffs imposed in 2018 that set off retaliatory tariffs from Mexico, Canada, Europe and China on American dairy products. What did those do to Wisconsin exports and farm income?

Darin von Ruden:
So farm income did drop, you know, in that 5% to 10% range initially. It has come up a little bit more recently, but a lot of that is due to less production here in the United States. So, you know, that will have an effect. You know, it’s probably, as farmers are seeing and saying too, is that the short term effect really actually could be long term when you look at having satisfied customers and all the sudden that customer doesn’t like what you’re doing because of the tariffs or the market that’s going on. How long is it going to take for you to get back to that market?

Frederica Freyberg:
The Trump Administration did give some $12 billion in government aide to farmers to offset tariffs with more now promised. How much did that assistance help here in Wisconsin?

Darin von Ruden:
So, on the corn side, it was really peanuts, probably the best explanation. You know, a penny a bushel. You know, most corn growers are spending 5 cents a bushel on advertising. So it didn’t even cover a quarter of their advertising bill. Dairy, we received 6 cents a hundred weight. And our advertising bill is 15 cents per hundred weight. So, you know, in the grand scheme of schemes, yes, it was dollars that were needed, but it was not nowhere near what the drop in the price that farmers received was. You know, dairy, we dropped 85 cents in that first month and got 6 cents back. So, you know, is that really there, you know, the frustration that I’m hearing and feeling across the state of Wisconsin now with the new proposed $15 billion is that they’re going to use the same formula that they did back in 2018. And that was heavily weighted towards soybeans because soybeans was the initial big loser in that process, but now we’ve all lost in this process. And for them to use that same formula, it’s really not going to be good for all commodities. You know, soybeans will do all right, but the rest of us are going to be struggling.

Frederica Freyberg:
Meanwhile, this trade war comes on top of deflated milk prices that are driving record numbers of dairy farmers to go out of business or declare bankruptcy in Wisconsin. How on edge are farmers across the state in the midst of all of this?

Darin von Ruden:
Very on edge. You know, it’s a daily struggle just to get the work done that needs to be done on the dairy farm, but then when you go in and look at your books and after the first day of the month, you have no money left and you’ve got 29 days left, what do you do? It’s a struggle. There’s divorces that are happening. Suicide rate is way up. You know and it’s about economics, and how do we get those dollars to come back into the farmers’ pockets that the consumers are paying?

Frederica Freyberg:
Very briefly, but with a big question, you’re a dairy farmer and represent many more. From your perspective, what is the fix here?

Darin von Ruden:
Well, we certainly need to have a better distribution network. You know, there’s parts of the United States that don’t have good dairy products in them. And that’s a big thing, but we also need to look at how do we control supply. You know, is probably the best thing to do. You know, we’re using our own natural resources, water and other things in this country, that we’re either throwing away or not being able to use, and so why don’t we take a good look at how we can control our supply and use less of our natural resources, number one, to feed our own people, and then if there is excess and it’s needed around the world, then we have that ready for that market.

Frederica Freyberg:
All right. We need to leave it there, Darin von Ruden, thanks very much for joining us on this.

Darin von Ruden:
Thank you Frederica.