‘Nobody wins in a trade war when food and agriculture are involved’
He received Chinese leader Xi Jinping six years ago on his family farm in Iowa. Half a world away, he is helping to run a China-US agricultural demonstration farm in Hebei province, and serving as honorary dean of an agricultural college that bears his name.
How is Rick Kimberley faring in Maxwell, Iowa, now that the two countries are on the verge of a trade war where tit-for-tat tariffs are putting agriculture in the crosshairs?
I spoke with him at the weekend via WeChat, the most popular messaging app in China. Kimberley appeared in the video as suntanned and sanguine as he was when I met him a few weeks ago. But talking about his rolling corn and soybean fields, he had mixed feelings.
Rick and Martha Kimberley’s farm has grown 1,100 hectares of corn and 607 hectares of soybeans this year, a rotation “agronomically and economically most suitable” to the farm in central Iowa, he said.
But prices for the crops have been falling so consistently that Kimberley said he planned to store them. Soybean futures plunged to their lowest level in more than nine years on June 19 after renewed concerns of a US-China trade war.
Kimberley said he expected to harvest about 650,000 bushels of corn and 90,000 bushels of soybeans. According to a report published by the Chinese Academy of Agrirows cultural Sciences on Thursday, US soybean, cotton, beef and cereal shipments to China may each drop by 50 percent in value. If so, Kimberley’s losses could be overwhelming.
“We have the capability of storing our grain to wait until the dispute is solved and prices improve, or other countries come to the US to purchase agricultural commodities,” the 67-year-old farmer told China Daily, adding that he had no idea how long the trade dispute would last.
Nearly one in every three of harvested soybeans in the US goes to China, and Iowa is the top exporter.
John Heisdorffer, another Iowa soybean farmer and president of the American Soybean Association, said soybean prices are declining as a direct result of the trade spat following the Trump administration’s plan to impose hefty tariffs on imports of Chinese goods.
Tariffs on $34 billion of Chinese products are scheduled to take effect on Friday, with additional trade barriers threatened in subsequent weeks. China has pledged to retaliate with equivalent measures, including substantial duties on imports of US agricultural products such as soybeans and corn.
“Prices are down almost a dollar and a half per bushel since the end of May and continue to plummet,” Heisdorffer said. “That represents a loss of more than $6 billion on the 2018 soybean crop in less than a month.”
Chad Hart, an Iowa State University economist, told the Des Moines Register that farmers in Iowa could lose up to $624 million, depending on how long the tariffs are in place and how quickly they can find new markets for their soybeans.
Kimberley said, “It is difficult to know how long this will last, but it is my hope that both sides will continue to negotiate in good faith to resolve their trade differences to find a mutually beneficial resolution.”
He said the China-US Friendship Demonstration Farm, launched in September in North China’s Hebei — Iowa’s sister province — is going well. Later this summer he will again visit the site, where nearly 101 hectares of corn and a few other crops are planned for this year.
“Despite recent trade differences, US and Iowa farmers consider China a valued trade partner,” Kimberley said. “The friendship demo farm can help enhance the relationship for the future.”
Asked what he would tell his Chinese students as honorary head of the Kimberley Agricultural Business School at Weinan Normal University, in Shaanxi province, Northwest China, Kimberley said, “No one wins in a trade war, especially when food and agriculture are involved.
“We have faith that the trade dispute will eventually be resolved as it is too important for the world’s two largest economies not to find common ground.”