Trump pledges to make it up to levy-hit farmers

They will come out of fight over trade better off, he says

President Donald Trump promised U.S. farmers that they will emerge from a trade dispute with China better off despite threats from Beijing to impose tariffs targeting American agricultural products.

“There’ll be a little work to be done, but the farmers will be better off than they ever were,” Trump told reporters Monday during a Cabinet meeting at the White House.

China last week announced $50 billion worth of tariffs on American products, including soybeans and pork, in retaliation for Trump’s plan to impose duties on 1,333 Chinese products. The biggest potential impact will be in rural areas that long have been part of the Republican base. Eight of the 10 biggest soybean-producing states went for Trump in the 2016 election, and three of those will feature close Senate races in November.

The Chinese “hit the farmers specifically because they think that hits me,” Trump said Monday.

“I wouldn’t say that’s nice, but I tell you our farmers are great patriots,” Trump added. “They understand that they’re doing this for the country. We’ll make it up to them.”

Agriculture has formed part of the bedrock of the president’s support, but economic pressures are growing. Farm profits may reach a 12-year low in 2018, according to a forecast the U.S. Department of Agriculture released before the Chinese tariff threat.

Soybeans, the second most valuable U.S. crop after corn, would be especially hard-hit — exports to China accounted for more than one-third of the oilseed’s revenue last year. Farmer organizations including the American Soybean Association have called the impacts

of tariffs on agriculture “devastating,” even as farmers who are supporters of the president have taken a more waitand-see approach.

When he announced additional possible tariffs last week, Trump directed the Agriculture Department to come up with specific actions to help farmers. Agriculture Secretary Sonny Perdue on Monday declined to give details in a speech to a rural lobbying group in Washington.

“The president isn’t going to lay all his cards on the table, and neither am I,” Perdue said.

One possible option, according to Steve Censky, deputy secretary of the USDA, could be using the department’s authority under the Commodity Credit Corp., a federal entity that funds farm subsidies, to buy surplus U.S. crops.

Using such authority to intervene in markets is rare but not unprecedented. Under President Barack Obama, the USDA bought surplus pork to keep up prices during a drought that caused producers to send animals to slaughter early, which increased supply.

“We have a pretty broad authority” to purchase surplus crops, Censky said at a conference of agricultural journalists in Washington. He previously was the head of the soybean association that is now protesting the administration’s stance toward China.

Sen. Pat Roberts, R-Kan, the chairman of the Senate Agriculture Committee, told reporters that the need for aid to protect farmers in a trade war with China may be beyond the scope of the USDA’s ability to administer assistance.

“I don’t know how you would work that,” Roberts, a critic of Trump’s trade approach, said. He added that he’s been invited to meet with the president Thursday, an indication that Trump knows the stakes of a trade war for some of his most loyal voters.

“The White House understands what’s going down in small towns and rural America on trade,” Roberts said.

Trump also said the U.S. is close to negotiating an update to the North American Free Trade Agreement. “We are fairly close on NAFTA and if we don’t make the right deal we’ll terminate NAFTA and we’ll make the right deal after that,” the president said.

The White House has pushed to announce a renegotiated NAFTA at the Summit of the Americas on Friday and Saturday in Peru, which Trump will attend. But Trump said last week that he had told his trade negotiators not to rush talks.

Mexican Economy Minister Ildefonso Guajardo said in an interview with Televisa, the country’s largest broadcaster, that he sees an 80 percent chance of an agreement by the first week of May.

Commerce Secretary Wilbur Ross on Monday said the U.S. will no longer tolerate trade practices that it

considers unfair. “Free trade is almost like the unicorn in the garden. People talk about it, but it’s very hard to find it nowadays,” Ross said during a speech in Washington. “We believe trade should be fair, free and reciprocal.”

Chinese President Xi Jinping gave a speech at the Boao Forum for Asia today , where he laid out China’s approach to trade.

Xi vowed to open sectors from banking to auto manufacturing, in a speech that also warned against returning to a “Cold War mentality” amid his trade disputes with Trump.

Xi said China would increase imports, lower foreign-ownership limits on manufacturing and expand protection to intellectual property. Xi cited the measures while saying China was entering a “new phase of opening up” in his keynote address today to his country’s answer to Davos.

The long-planned speech — marking 40 years after the first economic changes transformed China — was being closely watched after Trump’s plan to hit hundreds of Chinese products with duties. The country faces a credibility gap after years of promises to free up the economy were followed by more centralized control, market-access barriers and state support for Chinese companies.

Those practices are at the center of Trump’s threats to levy some $150 billion of tariffs against China. The U.S. has asked the the country to reduce its trade surplus by $100 billion, cut tariffs on cars and stop forced technology transfers by foreign corporations, among other things.