Sort & Cull

If It Quacks Like a Trade War

John Harrington
By  John Harrington , DTN Livestock Analyst

Have you noticed over the last several months how certain politicians and members of the Trump administration have strained to avoid the label "trade war," almost as if their stern mothers were close at hand, waving big bars of soap.

All this tariff talk was nothing more than "a family quarrel," sugarcoated one White House adviser, shrugging off the name-calling and nasty threats as nothing more than teenagers roughhousing in the basement with laser swords and super-soakers.

But I'm pretty sure all such pretending was abandoned this morning when President Donald Trump announced the placement of an additional $50 billion in tariffs on a long list of Chinese imports. In the same breath, the president hastened to add there were plenty more tariffs waiting in the wings if China chose to remain a bad player in the international market.

Not surprisingly, China aggressively responded faster than Sarah Huckabee Sanders could roll "fake news," "witch hunt" and "pardon" into a single sentence. China's State Council has already announced that it would levy penalties of the same rate on U.S. goods of the same value.

Although China's list of U.S. products to be taxed includes as many as 659 items, it is strategically skewed to especially punish the red-state exporters from Trump's political base (e.g., beans, chicken, pork). If the tit-for-tat continues to accelerate (and that's what the momentum feels like), higher tariffs on U.S. beef may not be far away.

Flanking the front line of this increasingly expensive "family quarrel" are serious "petition drives" of retaliation planned by erstwhile friendly neighbors (i.e., Mexico, Canada and the EU). In all honesty, if this messy trading mess doesn't yet qualify as a war, Gettysburg was nothing but an amusement park.

Speaking of beef exports, USDA Undersecretary Ted McKinney has been in Japan this week, reported to be leading one of the largest trade groups ever. McKinney is expected to talk to the Japanese about a possible bilateral deal with the U.S. It's about time.

Ever since President Trump ran the TPP agreement through the shredder in January 2017, he's been praising the virtue of bilateral trade agreements. Indeed, he's recently suggested that NAFTA should be replaced by two separate bilateral agreements, one with Mexico and one with Canada.

Fine. If "bilateral" is the game plan, let's get with it. We're behind many of our top competitors in this regard, so there's no more time to lose. And I think most know that the unfolding trade war (whether declared or undeclared) only makes the challenge of catching up more difficult.

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