Ag Policy Blog

White House Slow Walking Second Round of Farmer Trade Aid

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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Complications have arisen over the second tranche of trade-aid payments to farmers that was initially expected to be announced last week, but delays continue.

Reuters initially reported that White House officials are holding off approving the second round of Market Facilitation Payments "amid optimism China will soon resume buying U.S. soybeans" Reuters reported, citing three unnamed sources. So far this year, soybean sales to China equal about 2% of last year's volume. Total U.S. soybean exports are just 42% of last year's volume as well.

Markets have bounced with expectations for nearly two weeks since the G20 summit in Argentina and expectations that China would return to the U.S. to buy soybeans. So far, there have been great expectations, but no actual sale announcements.

USDA first announced the $12 billion aid package last summer and began providing payments this fall to producers of several crops as well as pork and dairy farmers. On Dec. 3, following a speech on trade at the DTN Ag Summit, Agriculture Secretary Sonny Perdue said USDA was still analyzing the impact of trade retaliation and working with the White House Office of Management and Budget (OMB) on an announcement of the payments, which Perdue said would happen "very soon, in a few days."

Tim Murtaugh, a USDA spokesman, responded to an email from DTN about the trade-aid payments and indicated USDA would have an announcement before the end of the year.

"Secretary Perdue was clear last week that we are in final stages of confirming our commitment to American farmers," Murtaugh stated. "We are in discussions with the White House and anticipate that the second payment rates for the Market Facilitation Program will be published before the end of the year."

USDA has paid, as of Dec. 10, just over $2 billion under the Market Facilitation Program.

Reuters reported the White House OMB "has not been terribly excited about the trade aid package" but would eventually approve a second round of payments.

U.S. soybeans have faced 25% retaliatory tariffs since last summer that have largely halted exports to China, leaving farmers and grain elevators to store more soybeans that are typically railed or shipped directly to export.

"From my perspective nothing has changed from the tariff damage that farmers experience," Perdue said at the DTN Ag Summit.

hris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

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