There was a time not long ago (just a few months ago) when American farmers could export as much as they could possibly produce and expect to sell all of it for a reasonable price, but that time is over.
Trump's trade war with the largest market in the world prompted the Chinese to cut off American agriculture entirely in some cases leaving farmers scrambling to find new buyers.
The problem is scrambling to sell your goods to another buyer means you won't be able to sell it for as much as you could before and, according to new data from the Labor Department, the value of American exports has plummeted.
Agricultural export prices fell 5.3 percent from the prior month, the biggest drop since October 2011, as soybean prices plummeted 14.1 percent. Export prices for corn, wheat, fruits and nuts also slumped in July. The overall export price index dropped 0.5 percent, the most since May 2017, the department said. The figures exclude the price effect from any tariffs.
China in July slapped 25 percent tariffs on American soybeans and also targeted other farm goods in retaliation for U.S. duties on a range of merchandise. The world’s biggest buyer of soybeans has shunned U.S. supplies amid the escalating trade conflict, threatening to curb exports after the harvest.
At the same time, Labor Department data shows that the price of foreign agricultural exports has remained steady, meaning foreign farmers are selling their goods for as much as they did before while American farmers cannot.
Trump's $12 billion bailout of American farmers may cushion the blow from a single disastrous harvest, but his trade war will leave scars that may not heal even when the war is over. It took decades to develop access to markets that Trump has wiped out on a whim and that was during times of relatively stable foreign relations.
When some farmers say Trump's trade war may destroy their entire business, it's not necessarily because one bad season will ruin them; it could be because there will not be any more good seasons in the future.
At least they'll be Great Again.