Four years ago, farmers and ranchers were optimistic that incoming President Donald Trump would bring added prosperity to farm country through new and better trade agreements.

Now, they’re counting on President-elect Joe Biden to undo the instability and damage caused by Trump’s trade wars.

While some in agriculture agreed with Trump’s hard line on trade policy, particularly in regard to China, others warned of the toll it would take on an already struggling farm economy. U.S. farm exports decreased from a peak of $150 billion in 2014 to $136.6 billion last year.

Low prices for some commodities have driven farm debt to a record high, and the number of farm bankruptcies in 2019 was the highest since 2010 amid the fallout from the global recession.

The Trump administration has distributed $23 billion in direct payments to farmers and ranchers to offset lost trade with China, but producers have consistently said they want “trade not aid.”

“First and foremost, farmers need stability, predictability,” said Brian Kuehl, co-executive director of Farmers for Free Trade, a nonprofit that promotes export opportunities for U.S. agriculture.

That’s been missing for four years, he said, adding that instead, farmers have endured trade wars that start with an online “tweet,” with no warning of what’s to come, followed by retaliation, driving down markets and commodity prices.

“So we need certainty and predictability, that would be point number one,” Kuehl said.

“Point number two — we want to see more energy being put into new markets for our food and ag products. The last four years we really spent disrupting relationships with existing partners,” Kuehl said.

During that time, the U.S. tore up the North American Free Trade Agreement with Canada and Mexico and now has put it back together in the form of the U.S.-Mexico-Canada Agreement.

It also tore up its relationship with China, and aside from a Phase 1 interim agreement, that relationship hasn’t been fixed, he said.

Trump also pulled the U.S. out of the 12-nation Trans-Pacific Partnership on his second day in office, he said. While he was able to negotiate a unilateral deal with Japan the U.S. remains on the outside of the reconstituted pact.

TPP would have boosted U.S. annual net farm income by $4.4 billion, according to the American Farm Bureau Federation.

“What we didn’t do a lot of is open new markets. There are a lot of countries where we could export food,” he said.

That list includes Vietnam, Indonesia, India and African nations, as well as opening the European Union and Britain to U.S. food and agricultural products, Kuehl said.

“Point number three — clearly we’ve got to resolve the trade war with China,” he said.

China is a $20 billion market for U.S. agriculture, but retaliatory tariffs on U.S. ethanol, corn, dairy and other commodities are limiting trade, he said.

“We have to get those lifted to boost our exports to China,” Kuehl said.

Once the trade war started, U.S. agricultural exports to China dropped from $20 billion annually to $9 billion, he said.

Some of the impact of Trump’s trade wars is seen in farm bankruptcies that were up 20% last year and record levels of farm debt, he said. Dairy was hit especially hard by the trade wars with Mexico and China, Kuehl said. “A lot of farm families are living on the edge. So we need certainty and stability.”

During his campaign, Biden said some encouraging things about understanding the importance of trade to U.S. agriculture, he said.

“We hope he follows through on those commitments,” Kuehl said.

But the U.S.-China relationship is in tatters, and tariffs aren’t going to go away overnight, he said.

“So there’s still a lot of work to do. I don’t think anyone should assume this is going to be quick or easy,” Kuehl said.

Shore up, open up

American Farm Bureau Federation hopes to see the Biden administration to be aggressive in trade disputes and securing more trade agreements, said Dale Moore, the organization’s executive vice president.

As the new administration gets up and running, Farm Bureau is hopeful it will be assertive in making sure U.S. agriculture has opportunities to get into markets around the world with new trade agreements and by strengthening existing trade agreements, he said.

“Agriculture needs trade to function,” he said.

Trade is an important component of the economic outlook for farmers and ranchers. And it’s important to commerce to have officials at the U.S. Trade Representative’s office and USDA in tune with the role and scope of trade and being deliberate in addressing trade barriers, he said.

There’s been progress with Japan and China and initial outreach to the UK and the EU, but there’s more work to be done, he said.

There will always be trade disputes. The important thing is to have tools in place to resolve them, he said.

Farm Bureau’s “top ask on trade is to move forward aggressively on getting new trade agreements established,” he said.

U.S. trade volumes and sales are 60% to 63% higher to countries with which the U.S. has trade agreements compared to countries it doesn’t, he said.

“Working to get trade agreements is a key — if not the key — in leveling the playing field,” he said.

But “any trade agreement that does not have agriculture squarely in the middle of the table is not going to be something we can support,” he said.

Solid, stable international markets are important to domestic supply. They ensure the U.S. is producing plenty of food and fiber for the domestic market. They also ensure the marketplace is providing a return to U.S. farmers and ranchers, he said.

“We’ve got to have a market for what we produce … otherwise farmers and ranchers suffer,” he said.

Trade goes hand-in-hand with the efficient and productive U.S. food production system that contributes to sustainability and the ability to feed people in the U.S. and around the world, he said.

“That’s the mission of farmers and ranchers,” he said.

Free trade, fair trade

The National Farmers Union doesn’t see trade as a panacea for U.S. farmers. The organization has not historically endorsed free-trade agreements due to concerns they have not gone far enough to protect U.S. farmers.

NFU’s board of directors did tepidly back the U.S.-Mexico-Canada Agreement because of the uncertainty that would have resulted from having no agreement, said Jenny Hopkinson, the NFU’s senior government relations representative.

NFU is a little bit skeptical of the promises of free trade and open markets. That doesn’t always equate to fair trade and farmer prosperity, she said.

“We have record-high exports, but family farmers are struggling,” Hopkinson said.

Free-trade agreements open U.S. markets to foreign products, and there needs to be protections for domestic producers, she said.

“Before we look to foreign markets, shouldn’t we be looking for opportunities that exist for farmers domestically?” Hopkinson said.

NFU’s first ask of the incoming administration would be to look at resolving domestic market issues before looking abroad, including consolidation in the livestock and farm inputs industries, and correcting supply-chain issues exposed by COVID-19, she said.

“Can we address those issues to help competition and markets domestically instead of going out and trying to procure new trade agreements? Let’s get our ship at home in order … before we look somewhere abroad,” she said.

NFU’s trade agenda for the incoming administration also includes policy on China.

“Certainly we agree that China has been a bad actor in international markets,” she said.

But NFU disagrees with President Trump’s decision to go it alone in addressing the issue instead of engaging with allies, she said.

“We think there’s a more multilateral approach we need to take,” Hopkinson said.

And that approach needs to be mindful of farmers and ranchers, she said.

NFU would also like to see currency realignments. A high-value dollar makes U.S. agricultural products less competitive abroad. If the U.S. dollar were more appropriately valued, U.S. producers could realize more value for what they are already selling abroad, she said.

“NFU wants the incoming administration to keep the needs of family farmers and ranchers in mind if they are going to engage in any new trade agreements,” she said.

The administration needs to ensure protections for the markets and livelihoods of farmers, ranchers and rural communities and make sure any new agreement is not causing harm, she said.

Break down barriers

The National Council of Farmer Cooperatives wants a level playing field for U.S. agriculture in the global marketplace and supports strong market development and promotion programs.

“We do look forward to working with the incoming Biden administration on trade,” said Chuck Conner, CEO of the NCFC.

Biden served many years as either the ranking member or chairman of the Senate Foreign Relations Committee, and NCFC hopes that strong international perspective translates into a strong trade agenda for the new administration, he said.

“It’s our expectation because of that experience, he’s going to seek trade agreements with new partners that should produce more sales for U.S. farm products,” he said.

U.S. agriculture faces many barriers in overseas markets, and the way to break down those barriers is with free-trade agreements, he said.

“We are looking for the opportunity to sell in more regions of the world. We’re looking for more trade agreements to break down those barriers that are keeping us from markets all over the globe,” he said.

In regard to trade with China, it’s been positive for the grain sector in recent months with better pricing as a result of exports moving at a vigorous pace. NCFC hopes Biden will be mindful that China is buying now and thoughtful in terms of any change to current trade with China that might disrupt those sales opportunities, he said.

Trade with China has been a point of great interest and, at times, consternation to U.S. agriculture, he said, but the current trend is for new sales opportunities for U.S. agriculture and soybeans in particular.

“It’s a trend we’d like to see continue,” Conner said.

NCFC hopes the new administration doesn’t come in and do anything to jeopardize those opportunities, he said.