During his address at Commodity Classic last week, Ag Secretary Tom Vilsack discussed the trade war with China. He says he can’t say with confidence that we “survived” the trade war.
“I think unfortunately, and tragically, there were a lot of farmers that did not survive the trade war, that ended up having to leave the farm and that’s always an incredibly sad circumstance. I think we have to acknowledge that. I think we also have to acknowledge that where we are relative to trade, especially with China, is pretty much where we were in 2017.”
Vilsack says the US market share of ag products going to China has gone down.
“It’s not as if they’re buying more than they were buying before. In fact, our market share in China was in 2017 roughly 25 percent of their agricultural purchases were from the U.S. Today, it’s 15 percent. So, I think we have to put this in perspective.”
Vilsack says one win from the trade war was China making commitments in the sanitary and phytosanitary area, opening up their beef market for example.
Was the trade war worth it? For Vilsack, the jury is still out on the overall impact.
“Certainly, if for whatever reason, China fails to meet its Phase One requirements in year two, I think that we have to maybe begin the process of asking China, ‘What more can be done in order for you to meet those requirements?’ Because they’re about 80 percent of what they promised they would buy. Certainly better than it was, and certainly helpful to the market, no question, and a good thing, but they’re not where they need to be.”
Vilsack added that we have to become less reliant on the Chinese market and start to diversify by being more aggressive with other market opportunities.