1. The Latest on Trade & Tariffs
June 26, 2019
Chad Hart
Associate Professor/Crop Marketing Specialist 1 1

2. Arable land

3. Why do U.S. farmers need export markets?
That’s where the customers are
That’s where the economic growth is
That’s where the consumption growth is
We produce surpluses
We only eat high on the hog
Exports are crucial to farm income

4. 96% of the world’s population lives outside the US
Source: CIA World Factbook

5. Population growth 2017 to 2050
Source: World Bank

8. Value of Ag Trade
Source: USDA-FAS

9. U.S. Ag Exports
Source: USDA-FAS

10. Top ten US ag export markets, 2017
Canada & Mexico buy % of US ag exports
Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

11. Top 10 ag exporting states, 2017
Source: USDA Economic Research Service, “State Export Data”

12. Agricultural trade with Canada
NAFTA
Two-way trade up 395% since NAFTA
Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

13. Agricultural trade with Mexico
NAFTA
Two-way trade up 577% since NAFTA
Source: US Census Bureau, Foreign Trade Statistics, FATUS export aggregations

14. USMCA
Source: USDA-FAS

15. Tariffs A tax on imports
Used to reduce trade and protect domestic industries
Has both positive and negative impacts
Positive for domestic producers of the product with the tariff
Negative for domestic consumers of the product with the tariff
If specifically targeted against one country, then impacts are
Positive for that country’s consumers
Negative for that country’s producers 15 15

16. Example: China’s Soybean Tariff
Positive for China’s soybean producers and U.S. soybean consumers
Chinese soybean producers capture a higher price
U.S. soybean consumers capture a lower price
Negative for China’s soybean consumers and U.S. soybean producers
Chinese soybean consumers pay a higher price
U.S. soybean producers receive a lower price
Price effects are due to supply changes
Less U.S. soybeans imported by China
More U.S. soybeans left on domestic market 16 16

17. Tariffs are a Policy Tool
Can be used to:
Reduce trade deficits
Raise government funds
Protect specific industries
Serve as a bargaining chip in trade negotiations
They’re not new. We’ve had tariffs on many goods since the U.S. was founded.
Major shifts in U.S. tariffs in:
1789, 1790, 1792, 1816, 1824, 1828, 1832, 1833, 1842, 1846, 1857, 1861, 1872, 1875, 1883, 1890, 1894, 1897, 1909, 1913, 1921, 1922, 1930, 1934, 1947, 1962, 1974, 1979, 1984, 1988, 1994, 2002, 2009, 2018 17 17

18. 18 18

19. Source: USDA-FAS

20. Recent Movement in the Top 3
Source: USDA-FAS

21. Soybean Export Shifts
Source: USDA-FAS

22. Corn Export Shifts
Source: USDA-FAS

23. Ethanol Exports
Source: EIA

24. Global Shares
Source: USDA

25. Want to provide feedback on my presentation. https://www. surveymonkey

26. Thank you for your time. Any questions. My web site: http://www2. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: