Sometimes — and maybe especially during a crisis — it’s easy to scramble for somewhere to hang your hopes, even if it’s a pretty weak hook.
I wondered if that was the case after a conversation back in February with one U.S. market expert as everyone was pondering tariff impacts for the Canadian beef sector.
We were still relatively early into what has become months of back-and-forth changing tariff policy, and the Canadian beef sector was still hoping that their U.S. counterparts could change the Trump administration’s mind about the whole thing.
Read Also
Roundup retraction makes public trust ripples
A foundational study on glyphosate safety was recently retracted, while Roundup maker Bayer has already said it may ditch the key agricultural herbicide after lawsuits piled up.
It was Steve Kay’s thought that the Republican Party — historically sympathetic to agricultural interests — could help reign in the U.S.’s trade direction, given the potential fallout for U.S. producers.
“We’ve got a Republican Congress in both the House and the Senate. And the Republican Party has historically been supportive of and sympathetic to the issues that U.S. agriculture and the meat and livestock industry raises,” said Kay, the California-based publisher and editor of Cattle Buyers Weekly.
I had my doubts. A number of announcements since President Donald Trump took office haven’t really lined up with that. Those included deep cuts to U.S. Agency for International Development (USAID) foreign contracts —USAID being an important granting body for American farmers. The U.S. Department of Agriculture —another key source of agriculture grants — got a spending freeze, potentially leaving U.S. farmers counting on those federal funds in a lurch.
Likewise, there was a freeze on disbursements from the Inflation Reduction Act which, according to Reuters, offered north of $20 billion for farm and forestry conservation programs. Trump later said the freeze only applied to clean energy projects.
But Kay may be right. Trump has a history of coming to ag’s rescue. According to Reuters, his first administration issued a record US$217 billion in farm payments during his first term, a good percentage of which was earmarked for COVID-19 relief, but there was also aid to take the sting out of Trump’s trade spat at the time with China.
On March 18, U.S. Agriculture Secretary Brooke Rollins announced up to $10 billion in direct farm payments, citing higher costs and falling commodity prices. She specifically noted market certainty.
My guess is U.S. farmers will likely take the money and abandon advocacy for cancelling the tariffs. U.S. Agriculture Secretary Brooke Rollins has already said the USDA is mulling direct payments to farmers to cover losses from a trade war.
Ironically, Canada’s best bet for stopping this trade war may be the U.S. Supreme Court. It’s stacked with Trump appointees, but it’s also rebutted his cancellation of payments to aid groups for work already performed. But the court also tends to tread lightly on executive orders and it’s a body that Canadians have little voice with.
So what are our options? It’s beginning to look like a matter of waiting for Trump to change his mind (not an unusual occurrence), running out the clock on his administration while hoping Americans don’t support his plea for a third term and also diversifying away from our heavy dependence on the U.S. market.
But all that’s going to take time — time Canadian farmers can’t spare.
