"There's a broad-based slowdown of the global economy attributed to lower industrial production, a decrease in international trade and of course, the trade war," states Dr. Ian Sheldon of The Ohio State University Department of Agricultural, Environmental and Development Economics. While the recently passed Phase One Trade Deal with China may be a move in the right direction, it's certainly not going to be an immediate solution to the loss the U.S., and specifically, farmers, have incurred since the trade war began. "The trade war hasn't ended," states Sheldon, "We've reached a truce," meaning it's no longer escalating. But the current tariff on soybeans remains at 27%; it was 3% before this trade war began. Add to that, there had already been a 53% reduction of beans exported to China from the U.S. since 2017, pointing to them using other countries to purchase them from, specifically Brazil. According to Sheldon, "the U.S. ag sector got caught in the cross-fire when the administration started fighting with China over trade and China retaliated by pulling back on the top 3 imports from the U.S. which included airspace technology, automobiles and soybeans." Tariffs have already cost U.S. producers/consumers more than $138 billion in lost sales and increased costs; on the flip side, the government has only raised $40 billion by imposing tariffs on other countries. In the Phase One Trade Deal, China says they will increase imports from the U.S. to $200 billion by 2021. This is a 92% increase from 2017 and economists are skeptical this could happen. Only time will tell, but with current conditions, the trade war is still alive and well and hurting our ag producers.
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