U.S. Wheat Trade: A Farmer’s Perspective

By Gary Baily, Washington Grain Commission Chairman, USW Director and a wheat farmer from St. John, Wash.

As Washington Grain Commissioners, trade has consumed a great deal of our time this past year. Relationships with our international partners are critical to the survival of our trade with countries such as Japan. Most of us have seen the proposed effects on our trade with Japan if the United States stays outside of the Trans-Pacific Partnership (TPP): a phased in $65/MT tariff reduction for TPP countries, U.S. market share for wheat falling from 50 percent to about 23 percent, and a reduction of baseline futures prices of $0.50 at a time when prices are already depressed.

I have been raising wheat in Eastern Washington for almost 30 years and have seen wheat fall victim to political whims several times. Looking back, however, I have not been as anxious about the future of our industry since the financial crisis of the 1980s. The divisive nature of the North America Free Trade Agreement (NAFTA) negotiations and the conclusion of the above mentioned TPP trade treaty without the United States cause concern about the long-term heath of our profession. This is especially true for young farmers who may not have the equity or financial backing to weather these storms.

Adding to the current trade environment is President Trump’s announcement that tariffs on steel and aluminum imports are being considered. The effects of those tariffs have yet to be quantified. If enacted, agriculture exports will likely be targeted for retaliation.

It is time for the President to consider the ramifications of his proposed tariffs, and acknowledge the positive contributions that our industry has for trade, and re-engage in TPP.