Trump Announces $12 Billion In Emergency Aid To Farmers Affected By Escalating Trade War With China, Others

With signs of his escalating trade war affecting farmers at home becoming evident, the Trump administration on Tuesday announced up to $12 billion in emergency aid to the farm sector, a report in the Washington Post has said.

The tariffs introduced by Trump on the import of steel and aluminium with the aim of reducing trade deficits have forced countries to impose levies on US products in response, which is affecting farmers in the country. China alone has imposed tariffs on $34 billion worth of US goods. Canada, Mexico and the European Union have also imposed tariffs on imports from the US. Among the hardest-hit commodities are soybeans, sorghum, cotton, corn, wheat and pork.

The package will essentially reimburse the farmers the cost of tariffs.

According to US Agriculture Secretary Sonny Perdue, the US government will provide incremental payments to support prices of crops.

“This is a short-term solution that will give President Trump and his administration time to work on long-term trade deals,” Perdue said on the issue of aid, which officials said wouldn’t need approval from the Congress.

Soybean is at the heart of the US-China trade war. Prices of the crop have hit their lowest point in nearly a decade, falling 16 per cent since the end of May. The oilseed forms 60 per cent of the US’s $20 billion of agricultural exports to China. China, the largest importer of US soybean, has retaliated against tariffs imposed by the Trump administration, with a 25 per cent tariff on the crop.

Being the world’s largest soybean consumer, China last year bought $14 billion worth of the oilseeds from the US. Now, it is planning to buy cheaper soybeans from countries like Brazil and Argentina, reports have said.

Trump’s aid move suggests he is preparing for a long battle.