ARGENTINA-CHINA TRADE DEAL UNDERCUTS AMERICAN SOYBEAN FARMERS

Written by Michael Thervil

ARGENTINA CHINA TRADE DEAL UNDERCUTS AMERICAN SOYBEAN FARMERS

[Argentina China American soybean Farmers] American soybean farmers are suffering due to China's pivot away from the American soybean market towards the south American countries of Argentina and Brazil. This is due to the Trump Administration's Reciprocal Tariffs also known as the “Trump Tariffs" as well as from the world shifting from a unipolar to a multipolar world in 2022. This drop in American soybean exports is also due to the rising cost of soybean harvesting and economic inflation. American soybean farmers' sales to China stood at typically 40% during the fall season, that percentage rate has now dropped to a staggering zero. For the historical record it should be noted that American soybean sales to China have been steadily declining from 60% since 2018.

What played a crucial part in China's pivot to Argentina and Brazil in terms of establishing the current soybean trade deal, was the fact that Argentina specifically ended its 26% export tax on soybeans. Because of this deal, both Brazil and but even more so Argentina are expected to experience a significant uptick in the both their agriculture and labor markets while America is naturally to experience an even further decline in agriculture, labor, and logistical markets while suffering an economic blow due to the surplus of soybeans which will drive down the earning in the American agricultural market. These ripple effects are also expected to affect American farmers next year as it is predicted that they will plant even fewer soybean crops next year due to the lack of demand from it’s once main exporter China.

OUR POSITION AT VEDA WORLD NEWS

It is unknown if the Trump Administration can comprehend the future ramifications of what many political analysts are calling “disastrous policies" and how those policies are and will further isolate both America and the American consumer from the rest of the world socio-economically speaking. But on the other hand, if the Trump Administration is intentional in its current actions, then by extension it can be stated that the Trump Administration should be challenged by the American people on this issue. With rising food costs, inflation starting to run rampant, and the inability of many Americans to find jobs that pay a livable wage that stays in step with the rising cost of living, the average American is starting to find themselves at their wits end.

Beyond soybeans, China has also stop the importation of American pork and corn into its country as well. For countries like Brazil but specifically Argentina, this agricultural trade deal with China is very much needed to save the Argentine Peso which has been decreasing in value and stability as well as Argentine assets. The one thing that the average American doesn’t want to see is a bailout for farmers, because from their perspective they know that even though the farmers may get bailed out, they will have to pick up the tab in the form of more taxes and inflation. Then the next question that comes to mind is who is going to bail them out as citizens as many Americans are already starting to capsize economically.

Any prospect of governmental bailouts brings back painful memories of the time when the American government created the “Too Big To Fail” during the 2008 financial crisis. For many this was a slap in the face of American capitalism because of the widely held belief by American consumers that no one and no business in America is and should be considered “Too Big To Fail”.