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Farm aid will be temporary even in extended trade war: USDA chief

Less assistance should be needed once market balance is set

Matthew Patane/The Gazette

U.S. Agriculture Secretary Sonny Perdue and Gov. Kim Reynolds speak to reporters at the 2017 Iowa Ag Summit in Des Moines this past August.
Matthew Patane/The Gazette U.S. Agriculture Secretary Sonny Perdue and Gov. Kim Reynolds speak to reporters at the 2017 Iowa Ag Summit in Des Moines this past August.

A $12 billion assistance plan for farmers hit by a growing trade war is unlikely to be extended in future years even if tariff battles continue, Agriculture Secretary Sonny Perdue said Wednesday.

The mix of direct payments to farmers, commodity purchases for food-aid programs, and stepped-up promotion of new export markets announced by the Trump administration Tuesday is based on losses related to 2018 crops that were planted well before retaliatory tariffs from China, Canada and other nations began, Perdue said after speaking at an agriculture conference in Arlington, Va.

In 2019, farmers will know the trade environment heading into planting, allowing them to make decisions that will lessen tariff-related losses.

Farmers who planted this year “had no idea what was coming about” on trade, Perdue said.

Once a new market equilibrium is established, there would be much less, if any, need for additional assistance, he said.

“We don’t expect trade disruption as much in future crops,” he said.

The U.S. Department of Agriculture’s plan Tuesday buoyed markets looking for new sources of demand for U.S. products. The announcement raised futures of soybeans, a crop heavily dependent on trade with China, to their highest price in two weeks, but it didn’t win over skeptics on Capitol Hill, including Republicans from politically important agricultural states.

“My thoughts are the thoughts of farmers. They want trade, not aid. It’s really just that simple,” said Sen. Ron Johnson, R-Wis.

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Perdue’s remarks echoed those of White House economic adviser Larry Kudlow, who said on CBS Wednesday that the aid package is only temporary and that the entire $12 billion in assistance that was announced might not be needed.

“Nobody’s really thrilled about this,” Kudlow said. “We’re just trying to protect American agriculture from some of the unfair trading practices.”

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