FAIRMOUNT, Ill. (WCIA) — Farmers in Central Illinois are facing trouble as the trade war between the US and China escalates.
President Trump increased tariffs on $200 billion of Chinese goods last week. China retaliated by raising its tariff rate on $60 billion of US items.
Farmers are feeling the harsh affects in their fields and in their bank accounts. They were already dealing with a 25% tariff imposed by China last year. The fallout of the most recent tariff increase prolonged the trade war and sent commodity prices plummeting. It’s leaving farmers questioning the sustainability of their businesses.
Lynn Rohrscheib is a farmer in Fairmount.
She says, “We hope to squeak through and make it but there is, unfortunately, going to be collateral damage where there will be farmers who aren’t going to make it.”
Patience is running thin for farmers and the effects of the trade war are hitting them head on.
Rohrscheib says, “The tariffs really slowed us down this fall. As we were harvesting, elevators weren’t able to empty out the bins and silos and sheds.”
She is a ninth generation farmer in Illinois. It’s the second largest soybean producing state.
Rohrscheib says, “60% of the soybeans we grow here in Illinois are exported and the Chinese market equates to 25% of that.”
She says these tariff increases are negatively affecting family businesses like hers.
“Right now, what we can receive at market for those is below the cost of production,” says Rohrscheib. “In the last five years we’ve lost about 50% of our incomes with the way commodity prices have fallen.”
Many have found ways to cut back on their budgets, but that only goes so far for so long. Monday, President Trump said he would use some of the tariff revenue, paid by US importers, to help subsidize farmers.
He said, “They can sell for less and make as much money until it’s straightened out. Our farmers will be happy. Our manufacturers will be happy. And our government will be happy because we’re taking in tens of billions of dollars,”
Rohrscheib says the ultimate hope is to restore trade relations quickly and “we just need a solution so that we can sleep at ease at night and have a little bit more certainty.”
China was by far the biggest export market for US soybeans. Last year, Beijing pledged to restart buying American soybeans as part of the negotiations, but purchases made so far haven’t made up for the lost lass year.