How the tariffs are impacting two Kentuckians- a farmer and an aluminum manufacturer

08/23/2018 07:09 PM

The morning of August 23, both China and the United States imposed tariffs on an additional $16 billion worth of goods from each country.
This is just the latest escalation into what is turning into a trade war with China.
Some Kentuckians are praising the tariffs, but for others, they are worried about how they are impacting their wallets.

Gerry Hayden is one of the people who says the tariffs are costing him money.
Wednesday morning, Hayden and his son checked out their silos ahead of their October soybean harvest.
Hayden says they’re expecting a good crop this year.
Looking over his soybeans, he explained, “Now you go out and look at it, and the pods have come out and there are new blooms on it. So we’re going to get a new crop of blooms.”
Even with that, Hayden thinks this will be a tough year for his farm. “Your goal is to have enough money at the end of the year to go again. And I can see it’s going to be tight this year, because we’ve gone from $10.34 down to $8.34 roughly. That’s two dollars a bushel for every bushel. You know, it’s affected this farm alone probably 100 thousand dollars this coming year,” said Hayden. In July, China issued a 25% tariff on soybeans and other products coming into their country. Along with being a farmer, Hayden is on the Board of Directors for the American Soybean Association. He says the same day China threatened the tariff, soybean prices fell. Speaking for the soybean market, Hayden said, “If we didn’t have a tariff, the bases could be a positive bases right now.”
The soybean tariff is a response from China to a trade war that started in March when President Trump announced tariffs on aluminum and steel.
While that announcement may have started a trade war, supporters say it also saved jobs in Kentucky.
“You saw plants regrettably, like some nearby here and 60 percent of this plant right out here were forced to shut 3 years ago. This country came within 6 months Annie of losing it’s ability to produce primary aluminum,” said Michael Bless. Bless is the Chief Executive Officer of Century Aluminum in Hawesville.
Bless says now, just months after the tariffs went into effect, his company is hiring about 300 people and bringing the plant back to capacity.
“We began to bring on the formerly shuttered capacity in June. The first pot line of the three pot lines that were closed will be back up in the next week or two and that’s what we’re celebrating today and then the other pot lines by the end of this year,” said Bless.
Both Governor Matt Bevin and Commerce Secretary Wilbur Ross were on hand to celebrate the return of the company’s recovery.
“This would not have happened without the hard work that all of you have done to raise awareness of the hardships that unfair foreign trade practices have caused for your industry,” said United States Secretary of Commerce Wilbur Ross.
Just 30 miles down the road, for people like Hayden there’s nothing to celebrate. Ross and Bevin both addressed that.
“What I would say to the fellow who is losing 100 thousand dollars is that’s more money than most people could even imagine making in a year, let alone losing. And so, I know it’s hard. And that’s not profit. That’s pure dollars out of his pocket. And so the reality is this. I would still encourage him to recognize the President has set aside a relief fund, not because that’s a long term but because he know’s there’s short term pain. That he wants to alleviate the short term pain with aid,” said Bevin.
In July, Trump announced a 12 billion dollar package to help farmers in need.
At the Century Aluminum event, Ross said the government is committed to helping farmers, saying “We think it’s plenty of money to handle the immediate situation, but the President is not going to let farmers go down the drain.”
However, Ross didn’t elaborate on how the President plans to keep that from happening should the money run out. When asked, Ross reiterated, “I told you, the president is not going to let farmers go down the drain.”
Hayden says he’s not giving up on the person he voted for in 2016, saying “We’ve got all the confidence in the President, that he knows what he’s doing. He’s a business man and he’s got our best interest at heart.
He says that’s the case for a lot of farmers. “We’re the ones getting affected by it. We’re the ones taking the brunt for it and we’re the ones supporting the President the most,” Hayden said.
In comments to Century Aluminum, Ross claimed America is in a better place to handle this trade war than China since they import more than we send out.
Currently for every dollar that America taxes, China is meeting.
The Chinese President, Xi Jinping and Trump are set to meet at the G-20 summit in November. But in a cabinet meeting last week, Trump says he doesn’t think the two sides will come to an agreement. In the meeting Trump said, “They are just not able to give us a deal that’s acceptable. So we’re not going to do any deal until we get one that’s fair to our country.”

1 Comments

Comments

  • rbc wrote on August 24, 2018 08:03 AM :

    The really serious effect on bean prices may be when we loose the Chinese market to other countries like Brazil….agriculture depends on developing and sustaining stable markets.

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