Agriculture News

California’s dairy farmers were struggling to regain profitability. Then came the trade wars

For Gioletti and other members of California Dairies Inc., the state’s largest dairy cooperative and the second-largest in the U.S., the trade war with China has had a direct effect: “We no longer sell any products into China since the middle of this year,” says Rob Vandenheuvel, the co-op’s vice president of industry and member relations. That means the loss of 6 percent to 9 percent of its sales of milk powder. “We’re down to zero there.”Agriculture faces untold challenges all over the state, but dairy farmers arguably have a tougher time of it. Livestock has to be cared for more intensively than field crops. On top of the environmental restrictions confronting all farmers, dairies must deal with regulations governing methane, a greenhouse gas produced by cow digestion and bubbling up from the manure spread into pits to be dried for fertilizer. New state rules will regulate how much groundwater farmers can extract, posing another potential limitation on their business.Labor has gotten scarce. Even though Gioletti’s workforce is mostly foreign-born, it’s not immigration enforcement that’s causing the scarcity, he says, but demand from a surging construction sector that’s outbidding him. (He says he pays an average of $12 an hour, which doesn’t include benefits such as health coverage but does include free housing.)

In defence of Canada’s dairy farmers

Other studies suggest that countries that have transitioned away from supply management, such as Australia, have seen an initial spike in dairy production, then a steady reduction in production, farms and farmers. Many producers have been forced to exit the industry due to soft market conditions.You cannot separate farming from the fabric of rural Canada. The families, animals and land are fully integrated into the community and landscape. The survival of rural Atlantic Canada, in particular, is dependent on this, and it is something we must keep in mind during all of our trade negotiations.

Oregon hemp farming sees "explosive growth"

The Oregon hemp industry is like a raging river, restrained by a dam that might soon break and allow products to flood an array of new markets. A provision in the 2018 Farm Bill before Congress would strike cannabidiol from the Drug Enforcement Administration’s list of Schedule 1 drugs, those the agency deems to have the highest potential for abuse. Nationally, hemp sales topped $820 million in 2017. The market is expected to reach $1 billion in 2018.In the roller-coaster cannabis industry, hemp enjoys a smoother ride than recreational marijuana. Oregon marijuana growers have produced heaping piles of weed far in excess of what consumers can smoke and ingest. Federal law prohibits growers from shipping outside the state, restricting demand in the legal market. Many growers are now fleeing to the more promising hemp trade.

Tariffs could negate gains from new NAFTA, Farm Foundation says in report

The deals struck by the U.S., Mexico and Canada in renegotiating the North American Free Trade Agreement promise new trading opportunities for U.S. farmers, but the Trump administration’s trade wars and the tariffs that go with them more than negate the potential gains, according to a new study presented today by the Farm Foundation. The three-country pact - now dubbed the United States, Mexico, Canada Agreement with the unwieldy acronym USMCA - is expected to eventually increase U.S. exports of mostly dairy and poultry by $450 million annually. It’s a significant boost, said Dominique van der Mensbrugghe, a research professor at Purdue University and one of the authors of the study, but retaliatory tariffs being levied on U.S. farm commodities by Mexico, Canada, China and other countries threaten to far outweigh gains from the USMCA.The study finds that Canadian and Mexican tariffs “will cause U.S. agricultural exports to decline by $1.8 billion,” according to van der Mensbrugghe and the other authors, all of whom work at Purdue. If Chinese and other tariffs are included in the calculations, “the United States would see a decline in agricultural exports of $7.9 billion, thus overwhelming the small positive gains from USMCA.”The U.S. hit Mexico and Canada with tariffs on steel and aluminum on May 31 and both countries have retaliated. Mexico responded with tariffs that rose quickly to 20-25 percent on U.S. cheese, pork, potatoes, apples and other commodities. Canada is also imposing new taxes on the U.S., but those tariffs focus mainly on value-added products like ketchup, strawberry jam, yogurt, maple syrup and whiskey.

China is more complicated. The country has hit just about every U.S. farm commodity with import taxes, retaliating both against the tariffs the U.S. placed on steel and aluminum as well the U.S. tariffs aimed at punishing China for intellectual property theft. China has been historically the largest foreign market for U.S. soybeans, but that has changed this year since China levied a 25 percent tax on the oilseed.