KANSAS CITY, Mo. – Economic analysts from across the country came together at the Ag Outlook Forum, presented by the Agricultural Business Council of Kansas City and Agri-Pulse held in Kansas City on Sept. 23.
Following a presentation by the US Dept. of Agriculture’s Deputy Chief Economist Warren Preston, panelists discussed the agriculture economy of the US. One of the biggest topics was the possibility of a US-China trade deal getting completed before the 2020 US presidential election.
“I don’t pretend to know the answer,” said Pat Westhoff, Food and Agricultural Policy Research Institute (FAPRI) director at the Univ. of Missouri. “I think it’s fair the Chinese negotiators have figured out that agriculture is a great pressure point for the president. They recognize that if they want to reward the president, they do something nice on ag. When they want to punish the president, they do something bad on ag.”
Luke Chandler, the chief economist for John Deere, also commented on the elements that would go into a US-China trade agreement, which spans outside of agriculture.
“There have been some encouraging developments more recently around the Chinese invites and reportedly buying some more US soybeans and some pork,” Chandler said. “If you look what’s happening in China at the moment with this African Swine Fever, clearly, food prices and food price inflation and food availability are really sensitive issues for the Chinese government and Chinese people.”
Chandler explained that there is strong evidence that food price inflation is going up in China, which could make the country move closer to a deal. However, he did mention that agriculture is only part of potential resolution.
“I think we all recognize that the Chinese agreeing to buy US agricultural goods, is really kind of a token towards getting the deal that they really want to get,” Chandler said. “It’s not really about what they are buying or not buying. It’s about intellectual property, and level playing fields.”
Outside of intellectual property, Chandler explained that agriculture is part of the issue, but there are also several other global components.
“There are bigger issues at play as well and it’s not even just about intellectual property. It’s about positioning in the world and around the militarization of the South China Sea and controlling important shipping zones,” Chandler said. “The development of their Belt and Road Initiative from Asia into the European region. There’s a lot of bigger issues at play here than just whether they do or don’t buy US agricultural goods, but clearly for the US farm economy it’s a really important issue.”
Other panelists included Jim Farrell, president of Farmers National Co., Warren Preston and Ashley Hungerford, an economist for the USDA office of the Chief Economist.