BILLINGS – As President Trump talks tough on trade, proposing new tariffs on aluminum and steel imports in what he says will protect American jobs, investors worry a trade war could emerge with China and hurt farmers in Montana.
Farmers and ranchers say the trade restrictions on steel could lead to other countries retaliating and imposing massive taxes on imported American goods.
“If there’s going to be retaliation, it seems like agriculture is always the one to get it. That’s been our biggest concern, and that’s a big concern for wheat farmers. I mean, China has imported 19.5 million bushels of spring wheat this year, Mexico, 66 million bushels of harderd winter. And in Europe, Italy and other countries, 5.2 million bushels of Durham,” said Steve Mercer, a spokesman for U.S. Wheat Associates
Trump proposed this week a 25 percent tariff on steel imports and 10 percent hike on aluminum coming into the United States. The announcement was praised by certain industry CEOs, but Wall Street took a tumble, indicating investors are nervous about retaliation from foreign governments.
“Canada is very upset about this already. Our biggest partner is Canada, and then China and South Korea is a big part of it. Retaliation of countries like that would very much hurt Montana agriculture, and we’ve got to realize it. Our elected officials need to start complaining very loudly to the president that this is a stupid thing to do,” said broker Gary Buchanan of Billings-based Buchanan Capital Inc.
Although Trump routinely accuses Beijing of unfair trade practices, yesterday’s announcement still shocked the Chinese government. One of its top economic advisers was actually in Washington to talk trade negotiations.
Although the President’s proposal targets Chinese steel, trade experts note that China didn’t even break the top 10 sources of U.S. steel imports in 2017.