U.S. Sen. Steve Daines traveled to China recently and pressed top leaders there to “come to the table” and reach an agreement to end the trade war that’s hurting Montana farmers and sending serious jitters through the global economy.
The Republican senator from Montana also said he’s very supportive of President Donald Trump’s tariffs on Chinese goods coming to the U.S., which in turn caused the Chinese to implement tariffs on U.S. goods. Those actions have caused higher prices for U.S. consumers, provoked Chinese businesses and consumers to do business with other countries, and slowed economic growth around the world, according to some economists.
Daines, who worked in China in the private sector before being elected to Congress, traveled to Beijing and met with Liu He, the vice premier of the People’s Republic of China.
“I met with top-level Chinese officials and urged them to continue trade negotiations and to come to the table and to reach a long-term solution and a long-term deal,” Daines explained in a conference call with reporters. “There is a big opportunity here for Montana agriculture. We had productive meetings with the highest-level leaders, including Vice Premier Liu He.”
Daines said he stressed to the Chinese that they shouldn’t wait until after the 2020 elections to reach a trade deal.
“I met with some of the largest Chinese buyers of U.S. meat products, including Alibaba and COFCO and some other wholesalers,” Daines said. “I delivered a strong message to Chinese leadership that we must rebalance our trade relationship, we must hold China accountable for unfair trade practices and intellectual property theft and that they’re not going to get a better deal by waiting until after the 2020 election.”
Daines hand-delivered letters from the Montana Grain Growers Association, the Montana Stockgrowers Association and the Montana Wool Growers Association. All three expressed hope in getting a trade deal done.
Chase Adams of the American Sheep Industry Association and James Brown of the Montana Wool Growers Association noted that the U.S. historically has shipped lots of raw wool and sheep hides to China and imported lots of finished wool and fabric goods. China is the largest importer of sheep and lamb meat in the world.
Lola Raska of the Montana Grain Growers Association addressed her letter to Xi Jinping, the president of the People’s Republic of China.
“Our farmers strongly support fair and open trade and we embrace the opportunity to expand agricultural commerce with China through direct procurement of our raw product or through investment in our agricultural infrastructure,” she wrote.
Raska told the Missoulian earlier this summer that huge U.S. taxpayer-funded payouts to Montana farmers aren’t even coming close to offsetting the profit losses they’ve suffered due to lower prices caused by the trade war.
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On Monday, U.S. Treasury Secretary Steven Mnuchin said the U.S. and China have made headway in progress toward reaching a trade deal, and more high-level talks are set to resume in the coming weeks.
Earlier this year, the Missoulian reported that many agricultural producers are concerned about losing China as a long-term trading partner if the trade dispute drags on too long.
“I do want to see a deal signed sooner rather than later,” Daines said.
He said that for decades, China has been abusing the system and not abiding by the same laws that other countries do. Once the U.S. is past this “impasse,” he said, there is a big opportunity for Montana ranchers and farmers because beef and wheat grown here is high-quality and in high demand in China.
Daines said that a Wall Street Journal article on Monday reported that China’s economy is slowing down faster than many people have suggested lately.
“The belief among economists is the real picture in China is much worse,” he said. “There’s a lot of pressure on the Chinese and the leadership to get a deal with the United States done, and President Trump is holding firm.”
In a meeting with the Missoulian last week, Sen. Jon Tester, D-Mont., said the price Montana farmers are getting for hard red ordinary winter wheat is about the same per bushel as they were getting in 1978, while the costs of everything from equipment to gasoline have gone way up.
“The truth is it’s bad,” said Tester, a Democrat. “It’s nuts. The tariffs are having a worse effect. And when it tips, it’s not going to be good. At $4 for wheat, let’s call it, you cannot operate on that. Even with government handouts, even with no debt load, you can’t operate on that.”
When farmers decide they can’t make a profit and need to sell out to a larger company or a larger farmer, that causes rural decline, Tester said.
“That takes a school that in the 1970s had 160 kids in high school to less than 50 today, Big Sandy High,” he said.