What does the trade war mean for Nebraska and Iowa agriculture?

SIOUX CITY (KTIV) - A trade war affects imports and exports, but what does that mean for Nebraska and Iowa agriculture?

Statistics from 2019 from Nebraska’s International Trade Office show that Nebraska exported $5.79 billion in agricultural products that year.

Products include soybeans, beef, corn, pork, and wheat.

The state’s top customers include China, Japan, Mexico, South Korea, Canada, the European Union and Taiwan.

Nebraska is also a top exporter of ethanol from corn, livestock feeds, corn meal, sugars, and sweeteners.

The Senior Director of National Affairs with the Nebraska Farm Bureau Federation, Jordan Dux, told KTIV 4 that when you think about trade, ultimately, this remains an agreement between two private companies.

“It is a company in the United States trying to sell a product to a company in China or vice versa,” said Dux. “And so the country set up trade rules. That’s what we’re seeing at the White House. You know, tackle is that, that they’re trying to set up. They’re trying to change trade rules, but it’s still important to remember that this is still a private business transaction that takes place.”

With the ever-changing markets and rules, Dux noted that it makes it hard to predict how this will impact consumers.

“We haven’t seen those tariffs completely. Chicken yet, in terms of the products, you know, right at the store, we haven’t seen that price increases, but we likely will see some of those and all that,” said Dux.

Dux added that the federation is hopeful that the president can work through tariff negotiations soon.

“At the same time, we have a supply chain, and we have a trading system that is resilient. Companies are going to make a decision one way or another as to how they’re going to move through the changes that the government set forward, but ultimately, as systems change, as rules change, governments react to them even with our closest trading partners. No trading relationship is perfect. There’s a lot of things we could point to that are issues, and so we are hopeful that that the President can work through negotiations and can work through these things relatively soon,” said Dux.

The Iowa Corn Growers Association’s website says one out of every three acres of corn planted in the U.S. will be shipped out of the country in some form. The rest is used domestically.

Iowa Corn added that there is domestic usage in terms of feed, fertilizer, feed fuel, and fiber, in how farmers utilize products that Iowa Corn wants to use more of Iowa’s products domestically to help use some of the excess supply seen worldwide.

Iowa Corn’s president is concerned about the impact tariffs will have on the relationships built with other countries as the trade war continues.

“Not knowing what direction we are day-to-day or even hour-to-hour. It’s hard to judge,” said the President of the Iowa Corn Growers Association Stu Swanson. “But certainly from a farm perspective, we count on the export market to provide that level of profit really that top third is where our profit comes from. And so we’re counting on that.”

Swanson added that it could impact rural Iowa. As finances are strained, he states that Americans spend less in the communities. Additionally, there are partners in the industry making layoffs and reducing manufacturing, resulting in the “ripple effect.”

As farmers start to plant as early as this week, Swanson adds to be aware of what’s happening in the markets.

“We saw during the last trade discussion, and war with China, that Chinese industry switched their purchases to South America, and so we’re concerned that as we have these battles that our competitors will take advantage of this opportunity,” explained Swanson. “We saw in South America that they brought acres into production and ramped up their acres of corn and soybeans. They’ve overtaken the US in terms of soybean production, they’re now number 1. They will be working towards taking that over on the corn side as well to become the world’s largest supplier of corn and beans, and so once those acres come into production, they will not leave. They will continue to produce. So that’s a concern that we have as the longer the tariff discussion goes on.”

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