Trump tells farmers more trade aid coming soon; Perdue says they hope and expect that will be the end of it

On Sunday President Trump spoke at the American Farm Bureau Federation's annual convention, promising farmers that they will soon get a final round of $3.6 billion in trade-war compensation, though trade deals have been signed meant to spur agricultural export sales. He noted that farm income increased in 2019, greatly aided by the federal Market Facilitation Program payments, and predicted, "The big stuff is yet to come," Chuck Abbott reports for Successful Farming.

Agriculture Secretary Sonny Perdue said Monday that the payments "didn’t have a timeline on when the third MFP payment would be coming, other than to say it is assured and imminent," Successful Farming reports. Perdue said the Trump administration is “hoping and expecting” that recent and upcoming trade deals will make further payments unnecessary.

"So far, producers have received $10.8 billion to offset the impact of the Sino-U.S. trade war on 2019 crops and livestock, on top of $8.6 billion in cash for 2018 production," Abbott reports. "A decision whether to release the final tranche of $3.6 billion, depending on market conditions and the state of trade negotiation, was due this month."

The Agriculture Department's recent Farm Income Forecast said direct government payments, mostly MFP funds, accounted for almost a quarter of all farm income, the largest share in over a decade, and a high-interest alternative lender was the single largest beneficiary of those payments.

Farmers are an important demographic for Trump, and one he wants to keep happy. "Farmers, who are often social and fiscal conservatives, voted for Trump in landslide numbers in 2016. Trump remains highly popular in farm country, partly because of tax cuts, regulatory relief, and support for corn ethanol," Abbott reports. "In a 2019 study by the Center for Agricultural and Rural Development, farmers in three Midwestern states said the trade war hit them in pocketbook but they agreed with Trump that it was important to end predatory trade practices by China – seeing it as short-term pain for long-term gain. Most of them said the trade-war payments were helpful."

Though the Trump said that the Phase I deal with China and the soon-to-be-signed USCMA deal with Canada and Mexico will "massively boost exports," some trade analysts are skeptical that U.S. exports can be rebuilt quickly enough to hit the $40 to $50 billion a year level required by the China deal. "The National Farmers Union, the second-largest farm group, said the trade war 'bruised our (U.S.) reputation, making other trading partners reluctant to work with us,'" Abbott reports. "The U.S. International Trade Commission has estimated that trade with Canada and Mexico will grow by 1% under USMCA."