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Ambassador Branstad says Chinese trade discussions continue

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Terry Branstad (file photo)

Farmers in Iowa and across the Midwest want quick resolution to the looming trade war due to the negative impact it’s starting to have on their bottom lines.

Speaking in Des Moines over the weekend, the U.S. Ambassador to China, Terry Branstad, says he isn’t sure how long the impasse with China will last. “We’re continuing to have discussions,” Branstad says. “I’m trying to keep the leaders in Washington informed and do all that we can. We’ve had several meetings and we’re going to continue to work on it.”

Branstad, a former Iowa governor, says President Trump is justified in putting tariffs on imports of Chinese goods into the U.S. He says China is in worse financial condition than the U.S. due to the drop in that nation’s stock market and currency value. “China has not treated us or other countries fairly for a long time with their stealing of technology and also not enforcing intellectual property rights, the trade deficit has gone up and up,” Branstad says. “We’re trying to get fair and reciprocal trade and we want to double ag exports over the next five years.”

Speaking at the Iowa State Fair, Branstad says it’s unfortunate American farmers have been collateral damage in the trade war and he’s unsure what it will take for China to finally cut a deal with the U.S.  “What the United States has done, we’ve focused on the areas that they’ve been unfair on, stealing technology and that,” he says. “They have focused on agriculture which had nothing to do with this. That’s why we think what the Chinese have done is unfair and they need to come to the realization, just as they did with sorghum, that this doesn’t make sense and they’re hurting their own consumer.”

Branstad says U.S. Treasury Secretary Steve Mnuchin has been in talks with Chinese officials over the past two weeks, so the countries are trying to negotiate.

(By Jerry Oster, WNAX, Yankton)

 

Congressman King is less optimistic about trade deals

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Congressman Steve King. (file photo)

Iowa Congressman Steve King says he hopes the trade disputes between the U.S. and other countries can be resolved sooner rather than later — but he is not optimistic.

King says he has said he’d like to see the trade issues solved before the soybeans turn ready for harvest, but he says in talking with the top two White House negotiators, he is not as optimistic as he was. King, a Republican, says they don’t even had a NAFTA agree done yet. King says Canada seems to be holding up that agreement, while Mexico is ready.

“So, the president has indicated he may be ready to cut a bilateral trade agreement with the Mexicans, and then to a bilateral negotiation with the Canadians, hoping to get that resolved,” according to King. King says trade with China poses a whole different series of problems, particularly for the Fourth District he represents — as the district is top in the state in pork and soybean production.

“Don’t forget that the center of the objection with China is not the trade imbalance — but instead is their theft of our intellectual property. The lowest annual cost of the thievery of our intellectual property is $250 billion dollars a year. The highest number I see is $600 billion a year,” King says. He says the recent administration decision to make up producer losses will help for now, but he wants the trade battle to end as quickly as possible.

(By Woody Gottburg, KSCJ, Sioux City)

 

Soybean association members: trade trip to Europe has been positive

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A delegation of Iowa Soybean Association members spoke with reporters from Europe Wednesday, where they are on a trade mission to sell more of their product.

The trip includes stops in Ireland (Dublin and Belfast), Denmark, Hungary and Austria. ISA president Bill Shirley of Noway, says talks have been positive — but they haven’t talked about numbers. “They would like to increase their inputs from the United States — but nothing specific,” Shirley says.

Dave Dalton of Milton says recent talks between the administration and the European Union have helped with the discussion of soybeans. “I think the sense that we’vie gotten from this side is that trade has always been open. They have source South American beans in the past and now it makes more economic sense to bring them in from the United States,” Dalton says. “The agreement to continue to talk about some of the trade issues between the E-U and the U.S. has kind of eased some of those trade issues. I think in general we are going to see more trade between the U.S. and E-U.”

The delegation was asked if they think the E-U can make up the deficit if the trade war with China continues. Grant Kimberly says there is good demand worldwide for soybeans — and that will help. “China of course is by far and away the largest buyer, and its hard to completely offset all that if we were to need to offset a majority of that,” Kimberly says. “So, I guess time will tell. It’s just too early in the process to see where this will all go.”

They were asked if there was any talk of the administration’s actions on trade. Shipley says he was surprised that it wasn’t a big point of discussion. “There’s a few comments made which we all expected that. We expected a lot worse if you want to know the truth,” Shipley says. He says things have gone pretty well as they have talked about the basics of getting more soybeans into the European market.

The delegation met with representatives of the Irish Grain & Feed Association, Northern Ireland Grain Trade Association, Denmark Ministry of Foreign Affairs, Danish Agriculture & Food Council, Budapest Ministry of Agriculture Department and International Relations, Hungarian Grain and Feed Association, as well as several farm visits across the countries.

 

Senator Ernst says President Trump is listening to concerns about trade negotiations

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Senator Ernst, Ambassador Branstad and Senator Grassley.

Senator Joni Ernst and the rest of the Iowa Congressional Delegation recently sent a letter to President Donald Trump expressing concern about the impact of trade negotiations on farmers in the state.

Ernst, a Republican from Red Oak, says process for handling trade issues isn’t exactly the way she would do it — but she says she the president does listen. “This president is very, very open and accessible, and more so than the last administration where we had even Democrats, some of my colleagues have stated they had very little if any interaction with the president,” Ernst says.

Ernst says she favors a more linear approach to handling the trade issues. “He is juggling a number of trade deals right now, which makes it very complicated,” Ernst says. “Of course I would prefer that he take up a trade deal, we get that deal done and we move on to the next.” She says in her talks with the president he has expressed confidence he can get the North American Free Trade Deal done by this fall.

Ernst says the president says Canada has been the problem in NAFTA, so they’ve encouraged the president to do a bilateral deal with Mexico while continuing to work on Canada. “Trade is so important for us, so while we have all these trade deals up in the air, we need to have some level of optimism moving forward that these deals are going to get done. So, I want to see action on it. I want to see that we do have NAFTA done,” Ernst says.

Ernst says they continue to remind the president of the concerns of farmers. “I know they are juggling a lot right now — it’s probably not the preferable way for Joni Ernst — but if we can get these deals done, I think our farmers will be doing well,” according to Ernst. “But I am extremely concerned in the short term on what it’s going to do to our markets.”

Ernst and Senator Chuck Grassley recently met with Terry Branstad, who is the former Iowa governor and now Ambassador to China to discuss trade with that country. “The ambassador did give us good feedback. I won’t discuss it openly today because of course we have a number of ongoing issues with China,” Ernst says. She says they also talked with Branstad about North Korea and while they have trade issues with China — China is important in helping to ensure the de-nuclearization of North Korea.

(Photo courtesy of Senator Grassley’s office)

 

Soybean producers continue to watch trade situation anxiously

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Midwestern farmers are seeing soybean prices fall as the U.S. and China remain at odds over trade and tariff issues.

Kirk Leeds, chief executive officer for the Iowa Soybean Association, says soybeans are one of Iowa’s top crops and this continued spiral in prices is disheartening. “China is very, very important for Iowa farmers,” Leeds says. “From soybean farmers in particular, they buy about 60% of all the soybeans traded in the world. Anything that causes a potential disruption in our ability to sell high-quality soybeans to a customer like China is very, very concerning.”

The initial concern came when the Trump Administration threatened to put high tariffs on steel and aluminum coming from China and China responded with threats of raising tariffs on a list of American goods, including soybeans.

“None of these tariffs are yet in place but just simply the threat of tariffs and counter-tariffs has been enough to drive soybean prices down,” Leeds says. “As you all know, at a time when farmers are already struggling to make ends meet, to have this kind of potential disruption in trade is very, very concerning.” Leeds says he and other members of the Iowa Soybean Association are in contact with the Iowa delegation in the U.S. House and Senate.

“The administration has promised that they will take a look at some way to compensate farmers for the loss of income,” Leeds says. “I’m kind of skeptical that we’re going to find anything that they’ll actually follow through on and anything that’s WTO-compliant. So, it’s really troubled times and uncertain times.”

Leeds says they’ve gotten tremendous support from both Iowa U.S. Senators Chuck Grassley and Joni Ernst as well as from the U.S. Ambassador to China, Terry Branstad, a former Iowa governor. Leeds says he’s taken around 25 trips to China over past 35 years, working to develop the trade relationship.

(By Pat Powers, KQWC, Webster City)

 

Iowa corn representatives host Asian Pacific rim trade team

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Roger Zylstra

A trade team from nations in the Asian Pacific rim is in Iowa this week, visiting a pair of ethanol plants, touring farms, and a feed mill in Grinnell.

Iowa Corn Board Promotion Director Roger Zylstra is hosting the group of government and industry representatives on his farm near Lynnville. He says they’re mainly interested in dried distiller’s grains, or DDGs, a byproduct of making ethanol.

“We’ve got a big feed mill here that feeds all of our local pigs and they use quite a bit of DDGs through that place,” Zylstra says. “They’re going to visit that mill and they’re going to visit our farm and talk to us about how we incorporate the DDGs into the feed.”

He says this visit takes on high importance, given the recent trade tensions between the U.S. and China. Zylstra says it also gives Iowa growers a chance to reestablish good relations with the Asian Pacific nations.

“We’re going to be the reliable supplier and we’re going to try to get the governments on both sides to cooperate as much as we can,” he says. “We’re here to provide the DDGs, the corn, the soybeans, the pork, whatever they need.” Zylstra says it’s a thrill to host these visits.

“That’s what Iowa Corn and the U.S. Grains Council, we’ve worked for years and years to establish and build the markets and the relationships that we have and continue to put a lot of emphasis on that,” he says. The trade group is also scheduled to stop at the Iowa Corn office and Iowa State University in Ames.

(By Jerry Oster, WNAX, Yankton)

 

Senator Grassley expresses support again for NAFTA

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Senator Chuck Grassley.

Ending the North American Free Trade Agreement would be, in a word, “catastrophic” to the Iowa economy, according to Iowa Senator Chuck Grassley.

The trade deal between the U.S., Canada and Mexico was reopened last summer for renegotiation. President Trump has made repeated critical comments about NAFTA and Grassley says the White House is well aware of his stance on the subject.

“Not only Senator Ernst and me but most agricultural state senators have made very clear how important NAFTA is to prosperity in agriculture,” Grassley says. “Just in Iowa’s case, Mexico would be the leading importer of Iowa corn.” Grassley remains optimistic the president will preserve, not scrap, the agreement.

“I don’t think that he’s going to end NAFTA,” Grassley says. “I think there’s tough negotiations going on now for the next two months.” Grassley explains why there’s a looming, unofficial deadline to complete efforts to fine-tune the trade deal.

“If there’s an agreement, it almost has to be made in the next two months, by the end of March,” Grassley says, “because you get into provincial elections in Canada, you get into national elections in July in Mexico and you get into our own midterm elections.”

President Trump mentioned NAFTA in passing during his speech Monday at the American Farm Bureau convention, only saying he’s “working very hard to get a better deal for our country and for our farmers and for our manufacturers.” NAFTA talks resume later this month between the three nations.

 

Trade trip increases optimism for return of ethanol, poultry exports to China

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Members of an Iowa trade delegation to China are expressing optimism that markets for trade of several products will be reopened with that country.

One of the big items is ethanol and the byproduct from the production of ethanol known as dried distillers grains or DDG’s.

Iowa Corn Growers Association president Kurt Hora, spoke about the issue during a conference call from the country.  “To be able to gain market access for those two products would be huge here in China. We know what a difference they’ve made to our livestock and our environment there in Iowa, and we know we can help them make a difference here,” Hora says.

He says they are also hoping to get broader acceptance of biotech corn. “We’ve been able to utilize biotech traits and looking for approval of the rest of the traits that’s helped us clean up our water and clean up our environment there in Iowa,” Hora says. “And we hope that they will embrace those traits and accept them so we can use them worldwide and get them over here.”

Iowa Ag Secretary Bill Northey.

Iowa Ag Secretary Bill Northey says China used to be a major importer of DDG’s, and Iowa as the nation’s leader in ethanol production has felt the loss of that market. “Losing that market for the DDG’s has impacted the profitability of our plants. Ethanol itself needs to come in here this market as well. There’s additional taxes recently on ethanol — so that is extremely limited now,” Northey.

The avian influenza outbreak that struck Iowa caused China to stop importing those birds. Iowa Turkey Federation executive director Gretta Irwin says she had some good talks with the Chinese representatives.

“The experience I think has been very mutual and very warm and friendly,” Irwin says. “And so for us in the turkey industry to have that opportunity to someday hopefully sell back into China a safe quality turkey product to meet their growing need for protein is very exciting for us.” It is the first trip for Irwin to China. She says they discussed importing turkeys for use in homes and also for commercial use.

“We’re seeing some very strong interest in fast food restaurants in China to be adding some turkey products,” Irwin explains. “So I am leaving here very optimistic and just very exciting for everything that we’ve been seeing here. It’s been an exceptionally wonderful experience.” Discussions are also underway on other poultry products such as chickens and eggs.

Kevin Stiles of the Iowa Egg Council says there are talks of exporting chickens from both countries. “I think we are in agreement that there are opportunities for U.S.D.A. to closely evaluate that opportunity for them to ship cooked poultry into the United States,” Stiles says. “And I think they realize that there are also opportunities for regionalization so that we can resume (shipping) poultry and poultry products into China.”

The regionalization he mentioned involves Chinese officials inspecting individual areas of the United States that were free from avian influenza and could import products. Stiles says they hope to eventually be able to export eggs to China.

“Several people we talked to thought that that was an opportunity. We’ve got some protocol that needs to be put in place,” Stiles says. He says they see that more of a long-term opportunity three to five years down the road. Stiles says the Chinese officials have been pleased with the added biosecurity since the bird flu outbreak and that has made the export of poultry more possible.

“We are getting close, I think they are appreciative of all that we do to guard against further outbreaks of avian influenza and limit any outbreaks that might occur,” Stiles says. “And so there’s a renewed confidence in our biosecurity efforts in Iowa and the entire United States.” Governor Kim Reynolds led the delegation to China.

Governor and commodity groups discuss several trade issues while in China

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Iowa Governor Kim Reynolds (in red) along with Ambassador Branstad and commodity representatives.

Governor Kim Reynolds spoke with reporters this morning from China where she hosted an Iowa reception along with representatives of most of the state’s commodities groups who are on the trade trip with her.

“We had about 150 people join us. It was a great opportunity for our commodity groups to meet with industry partners. We were blessed to have Ambassador (Terry) Branstad and his family join us for the reception tonight,”Reynolds says. Reynolds says they have also been visiting various agricultural operations in China.

“We had the opportunity to meet with the mayor of Shanghai and to continue to talk about partnerships and visit an aquaculture farm where the Iowa Soybean Association actually invested in technology to help with the production of the aquaculture at decreased cost and increased output,” according to Reynolds.

The governor says they talked about the reopening of the Chinese market to U.S. beef and how they want to continue to expand in that area. She says they also talked about export issues involving soybeans, corn and poultry.

“I think the group would share the sentiment that they felt that again progress had been made but that they needed to continue the dialogue to continue the resolution to continue moving opportunities forward,” Reynolds says.

Iowa Agriculture Secretary Bill Northey is also on the trade trip. Northey says having former Governor Terry Branstad take over as Ambassador to China makes a big difference in this trade mission. “And then to be able to see him absolutely totally engaged in his role as ambassador. He looks as natural as can be in that ambassador role. You realize how important it is for him to be in the position of this very important trading relationship and political relationship between the two biggest countries in the world — and then to have this great Iowa connection,” Northey says.

Northey says Branstad’s position and then having all the commodity groups together on the trip along with the governor has been a good thing. He says it has created many opportunities for conversations that they would probably not been able to have if they were traveling alone. Northey characterized the talks as “high level.”

He says the conversations have spanned many agricultural areas and that shows the importance being placed on agricultural trade from the federal level. “I also do believe that some of this that has been happening — whether its the biotech events, the beef trade, the rice opportunities that there are — rice isn’t going to impact a lot of Iowa farmers, but it certainly was movement toward better trade with China. Some of that is because the administration has pushed so hard to move some things that have been stuck for awhile,” Northey explains.

The conference call this morning happened at what was roughly 10 o’clock in the evening in China.

(Photo courtesy of the Iowa Soybean Association)

Tama plant first in Iowa to be approved to send beef to China

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Black Angus beef from Iowa Premium.

A meatpacking plant in Tama is the first in the state to receive approval to export beef to China.

The approval for Iowa Premium comes two weeks after the 13-year ban on U.S. beef imports to China was lifted. Iowa Premium CEO Jeffrey Johnson says the approval process is pretty similar to getting approval to ship anywhere else.

“The U.S.D.A. looks at your quality assurance assessment programs and your export verification programs, also there’s some grade labeling programs. They look at all of our programs — assess them and if they meet the standard for shipping to China — then they approve us,” Johnson explains. Johnson says they process Black Angus beef that they will send to China. He says the Chinese like all of the cuts from the cow.

Workers at the Iowa Premium plant in Tama.

“That’s the thing that we think is a good advantage for the beef industry in China, that they do take a breadth across the carcass. They don’t just take the middles, they don’t just take the ends, the take a good mix and China is going to be a real good partner for the beef industry,” Johnson says.

Johnson says they hope to send out the first shipments in a couple of weeks.

“We’re going to start with two container loads a week, hopefully build up to 4 to 4, so anywhere from 800,000  pounds to a million pounds a month,” according to Johnson. “Iowa Premium wants to have 34 percent of our meet going overseas. Because there are customers that want family farm raised Black Angus beef.”

Johnson doesn’t think starting up imports of beef again to China will impact the prices here in the U.S. “Cattle production if you look at the numbers is up across the U.S…I think that the industry is ready for the Chinese consumer,” he says. “It’s been coming, so the whole chain has to be prepared for it.” Iowa Premium has already been shipping some of its beef to other countries.

“South America, of course Japan is a great customer of ours today. We ship meat there every week,” Johnson says. The Tama plant employs 851 people right now working five days a week. Johnson says they can handle increased demand from China by adding a little more production to what they are already doing.

“Right now we do 5,500 head, we’ll do 6 days 6,600 head, and then we made do an additional 100 head a day just depending on the volume that we do. The company is built for expansion without building onto the building,” Johnson says.

He says they get all their cattle form family farmer-feeders in Iowa and neighboring Midwest states. Iowa Premium took over the closed plant in Tama three years ago and renovated and reopened it.

Photos courtesy of Iowa Premium.