Trade war or high-stakes game?

April 4, 2018

 

The Trump Administration is playing a high-stakes poker game with China and unfortunately, agriculture is right at the center of it.

 

That’s the belief of Dan Zwicker, with Zwicker Consulting in Waco, Texas.

 

“China buys ag commodities and raw commodities from the U.S. They don’t buy much of anything else,” Zwicker told The Central Illinois Farm Network on Wednesday afternoon.

 

Markets took a big hit on Wednesday after China retaliated to an earlier announcement from President Trump that the U.S. would hit China with 25 percent tariffs on medical, industrial technology and transport products.  China then targeted U.S. goods, including corn and soybeans. The Chinese ambassador said if the U.S. imposes further tariffs on Chinese goods, his country would take counter-measures of similar proportions.

 

Zwicker believes it all comes down to emotions and calls this “talk and positioning.”

 

“To my understanding, all of the trade representatives from China and the U.S. are talking behind closed doors.”

 

Zwicker is optimistic that the noise in front of everyone is not as bad as what is actually happening in the background. In fact, agriculture could benefit from all of this since ag products are the one thing China can buy from us. They can buy more soybeans, pork and red meat without having to buy products from South America.

 

“The last three administrations didn’t do anything about (the trade deficit) and it just kind of got worse as time went on.”

 

As a country, Zwicker believes we cannot afford to export our wealth and jobs to China like we have been.

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