Trade influences everything. The computers you type on, the cars you drive, the food you eat and more. In April 2018, President Trump released a list of more than 1,000 Chinese products that he planned to put tariffs on to punish China for restricting U.S. investment valuing. These tariffs are valued at over $53 billion. The very next day, China fired back with its’ own list of tariffs they would impose on U.S. goods. This list included $50 billion worth of goods including soybeans, many of which are sourced right here in Nebraska. Since April, those tariffs have jumped to a proposed $506 billion on US imports from China and $130 billion on Chinese imports from the US.
After this heated dispute between the countries, both decided to halt the tariffs for 90 days until they could come to a reasonable compromise. That deadline for compromise is coming up quickly on March 2. If the two countries do not resolve their disputes within this time frame, the tariffs will be imposed.
Beijing and Washington DC are not the only places that reap the consequences of these seemingly soley international issues, each person in our prospective countries will be affected. For consumers, prices will skyrocket. Those who will especially be negatively affected by these tariffs however, are the country’s loyal farmers– many of which live right here in Nebraska. Soybean farmer Ethan Yungdahl in Osceola, NE is worried about the consequences of these tariffs for his family farm. “They [China] have reduced their purchases of our grain, mostly soybeans so much that our prices have dropped by 25 percent. So in short, to answer your question about how this affects our family. If you could imagine making around $40,000 last year, this year, you would only make $30,000,” Yungdahl said.
Nebraska is the country’s fifth largest producer of soybeans and it brings in $9.82 billion for the state economy annually. There are hundreds of local farms throughout Nebraska that produce soybeans and when there isn’t demand to sell, their profit margins dissipate. The US is the source of 37 percent of the world’s soybeans and roughly 60 percent of those soybeans make their way to China. Because soybeans are available from other parts of the world, it isn’t that China will be using less soybeans in general, it is that they will be sourcing them from a different place.
Though a full blown trade war has not begun yet, one would significantly weaken the world economy due to the status of both the United States and China.