R-CALF USA

A Dive into Trade

Commentary by Bill Bullard, CEO, R-CALF USA

Our independent cattle and sheep industries have been steaming along through history as if they were without a strategic vision–rudderless and directionless. Today, we often hear that there’s nothing either industry can do about their current trajectories because both industries have so few participants left that they lack the means of achieving political influence.

But rather than join the “there’s nothing we can do about it” chorus, R-CALF USA has been working closely with other coalitions in an effort to enhance the political influence of independent cattle and sheep producers. One of the groups we work closely with is uniquely positioned to change the current directions of our fast-shrinking livestock industries.

It’s called the Coalition for a Prosperous America, and it’s the only national nonprofit organization representing exclusively domestic producers across many sectors and industries of the U.S. economy. It’s a coalition of manufacturers, workers, farmers and ranchers working together to rebuild America for ourselves, our children and grandchildren. CPA values quality employment, national security and domestic self-sufficiency over cheap consumption.

CPA has long been an advocate of regulating trade through the use of tariffs to protect domestic manufacturers, workers, and farmers and ranchers, and its political influence has been increasing exponentially.

Recently, CPA economist Andrew Rechenberg has been focusing his research on agricultural trade, and he has issued three important papers. In January, he issued his research papers “U.S. Faces Record Agricultural Imports, Worst Trade Deficit in History” and “Free Trade Agreements Have Damaged U.S. Agricultural Trade Performance.” Then in April, he issued his paper “Big Ag is Dead Wrong on Trade.”

His research shows that the United States’ agricultural trade balance, which was a trade surplus of over $39 billion just over a decade ago, has completely flipped negative in recent years, with approximately a $39 billion deficit last year. It further shows the U.S. has the largest agricultural trade deficits with Canada and Mexico and that the U.S. now only has a trade surplus in grains and oilseeds, with soybeans, corn and wheat accounting for about 95% of the products for which the U.S. still maintains trade surpluses.

Rechenberg concluded in his first research paper that this shift in trade balances shows that export gains for a few specific products and corporate giants have not made up for the widespread losses for all the domestically focused family farms.

In his second paper, Rechenberg found that “U.S. trade policies have prioritized marginal export gains for grains and oilseeds, while sacrificing the competitiveness of nearly all other agricultural products, including livestock/meat, vegetables, fruits, food products and more.” He concluded that “The promises of free trade are hollow. Instead of opening doors to new opportunities, these agreements have left American farmers vulnerable to foreign competition and eroded our food sovereignty.”

In his most recent paper, he argues that export growth for U.S. agriculture is a mirage, and he provided evidence that U.S. agricultural exports have plateaued, concluding that “Big Ag continues to advocate for the agricultural trade policies that have failed farmers for decades.”

And therein, the CPA economist disproves the notion that our livestock industries have been steaming through history without a strategic vision.

Independent cattle and sheep producers have long been unwitting accomplices to the strategic vision of Big Ag. We didn’t push back when Big Ag called for NAFTA that expanded their access to cheaper cattle and beef imports with which to satisfy America’s growing appetite for beef. And we didn’t push back when Big Ag called for the U.S.-Australia Free Trade Agreement, which greatly increased their access to cheaper lamb and mutton supplies.

One should be asking why, while Big Ag is explaining to consumers that the reason beef prices are so high is because there is a shortage of cattle and beef in the U.S., they are simultaneously advocating for more export market access, which will, of course, further reduce available beef supplies in the U.S. and further contribute to higher consumer beef prices.

One should also ask why, when our domestic cattle industry, which has long underproduced for the domestic market and remains far too small to satisfy the domestic demand for beef, is Big Ag not supporting limits and tariffs on imported beef and cattle to provide our domestic cattle industry the opportunity to rebuild and expand, which must be done to begin attracting new entrants into our industry.

The answer to these two questions is clear: Big Ag’s strategic vision, which we’ve been tacitly facilitating, is to control our domestic cattle and sheep industries much like they already control the vertically integrated hog and chicken industries.

It’s high time we stood together to put the brakes on Big Ag’s unfolding plan to chickenize our domestic cattle and sheep industries.

Source: R-CALF USA