This and That

August 13, 2020

Hello everybody out there in farm country. This radio commentary is brought to you by the National Corn Growers Association, CropLife America, and Renewable Fuels Association. They are all friends, supporters, and allies of a healthy farm economy and prosperous rural America. Thank you.

And now for today’s commentary –

There are a lot of balls in the air. I will try to deal with a few select ones today. I’ll start with aluminum tariffs – President Trump re-imposed a 10% “national security” tariff on imports of aluminum from Canada. Was that justified? I have my doubts. We just got the USMCA trade agreement approved and in place. Now Canada will retaliate with tariffs on some of our products – including washing machines, golf clubs etc. We have enough problems without creating another one.

Next – the COVID-19 aid fight. We don’t know where this is going. Negotiations have
stalled. President Trump said he would take care of the aid with an Executive Order if Congress
won’t step up and do it. The President ordered extended unemployment benefits, deferral of
payroll taxes, and more. Democrat leadership and some Republicans question the President’s
legal authority to do this. He is doing it any way. Perhaps Democrats will launch a lawsuit to
stop the aid, but politically that might be a bad idea for them.

A better outcome would be for both parties to come back and hammer out a compromise
pandemic relief package. Continuing Resolution – that’s what we will get. With less than a
dozen Congressional workdays left before the end of this fiscal year, Congress is not going to
pass a budget. We don’t want to shut down the government. A Continuing Resolution will carry
us beyond the election. Late again, but they can get it done.

Trade – U.S. agriculture is in position to end this year with a net trade deficit. I cannot
ever remember that happening before. Our deficit this year is $3 billion and not expected to get
any better in a month and a half. Corn sales are down 11%, cotton down 19% - fruits and
vegetables also down. China is coming on strong now. A 799,000 metric ton purchase of
soybeans was just announced following last week’s 1 million ton purchase. I still worry every
day as our U.S. – China relations continue to deteriorate. Trade disputes have hurt our sales, and
the virus has disrupted trade. Many normal trade channels are not working, and at the same time
it is reported that there are 844 million people in the world that are “food insecure.” They need
food.

Until next week, this John Block reporting from Washington, D.C. If you would like to
review my radio shows going back more than 20 years, just go on-line to
www.johnblockreports.com.