Overseas Headlines: September 10, 2019

September 10, 2019

United States:

Many U.S. farmers fume at Washington, not Trump, over biofuel, trade policies

“ROCHESTER, Minn./CHICAGO (Reuters) – American farmers helped elect President Donald Trump in 2016 on hopes he would shake up Washington and turn around a struggling agricultural economy, but many of his policies have actually stung farmers, notably his trade war with China and biofuel waivers for oil refiners. Many farmers are angry, and some are directing their anger not at the Republican president, but at Washington’s bureaucracy. Trump has faced backlash from agricultural groups, ethanol producers and Midwestern politicians upset that his trade war with China has slashed export sales of U.S. soybeans and other crops. Also, Corn futures tumbled after the government forecast a big crop when a flood-ridden spring stalled plantings. Corn-based ethanol plants shuttered after the administration granted waivers to dozens of exempting oil refineries. Yet polls show that while Trump’s support in farm country has slipped, it remains substantial. Instead of directing their anger at Trump, dozens of farmers interviewed by Reuters blasted the U.S. Department of agriculture (USDA) and other Washington institutions they believe are thwarting his true agenda. Unsubstantiated conspiracy theories involving USDA staff are circulating in farm country and gaining traction online. USDA did not respond to Reuters’ questions on Monday. Farmers are struggling with how to emotionally process their pain from the Trump administration’s policies, and anger at the USDA may be a coping mechanism, said Ted Matthews, a Minnesota psychologist who has spent 30 years counseling farmers and rural residents across the Midwest. “The question I hear from farmers who voted for (Trump) is, ‘We believed him when he said he would help make the farm economy better, that we could save our farms. Now, who do we blame?’” Matthews said. Many farmers told Reuters they intend to support Trump again in his re-election bid in 2020. “It’s much easier to be angry at a faceless Washington bureaucracy than at the man you voted for,” said Jere Solvie, 69, grain and hog farmer from west-central Minnesota who voted for Trump and still supports him. Ahead of Democratic nominating contests, that party’s presidential candidates have been campaigning hard in Iowa and other Midwestern states where farms have lost billions of dollars in crop sales to China. Still, the latest Reuters/Ipsos poll conducted last month shows five in 10 U.S. adults in rural areas approved of Trump’s performance in office, higher than his 41% approval nationwide. Trump’s approval rating was 71% as of Aug. 23, down from 79% in July, according to trade publication Farm Journal Pulse’s poll of 1,153 farmers. Of the farmers who supported the president, 43% said they “strongly approve” – down 10% from July and the first time the number fell below 50%. The farm journal’s poll came as ethanol groups complained that demand was decimated when Trump’s Environmental Protection Agency granted biofuel waivers to dozens of refineries, saving the oil industry hundreds of millions of dollars.”

https://www.reuters.com/article/us-usa-election-farmers/many-u-s-farmers-fume-at-washington-not-trump-over-biofuel-trade-policies-idUSKCN1VV11U

Europe: 

EU wants Trump to drop ‘reckless’ trade policies: incoming trade chief

“DUBLIN (Reuters) – The European Union will seek to convince U.S President Donald Trump to see “the error of his ways” and abandon some of his reckless trade policies, the EU executive’s incoming trade commissioner said on Tuesday.  The new head of the executive, Ursula von der Leyen, named a 27-strong team of commissioners on Tuesday who will take office on Nov. 1, assuming they secure approval from the European Parliament. Irishman Phil Hogan, currently in charge of agriculture, will take up the post of trade commissioner, facing a battle to improve trade ties with the United States and establishing economic future relations with Britain after Brexit. “Mr Trump certainly has indicated his clear preference for trade wars rather than trade agreements. If he keeps up this particular dynamic of protectionism, I expect that the European Union will continue to forge deals around the world,” Hogan told Irish national broadcaster RTE. “But obviously we are going to do everything we possibly can to get Mr Trump to see the error of his ways and hopefully that he will be able to abandon some of the reckless behavior that we have seen from him in relation to his relationship with China and describing the European Union as a security risk.” The EU knows that China has to make certain changes, Hogan added, but said that Trump’s actions were cleary not improving the economic situation in either the United States or China. Hogan, who has not held back in public and pointed criticism of Britain’s approach throughout the Brexit talks, said that even if a withdrawal agreement is struck this year, it would take another six to eight months before EU member states agree a mandate to allow him start future trade talks. He said, however, that a no-deal Brexit would create an even further delay, repeating the EU’s position that the main issues in the divorce proceedings of citizens rights, financial settlement and the Irish border would still need to be agreed. “There are a lot of people in the United Kingdom who have not come to terms that if there is a crash out of the European Union, we still have to deal with the same issues,” he said. “There is a wishful thinking that these are going to go away, they’re not. They are going to be centrally involved in phase two of the negotiations if phase one doesn’t complete and there is no getting away from that.” ”

https://www.reuters.com/article/us-eu-jobs-trade-hogan/eu-wants-trump-to-drop-reckless-trade-policies-incoming-trade-chief-idUSKCN1VV18Q 

Asia:

China August factory deflation deepens, prices fall most in three years; pork prices soar 

” BEIJING (Reuters) – China’s factory-gate prices shrank at the sharpest pace in three years in August, falling deeper into deflationary territory and reinforcing the urgency for Beijing to step up economic stimulus as the trade war with the United States intensifies. Analysts say flagging demand at home and abroad is forcing some Chinese businesses to slash prices to win new orders or cut output to contain costs, chipping away at already-lean profits and further dampening business confidence. The fall was mainly driven by weakness in raw material prices, especially for energy and metals. China’s producer price index (PPI) dropped 0.8% from a year earlier in August, widening from a 0.3% decline seen in July and the worst year-on-year contraction since August 2016, National Bureau of Statistics (NBS) data showed on Tuesday. Analysts polled by Reuters had expected the index to have shrunk by 0.9%, the second straight month of outright declines. “With demand-side pressures on prices increasingly subdued, we think that further monetary easing is on the horizon,” Capital Economics said in a note to clients, predicting producer deflation will get worse in coming months. Share prices in Shanghai fell as the data pointed to growing profit pressure.”

https://www.reuters.com/article/us-china-economy-inflation/china-august-factory-deflation-deepens-prices-fall-most-in-three-years-pork-prices-soar-idUSKCN1VV03W

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2019-09-10T14:29:51+00:00