WASHINGTON, D.C. (Reuters) — The U.S. Department of Agriculture is not planning to extend an up to US$12 billion aid package for farmers into 2019 to mitigate farmer losses due to the imposition of tariffs on American exports, Agriculture Secretary Sonny Perdue said.
“Farmers are very resilient and adept in making their planning and marketing decisions based on the current market,” Perdue sid.
The administration of U.S. President Donald Trump in July authorized the aid to shield farmers and ranchers from the repercussions of trade disputes between the U.S. and China, the European Union and others.
The U.S. has slapped tariffs on $250 billion worth of Chinese goods this year as part of Trump’s vow to cut the U.S. trade deficit with China.
Beijing retaliated by hitting $110 billion of U.S. products, including the agriculture sector, prompting the USDA to offer compensation to farmers of soybeans, sorghum, corn, wheat, cotton, dairy and hogs.
China, traditionally the biggest buyer of U.S. agriculture exports, has been largely out of the market for several products, leaving farmers struggling with a supply overhang.
“These facts are known now … so farmers, even under financial duress, will make their best business decision for 2019 without the expectation of a marker facilitation program,” Perdue said.
The USDA outlined the allocations of farm aid for the first tranche of $6 billion at the end of August. Perdue said he did not expect the second tranche to be outlined any later than December, adding that the amount was still being discussed.