As 2019 comes to a close, trade is still at the forefront of farmers’ minds. Will President Trump get a deal done with China? One analyst says yes, and no.
“Will we get a trade deal with China? A partial deal yes. The full deal, dealing with some of the real tough issues. No, I don't think so. We're a long way away from having that happen,” says Arlan Suderman chief economist for INTL FCStone. “I don't think we're going to see that happen but the partial deal that has agriculture and I think yes.”
According to Suderman, there have been new dynamics at play recently that leads him to think some kind of agreement is possible. For example, in October, the Chinese team brought 100 of their negotiators which surprised the U.S.
“They wanted to make sure if something came up they had the right person there to deal with it,” he explained.
Another difference this time around was the mood and reporting of the China state press.
“While they were here in Washington the China state press back home was starting to publish stories trying to prepare the people for how a trade agreement would be positive for China,” he says.
Ready to Ratify?
While the U.S. Mexico Canada Agreement (USMCA) has been completed for months, it has yet to be ratified by congress. There are unresolved issues between Democrats and Republicans over labor enforcement rules included in the deal, according to Pro Farmer’s Jim Wiesemeyer. While Democrats say there is still time to get USMCA passed this year, Republicans continue to warn that not passing the deal will be a political liability for the other party in 2020.
In October, Senate Finance Committee Chairman Chuck Grassley (R-Iowa) expressed concern the trade pact may not be approved by Congress yet this year. Grassley is “very worried for the first time, starting about now.”
Despite the concerns expressed by some on USMCA prospects this year, White House economic adviser Larry Kudlow said in October that House Speaker Nancy Pelosi (D-Calif.) has been cooperative during the negotiations and USMCA could be approved by the House and Senate this fall. Still, there aren’t that many legislative days left in the House or Senate this year, warns Wiesemeyer.