Trade War Causing Severe Pain As Farm Bankruptcies Surge Way Past The Level From The Last Recession
Trade War Causing Severe Pain As Farm Bankruptcies Surge Way Past The Level From The Last Recession by Michael Snyder – The Economic Collapse Blog
Farmers all across the middle part of the country are going bankrupt at an astounding rate, and over half of all farms in America are now losing money. The trade war with China has been the most devastating crisis to hit the U.S. farming community in decades, and at this point there is no end in sight. Farm after farm is being financially wiped out, and we haven’t seen this kind of economic pain for farmers since the Great Depression of the 1930s. In fact, it is being reported that bankruptcies in the key farming regions of the country are way above the level that we witnessed during the last recession. The following comes from Zero Hedge…
Bankruptcies in three regions covering major farm states last year rose to the highest level in at least 10 years. The Seventh Circuit Court of Appeals, which includes Illinois, Indiana and Wisconsin, had double the bankruptcies in 2018 compared with 2008. In the Eighth Circuit, which includes states from North Dakota to Arkansas, bankruptcies swelled 96%. The 10th Circuit, which covers Kansas and other states, last year had 59% more bankruptcies than a decade earlier.
There has been a lot of debate about whether or not the U.S. economy as a whole is heading into a recession in the near future, but the farming industry is already very, very deep into a major downturn, and this downturn has been caused by the trade war…
Trade disputes under the Trump administration with major buyers of U.S. farm goods, such as China and Mexico, have further roiled agricultural markets and pressured farmers’ incomes. Prices for soybeans and hogs plummeted after those countries retaliated against U.S. steel and aluminum tariffs by imposing duties on U.S. products like oilseeds and pork, slashing shipments to big buyers.
Low milk prices are driving dairy farmers out of business in a market that’s also struggling with retaliatory tariffs on U.S. cheese from Mexico and China. Tariffs on U.S. pork have helped contribute to a record buildup in U.S. meat supplies, leading to lower prices for beef and chicken.
In addition, it is also being reported that more than half of all U.S. farms are now losing money even though they continue to operate. Needless to say, this is not sustainable, and many more farms will go out of business if this current crisis persists.
This could be the final nail in the coffin for America’s family farms. After this crisis is over, if it ever actually ends, we may be left with only giant corporate farms and farms owned by foreign interests.
As I noted in my article yesterday, over 27 million acres of U.S. farmland is now owned by foreigners. This should have never been allowed to happen, because it is a major national security risk.
If a trade agreement with China is reached soon, that would greatly ease the suffering of America’s farmers. But as long as the U.S. and Canada continue to hold Huawei CFO Meng Wanzhou, that is not going to happen. Instead, the Chinese are going to attempt to buy time by trying to get the U.S. to agree to suspend the implementation of additional tariffs as “negotiations” continue.
And on Friday, we got word that a new trade war between the United States and Europe may be about to begin…