Business

China stopped buying US ag products. Here’s why that could hit Idaho hard

About the Dairy Industry in Idaho: an industry video

Idaho has about 500 dairy farms, all family owned. This video by Dairy West, a trade group, offers a quick, by-the-numbers glance at Idaho's dairy sector, which is one of the top 5 producers among the 50 states.
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Idaho has about 500 dairy farms, all family owned. This video by Dairy West, a trade group, offers a quick, by-the-numbers glance at Idaho's dairy sector, which is one of the top 5 producers among the 50 states.

China’s decision to halt purchases of U.S. agricultural products could hit Idaho hard, as the trade war between the two countries continues to escalate.

The move comes after the Trump administration threatened a wider expansion of tariffs on Chinese products last week, according to a Bloomberg News report.

China is consistently one of Idaho’s top trading partners, according to Idaho Commerce. In 2018, $417 million in Idaho exports went to China, including $59 million from food and agricultural products.

“The Governor’s office continues to monitor trade talks with China,” wrote spokeswoman Marissa Morrison in an email to the Idaho Statesman on Tuesday. “Due to the developing nature of the negotiations, it is difficult to fully understand how Idaho’s industries, including agriculture, will be affected.”

Idaho’s dairy industry, already struggling with the negative effects of the trade war and Chinese tariffs, stands to lose more than most if China doesn’t resume purchasing food products. China imported more than $38 million in Idaho milk, whey and cheese products in 2017, according to data compiled by the Idaho State Department of Agriculture. That number dropped in 2018, when China added retaliatory tariffs to several Idaho products. There’s currently a 31% total tariff on whey products alone, according to the Idaho State Department of Agriculture.

“Unfortunately, it’s a tough situation to have any sort of influence on,” said Rick Naerebout, CEO of the Idaho Dairymen’s Association. “The (Trump) administration tends to move forward without gauging local or regional impacts on their actions.”

Idaho farms and dairies received $24 million in the last year under a special program meant to help them survive the last round of retaliatory tariffs from China, as well as other countries like Mexico and Canada. But farmers and dairymen across the state received payments that couldn’t come close to what they lost.

Idaho dairy production continues unabated, Naerebout said, but further economic stress only results in more family-owned dairies closing. Naerebout said 20 Idaho dairies have closed so far this year — more than in all of 2018. A number of factors, including a labor shortage, were likely responsible for the closures, but Naerebout said the uncertainty of the trade war had a definite impact. Milk prices were just barely returning to the level that would allow dairies to break even, Naerebout said, after a four-year low.

“We don’t want to get USDA payments,” Naerebout said. “We don’t want to get stuck in the middle of trade disputes. We want to stand on our own two feet and have the industry be successful on its own two merits, not based on politics.”

BEHIND OUR REPORTING

We're diving deep into Idaho agriculture

Reporter Nicole Foy is helping the Idaho Statesman expand coverage of agriculture, farming and food across Idaho. Agriculture and food production has long been an important part of Idaho’s economy, with dairies, international agribusinesses and food processors among the state’s top employers. Many Idahoans have close ties to agriculture, even as houses continue to replace farmland, especially in Boise and throughout the Treasure Valley.

If you have agriculture-related story ideas, contact Nicole at 208-377-6347 or nfoy@idahostatesman.com. You can also take our survey.

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Investigative reporter Nicole Foy covers Latinos, agriculture and government accountability issues. She graduated from Biola University and previously worked for the Idaho Press and the Orange County Register. Her Hispanic affairs beat reporting won first place in the 2018 Associated Press regional awards. Ella habla español.
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