Twin punches of tariffs and floods are threatening to knock out farmers all across the Midwest – and in the Mississippi River basin. That basin drains from 31 states.
If rain falls in an area not even near the river’s main stem, it can still affect Mississippi River levels as that wall of water makes its way south – affecting farms and shipping.
And this past week President Donald Trump raised the tariff on Chinese goods to 25 percent. China retaliated May 13 with increased tariffs on $60 billion worth of American goods. Tariffs of 5 percent to 25 percent will take effect June 1 on about 5,200 American products – including livestock, food products and precision machinery.
“That adds further stress to an already-stressed Mississippi River economy,” said Frank Klipsch, mayor of Davenport, Iowa, and co-chair of the Mississippi River Cities and Towns Initiative. “China is the largest destination for U.S. soybeans – 30 percent of all soybean production. … Half the soybean-producing states are along the Mississippi. Agriculture is the third-largest economy along the river.
“We just sustained record flooding in our area – water above flood level for more than 40 days in the Quad Cities. This is not the most the opportune time to prolong tariff battles and give our soybean growers more bad news.”
Most of the Midwest has been dealing with greater-than-usual precipitation.
“A lot of that water is sitting in fields,” he said. “We’re dealing with a lot of weather issues. How do they get crops in the ground and then what do they do with them once they’re grown?”
The initiative brings together cities and farmers all along the river, with the mission to give them a voice. That voice is aimed at Washington, D.C., asking for help.
“We took a detailed look at disaster relief that’s making its way through the House right now,” said Colin Wellenkamp, executive director of the initiative. “There’s a lot in there that includes flooding but a lot that doesn’t. There’s a glaring omission as to assistance for the Mississippi and Missouri river basins, that we’d like to see put in. Our communities need as much assistance as possible.
“Impacts have been extreme this season, and are ongoing and we expect then to get worse. Some growers and some communities just aren’t going to be able to move their product for a while. That’s going to have an ongoing economic impact that we can’t even quantify yet.”
Klipsch said, “We need to have some moderation regarding soybeans – that our farmers are protected and we get the help we need related to the disasters we’re experiencing.”
Parts of the Mississippi River remain closed due to flooding; barges can’t move to ship grain. Some railroad tracks are flooded so agricultural goods can’t be shipped via rail.
“There’s a five-mile stretch of river closed,” Wellenkamp said. “Whenever it’s closed that costs $300 million a day in lost productivity to the nation. Currently rail routes are underwater; that adds to that economic impact. In some areas water is going down, but some areas had rain last night, with more rain today and tomorrow. It’s going to get a little worse before it gets better. It’s a roller coaster ride for us.”
Many fields are underwater – and even away from the river, many fields are too wet to plant.
“We are experiencing record flooding,” said Phil Stang, mayor of Kimmswick, Missouri. “I live right on the Mississippi River. If we go above 39 feet (river level) my living room will have catfish in it.”
With continuing high river levels and more rain, that’s a possibility. And the escalating trade war is adding more injury to injury.
“Ultimately people’s lives are on the line,” Stang said. “Nuances in negotiation have an exponential impact on the ground. Tweets, bluster and rhetoric can translate to the loss of farmers and our economy. There’s a degree of endangerment as to how it impacts real folks on farms and on Main Street USA and on Market Street. I support better trade deals for our country but we need to keep our global commodity supply chain whole.”
The tariffs and flooding are affecting not only the growers. They’re affecting the shipping industry as well as the communities that depend on them.
“We’re just south of Baton Rouge, where the Port of Baton Rouge begins,” said Lionel Johnson Jr., mayor of St. Gabriel, Louisiana, and co-chair of the initiative. “We are the gateway port for (soybeans) to the rest of the world – and China is the largest destination. Some of our river cities have been battling flooding since early November. We were under a flood watch as recently as last night (May 9). We find this the most inopportune time to deal with tariffs.”
The Army Corps of Engineers said due to torrential rains bringing a rapid rise on the Mississippi River, the Corps was opening a major Louisiana spillway four days earlier than expected. The Bonnet Carré Spillway is opened to relieve stress on New Orleans levees. The Mississippi River had risen 6 inches in 24 hours, and more rain was expected through the weekend.
And officials are planning to re-close a floodgate in Mississippi, with predictions issued May 10 that a flood inside a region walled off by levees will set a new record. The U.S. Army Corps of Engineers opened April 1 a floodgate north of Vicksburg after six weeks of closure. Floodwaters fell for a time, but began to rise again because of heavy rainfall. Now a rising Mississippi River means the gate will need to be closed again to prevent even worse flooding inside the walled-off basin. The lingering flood makes it unlikely that farmers will plant any summer crops on hundreds of thousands of acres in the south end of Mississippi’s Delta region.
Several Mississippi River Cities and Towns Initiative members gathered May 10 on a phone call with other industry representatives in an effort to put the word out about the double threat to not only farmers but also river communities. More than $500 billion in revenue rolls down the Mississippi River – revenue that is stalled.
“Illinois is No. 1 in soybeans,” said Mike Thoms, mayor of Rock Island, Illinois. “I’m sure we’re all interested in measures to win better trade deals. But I think that we pursue that balance using a strategy that is less corrosive than a prolonged all-out trade war. … We’ve been patient with the administration but we’re going through a record flood, which adds insult to injury.”
Davie Stephens, president of the American Soybean Association, said the association started working in 2017 with the Trump administration.
“We urged them to get something worked out before tariffs were implemented,” he said. “Here we are 10 to 11 months after that fact and we’re still working with the administration.
“We’re being affected left and right by what is imposed. I live on the Mississippi River (in Kentucky). There’s a lot of my county underwater. It’s made an impact on sub-surface moisture. It delays planting not only soybeans but also corn. All the crops are being affected. …
“The tariff issues add another stress on our already-stressed farmers. … We have a one-two punch here – record or near-record flooding affecting our growers and our cities. We expect high water through May and maybe beyond.”
Wet weather continues in the long-range forecast.
Wellenkamp said, “If the closures continue due to high water through the month – we hope that isn’t the case – that will have a continuing prolonged impact for a good portion of our freight. We’re hoping not a whole lot more water falls into the system.”
Stephens was on a phone call early May 10 with administration officials regarding the future of soybean trade.
“When you look at 2017 and look at now, a lot of things have changed in agriculture,” he said. “This morning we talked about how we move forward. How do we respond and how do we take action on what will be the retaliation from China? We’re ready to react, first and foremost, but we don’t want to sit here and guess what China’s response will be.
“If (the trade) can get resolved in the short term, it will take some time (but will) reestablish itself, hopefully. I don’t know if it will be 100 percent. But if something’s not resolved, it could have an impact on what it looks like for the next several generations to come.
“We’d like the president to hear us and believe what we are saying about the real-life consequences to our farms and families as this trade war drags on. … It took us more than 40 years to develop the China soy market. For most of us in farming, that is two-thirds of our lives. If we don’t get this trade deal sorted out and the tariffs rescinded soon, those of us who worked to build this market likely won’t see it recover in our lifetime.”
Visit www.mrcti.org for more information on the initiative.
The Associated Press contributed to this story.