The "Phase One" trade agreement signed between the United States and China is a positive step, according to North Dakota farm leaders who spoke at an ag panel at the Jamestown Civic Center Thursday. However, most felt it was too early to determine how big a factor it will be for future farm prices.
"Phase one that was signed yesterday is a real good first step," said Mark Watne, president of North Dakota Farmers Union. "The challenge is enforcing it if China doesn't purchase what they agree to."
Doug Goehring, North Dakota commissioner of agriculture, said the effect may not be felt immediately.
"I expect more normal trade relations for the 2020 crop," he said. "We should see stability and predictability going forward. Some of the technical barriers are being reduced."
Technical barriers include limitations on some genetically modified crops and other farming practices.
Goehring was one of the witnesses in the room when President Donald Trump signed the agreement Wednesday in Washington, D.C., on Wednesday. The agreement calls for China to make purchases of American agriculture products at market prices but leaves some of the tariffs in place.
Goehring said he was intrigued by the interaction between Chinese trade officials and Trump but believes we are "on the path to a better agreement and situation."
Watne and Goehring were joined by Nancy Johnson, North Dakota Soybeans Growers Association executive director, and Julie Ellingson, North Dakota Stockmen’s Association executive director, as part of a panel discussion hosted by the Jamestown Area Chamber AgEnergy Committee during the Winter Ag & Construction Expo.
Johnson said North Dakota has developed the infrastructure to deliver soybeans and other crops to China.
"Soybeans might be the most profitable crop to plant next year," she said, "but it might be a thin margin."
Johnson said increases in domestic use of soybeans would also aid North Dakota soybean farmers.
"What would make us happy would be a crush plant in Stutsman County," she said.
Minnesota Soybean Processors had planned to construct a soybean crushing plant at Spiritwood up until last summer. Minnesota Soybean Processors said in court documents that the Spiritwood Energy Park Association was working with Archer Daniels Midland on a possible future plant.
Ellingson said exports account for about 15% of the annual beef production in the United States with most going to Japan.
Goehring said tariffs are just one of the issues that can limit American exports of farm commodities.
"The biggest key is the value of the dollar," he said. "We have the highest quality and safest food but many countries can't afford it because of the value of the dollar."