Montana farmers and politicians are feeling chafed by President Donald Trump’s dismissive remarks about U.S. sales to Japan, a major market for the state.
Speaking at the Pennsylvania factory, Trump said Japan only bought U.S. wheat to make America feel good. The president described Japan-U.S. trade relations as lopsided, with wheat being the only U.S. product Japan buys, which isn’t true.
“They send us thousands and thousands, millions of cars, we send them wheat. Wheat. That’s not a good deal,” Trump said. “And they don’t even want our wheat. They do it because they want us to at least feel that we’re OK, you know, the do it to make us feel good.”
Montanans bristled at the suggestion. The nation’s third largest wheat producer ships more than 70% of its grain to buyers in the Asian Pacific. Japan is Montana’s top wheat market. Three Japanese companies own 29 Montana grain elevators, either outright or in partnerships. Those businesses literally buy Montana wheat right off the farm truck.
“Japan is our #1 customer for the US and Montana, a relationship we have spent 50 years building along with @uswheatassoc,” tweeted Michelle Jones, past president of the Montana Grain Growers Association. “They are an essential trade partner @realDonaldTrump. Their purchases account for 20% of my income annually.”
Japan is our #1 customer for the US and Montana. A relationship we have spent 50 years building along with @uswheatassoc— Michelle Jones (@bigskyfarmher) August 14, 2019
They are an essential trade partner @realDonaldTrump ...
Their purchases account for 20% of my wheat income annually. @wheatworld @FarmersForTrade pic.twitter.com/E42A7zYnLA
Lyle Benjamin, current president of Montana Grain Growers tweeted, “This mindset fundamentally misunderstands how trade and economies work. This mindset will not get us a useful or even good trade deal. Japan pays top $ for US wheat because they want our quality.”
This mindset fundamentally misunderstands how trade and economies work.— Lyle Benjamin (@LyleBenjamin4) August 14, 2019
This mindset will not get us a useful or even good trade deal.
Japan pays top $ for US wheat because they want our quality.@realDonaldTrump @SteveDaines @SenatorTester @USMCACoalition @wheatworld
Rural Montana turned out for Trump strongly in the 2016 presidential election, despite Trump’s promise to withdraw the U.S. from the 12-nation Trans Pacific Partnership, a multilateral trade agreement that would have generally improved market conditions for Montana wheat and beef in the Asia Pacific and specifically Japan.
The president promised that bilateral agreements would fill the void of the TPP withdrawal, but that hasn’t happened. This year, nations that stuck with a multinational agreement began seeing tariff reductions in Japan while tariffs on U.S. products remained high. Earlier this year, Republican U.S. Sen. Steve Daines said in a Senate Finance Committee hearing that Montana will lose $150 million in wheat sales to Japan in 2019 because of business lost to Canada and Australia.
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Trump has indicated a bilateral trade agreement with Japan will be struck this fall. Earlier in the week, Kyodo news agency reported that Trump has asked Prime Minister Shinzo Abe to buy U.S. wheat and soybeans ahead of finalizing a bilateral trade agreement in September. Kyodo reported Japan was considering the request, which would be worth several hundred million dollars.
“Ag is Montana's number-one industry and Montana's farmers produce the best and highest quality wheat in the world and Japan is one of our best customers. They buy Montana wheat because it's the best. I urge the Administration to quickly finalize trade negotiations with Japan,” said Daines in a text.
Wheat marketing groups contacted by Lee Montana on Wednesday were unaware of a pending major purchase by Japan. Montana’s Wheat and Barley Committee had heard nothing about the sale. U.S. Wheat Associates, the nation’s primary wheat marketing group, issued a fact sheet stating the importance of wheat sales to Japan. Included in the fact sheet was a photo of Chris Kolstad’s Montana wheat operation. Kolstad, U.S. Wheat’s immediate past chair, farms in Ledger.
The National Association of Wheat Growers was among the groups chafed by Trump’s remarks.
“@realDonaldTrump Mr. President, Japan is the #1 market for US wheat exports on average, where we hold just over 50% of the market. They don’t buy our wheat because 'they want us to feel okay.' They buy it because it’s the highest quality wheat in the world,” tweeted the National Association of Wheat Growers. “That’s not fake news.”
.@realDonaldTrump Mr. President, Japan is the #1 market for US wheat exports on average, where we hold just over 50% of the market. They don’t buy our wheat because “they want us to feel okay.” They buy it because it’s the highest quality wheat in the world. That’s not fake news.— NAWG (@wheatworld) August 14, 2019
Benjamin and fellow Montana farmer Vince Mattson, are on the NAWG board of directors.
Democratic U.S. Sen. Jon Tester, a wheat farmer, said in a press release “Montana farmers grow the best wheat in the world, and that’s exactly why countries like Japan — the number-one importer of our wheat and one of America’s closest allies — buy it.”
Wheat is a small fraction of U.S. goods sold to Japan. The U.S. Trade Representative reports that Japan bought $120.4 billion in U.S. goods and services in 2018. The U.S. bought $177.1 billion in goods and services from Japan. Japan was the fourth largest destination for U.S. export goods. U.S. farm products accounted for $13 billion of those exports, including $698 million in wheat sold.