Wednesday, September 5, 2018

Sanctions and globalism killed the agricultural star

For most of the 20th century, America was the primary bread basket to the world.  In fact until the mid 1970's when the vestiges of Globalism would begin to take shape via Nixon's 'trip to China' and the world disconnecting from the gold standard, the U.S. was the world's leading producer in corn, soybeans, and wheat.

But alas, how quickly one's dominance can wane.

Today the U.S. no longer is the bread basket to the world, and in fact has lost most of their competitive advantages thanks in large part to failed monetary and fiscal policies, and the use of economic war which has pushed other nations to expand their own agricultural efforts in response.

Brazil overtook the U.S. as the world’s biggest soybean exporter in 2012-13, according to the U.S. Department of Agriculture. It’s projected to be the second-largest corn exporter, on the heels of the U.S., this season. As of the last crop year, Russia now beats America in shipments of wheat. 
It’s a reversal for a country that has long identified as the world’s bread basket. America’s share of global corn, soybean and wheat exports has shrunk by more than half since the mid-1970s, the USDA says. In soybeans, the most exported U.S. crop, U.S. supplies make up about 40% of world exports, down from more than 70% three decades ago. 
Other countries’ rising share of global trade and their bin-busting harvests have helped fuel a multiyear downturn in crop prices that is pushing some U.S. farmers out of business. – Wall Street Journal
Yet what is perhaps becoming even more frightening is that America is now going down the path where they may one day soon become a global importer of agricultural goods, which inevitably spells the end of empirical dominance.

Oh wait... they already have thanks to NAFTA.
In the mid-1990s, supporters of the World Trade Organization (WTO) and the North American Free Trade Agreement (NAFTA) sold the deals to U.S. farmers and ranchers as the new path to economic success – hyping the agreements’ prospects for increasing exports. 1 U.S. food exports have increased, but not nearly as much as food imports. In 2013, the total volume of U.S. food exports stood just 0.5 percent higher than in 1995, the year that the WTO took effect. In contrast, imports of food into the United States in 2013 towered 115 percent above the 1995 level that marked the dawn of the WTO era. – Citizen

And sadly thanks to a third leg of irresponsible fiscal policy, the very country the U.S. has focused economic sanctions upon has not only adapted to their financial restrictions by increasing their agricultural output several fold, but has even overtaken the U.S. in the exporting of wheat and grain.
US Wheat Associates (USW) has announced the closing of its Moscow office on October 1 due to lack of demand for American wheat in Russia. Since 2016, Russia has been the global leader in grain exports. 
“With much more public information available about Russia’s wheat supply, we believe it is time to end our mission there and continue allocating more resources in markets where our export volume is growing,” said USW Vice President of Overseas Operations Mark Fowler. 
According to him, “Russian wheat is obviously very competitive in certain markets, but it is important to point out that our marketing and technical teams based in Rotterdam, The Netherlands, and Casablanca, Morocco, will continue competing for export business in the Middle East and North Africa.”Russia Today
So the next time a politician tries to publicly pander to the nation's farmers and tell them that their plight is the fault of Russia, or China, or anyone else they can try to blame, just remember that the real enemy is the bureaucracy in Washington, who has in a short amount of time taken a nation that once was the bread basket to the world in the 20th century, to the brink of bankruptcy here in the 21st.


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