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Chickpeas Sit In Silos As Trump's Trade Wars Wage On


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https://www.npr.org/2018/12/31/678416352/chickpeas-sit-in-silos-as-trumps-trade-wars-wage-on

 

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Since farmers like Druffel brought in this year's crops, hardly any garbanzos — or chickpeas — have moved.

 

"Thirty to 40 percent of our total revenue is in the bin," Druffel says. "And we're not sure what we want to do with it."

 

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The real trouble started early this year, with the U.S. pulling out of the Trans-Pacific Partnership. Then came President Trump's steel and aluminum tariffs. China and India are the two largest buyers of American garbanzos, peas and lentils, and those exports have all but stopped. Other countries are holding off on buying them, too, while the prices are unstable.

 

Druffel saw the market drop only when it was too late — after he had already planted the crop in the spring, and then again after harvest.

"It was a bit of a roller coaster," Druffel says. "It was one of the best crops we've ever harvested. And then to see the pricing take a 40 to 60 percent fall is really unfortunate. If you're talking real numbers, in February of 2018 I sold chickpeas for 50 cents a pound — and today they're trading at 18 cents a pound."

 

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Right now, it's a question of what to plant to make those costs back. Not much in dryland is making money right now. Prices are at or below cost of production in this area for wheat, barley, rapeseed, lentils, garbs and peas.

 

"There's not a lot to run right now, that is the absolute truth," McGreevy says.

 

McGreevy says older farmers might decide to just quit before the next go-round. But young farmers might be giving up the keys to the farm if things don't turn around in a matter of months.

 

"Young farmers generally have a lot more debt that they are assuming as they are just starting off in their careers," he says. "If they are purchasing any property, with prices that we are seeing right now, it's very difficult to cash flow that."

 

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46 minutes ago, TwinIon said:

It certainly seems like a lot of farmers are just going to go bankrupt as a result of this trade war. China is going to find other sources and those trade dollars will never come back.

 

Never coming back is the piece that I think many are in denial of. Once logistics with more amiable trade partners get sorted out, there's no reason at all to throw that all out just to resume trade with the US.

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