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Stop us if you’re heard this one before – a farmer, a heavy construction equipment operator and a vegetable canning company worker walk into a Senator’s office concerned about the impact potential tariffs on aluminum and steel imports would have on their business. This isn’t the setup to a bad joke; it’s what occurring today in Washington, D.C., after a March 1 announcement by the administration that tariffs of 25 percent and 10 percent may be applied to imports of steel and aluminum, respectively.

The contractor is concerned because the price of steel impacts the cost of completing a construction project such as a bridge or high-rise condominium. The aluminum canning plant worker is concerned because the additional cost of aluminum could result in an increase in the cost of canned vegetables to customers. The farmer, who exports a large share of agricultural production to customers all over the world, is concerned that the foreign governments affected by the steel and aluminum tariffs will retaliate by increasing import tariffs on U.S. agricultural goods, making U.S.-sourced foods less competitive.

All of the visitors to the senator’s office make good points. However, here we focus on the farmer. According to industry publications, many of America’s farmers’ top international customers are also top producers of aluminum and steel. Table 1, with data provided from the U.S. Geological Survey, lists the top aluminum producing countries in 2016 and 2017. Table 2, with data from worldsteel.org lists the top steel producing countries in the same years. Followers of U.S. agricultural trade will notice several important trading partners among the list.

A review of trade data from USDA’s Foreign Agricultural Service reveals that, the farmer in the senator’s office has the right to be concerned. Overall, 33 percent of U.S. agricultural exports in 2017 went to the top aluminum-producing countries. Even more stark, 39 percent of U.S. agricultural exports in 2017 went to the top steel-producing countries. Figures 1 and 2 show that for many states the stakes are even higher.

In fact, FFT put together a report in February that outlined how agriculture is targeted in trade disputes. Details on what the White House has in mind are expected later this week. But for now, the farmer, the construction worker and the canning plant worker wait with baited breath.

Veronica Nigh is an economist for American Farm Bureau Federation

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