The largest private U.S. Company Cargill, Inc. is heading toward a record shattering profit in response to a shocking boom for Farmers in the agricultural market, spurred seemingly by the demand created during the Trump Presidency.
The commodity mega-corporation which has dominated the global marketplace for decades reported a $4.3 Billion net income for the first nine months of its fiscal year, surpassing its best ever total annual profit with three months still remaining. Specifically Cargill pointed to “profitable trading opportunities” in grains and oilseeds created by Chinese demand which it was able to take advantage of. A byproduct of the President Trump’s trade policies with Beijing.
According to Bloomberg,
“Beijing has been buying record amounts of U.S. corn as it tries to rebuild pork production after farmers had to sacrifice millions of hogs in 2019 to stop an outbreak of the deadly African swine fever virus. The U.S. Department of Agriculture forecasts that China is importing 26 million metric tons of corn in the 2020-2021 season, up from just 7.6 million in 2019-2020.”
Fitch Ratings Inc. said,
“The solid underlying structural demand shift for food, fuel and feed within a tight commodity supply environment should provide support for good profit generation by global agribusiness companies,”
Trump Tariffs May Have Proven A Good Strategy for Farmers
Toward the end of 2020 the Associated Press wrote a piece about Trump’s four year long trade war with China, “It may prove to be a good strategy,” said Blake Hurst, a soybean and corn farmer who is president of the Missouri Farm Bureau. “But there are costs to it — costs to our reputation, costs to our future ability to negotiate … It’s a high-risk strategy that we’ve embarked upon, and we don’t know the results yet.”
Results like those from Cargill would seem to demonstrate that the Trump Administration’s course correction in January 2020 was an adroit move. The agreement which according to YahooNews stipulated that “Beijing will buy an additional $200 billion in American products over a two-year period compared to 2017, including $50 billion in agricultural goods.” in exchange for easing tariffs on Chinese-manufactured electronics and cellular devices was even grudgingly called a “mixed-success” by the mainstream media at the time.
With the performance metrics we now have from commodities giants like Cargill, the success is undeniable.