WASHINGTON, April 12, 2017 - International trade isn’t a topic commonly paired with the U.S. farm credit system, but it has increasingly become one of the top issues that bankers and banking representatives are bringing up with lawmakers and whoever else will listen.

Years of low commodity prices, coupled with falling farm income and tightening credit are weighing heavily on the agricultural economy, and there’s not much room for more bad news – like perhaps a loss of substantial export markets.

The U.S. exports about 20 percent of the pork, 15 percent of the corn, 50 percent of the soybeans and 50 percent of the rice that farmers produce here, so the health of the farm economy depends largely on trade. If one goes, the other goes too, Farm Credit Council President Todd Van Hoose said in an interview with Agri-Pulse.

“We’re going to be talking about the importance of trade,” said Van Hoose, when asked about the group’s message over the coming months to Congress. “As we go around the country, we see farmers asking that question – ‘Where are we going on trade and how can we open new markets?’ That’s going to be vital.”

Van Hoose isn’t alone in his concerns about trade. Doug Thiessen, CEO of Alabama Ag Credit, told lawmakers in a recent House Agriculture subcommittee hearing that Congress needs to support trade expansion.

 “American farmers and ranchers are the most efficient in the world and will lead the effort to feed a planet of 9 billion people by the year 2050,” he testified. “We strongly encourage continued efforts to open markets for U.S. farm products. Our producers can compete with any in the world but trade barriers in other countries often tilt the playing field against them.”

  Exports have become such a major part of the farm economy that they represent about $50 of the $160 to $180 that a farmer gets for every pig, Neil Dierks, CEO of the National Pork Producers Council, told reporters at a recent briefing.

Concerns from the farm credit sector are especially relevant because the trade landscape is increasingly uncertain under the Trump administration. One of the first actions President Donald Trump took after his inauguration was to withdraw the U.S. from the Trans-Pacific Partnership, a 12-nation trade pact that beef, corn, soybean, pork and other producers had been counting on to increase exports.

Another destabilizing event was Trump’s insistence that he will follow through on campaign promises to renegotiate or pull the U.S. out of the North American Free Trade Agreement (NAFTA). However, in a meeting with leading business CEOs on Tuesday, Trump promised “some very pleasant surprises” to come on NAFTA.

Robert Lighthizer, Trump’s nominee to be the next U.S. Trade Representative, has said NAFTA can be overhauled without impacting the tariff-free exports that farmers enjoy under the pact, but the U.S. ag sector is not yet convinced that’s so.

“We travel around a lot,” Van Hoose said, “and the questions I get are, ‘What’s going to happen in the farm bill?’ and ‘Are we going to get more trade agreements? Where are we going with that?’”

Bob Young, chief economist with the American Farm Bureau Federation, says the credit sector and farmers are justified in their concerns about the future of international trade. Young stressed the lost opportunity of TPP – Farm Bureau estimates that tariff reductions under TPP would have net farmers an extra $4.4 billion annually – and said he worries that some benefits from NAFTA are threatened.

“We’ve had an awful lot of rhetoric out of politicians here lambasting trade and beating up on (China and Mexico) to the extent that we’ve threatened them with much higher tariffs and spoken of (Mexico) poorly on the immigration front as well. We’ve actually got Mexico already starting to look to South America for some grain supplies.”

It’s those kinds of developments that make farmers skittish, Young said, stressing that one of the most egregious setbacks was the loss of TPP.

“We had a trade agreement that was basically done and we were just waiting for congressional ratification that would have given us a significant increase in access to the Japanese beef market, for example,” Young said. “This administration decided to come in and wave a hand and just throw that away.”