By Kirk Maltais
Approval of President Trump among farmers in the Corn Belt is on the rise following the signing of the long-awaited U.S.-China trade deal last week.
According to a monthly poll from agricultural trade publication Farm Journal released Sunday, 83% of farmers and ranchers approve of the president's job performance. It is the highest level of support for Trump among farmers since he took office, Farm Journal said.
The poll collected 1,286 responses among roughly 5,000 ranchers and farmers asked via text to give their opinion. Respondents were nationwide, but concentrated mostly in Midwest states like Illinois, Iowa, Indiana and Nebraska.
"We have heard repeatedly from farmers that they believe in the end of the trade fight with China," said John Herath, news director at Farm Journal.
The uptick in farmer support comes following the signing of the so-called phase-one trade agreement in Washington on Wednesday. The deal stipulates that China will purchase roughly $36 billion worth of U.S. agricultural exports in 2020, and over $43 billion in 2021.
Also playing a role in boosting farmer sentiment is the U.S. Senate passing the U.S.-Mexico-Canada Agreement on Thursday, the free-trade deal replacing the 26-year-old North American Free Trade Agreement.
"This trade agreement comes at a critical time for farmers and ranchers, increasing optimism that we'll turn the corner in 2020," said American Farm Bureau President Zippy Duvall in a statement Thursday following the Senate vote.
However, futures markets haven't responded strongly to these deals. Since the U.S.-China deal's signing, soybean futures on the Chicago Board of Trade have fallen 1.3%, closing at nearly $9.30 per bushel Friday. Corn and wheat futures have only marginally risen, by 0.1% and 0.3% respectively.
Weight on grains futures came mostly from what was perceived as terms favorable to China in the written agreement, allowing for Chinese buyers to start and stop export purchases depending on need and market conditions. However, traders believe China will buy large shipments of U.S. agriculture soon, with the deal specifying a 30-day window from the signing date for most commodities before a purchase program starts.
"While this may have turned out to be a disappointing week for many, I believe it will ultimately turnout to be nothing more than a detour on the road to recovery," said Dan Hueber, general manager of the Hueber Report, an agricultural research newsletter.
Farmers had a trying year in 2019, due to record rainfall during the spring and global trade tensions sinking commodity prices. Farm debt in 2019 is projected to hit $416 billion, a record, according to the American Farm Bureau.
Write to Kirk Maltais at Kirk.Maltais@wsj.com
(END) Dow Jones Newswires
January 19, 2020 17:10 ET (22:10 GMT)
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