Farming in central Indiana has already gone through difficult times. Many farmers have faced growing balances on operating lines of credit. Farmers near Indianapolis also always face the inherent instability of farm product markets. This particular problem, poor market prices, is being intensified by trade war tariffs.
One of the worst hit products is soybeans, which are now at a 10-year low. Many farmers refused to sell at these lower prices last year, hoping to ride out the market storm. However, farmers can only store soybeans for a limited period of time. They can also only store their full crop if they have the facilities for it. They will be forced to sell soon, regardless of market pricing.
Although there are numerous uses for soybeans, the market is being stunted by the retraction of the Chinese export market. The U.S. market still demands high amounts of soybean products, but the Chinese retraction as created a serious over-supply problem. Farmers may be forced to alter their operations in response to this demand change. To make matters worse, fears are growing that the Chinese market could eventually be fed by foreign markets instead of the U.S. market, permanently replacing this demand sector.
Although the soybean market is a good example, other farm markets in Indiana are also being hit. With many farms operating on tight margins and operating loans, the smallest fluctuation in market prices can hit hard. To make matters worse, many of these market fluctuations are unprecedented in recent times. Many farm operations could face insolvency and bankruptcy. A trend towards more farm bankruptcy filings may be lurking right around the corner. Operations that were barely paying the bills may not be operating in the next 2-3 years.
Although many farmers are not against these tariffs in principle, most farmers agree that major trade negotiations should be completed as soon as possible. Even beyond the farming sector, many other sectors of the economy are getting hard by the tariffs including tech industries, automobile markets, and steel. Although many favor trade negotiation, most people want to get these new agreements in place as soon as possible so that tariffs can stop across the board.