Latest / Closing Market Report / SPECIAL | Reagan, Trump, Argentina, & Beef Producers

Transcript

SPECIAL | Reagan, Trump, Argentina, & Beef Producers · Closing Market Report

• 0:00
  Todd Gleason: From the land to Grant University in Urbana Champaign, Illinois. This is the closing market reported as the October 2025. I'm Illinois Extension's Todd Gleeson away from the office today. So I thought we'd explore the Trump administration's trade policies as they relate to agriculture and the things that have taken place on the world stage this month with soybeans, beef cattle, and Argentina. Now before we get started, I'll remind you to visit our website at willag.org where today you can purchase your tickets for the December Farm Assets Conference to be held in Bloomington at the AGRA Center on the twelfth, that's a Friday, and one of the three Illinois farm economic summits scheduled around the state the following week, December 15 in DeKalb, on Tuesday the sixteenth in Peoria, and the seventeenth in Mount Vernon.
• 0:49
  Details again and a way to register are online right now at willag.org or at farmdocdaily.illinois.edu.
• 0:58
  announce: Todd Gleason's services are made available to by University of Illinois Extension.
• 1:03
  Todd Gleason: Let's set the trade policy stage first. Surprisingly, we'll do that by going back to just Thursday of last week. It was when president Trump announced on Truth Social that he was terminating, for the second time as it happens, trade and tariff negotiations with Canada. The president was angry about a province of Ontario television ad campaign running in The United States featuring former US president Ronald Reagan. The sound bites in it were pulled from a 1987 radio address Reagan made to the nation arguing not until the very end that Congress should not restrict his right to impose tariffs on semiconductors imported from Japan into The United States.
• 1:45
  Now Reagan's speech encapsulates from my viewpoint the basis from which most US agricultural trade policies and farm programs have been developed since he first took office starting with the 1985 Farm Bill, moving through the 1990s GATT or General Agreement on Tariffs and Trade which eventually gave way to the WTO or World Trade Organization and even including the federal crop insurance programs. Now you may watch the five minute address which president Reagan delivered from Camp David in Maryland to 04/25/1987 on YouTube. However, we'll listen to it in its entirety today courtesy of the Ronald Reagan presidential library.
• 2:29
  Ronald Reagan: My fellow Americans, prime minister Nakasone of Japan will be visiting me here at the White House next week. It's an important visit because while I expect to take up our relations with our good friend Japan, which overall remain excellent, recent disagreements between our two countries on the issue of trade will also be high on our agenda. As perhaps you've heard, last week, I placed new duties on some Japanese products in response to Japan's inability to enforce their trade agreement with us on electronic devices called semiconductors. Now imposing such tariffs or trade barriers and restrictions of any kind are steps that I am loath to take. And in a moment, I'll mention the sound economic reasons for this.
• 3:14
  But over the long run, such trade barriers hurt every American worker and consumer. But the Japanese semiconductors were a special case. We had clear evidence that Japanese companies were engaging in unfair trade practices that violated an agreement between Japan and The United States. We expect our trading partners to live up to their agreements. As I've often said, our commitment to free trade is also a commitment to fair trade.
• 3:42
  But, you know, in imposing these tariffs, we were just trying to deal with a particular problem, not begin a trade war. So next week, I'll be giving prime minister Nakasone the same message. We want to continue to work cooperatively on trade problems and want very much to lift these trade restrictions as soon as evidence permits. We wanna do this because we feel both Japan and The United States have an obligation to promote the prosperity and economic development that only free trade can bring. Now that message of free trade is one I conveyed to Canada's leaders a few weeks ago, and it was warmly received there.
• 4:21
  Indeed, throughout the world, there's a growing realization that the way to prosperity for all nations is rejecting protectionist legislation and promoting fair and free competition. Now there are sound historical reasons for this. For those of us who lived through the great depression, the memory of the suffering it caused is deep and searing. And today, many economic analysts and historians argue that high tariff legislation passed back in that period called the Smoot Hawley Tariff, greatly deepened the depression and prevented economic recovery. You see, at first when someone says, let's impose tariffs on foreign imports, it looks like they're doing the patriotic thing by protecting American products and jobs.
• 5:06
  And sometimes for a short while it works, but only for a short time. What eventually occurs is first homegrown industries start relying on government protection in the form of high tariffs. They stop competing and stop making the innovative management and technological changes they need to succeed in world markets. And then while all this is going on, something even worse occurs. High tariffs inevitably lead to retaliation by foreign countries and the triggering of fierce trade wars.
• 5:37
  The result is more and more tariffs, higher and higher trade barriers and less and less competition. So soon because of the prices made artificially high by tariffs that subsidize inefficiency and poor management, people stop buying. Then the worst happens. Markets shrink and collapse, businesses and industries shut down, and millions of people lose their jobs. The memory of all this occurring back in the thirties made me determined when I came to Washington to spare the American people the protectionist legislation that destroys prosperity.
• 6:09
  Now it hasn't always been easy. There are those in the congress just as there were back in the thirties who wanna go for the quick political advantage, who risk America's prosperity for the sake of a short term appeal to some special interest group who forget that more than 5,000,000 American jobs are directly tied to the foreign export business and additional millions are tied to imports. Well, I've never forgotten those jobs. And on trade issues, by and large, we've done well. In certain select cases, like the Japanese semiconductors, we've taken steps to stop unfair practices against American products, but we've still maintained our basic long term commitment to free trade and economic growth.
• 6:55
  So with my meeting with prime minister Nacasone and the Venice Economic Summit coming up, it's terribly important not to restrict the president's options in such trade dealings with foreign governments. Unfortunately, some in the congress are trying to do exactly that. I'll keep you informed on this dangerous legislation because it's just another form of protectionism, and I may need your help to stop it. Remember, America's jobs and growth are at stake. Until next week.
• 7:28
  Thanks for listening, and god bless you.
• 7:29
  Todd Gleason: Now that was Ronald Reagan from 1987 making a radio address to America about free and fair trade. Again, we're using it as a starting point for the desktop president Donald Trump has been having with US farmers this month. Now because on average, most US farmers came of age in the nineteen eighties, the trade policies they and the organizations which represent them have overwhelmingly supported our free and fair trade ideals like Reagan was espousing. Or they did until 2015 when then candidate Donald Trump was arguing against TPP or the Trans Pacific Partnership. Just after he was elected, the agricultural organizations lined up in support of getting TPP passed in the lame duck session.
• 8:15
  There, from my vantage, was a clear disconnect at that point between the ag lobby and farmer and rancher voters. It's pretty much existed right through this last month. Now early in the month, row crop farmers found themselves, let's say, miffed when President Trump, even as China has refused to purchase US soybeans this year, offered to lend support to the Argentine government by purchasing its currency. Argentina in that same time frame took an export tax of 35% off its outgoing soybeans. China purchased tens of cargoes from them.
• 8:51
  The two things weren't quite related but as many analysts on this program said out loud, the optics were not good. That was at the beginning of the month, then came news near the end of this month and spilling through last week that the president wanted to do more for Argentina while lowering the price of beef for US consumers. It started with reporters' question to the president aboard Air Force One about his plan to import more beef from the South American nation into The United States.
• 9:20
  unidentified reporter: What do you have to say to US farmers who feel that the deal is benefiting Argentina more than it is them.
• 9:27
  Donald Trump: Argentina's fighting for its life, young lady. You don't know anything about it. They're fighting for their life. Nothing is benefiting Argentina. They're fighting for their life. Do you understand what that means? They have no money. They have no anything.
• 9:40
  Todd Gleason: The news of the president's plan to import Argentine beef into The United States spread quickly, and the National Cattlemen's Beef Association wasted no time in responding. Here's the audio it sent out Monday to farm broadcasters after the Sunday air force one event. Colin Woodall is the chief executive officer for NCBA. He's being interviewed by Hunter Erman, also with the association.
• 10:03
  Hunter Ihrman: I'm here with NCBA CEO Colin Woodall. Colin, president Trump has been talking about potentially importing beef from Argentina as a way to address higher beef prices. Colin, what is NCBA's response to this plan?
• 10:18
  Colin Woodall: Well, we are extremely concerned with the plan, but probably more importantly, we are just flat disappointed that this is the approach that the president has taken. We understand what he is trying to do, but what he does not realize is that in trying to bring the price of beef down for the consumer, it means he's going to bring down the price being paid for cattle for US producers. So in effect, this is a direct attack on US cattle producers, and it negates so much of the work that we have done over the years to build the overall quality of our product, a quality that we're very proud of when you see the amount of beef that is grading Choice and Prime. The consumer likes what we are giving them and they've made it very clear that they want more of it. And that's why demand remains at almost a forty year high and that the consumer is still buying our great product.
• 11:16
  And unfortunately, the president's plan will have a huge impact on how we as cattle producers can capitalize on that.
• 11:24
  Hunter Ihrman: Colin, what is your message to the public or to the administration about how ideas like this impact family farmers and ranchers here in The US?
• 11:32
  Colin Woodall: It was pretty simple. Come talk to us. You know, we've had a great relationship with the White House and with the Secretary of Agriculture. They know that we are good partners and we have facts and figures. Just come visit with us and we can talk through any issue that pops up.
• 11:48
  But there also needs to be a realization from the president, from the secretary that any offhanded comment, as innocuous as they may think that it is, can have huge ramifications on the marketplace. And we saw that on Friday when the futures markets just absolutely crashed. And that cost this industry and a lot of cattle producers a lot of money. And for nothing more than just a passing comment on a plan that wasn't even fully formed. And that is unfortunate that this is not just about what could happen to us financially if the president moves forward with this plan, but what has already hit us as cattle producers just simply because of his comments.
• 12:31
  Todd Gleason: Colin Woodall is the CEO of the National Cattlemen's Beef Association. He made those comments Monday. Tuesday, US secretary of agriculture Brooke Rollins was doing damage control on CNBC. She's from Texas and her family is involved with the beef cattle industry. That's important because ag is a pretty small world and so she has some street creds.
• 12:54
  Brooke Rollins: We have had a massive run on beef over the last decade, and we've had almost 17% of our producers closed, which is about our ranchers, which is about a 150,000 ranchers have now stopped ranching. It's a whole other show. We need to describe that, but, basically, there's been a massive consolidation, which has not been good for our ranching industry. We have, you know, offshored a lot of that to some companies in Brazil and some other internationally. China owns some other companies.
• 13:20
  There's a real, really important realignment that has to happen for us to begin to onshore. We talk about onshoring and reshoring for manufacturing. We need to onshore and reshor for our beef producers, for our ranchers. So the prices are high. The president is very focused on fulfilling his promise of bringing grocery prices down, but he's also very focused, and you'll hear more from us perhaps in the next day or two on what we are going to do to incentivize, to open up new lands, to make it easier to become a rancher, to build more low you know, processing plants around the country so there aren't just a handful in the middle of the country.
• 13:58
  Todd Gleason: Again, US secretary of agriculture Brooke Rollins on Tuesday of last week. We'll get back to the Trump administration's plan in a bit. Somewhere in this time frame word gets out that the administration is planning to quadruple the amount of Argentine beef allowed to enter The United States. Honestly, it's not a huge amount, but that's not the point, and cattle ranchers were enraged. The president could not understand the pushback and posted that was the case on True Social, writing, the cattle ranchers, who I love, don't understand that the only reason they are doing so well for the first time in decades is because I put tariffs on cattle coming into The United States, including a 50% tariff on Brazil.
• 14:43
  If it weren't for me, they would be doing just as they've done for the past twenty years. Terrible. It would be nice if they would understand that, but they also have to get their prices down because the consumer is a very big factor in my thinking also. Well, that did not go over well. NCBA responded on x.
• 15:07
  Cattlemen and women cannot stand behind president Trump while he undercuts the future of family farmers and ranchers by importing Argentinian beef. That evening, the current president of the NCBA, Buck Warbine from Nebraska, was on the NewsHour. That's the PBS evening newscast.
• 15:26
  Geoff Bennett: So help us understand your opposition. Why are your members so strongly against expanding Argentine beef imports right now? From the outside, ranchers appear to be doing better with higher beef prices. So what's the core concern?
• 15:39
  Buck Wehrbein: The core concern is that it's a misguided attempt to lower prices to the consumer. And what the rhetoric and ideas and so forth that the president has put forth has big negative impacts on our markets like our futures market, and that is instantaneous. And yet the lag time from our cattle markets to the price in the grocery store is long. I mean, that's years in the making. And so this is going to negatively impact producers while doing almost nothing for consumers.
• 16:13
  Todd Gleason: So ranchers generally oppose president Trump's plan to buy more beef from Argentina arguing it will negatively impact their markets and do little to lower consumer prices. They believe the market will naturally correct itself and are concerned about animal health issues and long term effects of increased imports. Instead of increasing beef imports, they, in this case Buck Warbine on the NewsHour, suggest the administration focus on supporting ranchers through infrastructure improvements and regulatory changes.
• 16:44
  Buck Wehrbein: Yes. There are things that they can do. It will take time, but the market will take care of itself. And they've got the money and the commitment to build us a facility in South Texas to deal with the new world screwworm, which is pest making its way through Mexico that will get here. And that's gonna hurt us even more on our supplies so they can get going on that.
• 17:07
  They made a commitment in August, and we are very grateful for that, but nothing has happened yet. We've got the Endangered Species Act with wolves that are killing lots of calves and black vultures doing the same thing. And so they could work on things like the Endangered Species Act that are invasive and are hard on our producers and other regulatory items that could help ranchers be confident that they can rebuild their herd as soon as they're able to when they get grass again. So there are things that can be done. The main message though, is that the markets work and they will work, and what we don't need is anybody manipulating them.
• 17:47
  Todd Gleason: Warbine is clearly aware of the longer term eight to ten year cattle cycle, which is overdue to top. Beef markets have been climbing higher for years as the size of The US herd has been shrinking. This has happened in part because profitability has not been good, either because the price of corn has been high or because of the widespread drought that continues from place to place in the plains from Texas to Montana causing shortages of usable pasture land. It's something that Mike Zuzlow mentioned on this program last Friday, and then he went on to the market manipulation function, he's fearful the administration may deploy for the second time in this calendar year.
• 18:29
  Mike Zuzolo: I think he's gotten to a point with some of the people that he works with that has said beef prices are too high. We need to bring them down. And the the truth social post that he had earlier this week would would give me that kind of feeling, the the way he worded things. And that his goal now is to use whatever's in his arsenal to bring down beef prices. I think what I'm gonna be watching very closely now is what he talks to Brazil about and what he talks to Australia about because he went around his his administration went around and and talked to key countries to bring eggs into this country.
• 19:10
  I'm guessing he's trying to do that with the beef. So if we're gonna go down another leg, I'm gonna guess it's gonna be because that Australia and Brazil are bringing beef in, and that is a sizable quantity.
• 19:23
  Todd Gleason: Unlike the amount of beef that might come in from Argentina, which would be small as Matt Bennett pointed out during the Thursday closing market report.
• 19:32
  Matt Bennett: We wanna look at it from an actual statistics standpoint. Argentina, their imp our imports of Argentine beef last year was about 2.2. And so that amounted to if if we go ahead and increase to 80,000, you're probably only gonna raise, you know, our imports from them. You know, it's only gonna raise our our, in total, about one to 2%. So it's a small amount if we really get with it as far as importing their beef.
• 20:01
  The problem I had, Todd, and I will go political to a degree, is just just the nature of his of his true social post really frustrated the cattle rancher, if you will, because he's taking taking credit for, you know, a really strong cattle market. And, unfortunately, the strong cattle market has been due to the carnage, you know, for these ranchers over the course of time. We've lost a lot of ranchers. The profitability hasn't been worth a darn. You know?
• 20:29
  And so numbers are a seventy year low for the beef herd. That's why the market's up. It's got nothing to do with tariffs. So, that was a very frustrating thing for this cattle, you know, rancher, if you will. As far as the market's concerned, it it I think more than anything, what it did was it spooked your fund money because funds understand that one tweet or true social post can certainly change the dynamics of the market.
• 20:52
  And that's been a market they've been extremely long for quite some time. And so I think that what it does is it kinda spooks those guys, and I'm not so sure that they're gonna wanna stay long when one tweet can wreck the whole thing.
• 21:03
  Todd Gleason: The Trump administration did put out a plan to manage the carnage in the beef cattle world, though mostly it was ignored as producers and analysts alike were all too aware the market was already poised to make a correction lower. I asked longtime WILL analyst Ellen Dearden during Commodity Week how she viewed the week's activities.
• 21:24
  Ellen Dearden: To tell you the truth, 20,000 metric tons to 80,000 metric tons is not that big a deal, but I think the signal from the White House that, I'm gonna beat my chest and look how good of guy I am that we've got the consumer price for beef going to head lower is a kind of a kick in the gut. And I think that Colin Woodall is really good about saying that it does undermine the family rancher, family farmer. And so I'm not in favor of this action. I think this is intervention that doesn't need to be intervened on, but I'm just one small little cattle lady out here in the country.
• 22:14
  Todd Gleason: One of a shrinking number of cattle producers across The United States and particularly in Illinois where the extinction beef educator, Teresa Steckler noted a few years back, the exit of beef producers large and small from the sector at such a rapid pace that it worried the state ag associations. Ag's a small world. Beef production is an even smaller piece of that world that works three sixty five days a year caring for animals. There are no breaks in the livestock sector. No days off, no vacations, and they do not like it when somebody manipulates the marketplace.
• 22:53
  You've been listening to the closing market report from Illinois Public Media on this Monday afternoon. If you'd like to hear it again, you can do so on our website at willag.org, willag.0rg. I'm Extensions, Todd Gleason.