Current Trade Deals Differ From Traditional Agreements

According to CoBank Grains and Oilseeds Economist Tanner Ehmke, the trade deals being negotiated now differ from previous trade agreements. “Prior trade agreements took years to put together, at least 18 months, some of them several years.” That provides time to secure buy-in from the participating countries “and the trade deal here in the United States is supposed to be passed by Congress. thereby making it durable because it becomes policy.” Developing trade relationships outside of that traditional framework is more fragile. Ehmke cites the recent trade announcement with the United Kingdom. “Because it was not done through the traditional format of being slow walked to have the UK and the United States legislative bodies agree on these pacts, it’s not really a trade agreement but a temporary negotiation that can easily be undone on a whim..” With the current uncertainty over tariffs, Ehmke said grain elevators and grain merchandisers may be forced to widen the new-crop basis to attract local demand.