Sunday, October 21, 2018

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Tariffs’ impact harming Wisconsin businesses

Some owners say hike in costs to be passed along to consumers

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    Local farmers, manufacturers, producers and home-builders met Tuesday for a roundtable discussion led by U.S. Rep. Ron Kind to talk about how they have been impacted by President Donald Trump’s steel and aluminum tariffs.

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Farmers, homebuilders, manufacturers and producers alike across the state have been negatively impacted by President Donald Trump’s increased steel and aluminum tariffs and the subsequent tariff retaliation.

At a roundtable Tuesday in Eau Claire hosted by U.S. Rep. Ron Kind, D-La Crosse, people from several different business fields came together to discuss one thing: how their businesses are now struggling because of the current trade war.

For Timm Boettcher, CEO of Realityworks, an Eau Claire company that makes educational materials used worldwide, the price increases from the steel tariffs are significant.

Because imports of the metals have slowed, he said the company has to pay even more than the 25 percent tariff on steel. He said prices are up 45 percent from what they paid a year ago.

“These are not minor price changes. ... These changes have had a really phenomenal impact. I don’t want to pass those prices along to educational programs, but I don’t have a choice,” Boettcher said.

Many in the room echoed this sentiment, saying they don’t want to raise prices as a result of tariffs and tariff retaliation but will have to in order to keep their companies afloat.

Because of the retaliatory efforts taken by other countries, it’s not only Wisconsin’s steel- or aluminum-importing companies that are suffering.

Chippewa Valley Bean is one company that has faced issues caused by the trade war. Cindy Brown, the company’s president, said the increased costs mean a decision between figuring out how to absorb the costs or putting the costs on the consumers.

Tony Mellenthin, a soybean farmer from Eau Galle and president of the Wisconsin Soybean Association, said if he sold a bushel of beans right now, it would sell for $1 to $2 less than it cost to produce it.

That kind of effect, he said, has harmful repercussions.

“Regardless of when this trade issue is resolved, this is not something that is remedied overnight,” Mellenthin said. “This has long, long-lasting consequences.”

In a move by the government to assist farmers caught in the trade war, officials announced up to $12 billion in emergency aid. Farmers can expect to see payments starting this September.

Paul Bauer, general manager of Ellsworth Creamery, said that announcement added some stability to the farm economy, but Kind reminded him that the aid only addresses short-term needs.

Gary Siepel, director of the Wisconsin Soybean Marketing Board, said the $12 billion in emergency aid doesn’t solve existing problems.

“That $12 billlion is a Band-Aid for farmers,” Siepel said. “What we want is a long-term solution.”

He did, however, say he has confidence the country’s trade issues will be worked out. Farming has its ups and downs, and right now, he said, it’s “pretty low down.”

Kind said the tariffs are more pervasive than initially thought.

“In response to (sections) 301 or 232 steel and aluminum, we have retaliation. And we start to lose more and more market share all the time,” he said.

Steve Toft of Osseo, Kind’s Republican opponent in the congressional race, said he doesn’t believe in tariffs either. While campaigning across the state, he said what he’s heard universally is that nobody wants them. While Toft said he understands Trump’s decision to enforce the tariffs, he has seen it hurt industry in the district.

“What farmers want is trade, not aid.” he said. “We don’t want farmers to have to go bankrupt.”

Kind said when he returns to Congress after Labor Day, he will continue to have discussions with the administration about trade policy. 

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