The Trump administration on Tuesday plans to announce aid for U.S. farmers to help protect them from the repercussions of trade spats between the United States and China, the European Union and others, a source familiar with the plan told Reuters.
The Washington Post earlier reported that the White House was readying $ 12 billion US in assistance, citing two people familiar with the plan.
Politico, citing two sources familiar with the plan, also reported the administration will pay for billions in trade-related aid through the U.S. Department of Agriculture's broad authority and two commodity support programs in a farm bill under consideration in Congress.
Shares of farm-related companies rose following reports of the financial assistance, which raised the prospect that farmers will have more to spend on tractors and other farm gear.
Deere & Co rose four per cent in late morning trading, while Caterpillar Inc and AGCO Corp were up nearly two per cent ahead of the expected announcement. Soybean futures also rose as traders bet farm aid would improve demand, reducing a current surplus supply.
The USDA did not immediately comment.
Farmers have been a particular target in the current clash over trade policy as other countries seek to retaliate for President Donald Trump's duties on Chinese goods as well as on steel and aluminum imports from the European Union, Canada and Mexico. Those affected economies have in turn targeted U.S. agricultural products, including soybeans, dairy, meat, produce and liquor.
Some manufacturers will view the subsidies to farmers as "frustrating," according to a representative of a manufacturing coalition working on trade issues, speaking on condition of anonymity pending the official announcement.
Manufacturers — particularly any who use steel or aluminum — have also been hit hard by the effects of Trump's decision to levy tariffs on the two metals.
Trump, who has long praised American farmers, earlier on Tuesday defended his trade actions.
"Tariffs are the greatest! Either a country which has treated the United States unfairly on Trade negotiates a fair deal, or it gets hit with Tariffs. It's as simple as that – and everybody's talking!" he wrote on Twitter.
Democratic U.S. representative Jackie Speier of California, a major agricultural state, blasted the Republican president over the reported plan.
"OK @POTUS – you created this mess with your trade war and now you are going to spend $ 12 billion to placate the farmers that voted for you," she tweeted.
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