It is no secret that the trade war taking place between the United States and China is hitting certain sectors very hard.
One area that is getting obliterated is in agriculture, specifically growers of peas. China and India are the largest consumers of peas and both countries are being hit with tariffs.
This is really putting a hurting on those who grow peas. This is a product that has grown in planting over the years as more farmers inserted it as part of their crop rotation.
Pea production is up 40% from a year ago while prices are sitting at 20 year lows. This pushed the price down to a level that is below the cost to grow.
Obviously something has to give. Trump is very aware of the plight of the rural communities since he placed so much of his presidency and reelection hopes in those areas.
Technology is helping to offset the loss in exports somewhat.
The number of pea products is increasing dramatically. In 2019, there were 327 new pea products introduced in the United States. Companies such as Beyond Meat are ordering more peas which is helping somewhat.
Many of the pea farmers are taking advantage of this substitute meat market that is emerging. There is a major question if it is sustainable. If it is, many are looking to be in on the ground floor.
Even with the introduction of more pea based products, the plight of the growers is still in rough shape. They need the exports to survive, something they are aware might not be coming. Many do not seem upset with the President over the action since they believe there were unfair practices that took place for years. This is, perhaps, righting a wrong in their eyes.
Nevertheless, it does not make the situation any easier. The growth of the pea market coupled with the trade war is putting enormous downward pressure on prices. To get back whole, the growers are going to require a lot more technology to pull them out of this without a trade agreement.
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