California dairy farmers are feeling the effects of the trade war with Mexico that started when President Donald Trump imposed tariffs on Mexico‘s steel and aluminum.
In retaliation, Mexico in June imposed a series of tariffs on U.S. goods, such as pork, apples, potatoes, bourbon and different types of cheese.
“The market in the last two weeks of June dramatically dropped,” Frank Konyn, owner of Konyn Dairy, said. “I am losing $1,400 a day, about $40,000 a month here in this dairy.”
The tariffs increased the price of milk coming from the United States, meaning more milk is staying in the local economy. And that’s bad for business.
“Because all those products are staying here at the market, there is a greater supply,” Konyn said. “And as a result of the great supply, the price goes down.”
According to the California Council of Milk Producers, losses for the industry surpassed $380 million in the last six weeks, though it notes that not all the losses can be blamed on the trade war.
“[B]ut the industry would undoubtedly be better off if it hadn’t become one of many casualties in the trade war,” the group said in its July newsletter.
For dairy farm workers such as Miguel Aldana, there are concerns the trade war could cost him his job.
“So sad because I’ve worked since I was 20 in this industry and suddenly you can be out of a job,” Aldana said in Spanish.
For now, workers at Konyn Dairy can relax. No job cuts have been contemplated so far, Konyn said.
“We cannot do that,” he said. “The cows need to have their feed. They need to have their water. They need to be milked. I can’t just stop milking them and come back in a week.”
Konyn hopes the trade war will end soon and both countries could come to an agreement.
“I want to see a strong economy in Mexico and I want to see a strong economy in the United States,” he said. “If we can get a strong economy going everywhere, I’ll get my money back in the future and everybody comes out as a winner.”