by Chris Faure, for The Saker Blog
Let’s clarify, a trade war is a war.
Let’s clarify, world trade is not a zero sum game where you have a winner and a loser. Where we are in geopolitical danger levels, we’ve reached the same danger levels in world economics this past week and through this morning in the trade war, US vs China.
Let’s clarify, the US administration, Mr Trump’s special skill of negotiating has lost this trade war, because China does not have to win. China only has to endure and time for China, is a win. You will find parallels with many other countries in hot water in the geopolitical world, where they don’t have to win, but simply endure and win time and wear down the Empire. This is where we are in this trade war. What Trump and his team are arguing for in trade negotiations with China is no different than what they’ve offered so many others – surrender your sovereignty or face punishment. Unfortunately for the US Administration, the world is saying more and more … Bring it On!
In addition, China stood firm on 3 requirements:
The documentation and tone has to show respect for China’s core interests
Demands for what China should purchase from the US should be realistic
China will not, absolutely, not change their internal structures (laws) because the Americans are fearful of BRI or Made in China.
This morning, with monotonous regularly I saw the financial media leading with headlines of how many % tariffs China is placing on how many billions of US imports to China and how many % tariffs the US is placing on how many billions of imports to the US.
That is not where the story lies. In terms of world trade and impact on the financials of these two countries, these are drops in the bucket although they hurt small business badly and has a serious downstream effect on shipping, and everything around moving product.
The story is in the unerring aim that China takes in this trade war, when they need to retaliate. The story is in the fact that neither Mr Trump’s carrot, nor his stick could move China one iota, and this morning we are in a position where China, unerringly just an hour or so before the US market open, takes unerring aim, again at US agriculture as they did before. You know, that piece of the economy that takes a year to even plan and grow and where futures trading is long term and which is still causing mega bankruptcies in the farmer communities of the US midwest whose export to China is lying rotting in the fields or in the warehouses, exacerbated by brutal winter and spring weather conditions. facing surging bankruptcies from farmers hit
The same way Wisconsin dairy farmers are also going bankrupt thanks to the continued flood of cheap European dairy keeping wholesale milk prices low. Why is this happening? Russia countered European and American sanctions over Crimea with a ban on imports of European dairy. https://www.strategic-culture.org/news/2019/05/12/trumps-trade-war-is-already-over/
The same way that Mexican first grade or export grade farming produce is now being sold inside of Mexico, and the Mexicans never had it so good. Whereas before they would buy the avocado with the skin blemish, or the tomato not exactly the right size, now they are buying the cream of the crop as it has become too onerous to continue exports to the US in many cases.
Mr Trump’s art of the deal is eating Americas lunch. Bear in mind, we are not talking about Chinese paper lampshades here. We are talking about what we are all going to eat and how much it will cost to fill a basic food basket.
With a short search you can find the various phases in this trade war, where Mr Trump marched on Beijing. It is however only now getting interesting.
Where we stand now, is here.
China’s position verbalized by …. chief editor of the Chinese Global Times:
The sooner new tariffs on $300 b of Chinese goods come, the better. That means trade war comes to the 1st turning point, shifting from a comprehensive US offensive to a stalemate. The two sides will then compete on endurance. China’s political system will ensure we won’t lose.
In reality China is unerringly taking further aim at Mr Trump’s base itself. China might stop purchasing agricultural products from the US in total. They may reduce its orders for Boeing planes and they may restrict service trade. The PBOC is also modelling the dumping of US Treasuries which will have serious systemic effects, most probably strengthen the yuan and push the cost of doing business with the US much higher. If China is going to dump Treasuries, Chinese pride will follow and they may also be dumping US stocks and real estate. After all, China needs now to protect their trade with the rest of the world.
The US side stands here:
There’s a hole in the bucket dear Liza, dear Liza –
With what shall I fix it Dear Henry, Dear Henry …. ? Oh Sh!t!
Mr Trump stands here:
Even at this early stage, we can add up another loss for empire and a very amazing gain in an ongoing systemic change in economics that is necessary in our world, in parallel with the systemic change in geopolitics, all toward a multi-polar peaceful world.
Bellowing at China for problems that were uniquely created by the US itself, will not win this trade war. Tweeting is not going to make one iota of change. China has now settled in for the long haul while still talking (and winning time).
To make the farmers happy (Trump’s base), he says the US will buy their own farmer’s production from their own farmers and give it (sell it – disaster capitalism?), to poor and hungry countries. It is of course a lie that China will pay for any tariffs. A quick search will show how tariffs actually work.
So, we are in a space where the world economy is in real hot water and China is the only stable force that we have currently from a world perspective. Mr Trump is still hoping that a more expensive product delivered into the US will lead to a type of economic manufacturing reconquista, i.e., on-shoring of manufacturing back to the US. There is a problem with this thinking and it is that no big organization in its right mind will fully return to US shores in the current climate of decay, uncertainty and societal derangement. Oh, they will, eventually, but some issues must be solved first. Trump has no more economic clout left – he can still do damage, but China is making statements that they will keep their internal economics floating on an even keel, in order to create some stability for the world. China will of course act in China’s interest and they have been hardening against full tariffs since this trade war started.
We have the world’s economic well being in China’s hands, with Trump delusional and breaking what he can break, under the mistaken belief that this is all in his hands.
We can only look forward to China hitting back hard, which they have started to do this morning, and then pivoting hard to its own business and its own civilizational well being. What happened this last week, is that Trump gave away his full hand, and China has given nothing yet – and nobody knows what really is in their hand. So what rabbit can be pulled out of Mr Trump’s hat now? At this stage, looking at past doubling down from Empire, missiles and aircraft carriers may be the next best thing for the US and that is the terrifying part.
This morning in China news:
Tall tales won’t help US win trade war
China has plenty of countermeasures. The US tariff moves are very much like spraying bullets. They will cause a lot of self-inflicted harm and are hard to sustain in the long term. China, on the other hand, is going to aim with precision, trying to avoid hurting itself.
The Chinese government has been blunt about the difficulties and losses that the trade war will bring to the Chinese economy. This is in sharp contrast to the US government seeking to beautify the trade war.
The Chinese side is obviously more realistic while the US is falsifying. This will, to a large extent, influence how the two countries digest the trade war impacts.
http://www.globaltimes.cn/content/1149748.shtml
If you want to wage a trade war, don’t march on Beijing.
The tactic is Trade War and Tariffs.
The Strategy is to destroy China’s dominance in the Global Supply Chain of high tech products.
So winning this, which the US will, China will be forced to do much more conversion and faster to a consumer economy.
The saving grace is BRI which develops a huge market substitution for China’s products. It isn’t there and won’t be for four or five more years, but then, China will have most of the infrastructure of Eurasia branded.
How much pain can China take in the meanwhile?
Chinese pride will take care of the middle class pain. They see and feel the insult and will work assiduously to counter US advantages. The still-poor will develop a bit slower than planned.
China has declared its redlines. They are in for the fight. It will be fought around the globe, not just internally inside China. Though they are loath to be a part of the Resistance to Empire, they have no recourse.
Putin and Xi will devise the tactics to take down the Hegemon. Throwing weight around, as the Hegemon does, is dangerous when you are up against martial arts experts. You tend to land on your ass.
The US thinks it is an Asian Power. It will soon realize that it is not, never will be.
Pompeo’s statement that the US is going to protect “the sovereignty of the Indo-Pacific” is the sort of Imperial Delusion not heard in a century. What drug is he ingesting?
Great comment
I foresee then the empire striking at those markets at a faster pitch.
The bring down of Iran will be attempted before the BRI can achieve escape velocity.
However, if you are correct on the 4-5 years prediction for the integration to start showing signs of success, then the time scale is on the side of China and Russia. Not the hegemon.
However, in the very near term, the tariffs will increase the liquid funding of the harassment and hybrid interventions the US has planned. Smart tactical move and throws the US middle class into the shitter to do it.
China could force the finance advantage into neutrality by selling treasuries, requiring some behind-the-scenes control mechanism that will sap time and money.
Basically, they will sabotage the region and the livelihood of millions just to prevent Eurasian integration.
There is also China’s own consumer market which has lots of rooms to grow. Only 18% of China’s exports go to the US which means 82% goes to the rest of the world.
The growth in China’s own consumer market, the African market (nurtured by China), South West Asia, Russia and Europe will make up for the US market within 12 months.
China’s export to the US totaled 4% of its GDP in 2018. China’s own consumption is 78% of GDP and growing in 2018. So just a 2% increase in domestic consumption will make up fro 50% of export to the US in 2018. But based on the velocity of consumption growth during the last 3 quarters, China’s consumption could easily reach 82% of its GDP thereby completely making up for export to the US market.
So China won’t waste a sweat in the trade war with the US. Maybe her GDP growth rate may not even notice the trade war in 2019.
Lard, I believe.
Great article and great comment.
Internal revolt and the necessity of using the armed forces to repress dissent will happen to the empire before the BRI starts to yield the real replacement to the obsessive buying of the citizens of the Great Gold Mountain.
The Empire does not possess the military capability for even an outside chance at beating the senior partners in the axis of resistance, and I think many in the empire’s governance structure secretly know it, but keep it to themselves, if not also from themselves.
That means the very real threat of nuclear war, that is the first very bad risk, which will, unfortunately, not diminish, were the empire to break into rabid fragments, many with nuclear weapons!
As for trade war fallout, China and Russia will first dramatically increase their trade with each other, well in excess of all previous benchmarks and precedents, and catalyze so-called Eurasian consolidation.
Certainly there will be pain, but we have passed a point where it is certain to be eminently more manageable than the culling those under the auspices of the empire will have to contend with, especially those closer to the epicentre.
We can see in the past several years the establishment of alternative infrastructures and processes in preparation for the collapse of the empire; so the work is already well-underway, and as the author notes, time is on the side of the axis of resistance, for soon, they will be able to cast off the yoke of the empire, and in so doing, the last factor preventing the abrupt implosion of the empire will be removed.
Larchmonter445
Your comments are great.
Larchmonter445, China is already a consumer economy and has been for many years. When I was last in China, in 2003, the main driver of growth was exporting, but the consumer economy was in full flood, with huge and rapid growth. So many, many, China only brands. Today, many of those China-only brands are now regional and global brands – albeit with fairly low recognition in the English speaking world.
There’s a figure that amazed me when I saw it a few days ago: in 2017 China manufactured 24.8 million cars. In the United States, 3.07 million. The UK 1.67 million (the last surprised me, I expected far fewer!) Most of those cars are for the domestic market, although they are popping up in the United States these days.
What is the U.S exporting? Agricultural products, processed fuels and, for the time being, Boeing aircraft. Oh, I almost forgot, armaments.
What is striking about U.S exports of goods is the degree to which they are, by value, commodities. That should not be the case, commodities are what less advanced nations sell.
Yes, China can and will outlast the U.S. in a trade war, for the reasons you suggested but I think that the time frame for the Chinese to grow past any real need for U.S. purchases is likely much less than you expect. Think of it this way, if one assumed that the U.S. stopped buying any Chinese goods the hit to the Chinese economy, one time, would be a reduction of about 2% in annual growth. Of course, that’s not going to happen because the goods that the U.S buys from China are needed there. Trade from China to the U.S was, last I looked, increasing, even with tariffs.
I saw the lunatic Gordon Chang, just by chance, on Fox (Rupert Murdoch’s gift to insanity) last week. He was, as for the last thirty years or so, predicting China’s imminent ‘collapse’, to the enthusiastic approval of the twerp interviewing him. But what did impress was Chang’s undisguised derangement. His hatred of his part ancestors was always extreme, but here he was like a rabid Doberman on a leash, straining forward, face contorted, veins bulging, as he spat his hatred out. The Exceptionals are going barking mad, poor dears.
More Fox lunacy, this time deliberately viewed. A shaven headed lunatic called Steve Hilton, and the ultra-malevolent Bannon, both spewing such deranged hatred at China that it seemed almost a caricature. Replete with demented confidence that China will soon ‘collapse’, or be ‘brought down’ or some such garbage. I have been slowly inured to rapidly growing lunacy and unhinged hatred flowing from the Right (ie all US politics) over the last forty years, but the sheer mix of hatred and racist terror at China’s rise has really sent this insanity into hyper-drive.
So, don’t get into a land war or a trade war in Asia? Makes sense to me.
Does the US-China trade war mean that American companies will be forced to move their subsidiaries out of China? Too bad those American companies will not be relocating manufacturing facilities and know-how to the USA anytime soon. It would be bad for executive bonuses and for the stock prices, you see.
The business elites of other countries with which the USA has free trade agreements – such as Mexico and Vietnam, will rejoice! The wage arbitrage and the destruction of the environment will continue unabated. Wake me up when Apple decides to make an iPhone in the United States……….
Mexico is too much of a high-wage place now for American executives. Many of the plants that moved to China were US plants that had been in Mexico. In summary, the search for low-cost labor moved from the American northeast and midwest to the American south and southwest. Then those plants moved to Mexico after NAFTA in search for lower wages. With China being allowed into the WTO, it was frequently those Mexican plants, as well as of course more American plants, that moved to China.
Meanwhile, I have heard Vietnam mentioned quite favorably among elites in search of new near-slaves.
China and Russia ought, I believe, establish ‘National Endowments for Economic Justice’, and begin financing freedom-loving Americans in the manner in which the USA finances subversives and traitorous stooges throughout the world. Hoist on their own petards, I would hope.
what about financing worker co-ops ..worker owned manufacturing co-ops!?
set up some teaching for workers on how to create all manner of co-ops to provide their worker-owned and managed employment at good wages
hahahahaha
wow! the oligarchy would prolly cut that off in a flash
I have lived in Mexico for many years now and so far only ever seen factories relocate to, not from, Mexico. Makes sense too: Mexican unskilled factory wages are around 5-8 usd a day, China is by now far above that, not to speak of anywhere in the US. Skilled labor here may hover around 20-30 usd, still a pittance compared to normal developed countries. Crime and corruption remain Mexico´s principal problems, and since the last election uncertainty caused by their current naive and narcissistic romantic socialist president pushed and kept in power by some of the country´s most corrupt factions.
What is with the obsession with raw wages? They mean nothing without taking into account of productivity, where China is miles ahead of Mexico or any other low-middle income country thanks to economies-of-scale and the CCP’s massive focus on infrastructure and education.
It’s just like GDP per capita numbers: Mexico has it higher than China on paper, but the average Mexican will find life of an average Chinese is an utopia in comparison.
Trump has always had a problem with Enemy Identification in his trade war. It wasn’t that those evil Chinese stole American jobs. It was that American corporate executives and bankers pushed corporations to move production to China for greater profits at the expense of American workers. The Chinese were willing to play along, and used the American corporate money to help build that stage of their economy. But the real evil-doers were American executives and bankers sitting in board rooms.
Since Trump has picked the wrong target, he will surely fail. Even if he makes Chinese goods uncompetitive with his sanctions, the corporate executives and bankers will not return the jobs to American workers. They will instead just move to the next nation willing to have its work force work at near-slave wages. I understand Vietnam and others are lining up for the opportunity. Meanwhile, the Chinese having successfully used the Americans to gain that stage of an economy, are already moving on along the same path as Chinese corporations have begun to move abroad searching for near-slave labor.
So, Trump will hit the American economy but miss the real evil-doers. And remember the Trump tax cut. That tiny little bit that ordinary Americans got will now be overwhelmed that the Trump Tax Increases. Remember that Tarriffs are Taxes Too, and no matter how much bull Trump puts out on Twitter, American workers still have to make their paychecks stretch and in the year before the election they’ll be paying higher oil costs due to Trump in Iran and Venezuela and higher prices on everything made in China due to Trumps Tax Hikes. And somewhere along the way they’ll remember the way Trump picked a cabinet of billionaires and generals and figure out that Trump wasn’t on their side. And that’s exactly the thought that sunk Hillary with those same Americans.
I feel it’s just a way to produce propaganda to get the masses to live under war-funded austerity. Of course China just played the cards she was given by using her only advantage -phenomenal labor capital- and from there building herself up. The globalization and trade war narrative is in fact inverted as you said. But you can’t sell that to people working a 9-5 who have no clue about geopolitics and the truth of global primacy. So label the enemy in lies and motivate your people to carry out your plans is the goal.
As time goes by and we learn more about Trump, past and present, it becomes clear that he doesn’t know what he’s doing. And as the old maxim goes, you don’t interrupt your enemy when he’s busy making mistakes, which is what the rest of the world not allied/vassal of the Outlaw US Empire’s doing.
Trumps ‘card’ was played the day he was conceived.
It’s been a life of deceiving since he uttered his first words.
Watch the SE Asian Chinese diaspora kick into gear now and watch Malaysia’s, Thailand’s, Vietnam’s, Philippines’ “exports” to the US soar.
What’s the cost of a few new labels and fake Form A’s? 5-10%, FOB, depending on the product.
So re-sourced, Chinese goods will flow via “the network” from SE Asian ports.
Win, win, win.
The network will be happy.
That is so true. People do not generally know how this works, and if they did, they would immediately see the absurdity! And the whole of the eastern part of this world, will be sharing exportation of the ‘new and improved’ sourced product, loaded FOB from SE Asia, and China will pick for itself the high value and focus the rest to BRI. This is a juggernaut.
“China only has to endure and time for China, is a win.”
Exactly. The key point.
China is already bigger on PPP, so any rise in the Yuan just makes China bigger on $GDP.
China grows at 4-5% faster than US.
And the BRI (OBOR) network grows much much faster.
Time is a win for China.
I am not worried about China or the future of BRI, and I don’t even believe that Trump wants to try to cripple Chinese high-tech.
Although we are at a ping-pong moment between the US and China, I have been listening to who is screaming. China is not screaming. Russia is not screaming. No one would expect the Russians to scream anyway, granted, because Russia, in contrast, to China, is a more autarkic, self-reliant economy. Wall Street is screaming. Big market-cap corporations are screaming. Zero-Hedge headlines are screaming: “A Record Number Of Investors Are Hedged For A Crash,” “Apple Needs A 14% iPhone Price Hike To Offset Higher Tariffs,” which is nothing short of farcical or hilarious in view of Apple’s obscene profit margins. Well, you don’t need to buy Apple, do you? See otherwise https://www.marketwatch.com/story/trade-war-watch-these-are-the-us-companies-with-the-most-at-stake-in-china-2018-03-29?ns=prod/accounts-mw.
The US Chamber of Commerce is screaming. Just for a bit of perspective, none of this has to do with the US or the Chinese economy, and if Nike’s market-cap gets smashed, it will cripple neither the Chinese nor the world economy.
And, as far as farmers in the US Midwest are concerned, there is the current, momentary situation and there is the basic structure of US farming (Big AG): farmers’ prices are depressed by the cartels (for which the Chamber of Commerce is the lobby), prices are set for the sake of market-cap globally, and consumer prices in the US are always higher than they would be if independent farmers were supplying a “free market.” US farmers have been on the brink of collapse for a long time, that suits the cartels just fine: they buy up the land and depress prices further, no matter how much is sold to China or anyone else. Currently, the Midwest is suffering the consequences of floods and cold weather (not “global warming”), which has drastically depleted livestock numbers and is nothing less than a natural catastrophe like a hurricane in Puerto Rico. Expect Trump to make moves as needed by a natural catastrophe. Whatever he does, I will bet that the cartels won’t like it.
Preliminary summary: for all the trade-war talk, it is good not to forget that Trump is shaking out his enemies in the world or corporate thievery. Of course, that is preparatory to additional financial shake-out moves.
Lastly, tariffs are an ancient (in Americans frames of reference) American tradition. Whatever one thinks of Pat Buchanan, he has a good review of it here: http://www.unz.com/pbuchanan/tariffs-the-taxes-that-made-america-great/. Trump never made a secret of where he stands in that tradition, which means, of course, that he also knows that former presidents in that tradition were assassinated.
As Pat Lang likes to quip, analysis is not advocacy. Still, “free trade“ has always ben he slogan of slave traders.
George, Trump is screaming – don’t you read his twitter? Trump also asked (begged?) China to call off tariffs against US farming because this will hurt for years to come.
Devaluing and shaking our shoulders writing this economic event off to ping pong illustrates a colossal ignorance. This is not a small issue, but will change our world economics systemically and structurally forever.
Actually Paul Craig Roberts wrote it up for us.
“The evil done by globalism has taken a toll on both first and third worlds. It is entirely the result of first world capitalist profit-maximizing. It has nothing to do with China.
China is being blamed not because its industry produces cheaper than our industry, but as a scapegoat to hide from view the fact that US global corporations alone are the cause of the lost American jobs.
Tariffs cannot bring back the jobs. ”
http://www.unz.com/proberts/the-tariff-issue/
Chris —
The current trade negotiation between China and the US is merely one theater in a broad philosophical clash between a largely open and a totally closed society. (I write “largely open” because all sorts of trans-national firms and foreigners have captured large segments of US communications and the economy — including flowers and lemons!)
Over 40 years ago, totalitarian China decided to hollow-out US manufacturing by dumping Chinese goods in the US, at below manufacturing costs, while simultaneously erecting tariff barriers to US goods. When US firms sought to gain access to Chinese markets without tariffs, by manufacturing goods in China, these were required to turn-over their proprietary knowledge and China then established rival companies, which under-priced the American firms, through Chinese subsidies to the newly established new rivals.
Following careful study begun in 2016, the US determined that $200 Billion of goods imported from China were subsidized 25%. The Trump Administration initially imposed a 10% import tariff and gave China a year to correct the situation. (A 25% tariff was completely consistent with WTO rules.)
The Chinese Politburo has now rejected carefully negotiated provisions to stop dumping, intellectual thefts and such. American negotiators left Peking two weeks ago and advised President Trump that the draft agreements had been voided by the Politburo. When President Trump announced that he would proceed with 25% tariffs, the Politburo despatched their former negotiator, having “stripped” him of any authority to cut a deal. The Americans advised this “stripped” fellow that they would only negotiate with someone who could cut a deal, be this President Xi or whomever else the Politburo designated.
Chris you raise a Walmart-aisle-6 argument about low, subsidized Chinese goods versus living-wage priced goods. What you fail to mention is that 90 million Americans have been out of work and living miserably on American welfare payments. These are the “Deplorables” who voted for President Trump.
Between 1800 and 1950, the US maintained a 30% tariff on all foreign goods and created a middle class such that the world had never known. Since the country imported next to no raw materials, the US economy worked very well for US citizens, who enjoyed a living 30% higher than any in Europe.
Effectively, President Trump has told the Chinese, the EU and other beneficiaries of post-WWII American give-aways, that he is prepared to return to a trade regime such as occurred between 1800-1950. Mercedes, BMW, VW, Honda, Toyota and other manufacturers are busily moving their operations to the US and creating new jobs here.
From President Trump’s perspective, what is there to lose? Good manufacturing jobs for his working class supporters, high employment, therefore higher Social Security and Medicare receipts to support retired Americans and a national ability to ignore disruptions in other continents.
If China persists in running a closed, inherently inefficient society, by closely monitoring its citizens for politically incorrect thoughts, to be exploited by a Chinese Politburo, it will ultimately implode — as did the Soviet Union. On the other hand, if China freed its very bright, hard-working and entrepreneurial citizens, it would be very, very wealthy in an honorable way consistent with its Confucian ethic.
Complete garbage, redolent of Fox News Sinophobic hatred. China was chosen as an off-shore site for manufactures by the US capitalist elite. The low cost goods sold to the USA allowed the tens of millions of US working poor and near poor, to have some decency of life, thanks to WalMart etc. You ought to be grateful, but the US Right are never other than arrogantly belligerent. And you even have the racist arrogance to call Beijing, ‘Peking’. Not trying, White Boy-you ought to say ‘Peiping’ to properly establish your racialist credentials. At least China’s rise has you racist supremacists soiling your nappies-it’s a joy to watch.
Paul Craig Roberts has a better take
http://www.informationclearinghouse.info/51611.htm
https://militarywatchmagazine.com/article/china-s-85-000-ton-type-002-carrier-will-be-a-high-tech-emals-equipped-peer-to-america-s-gerald-ford-class
This is interesting. USA is losing primacy across all fronts – including its carrier fleet for the first time since 1945. What will be left for American by 2029?
The Sino-American trade war is a precursor to actual war, one of many locations conflagration could be ignited. Being between the two largest global economies it will be a world war; it will affect and drag in the entire planet, resulting in nuclear holocaust. Some trade wars, such as the Pasta Wars when President Regan imposed tariffs on European pasta, are genuine disputes and resolved. Other examples are more sinister. The Opium Wars sought to weaken the Chinese Qing dynasty, to the benefit of western merchants. Modern China is much stronger, its people will suffer if the nation’s rise is stifled, that is something its government cannot allow. Current international events fulfil a pattern of history, a portent of world war.
https://m.journal-neo.org/2019/05/20/a-china-food-crisis-more-danger-than-trade-war/
Another set of pests endemic to North America is let loose upon the world. A world food crisis is brewing. Russia should be storing her grain up rather that selling every ton harvested.