FarmPolicy

August 17, 2019

Farm Bill; Animal Agriculture; Trade; Biofuels; Climate Issues; Ag Economy; and Financial Reform

Farm Bill: Hearings

The House Agriculture Committee held a field hearing in North Carolina yesterday to review U.S. agriculture policy, as the Committee begins the process of writing the 2012 Farm Bill.

A House Ag Committee news release from yesterday pointed out that, “This is the ninth in a series of field hearings scheduled across the country to consider new ideas regarding federal food and farm policy. Four Members of Congress attended today’s hearing and heard testimony from eight witnesses on a variety of farm policy issues.”

At yesterday’s hearing, North Carolina farmers Frank Lee (audio clip, MP3-1:33) and Allen McLaurin (audio clip, MP3-3:21) provided perspective on the Farm Bill safety net, highlighting provisions that they viewed as important. Their testimony touched on trade, including the WTO cotton case with Brazil, as well as program payment limitation issues.

Opening statements from all of the witnesses at yesterday’s hearing can be viewed here.

Near the conclusion of yesterday’s hearing, Rep. Bob Etheridge (D-NC) pointed out that although Farm Bill debates have historically been bi-partisan, regional and geographic differences often create some stumbling blocks in policy development. In addition, Rep. Etheridge reminded the audience that budget issues would be a concern in developing the next Farm Bill. He specifically noted that in the last Farm Bill, the Ag Committee sought additional funding from the Ways and Means Committee that ended up bolstering funding for some nutrition programs.

To listen to a portion of yesterday’s comments by Rep. Etheridge, just click here (MP3-1:13).

Recall however that at a Farm Bill hearing on April 21 in Washington, D.C., Ag Committee Chairman Collin Peterson (D-Minn.) pointed out that, “We also have to be realistic in terms of our budget situation. I think most of us on this committee are not interested in running up the deficit. In fact, we are probably more interested in trying to get the deficit under control and so, as we move ahead with this Farm Bill, I am not going to be looking for additional resources. I think we have to live within the baseline that we currently have for the Farm Bill. We will proceed in that manner.”

At an April 30 Farm Bill field hearing in Des Moines, Iowa, Chairman Peterson stated that, “I think that last comment kind of ties into something I want to say, and that is that we are not going to have any extra money for this farm bill. We’ll be lucky to hold onto what we got. I saw on some of the testimony people wanting to raise loan rates because they are ridiculously low. If we get down to loan rates, we’re out of business. It ain’t gonna happen. The money it costs to raise the loan rates, you know, I just – it’s not realistic. So one of the reasons we’re starting this hearing process early is to see if there’s a more efficient way, a better way to provide the risk management tools, the safety net, the conservation that we all want to do.”

And in an interview with Minnesota Public Radio’s Tom Crann on Friday, Chairman Peterson reminded listeners again that the Farm Bill budget situation would be tight. Interestingly, he went on to comment on the USDA’s Standard Reinsurance Agreement and the resulting cuts contained in the latest proposal. Chairman Peterson noted that agriculture is already taking deficit reduction cuts and offered an analysis on what the impacts on the national debt would be if other non-agricultural related programs faced similarly proportioned cuts in program spending.

To listen to a portion of Chairman Peterson’s remarks on these issues from Friday, just click here (MP3-2:40).

With respect to the Senate Farm Bill hearings, a news release issued yesterday by Sen. Ag. Comm. Chairman Blanche Lincoln (D-Ark.) noted in part that, “The farm bill is one of the most important pieces of legislation Congress considers on behalf of rural America and our nation’s farmers and ranchers. This first hearing will focus on maintaining a sound U.S. farm policy to protect our most vital resource – our food supply. Our food security, millions of jobs and a good share of our national economy depend on the work our farmers and ranchers do every day. The farm bill is necessary and vitally important to ensure we continue to have a safe, reliable and affordable supply of food and fiber.”

Ag. Sec. Tom Vilsack, producers, and national farm organization leaders are set to offer perspective and analysis at Wednesday’s hearing.

Farm Bill: Nutrition

The AP reported today that, “Hungry children looking for a free meal this summer may not be able to find one.

“States and cities have cut funding for summer meal programs as need has skyrocketed, according to a new report from an anti-hunger group that tracked the program in 2009. Budget woes that have left many families hungry are also affecting local governments that find themselves without the needed dollars to feed children while they are out of school.”

Farm Bill: Takes Time

Dave Russell reported yesterday at Brownfield that, “Chuck Conner, President and CEO of the National Council of Farmer Cooperatives (NCFC) remembers when writing a Farm Bill only took a few months.

“‘I’ve been involved in the writing of six Farm Bills,’ said Conner. ‘The very first Farm Bill I worked on in 1981 we started the debate on the Farm Bill in March 1981 and we were done by the summer of ’81, it took just a few months.’

“But Chuck Conner also understands things have changed since that 1981 Farm Bill.

“‘The process of getting any type of farm legislation through has just grown so much more difficult,’ Conner said. ‘You just have to allow months, if not years worth of time for it to happen or else you’re going to be too late.’”

Animal Agriculture

Lyndsey Layton reported in today’s Washington Post that, “The Food and Drug Administration urged farmers on Monday to stop giving antibiotics to cattle, poultry, hogs and other animals to spur their growth, citing concern that drug overuse is helping to create dangerous bacteria that do not respond to medical treatment and endanger human lives.

“Joshua M. Sharfstein, the FDA’s principal deputy commissioner, said antibiotics should be used only to protect the health of an animal and not to help it grow or improve the way it digests its feed.”

The Post article noted that, “The Animal Health Institute, which represents companies that make drugs for animals, said Monday that it agrees that antibiotics should be used in a ‘judicious manner.’ But groups on both sides of the issue lobbed criticism at the FDA’s latest effort. Farming interests, including the National Pork Council [related news release] and the National Cattlemen’s Beef Association [related news release], suggested the FDA needs more evidence before it dictates changes to long-standing practices of administering antibiotics to animals.

“‘Show us the science that use of antibiotics in animal production is causing this antibiotic resistance,’ said Dave Warner of the pork council. ‘How do we know [the problem] is not on the human side? Where is the science for you to go forward on this?’

Public health groups, however, said the agency’s actions were too tentative.”

The AP reported yesterday that, “The agency said it is expecting to issue more specific guidelines soon, but FDA Principal Deputy Commissioner of Food and Drugs Joshua Sharfstein would not say whether the agency eventually plans to issue stricter regulations. He said the guidelines are just a first step and the agency will be watching industry response and also patterns of antibiotic resistance.”

Reuters news reported yesterday that, “The poultry industry said it already has ratcheted down ‘by a large margin’ its use of antibiotics.

“Bernadette Dunham, director of FDA’s Center for Veterinary Medicine, noted voluntary efforts to reduce antibiotic use and said, ‘We believe additional steps are necessary to have a real impact on this problem.’”

Meanwhile, an update posted yesterday at FeedStuffs Online reported that, “California restaurants and supermarkets would be required to import only eggs produced in compliance with the state’s 2008 ballot measure Proposition 2 (Prop 2), according to legislation that has now passed the California General Assembly and is heading to Gov. Arnold Schwarzenegger for his signature.

“Prop 2 requires that hens have sufficient space to sit down, stand up, turn around and extend their wings without touching an enclosure, which effectively makes conventional cage production systems in California illegal when the law takes effect in 2015. The measure passed with two-thirds of the vote.”

Trade

A news release issued yesterday by Sen. Blanche Lincoln noted that, “U.S. Senator Blanche Lincoln, D-Ark., Chairman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, today released the following statement in response to President Obama’s direction to the U.S. Trade Representative to complete the Korea free trade agreement (FTA) this year.

“As Chairman of the Senate Agriculture Committee, creating jobs and putting our economy back on the right track is my top priority. Opening more markets for agricultural producers will help Arkansas farmers, ranchers and rural communities who have felt the devastating effects of the current economic climate.”

The American Soybean Association and National Pork Producers Council also provided public remarks in support of the Korea FTA.

Also, recall that the House Ag Committee will be considering H.R. 4645 on Wednesday, a bill that could expand agricultural exports to Cuba.

A new release from yesterday by the National Corn Growers Association stated that, “With possible legislation that could increase U.S. corn exports under consideration, the National Corn Growers Association urges growers and those who support them to contact their representative in the House asking that they cosponsor H.R. 4645, the Travel Restriction Reform and Export Enhancement Act. If the representatives are members of the Committee on Agriculture, ask them to vote for the bill without amendment.

“‘This bill increases one-way trade to Cuba and is good for the economy,’ said Steven Yoder, chairman of the Joint Trade Policy A-Team of NCGA and the U.S. Grains Council. ‘It is a win-win situation off an embargo that is having unintended consequences against a group – American farmers and ranchers – that it was never meant to affect.’”

Biofuels

Clive Cookson reported on Sunday at the Financial Times Online that, “DSM, the Dutch life sciences and chemicals company, is moving into the embryonic, but potentially huge, market for second-generation biofuels.

At this week’s world congress on industrial biotechnology in Washington, DSM will announce ‘a breakthrough in bioconversion.’ This will improve the efficiency with which fuels can be made from ‘second generation’ sources – agricultural waste such as corn stalks and wheat straw, wood chips and energy crops grown on land that is unsuited to food ­production.”

The FT article stated that, “DSM’s second-generation technology has two components. The first is an enzyme, derived from a fungus discovered originally in a Swiss compost heap, which breaks down the cellulose in wood, plant stalks and other agricultural waste.

“This produces a range of sugars which are then converted by DSM’s ‘advanced yeast’ strain into ethanol, the standard biofuel.”

Reuters writer Tom Doggett reported yesterday that, “U.S. gasoline prices increased for the second week in a row, the Energy Department said on Monday, as higher crude oil costs and expensive summer blends helped to push up pump prices.

“The national price for regular unleaded gasoline rose 1.4 cents over the last week to $2.76 a gallon, 12 cents higher than a year ago, the department’s Energy Information Administration said in its weekly survey of service stations.”

Climate Issues

Darren Goode reported yesterday at The Hill’s Energy Blog that, “President Barack Obama will have his hands full when he sits down at the White House on Tuesday with a bipartisan group of senators to talk energy and climate legislation: Not only will he be trying to corral a particularly partisan Senate, he’ll also have to unite a divided Democratic caucus on how best to move a bill this election year.”

The update noted that, “Centrist Republicans have rallied behind a bill from Sen. Richard Lugar (R-Ind.) that avoids pricing carbon in lieu of reducing greenhouse gas emissions and foreign oil dependency through other means, like fuel efficiency and renewable fuels production.”

“[Sen. Byron] Dorgan [D, ND] has been pushing [Senate Leader Harry] Reid [D-Nev.] to bring up an energy bill passed last year by the Senate Energy and Natural Resources Committee instead of the larger Kerry-Lieberman plan.”

“[Sen. Ben Cardin (D-Md.)] said an alternative carbon-pricing plan from Sens. Maria Cantwell (D-Wash.) and Susan Collins (R-Maine) that avoids setting up a massive new carbon market could be something to build upon.”

Darren Samuelsohn reported yesterday at Politico that, “President Barack Obama needs a couple of Senate Republicans to play ball if he’s going to pass a cap on greenhouse gases this year.

But few, if any, GOP senators seem willing to work with him on a plan their leaders have dubbed a ‘national energy tax’ — despite the fact that some of them have seemed supportive of the idea before.”

However, Mike Soraghan of ClimateWire reported yesterday at The New York Times Online that, “What Sen. Harry Reid (D-Nev.) puts in the Senate climate and energy bill, and what gets added on the floor, may not matter as much as simply whether some bill passes.

In the end, a joint House-Senate conference committee will likely hammer out the final version of the bill. That might not take place until a ‘lame duck’ session after the November election, when much of the political pressure on lawmakers has dissipated.”

And a news release issued yesterday by the National Association of Corn Growers stated that, “As Congress prepares for an Independence Day Recess to be followed by vigorous discussion of a new energy bill, the National Corn Growers Association has stepped up its campaign to ensure that corn-based ethanol is part of the formula that brings our country to energy security and independence.

“‘With nearly two-thirds of our oil imported, we need to focus on a broad range of domestic fuel solutions,’ said NCGA President Darrin Ihnen, a South Dakota farmer. ‘Legislation is before Congress to continue much needed incentives and there is a new energy bill on the horizon, making it an important and critical time to talk about ethanol’s many environmental and economic benefits to our country.’”

Ag Economy

Cheri Zagurski and Katie Micik reported yesterday at DTN (link requires subscription) that, “Corn and soybean crop condition worsened in the last week, but progress of the two crops remains ahead of the five-year average.

Corn conditions ratings slipped in the week ending June 27, with 2 percentage points taken out of the good category and 1-percentage-point increases noted in the poor and fair categories. Silking is reported at 7 percent, compared to a 5-percent five-year average.”

Soybean conditions also slipped, with 1 percentage point each taken out of last week’s excellent and good categories and 1 percentage point each added to the poor and fair categories. Soybean blooming is reported at 9 percent, compared to a five-year average of 8 percent.”

Ian Berry reported in today’s Wall Street Journal that, “Corn futures fell for the sixth day in a row Monday, ending at nearly a nine-month low as favorable weather forecasts fueled talk of a record crop.

“Corn for July delivery ended down 6.75 cents, or 2%, to $3.3375 per bushel on the Chicago Board of Trade, the lowest price since Oct. 2. Corn for December delivery, which represents the crop to be harvested in autumn, closed down 7.75 cents, or 2.1%, to $3.5275.

“Forecasts calling for dry weather this week across the U.S. corn belt emerged as a key factor, analysts said. Dry weather bodes well for crops following a spate of torrential rains in many areas of the Midwest.”

Financial Reform

Victoria McGrane and Corey Boles reported in today’s Wall Street Journal that, “The most sweeping overhaul of financial regulations since the 1930s is on a knife’s edge as Democrats scramble to secure the Senate votes needed to pass the legislation.

“The death of Sen. Robert Byrd (D., W.Va.) robs Democrats of a vote to push the bill toward final passage. Another Democratic senator, who voted against an earlier version of the legislation, said Monday he wouldn’t support the final product either. And the late addition of a fee on banks and hedge funds to cover the cost of the legislation is roiling the few Republicans thought likely to vote for the package.

“Democrats need to retain the remaining 57 Democratic and Independent senators and also win over at least three Republicans to meet the key 60-vote threshold needed to pass the bill. As of Monday, no Republican had committed to voting for the legislation.”

With respect to the conference report on the financial regulation, a House Ag Committee news release from Friday indicated that, “‘While everyone had to make some compromises to come to a consensus, I think that the final outcome of this conference committee will ensure that Wall Street can no longer put America’s economy at risk with irresponsible, unreasonably risky activities that caused the last crisis,’ Chairman Peterson said.

The House Agriculture Committee played a key role in developing the financial reform legislation, particularly provisions that address increased volatility and speculation in the derivatives markets and that strengthen oversight and increase transparency in the markets for futures, options and over-the-counter products and swaps.

“‘This legislation reflects nearly three years of public debate and a lot of bipartisan work on derivatives and their effect on the economy,’ Chairman Peterson said. ‘The passage of this conference report demonstrates that Congress is serious about finally providing much needed oversight and transparency in the markets for over-the-counter derivatives and ensuring that they will never again threaten the stability of our financial system.’”

Keith Good

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