FarmPolicy

October 25, 2014

Farm Bill Issues; Climate; Biofuels; Trade, Food Security, 1099, and Political Notes

ACRE

Reuters news reported yesterday (article posted at DTN, link requires subscription) that, “Wheat growers will receive about $300 million in supports for their 2009 crop through a new U.S. program that safeguards farmer revenue, said an Agriculture Department spokeswoman on Monday.

“The money will flow through the Average Crop Revenue Election, created in the 2008 farm law. ACRE offers significantly higher price guarantees than traditional crop subsidies but payment is made only when statewide and farm-level revenue from a crop falls below a trigger level.”

The article added that, “USDA estimated payments of $300 million to wheat growers and slightly more than $400 million for all crops, said the spokeswoman. Earlier this year, USDA estimated payments also would include $65 million to corn, $14 million for barley and $11 million for sunflowerseed.”

Nutrition

The Washington Insider section of DTN reported on Monday (link requires subscription) that, “A fight over competing bills to reauthorize an array of nutrition programs has attracted considerable attention in Washington this weekend because it pits groups against each other who are usually allied, and, because the controversy is so bitter. The fight is not an attempt to kill the programs, but over which of two competing approaches to use to reauthorize them.

The legislative state of play is complex. A child nutrition program reauthorization bill passed the Senate unanimously –– imagine that –– last summer and was sent to the House. The Senate bill reauthorized an array of conventional nutrition programs, including school lunches and breakfasts, and would have given USDA new authority to set nutrition standards for food sold in school vending machines and a la carte lines. And, it would have authorized the first increase in decades for per-meal reimbursement to schools.”

“When the bill got to the House, the original $4.5 billion in new spending for the decade was boosted to $8 billion.”

And, as The New York Times editorial board explained last week, “[The House version] provides $7.5 billion for nutrition programs over the next decade, and it does not try to partly offset the cost by taking money away from the food stamp program.”

Monday’s DTN item explained that, “Agriculture Secretary Tom Vilsack got involved last Tuesday when he held a conference call with reporters to urge the House to act quickly. Advocacy groups supporting the bill say the White House and first lady Michelle Obama have made calls to House members urging them to vote for the bill, which they plan to bring the bill to the floor under suspension of the rules, which would require a two-thirds majority of House members present for passage. While the Senate voted overwhelmingly for its bill in August, it is uncertain how it would fare if the House-proposed fund shift is included.”

“Speaker Nancy Pelosi, D-Calif., expressed confidence as recently as Friday that she could overcome objections and deliver the bill to President Obama this week. However, leadership aides told the press that no vote has been scheduled, ‘although there is still a chance it could still come up.’ Pelosi said she does not like using food stamp money to pay for the bill, but noted that it has been considered ‘as a funding source for purposes that are not consistent with nutrition and the health of our children.’”

Abby Phillip and Carol E. Lee reported yesterday at Politico that, “A bill to provide healthful school lunches for low-income children — a high-profile project of first lady Michelle Obama — has raised tensions between the White House and President Barack Obama’s key allies in the House of Representatives.

“Despite heavy lobbying by the first lady, more than 100 House Democrats have balked at approving the Senate’s $4.5 billion version of the nutrition bill because it is funded in part with $2.2 billion in cuts to SNAP, the federal food stamp program. They want assurances from the Obama administration that the funding cuts the Senate approved will be restored in the near future.”

The article noted that, “Late Monday, the White House signaled that it is willing to work with House Democrats to find a compromise.”

After additional analysis, yesterday’s article indicated that, “‘Well, the child nutrition legislation is indeed a top priority for the first lady, and we commend her for her leadership,’ Pelosi said. ‘We’re working on how we proceed with that legislation, and we’ll have an announcement soon.’

“Pressed on the issue, Pelosi said, ‘I’m not pleased with using food stamps as a pay-for in the legislation. However, there are those who have eyed the food stamp money for purposes that are not consistent with nutrition and the health of our children. I think we’ll be able to come up with an approach that accomplishes what the first lady set out to do and to do so in a timely fashion because it is also long overdue.’

After some discussion among officials in the East and West wings, the White House is poised to support promising to find a way to fund the food stamps program in the future.”

Meanwhile, an update posted yesterday at The Hill Online included a list of “Bills competing for floor time in lame-duck session.”

Among the items listed: Child nutrition and Food safety.

Climate

Darren Samuelsohn reported yesterday at Politco that, “President Barack Obama is pledging to throw his full weight next year behind efforts to overhaul the nation’s energy and climate change policies, though he concedes such moves might need to happen ‘in chunks.’

“In an interview published Tuesday by Rolling Stone magazine, Obama lamented how the economic crisis contributed to this year’s Senate stalemate over a comprehensive bill to cap carbon dioxide emissions and establish renewable power standards.

But for the first time, Obama publicly committed to trying again next year.”

The article added that, “‘One of my top priorities next year is to have an energy policy that begins to address all facets of our overreliance on fossil fuels,’ Obama said. ‘We may end up having to do it in chunks, as opposed to some sort of comprehensive omnibus legislation. But we’re going to stay on this because it is good for our economy, it’s good for our national security and, ultimately, it’s good for our environment.’

“Obama didn’t elaborate on specific pieces he’d like to see move in the next version of energy and climate legislation, but ideas floating around on Capitol Hill include a nationwide standard for renewables and a limit just on greenhouse gas emissions from power plants.”

Reuters writer Jeff Mason reported yesterday that, “Republicans are expected to make big gains in the Nov. 2 polls, possibly taking control of one or both houses of Congress. With Republicans in power or even smaller Democratic majorities in Congress, the president will have a harder time getting his policy priorities passed.

“Obama’s decision to grant an interview of more than an hour to Rolling Stone reflects a bid to energize young voters who helped propel him to the presidency two years ago, an effort that includes a trip to college campuses this week. Climate change is a key issue among young voters.”

Washington Post writer Juliet Eilperin reported yesterday at the Post Carbon Blog that, “But when [Rolling Stone editor, Jann Wenner] asked Obama if he would launch a lobbying campaign similar to the one on behalf of health care last year, the president replied: ‘Yes. Not only can I foresee it, but I am committed to making sure that we get an energy policy that makes sense for the country and that helps us grow at the same time as it deals with climate change in a serious way.’

“Whether Republicans will sign off on such a program if they make serious gains in November, even if it’s done in small ‘chunks,’ remains to be seen.”

Meanwhile, Mike Lillis reported yesterday at The Hill’s Energy Blog that, “Labeling climate change ‘a serious public health issue,’ more than 100 leading health advocates called on Washington policymakers this week to allow the Environmental Protection Agency (EPA) to regulate greenhouse gas emissions.

“The advocates — including 18 national public health organizations, 66 state-based groups and dozens of individual medical experts — urged lawmakers to ‘recognize the threat to public health posed by climate change and to support measures that will reduce these risks.’”

And Darren Goode reported yesterday at The Hill’s Energy Blog that, “Senate Majority Whip Richard Durbin (D-Ill.) Tuesday threw cold water on suggestions that the Senate would respond legislatively to the Gulf of Mexico oil spill or take up a renewable power mandate during a post-election lame-duck session.”

Biofuels

Daniel Looker reported yesterday at Agriculture.com that, “Senator Chuck Grassley (R-IA), shared his view of how a Republican takeover of Congress might affect agriculture Tuesday. He sees little change in farm policy in the agriculture committees, more support for trade agreements and more emphasis on existing tax credits for ethanol and biodiesel than on trading of energy offsets.

“Tax credits are expected to come up in a lame duck session in November and December after the election but before new members of Congress are seated next year.

“But Grassley told reporters Tuesday that Republicans might take the view that they could wait until January of next year to deal with tax issues, when they’re in the majority, if they do as well as expected in November.”

Mr. Looker added that, “That would mean that the 45 cent-a-gallon tax credit for ethanol would expire this year without being renewed, a fate similar to what happened at the end of 2009 when the $1 a gallon biodiesel tax credit expired without being extended. The biodiesel credit still hasn’t been renewed.

“Grassley said that he hopes that doesn’t happen. Instead, he hopes that while Democrats still control Congress in late 2010, that ‘for the good of the country,’ they’ll bring expiring tax credits to a vote.”

Philip Brasher reported yesterday at the Green Fields Blog (Des Moines Register) that, “A coalition that’s been trying to stop or slow the growth of the corn ethanol industry is arguing against proposals to increase the amount of ethanol that can be added to gasoline.

“The coalition that includes groups representing the oil and food industries first opposed a proposal to raise the limit to 15 percent. The Environmental Protection Agency could approve that increase for cars 2007 or newer next month. Now, the anti-ethanol coalition is opposing a smaller increase to 12 percent.”

Trade

Beth Hawley and Kwaku Duncan reported yesterday at The Hill Online that, “Lacking the votes necessary for passage, a House panel has postponed action on a bill that would lift travel restrictions to Cuba.

“The House Foreign Affairs Committee had scheduled a Wednesday markup on Rep. Collin Peterson’s (D-Minn.) measure, which was approved by Peterson’s Agriculture panel earlier this year. But the markup on Tuesday was postponed.”

The bill’s future is now uncertain,” the Hill article said.

The National Pork Producers Council issued a new release yesterday in support of lifting the restrictions on Cuba, and Sen. Ben Nelson (D-Neb.) “joined several Senate colleagues in urging the President to lift restrictive rules that serve as a barrier to agricultural trade with Cuba.”

The letter urges the President to direct the Treasury Department to end its 2005 policy of requiring payment before goods leave port and its requirement that cash payment be routed through third-country banks. Other U.S. industries such as telecommunications and travel agents are already allowed to bypass middlemen and transact directly with Cuban banks.”

In other trade news, Bloomberg writer Ilya Khrennikov reported yesterday that, “Russia agreed to more than halve farm subsidies by 2017 as it aims to join the World Trade Organization, Kommersant reported, citing Agriculture Minister Yelena Skrynnik, speaking yesterday in Geneva.”

Food Security

Reuters news reported yesterday (article posted at DTN, link requires subscription) that, “Former major grain exporter Russia, hit by drought unseen in more than a century, may have to import 300,000-500,000 tonnes of U.S. corn, a relatively small volume but without precedent in the past 10 years.

“Chicago Board of Trade grain markets were buzzing on Friday with talk that Russia may be looking to make a rare purchase of U.S. corn, but analysts and cash sources were unable to confirm the rumors that helped send futures higher.

“‘Imports of U.S. maize are very likely after the new year to Russia’s northwestern part where poultry breeding is highly developed,’ Andrei Sizov Jr., executive director at SovEcon agricultural analysts told Reuters.”

The Asia Society released a Task Force report yesterday titled, “Never an Empty Bowl,” a report on food security in Asia.

A related release from yesterday indicated that, “For the first time in history, the number of people suffering from chronic hunger reached one billion globally in 2009, with Asia accounting for approximately two-thirds of the world’s hungry.

“The future looks even more daunting. Population growth, increasing demand from changing diets, dwindling land and water resources for agriculture, higher energy costs, and the huge uncertainties regarding the effects of climate change present scientists and policy makers with additional challenges.

“A new Task Force report jointly released by the Asia Society and the International Rice Research Institute (IRRI) brings together a pragmatic approach to public policy and the best science, with substantial input from key players in the field, to advance a comprehensive plan of action to address food insecurity and poverty in the region.”

Dan Glickman, Former U.S. Secretary of Agriculture and M.S. Swaminathan, Chairman of the M.S. Swaminathan Foundation; recipient of the first World Food Prize, were co-Chairs of the task force.

1099 Issue

A news release yesterday from the American Farm Bureau Federation stated that, “Provisions in the new health care law that require farms, ranches and other businesses to complete an Internal Revenue Service Form 1099 for any expenditure totaling more than $600 in a calendar year create an unnecessary and costly paperwork burden, according to the American Farm Bureau Federation.

“Farm Bureau backs bills in the House and Senate, H.R. 5141, by Rep. Dan Lungren (R- Calif.) and S. 3578 by Sen. Mike Johanns (R-Neb.) that would repeal the Form 1099 reporting requirements. In addition, Farm Bureau filed comments with the IRS calling for repeal of the provisions that are set to take effect in 2012.”

Political Notes

– “Carnahan’s path in Missouri narrows.” Politico. David Catanese. 9.28- “While there’s some evidence a recent ad offensive tarring Rep. Roy Blunt as a consummate Washington insider is leaving a mark, it appears Robin Carnahan’s path to victory in the Show-Me State Senate race is becoming increasingly narrow.”

– “Ohio Tests Arguments of Midterms.” The New York Times. Jeff Zeleny and Dalia Sussman. 9.29- “Rob Portman, a former Republican congressman who served as trade representative and budget director in the George W. Bush administration, holds an 11-point lead among likely voters over Lt. Gov. Lee Fisher, his Democratic opponent. Mr. Fisher has had trouble raising money, and his attempts to criticize Mr. Portman on trade and other issues do not appear to have broken through.”

– “Tea-Party Movement Gathers Strength.” Peter Wallsten and Danny Yadron. The Wall Street Journal. 9.29- “The GOP now holds a three-point edge, 46% to 43%, when likely voters are asked which party they would prefer to control Congress. That is down from a nine-point Republican lead a month ago.”

– “Thune: Iowa ‘my style.’” Politico. Andy Barr. 9.28. “Sen. John Thune believes that campaigning for the Republican nomination in Iowa would cater to his ‘style,’ even if he hasn’t decided to run. The South Dakota Republican told the Rapid City Journal on Monday that he does not expect to make his formal decision until ‘sometime next year.’”

Keith Good

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