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Wednesday Morning Update: Policy Issues; Ag Economy; Trade; Regs; and, Budget

Policy Issues

Yesterday, the House Appropriations Subcommittee on Agriculture heard testimony regarding the USDA’s Marketing and Regulatory Programs.

In his opening statement, Subcommittee Chairman Robert Aderholt (R., Ala.) indicated that, “USDA is requesting a total of $987 million in discretionary resources in FY 2016 for the mission area, a decrease of $12.5 million from the 2015 enacted level…I am particularly concerned that USDA has requested scarce discretionary resources for lower priorities. For example, APHIS has requested an increase to enhance implementation of the Lacey Act provisions. I have trouble supporting such an increase at the expense of higher priority and more effective animal and plant health programs, many of which the agency has proposed to decrease.

“With the overall spending caps still in effect, I anticipate that the Subcommittee’s funding levels will remain relatively flat at best.”

Ed Avalos, USDA Under Secretary for Marketing and Regulatory Programs noted yesterday that, “To strike the balance between rigorous scientific review and timely entry to the market of genetically engineered crops, USDA streamlined and improved the process for making determinations on petitions involving biotechnology. Because of the enhancements, we reduced the length of the petition review by more than 600 days when we can use the environmental assessment process. With this improvement, we estimate that the cumulative number of actions taken to deregulate biotechnology products based on a scientific determination will increase from a cumulative total of 87 actions in 2011 to an estimated 119 in 2016.”

This topic came up in the discussion portion of yesterday’s hearing; Chairman Aderholt inquired: “Last year you reported that you were only able to reduce the backlog of 22 petitions by six. Your testimony this year states that you are nearly through the list of backlogged petitions. Can you provide us some more details on the status of the backlog and what progress you’ve been able to achieve?”

Animal and Plant Health Inspection Service Administrator Kevin Shea offered more details, and explained that, “You might recall a year ago I pledged to you we would cut the backlog of 16 by at least half, and I’m proud to say that the fantastic men and women who work in our biotechnology review program have indeed exceeded that goal, and there now only six of those 16 remain, so that means we reduced it by more than half.

“I would say this also, when we began our business process improvement just a few years ago, 2012, there were 23 re-regulation requests in the backlog. Since then 11 [more] requests to come in, so there were a total of 34 regulation requests. There are only six left. We got 28 out of 34 done. There are only six remaining. We’re going to get those done, we think, by the end of this fiscal year.

And so now we have the system in equilibrium. We can handle the amount that come in. And not only can we handle them, we can handle them quicker. It was taking us three to five years to do these things. We are now down to 15 to 18 months. Our goal is no more than 15 months, and I think we’re going to achieve that as well.”

Also on the biotech issue, Puneet Kollipara reported yesterday at The Washington Post Online that, “He’s not making his popular children’s science show anymore, but Bill Nye the Science Guy is still making a public impact by going after pseudoscience and science denial. He’s railed against the idea of teaching creationism in public schools, and he’s come to the defense of climate science and vaccines.

“But on another hot-button issue involving science — genetically modified organisms (GMOs) — Nye has actually angered many scientists. Over the years, including in a chapter in his 2014 book ‘Undeniable,’ Nye has suggested that there’s something fundamentally problematic with foods containing GMO crops. He has argued that GMOs may carry environmental risks that we can never rule out with certainty.

Now, Nye seems to have changed his mind. Backstage after an appearance on Bill Maher’s ‘Real Time,’ Nye said an upcoming revision to his book would contain a rewritten chapter on GMOs. ‘I went to Monsanto,’ Nye said, ‘and I spent a lot of time with the scientists there, and I have revised my outlook, and I’m very excited about telling the world. When you’re in love, you want to tell the world.’”

This morning, the Appropriations Subcommittee on Agriculture is scheduled to hear testimony from FDA Commissioner Dr. Margaret Hamburg.

The House Ag Committee indicated yesterday that, “Due to the anticipated inclement weather and cancellation of votes in the House on Thursday, March 5,” the Subcommittee on Conservation and Forestry hearing “to review the definition of ‘waters of the United States’ proposed rule and its impact on rural America” has been postponed. The hearing will be rescheduled for a later date.”

Ron Nixon reported in today’s New York Times that, “The Obama administration, as part of a broader push to address persistent poverty and childhood hunger in rural areas, said Tuesday that it would provide millions of dollars in grants to help several economically distressed communities.”

Mr. Nixon added that, “The Agriculture Department’s push to address childhood hunger came as the Republican-led House announced plans to roll back new school meal regulations, and considers revisions to the Supplemental Nutrition Assistance Program, or SNAP, to reduce the number of people receiving food stamp benefits.

“Mr. Vilsack said the efforts in Congress could undercut the gains made in reducing childhood hunger and poverty.

“‘The answer is not to roll the nutrition standards back,’ Mr. Vilsack said. ‘And as far as reducing the number of people on SNAP, let’s find the right way to do this by focusing on people who want to work and helping them.’”

A brief report highlighting some SNAP related data this week from the U.S. Census Bureau indicated that, “In the 2013 ACS [American Community Survey], 15.7 million households, or 13.5 percent of all households, received SNAP at some point in the previous 12 months. In 2012, 15.8 million households, or 13.6 percent of all households, received SNAP at some point in the previous 12 months.

“The states with the highest SNAP participation rate in 2013 were Oregon (19.8 percent) and Mississippi (19.4 percent). There was not a statistically significant difference in participation rates between these states. The state with the lowest SNAP participation rate was Wyoming (5.9 percent).”

The report also included this graph, depicting the percentage of households receiving SNAP Benefits: 2000−2013.

In a tweet yesterday, Senate Ag Committee member Bob Casey (D., Pa.) stated that, “Another round of draconian cuts to #SNAP will harm vulnerable children and seniors in Pennsylvania and negatively impact economic growth.”

In a separate tweet on SNAP yesterday, Sen. Casey added that,, “Over the last few years the Senate has pushed for substantial reforms to the #SNAP program to improve efficiency and effectiveness.”

More specifically regarding the current legislative environment, Sen. Casey tweeted yesterday that, “Despite these steps, some in the House seem insistent on launching a mean-spirited campaign against the vulnerable. #SNAP

Also yesterday, House Ag Nutrition Subcommittee Chairwoman Jackie Walorski (R., Ind.) tweeted that, “Together we can put an end to hunger #hungerpc15”

In other nutrition related issues, a news update yesterday from Rep. Kristi Noem (R., S.D.) stated that, “[Rep. Noem] today announced plans for legislation that reduces federal mandates on school meal standards, including the more stringent whole grain requirements that went into effect in July 2014 and the Target 2 sodium requirements set to be implemented in the coming years… Rep. Noem introduced her initial Reducing Federal Mandates on School Lunch Act in December 2013. This updated version of the bill includes new provisions to address concerns with the Target 2 sodium levels and whole grain requirements.”

An underlying backdrop to nutrition related issues are the cost and affordability of food.

Yesterday, USDA’s Economic Research (ERS) provided a closer look at food price issues in its Food Price Outlook for 2015– a summary of the ERS update is available at FarmPolicy.com.

Bloomberg writer Andrew Martin penned a very lengthy and in-depth article yesterday which looked at food and policy related issues titled, “Inside the Powerful Lobby Fighting for Your Right to Eat Pizza.”

This extensive article, which was filled with several interesting graphical illustrations, stated that, “Pizza is special, says Lynn Liddle, executive vice president for communications, investor relations, and legislative affairs at Domino’s Pizza and chair of the American Pizza Community — the APC, as it calls itself…[F]or decades, pizza makers have relied on the food’s natural advantage: Everybody loves it. Some 41 million Americans — more than the population of California — eat a slice of pizza on any given day. If pizza were a country, its sales would put it in the top 100 of global gross domestic product.”

The Bloomberg article noted that, “More recently, though, pizza has become a target, lumped into a nutritional axis of evil along with French fries and soda. New federal nutrition standards for school lunches, part of a 2010 law, squarely targeted pizza’s dominance in cafeterias…[O]ne by one, other purveyors of fast food have been convinced, nudged along by new laws or public shaming. McDonald’s, for example, voluntarily took soda out of Happy Meals and added calorie counts to its menus long before the government required it. Wendy’s also removed soda from its children’s menu, and Darden Restaurants reduced calories and sodium in kids’ meals at its restaurants, including Olive Garden and Red Lobster, and made vegetables and milk the default side options.

Pizza advocates have taken a different, more combative tack. They’ve separated themselves from other food groups in Washington to become their own lobbying force.”

The Bloomberg article added that, “Now, with the Republicans running Congress, there’s talk of reversing some nutrition policies that conservatives consider pet projects of the first lady and examples of government overreach. The School Nutrition Association has already asked Congress to roll back some of the more onerous nutrition rules in the coming year. The frozen-pizza people, meanwhile, haven’t yet taken a position.”

In other policy news, an update yesterday from the American Sugar Alliance (ASA) stated that, “Congressman Ted Yoho (R-FL) reintroduced his Zero-for-Zero sugar policy, on Friday, which would instruct the administration to target the foreign sugar subsidies that are distorting world prices and keeping a free market from forming. Under the plan, U.S. sugar policy would also be rolled back in exchange for the elimination of foreign programs.

“Members of the [ASA] praised Yoho and the eight original co-sponsors of H.Con.Res. 20, and said sugar farmers from across the country are in town this week to educate lawmakers about the current U.S. policy and to encourage support for the resolution.”

Meanwhile, Timothy Cama reported yesterday at The Hill Online that, “Pro-ethanol group Fuels America has signed with a pair of high-profile lobbyists from both parties as part of its effort to defend the federal ethanol blending mandate.

“Documents filed with Congress in late February say that prolific Democratic fundraiser Heather Podesta of Heather Podesta + Partners and former Republican Speaker Denny Hastert of Dickstein Shapiro started representing the ethanol coalition’s interests on Capitol Hill in mid-January.”

And looking ahead to this Saturday’s Iowa Agriculture Summit, Jennifer Jacobs reported on the front page of Tuesday’s Des Moines Register that, “The debut of Jeb Bush on the Iowa presidential landscape is one factor that marks Saturday’s Iowa Agriculture Summit (@IowaAgSummit), as an important milestone of the early 2016 campaign.”

Politico reporter Helena Bottemiller Evich penned an article relating to the summit yesterday titled, “The real Iowa kingmaker: How a pork and ethanol giant drew the entire GOP field to an Iowa stage.”

 

Agricultural Economy

Kelsey Gee reported in today’s Wall Street Journal that, “U.S. hog prices tumbled to nearly a two-week low Tuesday, pressured by rising supplies and unexpectedly weak demand of pork products.

Cattle futures also slipped, reaching five-week lows, amid a seasonal slowdown in consumption of red meat.”

Ms. Gee added that, “Pressure in the wholesale pork market this week has renewed concerns that growing U.S. volumes of hams, loins and other items are being met with tepid demand from grocery and restaurant buyers, which have little incentive to aggressively purchase pork if prices continue to drop. This has squeezed margins for pork processors, in turn weighing on the market for slaughter-ready hogs.”

 

Trade

Vicki Needham reported yesterday at The Hill Online that, “The Senate’s top Republican hopes the upper chamber can move forward soon with trade promotion authority, which would streamline passage of global agreements.

“Senate Majority Leader Mitch McConnell (Ky.) said Tuesday that he wants to pass so-called fast-track authority because it is one of the few issues where Congress and the White House agree.”

 

Regulations

Timothy Cama reported yesterday at The Hill Online that, “The White House on Tuesday threatened to veto a pair of Republican bills aimed at changing the way the Environmental Protection Agency (EPA) uses science to justify regulations.

“The first bill would attack the EPA’s use of ‘secret science’… The second bill would reform the EPA’s Scientific Advisory Board, a panel of independent experts that make recommendations on science, regulations, standards and other subjects to the agency.”

Bloomberg writer Sonja Elmquist reported yesterday that, “Steve Edgar, a fighter pilot who operated wartime drones in Iraq and Afghanistan, is back home in Idaho. Now, he plans to use unmanned aircraft for a more peaceful purpose: Improving farmer crop yields.

“Edgar’s firm, Advanced Aviation Solutions, in January became the first company involved in agriculture to be approved by the U.S. to fly unmanned aircraft over farms. Three others have followed since as the Federal Aviation Administration rolls out rules on how commercial drones are used in the U.S.”

Recall that the potential use of drones for USDA came up last week at an Appropriations Ag Subcommittee hearing with Natural Resources Conservation Service (NRCS) Chief Jason Weller.

 

Budget

Siobhan Hughes reported in today’s Wall Street Journal that, “The Republican-controlled House voted Tuesday to fund the Department of Homeland Security through September without blocking implementation of President Barack Obama’s executive actions on immigration, backing down from a standoff that had threatened a partial government shutdown.

“The House cleared the measure 257-167, going along with a Senate plan it had rejected just days earlier. The action sends the bill to the White House where Mr. Obama said he will sign it as soon as he receives it.”

Keith Good