Donnelle Eller reported on the front page of yesterday’s Des Moines Register that, “Economists expect Iowa corn and soybean growers will lose money over the next four years, beginning with this year’s harvest, squeezed by low commodity prices and high production costs.
“The potential downturn follows a boom that saw growers worldwide bringing millions more acres into production to take advantage of record-high prices.
“Experts in Iowa compare the downturn to the devastating 1980s farm crisis, the only time in at least 60 years that the state’s farm industry posted a loss. This correction is unlikely to be as severe, because farmers are coming off record-high net incomes. But enough similarities exist to cause concern.”
At his weekly news conference yesterday, House Speaker John Boehner (R., Ohio) indicated that, “On the farm bill, you know, I’ve not seen any real progress on the farm bill. And so if we’ve got to pass a one-month extension of the — of the farm bill, I think we’ll be prepared to do that.”
A reporter followed up by asking: “Would it be the entire farm bill or specific […off-mic…].
Speaker Boehner noted that, “I’ll let the chairman answer that question, but I think all of it probably ought to be extended for a month. Listen, I made it clear that the House is going to leave next Friday. And you all know me pretty well. I mean what I say, and I say what I mean.”
Russell Berman reported yesterday at The Hill Online that, “On the farm bill, Boehner was more pessimistic and raised the possibility of needing a one-month extension of current policy into next year.”
The update added that, “Without an extension, milk prices could spike after Jan. 1. Boehner said that he believes an extension should cover the entire farm bill and not just the dairy program.”
Ms. Jalonick added that, “White House spokesman Jay Carney reiterated Obama’s support for the Senate version of the bill Thursday, calling the House SNAP cuts ‘unconscionable’ and harmful to families across the country.
“‘The president has mentioned and made clear that there is an opportunity for bipartisan cooperation on a comprehensive farm bill,’ Carney said. ‘And he hopes and expects that that can be achieved before the end of the year.’”
U.S. Department of Agriculture Communications Director Matt Paul noted in a statement yesterday that, “Negotiations on Capitol Hill about the Farm Bill should continue until House and Senate leaders reach agreement on a comprehensive bill. Numerous members of both sides have indicated progress, and the country deserves continued work on this critical legislation.”
Meanwhile, Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “House Agriculture Committee Chairman Frank Lucas (R-Okla.) on Thursday said a deal on the farm bill is emerging, though nothing has been finalized.
“He said that while finishing the bill by the time the House recesses on Dec. 13 would be ‘Herculean,’ he does not yet want Congress to move to a one-month extension.
“‘As Sen. [Debbie] Stabenow [D-Mich.] says, nothing is ever done until all the parts are complete. Maybe Sen. Stabenow is right,’ Lucas said. ‘It would still be my hope that we could get all of our work done in time to not require an extension.’”
Mr. Wasson added that, “Speaker John Boehner (R-Ohio) called for a stopgap farm measure on Thursday to avoid a spike in milk prices in early January.
“But Lucas said he believes the Agriculture Department would hold off on implementing the dairy policies if a farm bill is moving through Congress.”
The Hill update explained that, “The chairman said that he would be leaving for Oklahoma on Thursday afternoon, likely leaving any deal on the farm bill for next week.
“A House leadership aide said that the talks are moving too slowly to allow for a deal before the time the House leaves for its recess on Dec. 13, and that is why Boehner sees the need for an extension that avoids a milk price spike.”
Also yesterday, Niels Lesniewski reported at Roll Call Online that, “On the House floor, Majority Leader Eric Cantor, R-Va., said the House would be ready to consider ‘legislation pertaining to farm programs, including potentially a full farm bill conference report,’ if it becomes available.”
Reuters writer Charles Abbott reported yesterday that, “The House might vote next week to extend the now-expired 2008 farm law into January, ‘just enough for us to get our work done,’ said a House staff worker.”
Mr. Abbott noted that, “Farm-state lawmakers were optimistic about wrapping up the bill in short order, but not before the new year. A senior member of the House Agriculture Committee, Mike Conaway of Texas, said Republicans were ‘flexible’ in negotiations with the Senate while insisting on stricter food stamp rules.”
The Reuters article added that, “Conaway told the Farm Journal Forum, a farm policy meeting, that the final version of the farm bill will need work requirements for food stamp recipients: ‘something that says to continue to get food stamps you have to get back into the game’ by working or looking for a job.”
Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “The main farm bill negotiators emerged from their first face-to-face meeting in nearly two weeks on Wednesday more optimistic they will reach an agreement.
“The hour-long meeting occurred as Speaker John Boehner (R-Ohio) took to the House floor to blame Senate Democrats for failing to agree to a farm bill deal.
“‘Staff are doing some work on specifics and scores and so on, but we are making great progress,’ said Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.), who flew into town despite the Senate recess to hold talks.”
* Fifth District- Richmond- “Crop yields varied since our last report. Corn yields are above the 2012 record and on track for a strong finish this year. Cotton and peanut yields are steady in North Carolina, though below the 2012 record. South Carolina cotton declined moderately from the 2012 record, while peanut yields there were on par with year ago levels. In animal farming, a contact noted that poultry production was declining on the Eastern Shore of Virginia and Maryland due to regulatory changes and water pollution issues.”
* Sixth District- Atlanta- “Drought conditions in Mississippi and Louisiana eased while other areas in the District continued to experience abnormally dry conditions. Since the previous cycle, monthly prices paid to farmers for cotton, rice, and oranges increased while prices for corn, soybeans, beef, hogs, and poultry decreased. The most recent crop production projections for corn and soybeans were up from last year while cotton, rice, and orange projections were down. Contacts reported making investments in irrigation equipment, storage augmentation, and replacing smaller equipment with larger, more modern units as ways to improve production and/or contain costs.”
* Seventh District- Chicago- “Harvesting took longer this fall than a year ago given the larger size of the crop and delays from precipitation. Crop yields remained higher than expected across the District, even in areas that experienced yield losses from drought. In general, farmers tended to sell soybeans and store corn. Pastures and winter wheat fields were in better shape than they were last year. Crop prices fell over the reporting period, though higher exports of corn, soybeans, and wheat cushioned the decline. Lower fertilizer prices relieved some concerns about 2014 crop production costs. Milk and cattle prices were a bit higher; hog prices fell, although they remained above the level of a year ago. The prospects for livestock producers improved due to reduced feed costs.”
* Eighth District – St. Louis- “As of mid-November, over 90 percent of the District corn, sorghum, and rice crops had been harvested, while harvest progress of the District cotton and soybean crops was 81 and 89 percent complete, respectively. Winter wheat planting was 87 percent complete, on average, across the District.”
* Ninth District- Minneapolis- “The agriculture sector saw slight contraction. In the Minneapolis Fed’s third quarter (October) survey of agricultural credit conditions, 28 percent of lenders reported that farm incomes decreased from the second quarter, while 15 percent reported increases; nearly half expect incomes to decrease in the final three months of 2013. October prices received by farmers decreased from a year earlier for wheat, corn, soybeans, milk, eggs, turkeys and cattle; prices increased for chickens, calves, hogs and dry beans. An early-October blizzard in western South Dakota killed an estimated 15,000 cattle there. Drought conditions abated in most of the District in late fall.”
* Tenth District- Kansas City- “A steep drop in crop prices, which partly reflected better-than-expected corn and soybean yields, lowered District farm income and boosted demand for farm operating loans since the last survey period. Some livestock operators in Western Nebraska also faced significant herd losses due to a severe October snowstorm. Farm income was expected to remain weaker than last year despite some support from crop insurance and a gradual improvement in livestock sector profitability resulting from lower feed costs. With reduced incomes, agricultural bankers reported the number of requests for loan renewals and extensions edged up and demand for new farm operating loans also increased. Farmland values rose further, but the pace of gains moderated and most contacts expected values would hold steady through the end of the year.”
* Eleventh District- Dallas- “Drought conditions continued to ease, although the Texas panhandle area remained particularly dry. Corn and sorghum production was higher, while cotton production was down. The livestock sector continued to benefit from improved pasture conditions, lower feed costs, and high selling prices for cattle.”
* Twelfth District- San Francisco- “Output in agricultural and resource-related industries expanded on balance. Demand remained strong for most crop and livestock products, although weaker commodity prices caused some contacts to pare back their expectations for production activity in 2014. Water resources were sufficient in most areas.”
House Ag Committee Chairman Frank Lucas (R., Okla.) was a guest yesterday on the AgriTalk radio program with Mike Adams, where the conversation focused on the Farm Bill. An unofficial FarmPolicy.comtranscript of yesterday’s discussion is available here.
Chairman Lucas indicated that, “I think my colleague Chairwoman Stabenow said so, so I’ll repeat it again, we have another principals meeting tomorrow [Wednesday]—Senator Stabenow, Senator Cochran, Congressman and Ranking Member Peterson and myself. I look forward to see what the Senate will put on the table tomorrow. But we’re at the point in time where it should be possible to conclude this process.
“But as you and I have discussed many times, Mike, there are some very philosophical differences. The House perspective on how many dollars in the nutrition savings, reforms to have, the difference between the House and Senate perspective on what kind of a safety net we have in the commodity title.”
Ed O’Keefe reported in today’s Washington Post that, “House and Senate negotiators plan to meet again this week in hopes of finishing another complicated piece of legislation before a critical, fast-approaching deadline.
“In this case it is the farm bill, an omnibus measure that sets federal agricultural policy and spending on food aid.”
Janet Hook and Kristina Peterson reported in today’s Wall Street Journal that, “Congress is heading into the final stretch of its legislative session with a pile of year-end policy decisions before it and little time to address them.
“Lawmakers are struggling to negotiate deals on farm programs and food stamps, and on the budget for a fiscal year that began two months ago…[T]he window for joint congressional action is narrow. The House returns from Thanksgiving recess Monday, while the Senate reconvenes Dec. 9. If the House adjourns for the year as planned on Dec. 13, the two chambers will be in session simultaneously for only one week in December.”
Secretary of Agriculture Tom Vilsack was a guest on Wednesday’s AgriTalk radio program with Mike Adams where the conversation focused on Farm Bill issues. An unofficial FarmPolicy.comtranscript of the conversation with Sec. Vilsack and Mike Adams is available here.
Sec. Vilsack pointed out that, “Well, I think we have to be realistic about this. If there is no appearance that there’s going to be a deal or if things break down and folks continue to be sort of in their corners and there isn’t a middle ground to be had, then obviously we’re going to have to start working towards and triggering permanent law.
“Some people have suggested that’s going to take a while to implement, but the reality is it’s not that we haven’t been thinking about this at USDA, we have been. We have a pretty good sense of what we would need to do. We’ve reached out to some of the folks, particularly in the dairy industry, to get their views about this. So we would be in a position, in short order—I don’t want to put a timeline on it—but in short order to get something done on the permanent law side.
“But boy, I tell you, that’s not something that I want to do, I’m reasonably certain that’s not anything that anybody in Congress would want to have happen, and I’m sure that no consumer is anxious to see that happen. So hopefully we continue to see progress.”
Sec. Vilsack also noted that, “It’s not just the permanent law issue, it’s also the Brazilian cotton issue, which is a trade dispute that we lost in the WTO, and there are consequences for inaction there. They can begin assessing retaliatory tariffs against many of our products, including exposing some of our intellectual property and destroying the protections that intellectual property has, which would be a first, frankly, in trade discussions, as I understand it.”
David Rogers reported yesterday at Politico that, “Maybe it’s time to admit that whatever comes out of the great Farm Bill Wars in Congress will be — an experiment.
“Indeed, it’s a whole new world already compared to the last enacted bill in 2008, which passed by veto-proof margins and was helped along then by added money for nutrition and continued direct cash payments to farmers.
“This time the mandate is entirely different: requiring a major rewrite of the commodity title while also tackling food stamps — all in the name of reform and deficit reduction.”
“So why is it so hard?” Mr. Rogers asked, “One big reason is that everyone seems to have underestimated the challenge of replacing the current system of direct cash payments that’s been the backbone of the commodity title since 1996.”
Mary Kay Thatcher, the Senior Director of Congressional Relations for the American Farm Bureau Federation, was a guest on yesterday’s AgriTalk radio program with Mike Adams where the discussion focused on the Farm Bill. An unofficial FarmPolicy.comtranscript of yesterday’s discussion is available here.
Ms. Thatcher pointed out that, “I was hoping that we could have some good news to share this morning, but I think we’re going to continue to work at it. Staff’s up there working hard today, even though the members aren’t around, and the four principals are presumably still having some kind of conference call to further discuss it today. So we still have some hope that, indeed, by the end of the year or by the middle of January, when we have this budget bill, that we can have it done, but we aren’t there today, and I can’t even tell you exactly what progress has been made.”
In a related update, Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “The top leaders of the House-Senate farm bill conference committee plan to hold a pivotal conference call on Monday.
“Sen. Debbie Stabenow (D-Mich.) and Rep. Frank Lucas (R-Okla.), the respective heads of the Senate and House Agriculture committees, and the committees’ ranking members Sen. Thad Cochran (R-Miss.) and Rep. Collin Peterson (D-Minn.) will join the negotiating session.
“The ‘big four’ leaders are still trying to hammer out a farm bill deal in order to move the $1 trillion agriculture subsidy, crop insurance and food stamp bill on the House and Senate floor in December.”
And, Mr. Wasson tweeted yesterday evening that, “Conf call by 4 #farmbill lead negotiators happened. Process continues w/ no resolution yet”
Ron Hays, of The Oklahoma Farm Report and Radio Oklahoma Network, spoke on Friday with House Ag Committee Chairman Frank Lucas (R., Okla.) about the Farm Bill and farm policy variables.
An audio replay and summary of the Chairman’s remarks from Friday can be found here, while an unofficial FarmPolicy.comtranscript of the conversation with Ron Hays and Chairman Lucas is available here.
David Rogers reported yesterday at Politico that, “Farm bill talks stumbled badly Thursday and House Agriculture Committee Chairman Frank Lucas (R-Okla.) said it would be ‘very challenging’ now for him to meet the Republican leadership’s schedule of having a final agreement back on the House floor by Dec. 13.
“The Oklahoma Republican had been pressing hard for some framework of a deal before the Thanksgiving recess. But after three face-to-face meetings between House and Senate negotiators in less than 24 hours, the upshot seemed more a picture of frustration.
“‘Anything is possible but it is very challenging,’ Lucas said. He added that it was a ‘fair assessment’ that he had not made the progress he had hoped for this week.”
David Rogers reported yesterday at Politico that, “Farm bill talks intensified Wednesday night even as a new report showed that food stamp expenditures are already beginning to fall as a share of the economy — a downward decline that’s expected to accelerate over the next five years.
“Further cuts from food stamps are a major dividing point in the farm bill negotiations now, but there is growing pressure to try to reach a deal in the next few days on both the nutrition and commodity titles.
“The top four members of the House and Senate Agriculture Committees met for almost 90 minutes Wednesday evening behind closed doors with staff. Further discussions are expected Thursday morning, and House Chairman Frank Lucas (R-Okla.) held out the possibility of more meetings Friday depending on what progress is being made.”
Chris Clayton reported yesterday at the DTN Ag Policy Blog that, “Farmers in parts of the northern and eastern Corn Belt would be collecting Price Loss Coverage payments on their corn crops this week IF the House version of the farm bill were in place.
“DTN’s market tracker shows corn for delivery selling as low as $3.17 a bushel in northeast Montana. Cash prices in several states show farmers would be receiving a target-price check for corn.”
Gregory Meyer reported on Friday at The Financial Times Online that, “The Obama administration has formally moved to put the brakes on US biofuels as it juggles conflicting pressures from two of the most powerful lobbies in Washington.
“Its proposal to trim a statutory ethanol blending mandate for the first time drew the threat of a lawsuit from the renewable fuels industry, and complaints from the oil lobby that the measure did not go far enough.”
Mr. Meyer noted that, “The rule unveiled for public comment on Friday by the Environmental Protection Agency [proposed rule, fact sheet, news release] called for 15.21bn gallons to be blended into the motor fuel supply in 2014, 16 per cent lower than the 18.15bn gallons under the renewable fuels law passed in 2007. It is a significant reversal for the agency, which just a year ago upheld the mandate in the face of protests from several state governors.”
The FT article indicated that, “‘As a result, we are now at the ‘E10 blend wall,’ the point at which the E10 fuel pool is saturated with ethanol,’ the EPA said.”