FarmPolicy

March 29, 2017

Last Report: Personal Note; Ag Economy; Trade; and, Regulations

Personal Note

I remember the time in 2002 I tried to explain to my wife an idea I had about summarizing newspaper articles relating to farm policy issues for busy people at work who didn’t have time to read as much as they wanted to.

Now the time has come to stop writing the daily reports.

Thanks so much to the over 200 individuals who took time the past couple of weeks to share with me their appreciation for the reports; here are reflective examples of what these very thoughtful notes from readers said:

“Everyone always says ‘make sure you get the farm policy update’ because everyone knows it’s the best.”

You’ve been a must-read for thousands.”

“I’ve shared your site with dozens of people over the years, always saying ‘sign up for Farmpolicy.com. It is the very best source for ag news anywhere.’ This is one of the few places where information is gathered and shared without commentary.”

“Your willingness to provide this early-morning update day after day, without fail, has been a wonderful contribution.”

“I have marveled at the discipline and effort required to bring ‘farm policy’ to my east coast desk early in the day.”

“Your daily surveys are the best-written, most comprehensive, and most objective news source that I have seen for a long time.”

“In addition, your integrity in reporting is deeply appreciated. There is a lot that gets said in ag circles, and you screened out the chaff. Your accuracy in reporting was always highly valued as well. Only you could have provided that unique combination of an ag economist, an ag attorney, and a journalist. The ag community has richly benefited from your dedication and commitment to FarmPolicy.com.”

“Distilling the information from numerous sources, sites, and newspapers is an overwhelming task that you accomplished with great professionalism. What you provided was accurate, complete, and extremely valuable.”

And Rep. Adrian Smith (R., Neb.) tweeted yesterday: “Thank you to Keith Good for his years of ‪#ag reporting. Sad to see ‪@FarmPolicy end, but I wish him all the best in his new chapter.”

Thanks to all for reading FarmPolicy.com.

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Wednesday Update: Ag Economy; Policy; and, Regulations

Reminder: Only two FarmPolicy.com reports left.

Agricultural Economy

A news release yesterday from USDA’s National Agricultural Statistics Service (NASS) stated that, “For a second year in a row, U.S. growers are raising the bar on soybean acreage. Growers across the United States intend to plant an estimated record-high 84.6 million acres of soybeans in 2015, [related graph], according to the Prospective Plantings report released today by [NASS].”

Yesterday’s release added that, “NASS today also released the quarterly Grain Stocks report to provide estimates of on-farm and off-farm stocks as of March 1. Key findings in that report include:

“- Corn stocks totaled 7.74 billion bushels, up 11 percent from the same time last year. On-farm corn stocks were up 13 percent from a year ago, and off-farm stocks were up 7 percent.

“- Soybeans stored on farms totaled 1.33 billion bushels, up 34 percent from March 1, 2014. On-farm soybean stocks were up 60 percent from a year ago, while off-farm stocks were up 18 percent.”

University of Illinois agricultural economist Darrel Good indicated yesterday at the farmdoc daily blog (“USDA Stocks and Acreage Estimates Smaller than Expected for Soybeans and Larger than Expected for Corn”) that, “Compared to pre-report expectations, the March 1 soybean stocks and 2015 planting intentions estimates represent modestly friendly surprises. On the other hand, the stocks and planting intentions estimates represented modestly negative surprises for the corn market. Part of the negative corn price response to the estimates likely reflects inflated trend yield estimates for 2015 and perhaps an incorrect interpretation of the pace of feed and residual use during the first half of the marketing year. Attention will now turn to spring weather and planting progress.”

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Sunday Update: Policy Issues; Ag Economy; and, Biofuels

Reminder: Only four reports left, FarmPolicy.com ends Friday.

Policy Issues

Reuters writer Christine Stebbins reported on Friday that, “U.S. farmers will have another week to enroll in the government’s new subsidy programs under the five-year farm bill, with the deadline extended to April 7, the U.S. Department of Agriculture said on Friday.

“The final day for farmers to update their crop acreage and yield history, the first step to qualify for the new subsidies, will be extended to April 7. The farmers had already had the deadline to update their acreage data extended by one month to March 31.”

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Tuesday Morning Update: Policy Issues; and the Ag Economy

Policy Issues

Lydia Wheeler and Tim Devaney reported yesterday at The Hill Online that, “The House Agriculture Committee will examine the costs and impacts of mandatory biotechnology labeling laws at a hearing Tuesday morning.

“Lawmakers are pushing for a federal law that would require manufacturers to label all genetically engineered foods and any food products that contain genetically engineered ingredients.

“The Genetically Engineered Food Right-to-Know Act, which Rep. Peter DeFazio (D-Ore.) introduced in the House and Sen. Barbara Boxer (D-Calif.) introduced in the Senate, would direct the Food and Drug Administration to enforce the new rule.”

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Friday Morning Update: Policy; Trade; Ag Economy; Biofuels; Biotech; and, Budget

Policy Issues

On Thursday, the House Agriculture Nutrition Subcommittee met, “to review SNAP recipient characteristics and dynamics.” Yesterday’s hearing followed Wednesday’s full House Ag Committee meeting on SNAP and nutrition issues.

A FarmPolicy.com summary and overview of Thursday’s Subcommittee hearing is available here.

Over the past two days, the House Ag Committee has been presented with a large amount of detailed analysis and information on SNAP; it appears that Chairman Mike Conaway’s (R., Tex.) top-to-bottom review of the program is off to a substantive and serious start.

In remarks on the House floor Thursday, Ag Nutrition Subcommittee ranking member Jim McGovern (D., Mass.) indicated that, “Mr. Speaker, yesterday the House Agriculture Committee – where I am proud to serve – held the first hearing in its ‘top-to-bottom’ review of the Supplemental Nutrition Assistance Program, or SNAP.

“SNAP is the nation’s pre-eminent anti-hunger program that provides critical food assistance to more than 46 million Americans. Last year, 16 million children – or 1 in 5 American children – relied on SNAP. Unfortunately, every indication is that Republicans will once again try to cut this critical safety-net program.”

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FarmPolicy.com Monday News Update

Recall that earlier this month, USDA updated its U.S. Farm Sector Income Forecast and noted that, “Net farm income is forecast to be $73.6 billion in 2015, down nearly 32 percent from 2014’s forecast of $108 billion. The 2015 forecast would be the lowest since 2009.”

Scott Irwin, an agricultural economist at the University of Illinois at Urbana-Champaign, noted that, “It’s neither happy times nor is the sky falling in terms of agriculture incomes.”

However, Reuters news published a disconcerting article on Monday which stated that, “Across the U.S. Midwest, the plunge in grain prices to near four-year lows is pitting landowners determined to sustain rental incomes against farmer tenants worried about making rent payments because their revenues are squeezed.”

The article noted that, “Some grain farmers already see the burden as too big. They are taking an extreme step, one not widely seen since the 1980s: breaching lease contracts, reducing how much land they will sow this spring and risking years-long legal battles with landlords.”

Meanwhile, a separate Reuters article over the weekend focused on the issue of genetically modified crops in India.

Details on these two Reuters articles can be found at FarmPolicy.com.

The Wall Street Journal reported on Monday that it will “likely take months for the backlog to clear” at West Coast Ports after this weekends resolution of the labor dispute there.  Labor Secretary Tom Perez discussed his role in resolving the dispute Monday morning on MSNBC and CNBC television.

Monday’s papers also included a look at the ongoing budget showdown regarding the Department of Homeland Security. The impetus for the dispute stemmed from executive branch action on immigration policy.  Meanwhile, a subsequent federal court ruling temporarily stopping executive branch implementation of the that policy has added to the complexity of how to resolve the dispute.

An article on the front page of Monday’s Wall Street Journal noted that, “Senate Republicans, still mulling their options, are most likely to end up supporting a short-term extension of the agency’s current funding.” Also, Nathan Koppel reported today at The Wall Street Journal Online that, “The Obama administration on Monday asked a federal court to allow it to continue implementing the president’s immigration plan, which was temporarily blocked last week by a Texas judge.”

News with potentially negative implications for the Trans-Pacific Partnership trade negotiations and Japan unfolded on Monday.

Robin Harding reported today at The Financial Times Online that, “Shinzo Abe, the Japanese prime minister, has lost an important ally on the Trans-Pacific Partnership trade deal after his agriculture minster resigned in a scandal over political donations.”

The FT article added that, “The resignation matters because Mr Nishikawa is a longstanding member of the LDP’s ‘agricultural tribe’. He acted as a firewall for Mr Abe against internal party critics on trade deals and farm reform.

“Negotiators are near a deal on the huge TPP agreement, and agricultural reform is one of Mr Abe’s top priorities this year, so the loss of Mr Nishikawa is a blow to the prime minister’s agenda.”

Also today at FarmPolicy.com is a summary of a recent USDA- Economic Research Service report highlighting agricultural trade issues with China, as well as a look at an ERS publication on wetlands and the Farm Bill.

Keith Good

Cuba Policy; China (Trade-Biotech); and, the Agricultural Economy

Cuba Policy

Geoff Dyer and Marc Frank reported yesterday at The Financial Times Online that, “The US is to open talks with Cuba about establishing full diplomatic relations and reopening an embassy in Havana, potentially bringing to an end more than five decades of hostility and one of the last vestiges of the Cold War.

“The dramatic move to thaw relations began with a prisoner swap on Wednesday, including three Cuban agents held in US jails and Alan Gross, an American development worker who has been in a Cuban prison for five years on spying charges. The US said an unnamed Cuban man who had provided ‘critical’ intelligence to the US had also been released from a Cuban jail after almost 20 years.”

The FT article explained that, “The push to ease ties with Cuba could bring to an end more than 50 years of US economic sanctions which were put in place just after the Cuban Missile Crisis of 1962 in a bid to isolate the island and contain its ambitions to export communism.”

“‘These 50 years have shown that isolation has not worked. It’s time for a new approach,’ Mr Obama said in a televised address. ‘It does not serve America’s interests, or the Cuban people, to try to push Cuba towards collapse,’ he said. ‘Let us leave behind the legacy of both colonisation and communism, the tyranny of drug cartels, dictators and sham elections.’

US officials said that the administration was relaxing some restrictions on commerce with Cuba, although bigger steps to unwind the embargo would require the approval of Congress,” the FT article said.

Dyer and Frank added that, “Marco Rubio, the Florida senator who is the son of Cuban immigrants, immediately denounced the initiative and said he would work to block efforts at opening trade and commerce with Cuba.”

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Appropriations; Biofuels; Biotech; Immigration; CFTC; Tax Extenders; Data; and, the Ag Economy

Appropriations- Nutrition, and Conservation

Tom Hamburger reported in today’s Washington Post that, “First lady Michelle Obama is set to take an unusual, high-profile step Tuesday into the center of a legislative battle by delivering White House remarks taking issue with makers of frozen pizzas and french fries and other companies seeking to scale back school lunch standards.

“Obama is scheduled to speak out against a House measure, backed by Republicans and pushed by the food industry and some school officials, that would allow some districts to opt out of federal mandates passed in 2010 to reduce sodium and increase whole grains, fresh fruits and vegetables in school lunches. White House aides say she will announce the launch of a campaign-style push to fight the legislation.

“The effort fits with the spirit of Obama’s ‘Let’s Move’ campaign and other initiatives in which she has advocated for healthy eating and a reduction of obesity. Until now, however, she has largely shied away from direct confrontations with lawmakers and industry groups.”

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Farm Bill- Policy Issues (Hearings); Tax Extenders; Ag Economy; and, CFTC- Friday

Farm Bill- Policy Issues: House Ag Committee Hearing

The House Ag Committee held a hearing yesterday “to review the state of the rural economy,” and heard from Secretary of Agriculture Tom Vilsack.

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Climate- Policy Issues; COOL; Ag Economy; Biofuels; Immigration; Biotech; and, EPA

Climate Issues- White House Proposal, and Farm Bill Issues

Justin Gillis reported on the front page of today’s New York Times that, “Climate change is already having sweeping effects on every continent and throughout the world’s oceans, scientists reported Monday, and they warned that the problem is likely to grow substantially worse unless greenhouse emissions are brought under control.

The report by the Intergovernmental Panel on Climate Change, a United Nations group that periodically summarizes climate science, concluded that ice caps are melting, sea ice in the Arctic is collapsing, water supplies are coming under stress, heat waves and heavy rains are intensifying, coral reefs are dying, and fish and many other creatures are migrating toward the poles or in some cases going extinct.”

Chapter Seven of the report, which is available here, is titled, “Food Security & Food Production Systems.”

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Budget Developments; Farm Bill and Policy Issues; Ag Economy; and China

Budget: Payroll Tax –Debt Limit –Energy 

Paul Kane and Ben Pershing reported in today’s Washington Post that, “Amid some dissent, House and Senate leaders prepared for final votes Friday for an economic package worth more than $150 billion that would extend a payroll tax holiday and unemployment benefits for the rest of the year.

“While Senate Republicans protested, the remaining members of a House-Senate committee tasked with forging a compromise pronounced themselves satisfied with the deal, signing the 270-page compromise Thursday afternoon in a bipartisan ceremony that stood in sharp contrast to the otherwise bitterly partisan tone of this Congress.”

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Budget Issues -Senate Farm Bill Hearing; Policy Issues; Ag Economy; and China

Budget issues and Senate Farm Bill Hearing

Naftali Bendavid and Siobhan Hughes reported in today’s Wall Street Journal that, “Congressional negotiators working on a deal to extend jobless benefits and a payroll-tax cut say they have come to a deal, paving the way for a vote before the policies expire at the end of the month.

“‘We have reached an agreement,’ said Rep. Dave Camp (R, Mich.) shortly after midnight. ‘We’re confident that this can be concluded.’

“Sen. Max Baucus (D, Mont.) said, ‘It’s clear that we’ll have a majority of conferees sign the conference report.’”

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Budget and Policy Issues (Farm Bill); Ag Economy; and China

Budget and the Farm Bill -Pay Roll Tax –Transportation

Daniel Looker reported yesterday at Agriculture.com that, “Farmers would take a big hit in cuts to crop insurance premiums proposed in the Obama Administration’s 2013 USDA budget released Monday. That idea isn’t going over well, either in Congress or among farm groups.

“‘There’s pretty much unanimous agreement among farmers and here in Congress that we need a strong crop insurance program,’ Senator Chuck Grassley (R-IA), a member of the Senate Agriculture Committee told Agriculture.com Tuesday.

“According to this detailed breakdown of the USDA budget, the federal government would save $3.3 billion over 10 years by cutting subsidies on farmers’ premiums. ‘The proposal would reduce the premium subsidy levels by 2 percentage points for those policies that are currently subsidized by more than 50 percent,’ says page 101 of that appendix to the budget. Currently, USDA subsidizes about 60% of farmers’ premium costs.”

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Budget and Policy Issues (Farm Bill); the Ag Economy (ERS Updates); and China

Budget: Agriculture, CFTC, EPA, Trade, and Energy; and Pay Roll Tax Issue

Budget Issues: Agriculture- Farm Bill

Lori Montgomery reported in today’s Washington Post that, “President Obama rolled out an election-year budget on Monday that would delay action to reduce the national debt in favor of fresh spending on Democratic priorities aimed at rebuilding the American middle class.

“In his final budget request before facing voters in November, Obama called for $350 billion in new stimulus to maintain lower payroll taxes, bolster domestic manufacturing, lure jobs back from overseas, hire teachers, retrain workers and fix the nation’s crumbling infrastructure. There would be only modest trims to federal health-care programs and no changes to Social Security, the biggest drivers of future borrowing, despite last year’s raucous political debate over the federal debt.”

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Budget; Farm Bill; Ag Economy; Trade; and MF Global

President Obama’s Budget and Agriculture- Payroll Tax- Transportation

Jared A. Favole and Damian Paletta reported in Saturday’s Wall Street Journal that, “President Barack Obama on Monday will propose a multi-trillion-dollar U.S. government budget that seeks to spur job creation and impose higher taxes on the rich to help reduce the deficit, laying down a clear election-year marker of his priorities.”

The Journal article pointed out that, “The budget calls for new spending limits on agriculture subsidies and moving to five-day-a-week postal delivery, among other things.”

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Budget; Farm Bill; Regulations; Ag Economy; MF Global; and Trade

Budget: Payroll Tax Cut Extension

Yesterday’s Need-to-Know Daily Email from the National Journal reported that, “The conference committee tasked with bridging the partisan divide over how to extend unemployment insurance and a payroll-tax break convenes today for their second public meeting. Lawmakers have until the end of the month to strike a deal. Also on their agenda is the Medicare ‘doc fix,’ which entails preventing a pay cut for doctors who treat Medicare patients. That task got harder on Tuesday, however, when the Congressional Budget Office said that freezing physicians’ pay at current levels for the coming decade would cost $26 billion more than had been assumed in November.”

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