The U.S. Department of Agriculture’s Economic Research Service (ERS) updated its 2014 Farm Sector Income Forecast yesterday, and noted that, “Net farm income is forecast to be $96.9 billion in 2014, down 21.1 percent from 2013’s estimate of $122.8 billion. The 2014 forecast would be the lowest since 2010, but would remain $16 billion above the previous 10-year average ($80.8 billion) [related graph].”
Brian Knowlton reported earlier this week at The New York Times Online that, “President Obama, in an interview broadcast on Sunday, said he rejects Republican criticism that he has exceeded his authority in moving to spare millions of undocumented immigrants from deportation, adding that he has been ‘very restrained’ in his use of executive authority.
“Angry Republican lawmakers have accused Mr. Obama of unconstitutional, even imperial, overreach. They have pointed to past remarks in which he himself suggested that his powers to act were limited.”
The Times article added that, “Mr. Obama has framed his action not as an amnesty for some undocumented immigrants but as a directive, in part, to federal agencies to focus their attention on those with criminal records, not on law-abiding, taxpaying, longtime immigrants. In all, about five million of the estimated 11 million undocumented immigrants would be protected.”
Kristi Boswell, Director of Congressional Relations for the American Farm Bureau Federation, was a guest yesterday on the AgriTalk radio program with Mike Adams, where the conversation focused on immigration issues (audio replay here, MP3- 10:18). An unofficial FarmPolicy.com transcript of yesterday’s discussion is available here.
Chris Casteel reported yesterday at The Oklahoman (Oklahoma City) Online that, “Rep. Frank Lucas spent several years working his way to the top spot on the House Agriculture Committee. Once he became chairman, in 2011, he fought for three years to get a sweeping farm bill passed; it was arguably the most significant legislation in the past two years that made it through both houses and got signed into law.
“The western Oklahoma rancher will lose his chairmanship in the next Congress, which begins in January, because of the term limits House Republicans impose on those positions. But he isn’t bemoaning the loss of power and prestige. He said his blood pressure has improved considerably.”
The article added that, “As for the Agriculture Committee, Lucas said that he’ll remain active but won’t bug the next chairman, Texas Republican Mike Conaway.
“‘I would like to give my successor an opportunity to develop his own perspective,’ Lucas said.”
Tennille Tracy reported yesterday at the Washington Wire blog (Wall Street Journal) that, “Rep. Mike Conaway (R., Texas), the newly appointed chair of the House Agriculture Committee, is pledging to undertake a ‘thoughtful’ review of food stamps.
“Mr. Conaway, a certified public accountant, has been critical of the food stamp program, formally known as the Supplemental Nutrition Assistance Program or SNAP. He defended Republican-led efforts to eliminate billions from the program and supports tougher work requirements for able-bodied adults without children.
“‘The committee will conduct a thoughtful review of all programs under its jurisdiction,’ Mr. Conaway said in an e-mail. ‘It’s only natural for much of that review to focus on nutrition programs as they account for almost 80% of the spending within the jurisdiction of the committee.’”
Bill Tomson reported yesterday at Politico that, “‘It’s never too early to start on the next farm bill,’ said Rep. Mike Conaway, the next chairman of the House Agriculture Committee.
“The Texas Republican, whose position in the top agriculture post was confirmed Tuesday by the House Republican Steering Committee, told POLITICO in an exclusive interview Friday that he’s already thinking about the 2019 farm bill, planning an in-depth review of the food stamp program and ready to help get an immigration reform bill done to help farmers.
“It’s too early to judge the major new subsidy programs in the 2014 farm bill — the five-year, $500 billion blueprint for U.S. agriculture policy that was only signed into law in February — but the next House Agriculture Committee chairman said he expects to begin drafting the next bill by 2017 or 2018 at the latest.”
From National Crop Insurance Services, November 11, 2014- Crop insurance policies must remain affordable for farmers and ranchers or the entire farm safety net will fail, crop insurance providers said today in a new educational video.
Farmers help fund current farm policy by spending approximately $4 billion a year out of their own pockets on crop insurance policies and by shouldering a portion of losses in the form of deductibles before receiving assistance.
“But if insurance bills get too big, or deductible losses get too high, fewer farmers will sign up for policies, and the whole system will collapse,” noted the video. “If that happens, not only will it be harder for farm families to bounce back after disaster, but costs that are currently being borne by farmers and private insurance providers will shift back to taxpayers.”
Congress took steps in the 2014 Farm Bill to keep crop insurance affordable. Among the steps spotlighted in the video:
· Farmers receive discounts on the premiums they pay for coverage, including discounts for new and beginning farmers looking to start a career in agriculture.
· Supplemental coverage is made available to help counterbalance a portion of deductible losses.
· And Congress defeated attempts by some opponents of agriculture to cap crop insurance benefits and make policies more expensive for everyone.
This is the second in a series of educational videos meant to highlight three policy attributes that are essential to maintaining a strong crop insurance system. The first three-minute segment examined the importance of making crop insurance, widely available, and a future piece will look at maintaining the viability of private-sector delivery.
“Congress cemented crop insurance’s role as the centerpiece of the farm safety net during the 2014 Farm Bill,” explained Tom Zacharias, president of National Crop Insurance Services (NCIS), the trade group that sponsored the video series. “However, that safety net will breakdown if crop insurance policies aren’t widely available, aren’t affordable to producers, and aren’t economically viable to be administered by efficient private insurance providers.”
Chase Purdy reported yesterday at Politico that, “‘Kansas Republican Pat Roberts, the likely next chairman of the Senate Agriculture Committee, says he has no plans to reopen the farm bill to make any substantial changes,’ Pro Agriculture’s Bill Tomson reports this morning. ‘Roberts, who sought far bigger cuts to food stamps and opposed the price-based subsidies in the 2014 farm bill, stressed in an interview with POLITICO Monday that it would be a mistake to expose the massive five-year, $500 billion piece of legislation to others who would seek to make changes.’
“‘I do not intend to open up the farm bill,’ Roberts assured. ‘That would be irresponsible.’”
A news release yesterday from USDA’s National Agricultural Statistics Service (NASS) indicated that, “According to the November Crop Production report released today by [NASS], corn production is expected to reach 14.4 billion bushels this year, up 3 percent from 2013 [related graph]. Soybean production is forecast at 3.96 billion bushels this year, up 18 percent from 2013 [related graph]. Both crops are on target for record-high yields and production. Based on conditions as of November 1, yields for corn are expected to average 173.4 bushels per acre, down 0.8 bushel from the October forecast, but 14.6 bushels above the 2013 average. As for soybeans, yields are expected to average a record high 47.5 bushels per acre, up 0.4 bushel from October and up 3.5 bushels from last year.”
The WASDE report included this overview table of corn supply and demand variables, and stated that, “Projected corn ending stocks are lowered 73 million bushels. The projected range for the season-average farm corn price is raised 10 cents on each end to $3.20 to $3.80 per bushel.”
Likewise, yesterday’s WAOB report included this overview table of soybean variables, and explained that, “Soybean and soybean product prices for 2014/15 are unchanged from last month. The U.S. season-average soybean price range is projected at $9.00 to $11.00 per bushel. Soybean meal and soybean oil prices are projected at $330 to $370 per short ton and 34 to 38 cents per pound, respectively.”
With respect to wheat, yesterday’s WASDE update added that, “The projected range for the 2014/15 season-average farm price is narrowed 10 cents on both the high and low end to $5.65 to $6.15 per bushel.”
Policy Issues: Farm Bill; Tax Extenders; and Budget
Pat Westhoff, the director of the Food and Agricultural Policy Research Institute at the University of Missouri, indicated in a column on Saturday at the Columbia Daily Tribune (Mo.) Online that, “Our current set of farm and food policies only can be understood in the context of past budget debates. Although many other factors will drive future farm policy decisions, it’s a safe bet that budgetary concerns will continue to play a central role.
“In 2011, Congress was considering a large budget deal, and the leaders of the House and Senate committees in charge of writing farm legislation put together a package designed to reduce federal spending on farm and nutrition programs by $23 billion over the next 10 years.
“That budget deal fell apart, but the agricultural and nutrition provisions that were intended to be part of that deal became the basis for what eventually became the 2014 farm bill. Indeed, the final farm bill still targeted the same $23 billion in savings initially proposed more than two years previously.”
Broad Policy Issues- Budget, Taxes, Immigration, and Trade
Budget, and Taxes
Lori Montgomery and Ed O’Keefe reported in today’s Washington Post that, “Before ceding full control of Congress to the GOP in January, Senate Democrats are planning to rush a host of critical measures to President Obama’s desk, including bills to revive dozens of expired tax breaks and avoid a government shutdown for another year.”
The Post writers explained that, “Republican leaders, too, are inclined to clear the legislative decks of must-pass bills so they can start fresh in January, when they will have control of both chambers of Congress for the first time in eight years. Leaders from both parties are due at the White House for a lunch Friday to begin discussing the parameters of the possible in a new era of Republican domination.”
Today’s article noted that, “House and Senate negotiators have been at work for weeks on a comprehensive bill to fund federal agencies through next September, and aides said they hope to bring the measure to a vote before the Dec. 11 deadline.
“Some conservatives are agitating for a temporary measure that would allow Republicans to revisit agency funding levels when they take charge early next year. But Republican leaders, including Sen. Mitch McConnell (Ky.), would rather get the bills for fiscal 2015, which began in October, out of the way so they can focus on crafting a budget for fiscal 2016.”
Post Election Policy Issues: Farm Bill, Tax Extenders, and Food Labeling
AP writer Steve Karnowski reported yesterday that, “U.S. Rep. Collin Peterson anticipates being able to work out compromises on agricultural issues in the next Congress, but said Wednesday he has concerns about the makeup of the next Senate Agriculture Committee.”
The article noted that, “Peterson worked closely with the Republican chairman of that committee, Rep. Frank Lucas of Oklahoma, to assemble and pass a compromise 2014 farm bill earlier this year. He doesn’t foresee any problems developing a similarly good working relationship with whoever replaces Lucas, who is term-limited under House GOP rules. Peterson said…[R]epublicans will take control of the Senate in 2015, and Kansas Sen. Pat Roberts, who survived a re-election fight, is considered to be the leading candidate to become the next chairman of the Senate Agriculture Committee, Peterson said. He pointed out that Roberts used his position as chairman of the House panel in 1996 to pass the ‘Freedom to Farm’ act, which was designed to wean farmers off subsidies in exchange for more flexibility in deciding what to grow. Roberts also voted against this year’s farm bill.
“‘He has made some noise about opening up the farm bill if he gets to be chairman, which is a very bad idea, and puts everything we worked for in jeopardy,’ Peterson said.”
Mr. Karnowski added that, “Peterson’s priorities in the next Congress will include implementing the farm bill; reviving stalled legislation to reauthorize the Commodity Futures Trading Commission through 2018, which passed the House but has not come up in the Senate; a five-year transportation bill; and changes to immigration law to address the need for more farm workers.”
Grant Gerlock reported yesterday at The Salt blog (National Public Radio) that, “U.S. farmers are bringing in what’s expected to be a record-breaking harvest for both corn and soybeans. But for many farmers, that may be too much of a good thing.
“Farmers will haul in 4 billion bushels of soybeans and 14.5 billion bushels of corn, according to USDA estimates. The problem? Demand can’t keep up with that monster harvest. Corn and soybean prices have been falling for months. A bushel of corn is now worth under $4 — about half what it was two years ago.”
The update noted that, “That means a glut of corn and soybeans and the lowest prices in at least five years. To make matters worse, the oil boom in North Dakota is tying up the railways used to ship grain. Trains for things like coal or imports are also running behind. Bruce Blanton at the U.S. Department of Agriculture says the wait means some of the harvest could go to waste…[S]ome farmers will have so much grain to sell, they’ll still manage to make some money. Others will lean on saving or subsidized crop insurance. Low prices could even trigger a new set of government safety nets in the Farm Bill.
“Cory Walters, an agricultural economist at the University of Nebraska-Lincoln, says rising costs for everything from seeds to fertilizer make these low commodity prices harder to handle.
“‘Does that mean we’re going to have multiple years of low prices and it’s all doom and gloom? No, I don’t buy that right now,’ Walters says. ‘Because there’s a lot of changes could happen from year to year on acreage, weather.’”
From National Crop Insurance Services, Oct. 31, 2014- Crop insurance providers today released the first in a series of educational videos meant to highlight three policy attributes that are essential to maintaining a strong crop insurance system in the face of future market and weather challenges.
The first three-minute segment examines the widespread availability of crop insurance, whereas future videos will look at the affordability of policies and the viability of private-sector delivery.
“Congress cemented crop insurance’s role as the centerpiece of the farm safety net during the 2014 Farm Bill,” explained Tom Zacharias, president of National Crop Insurance Services, the trade group that sponsored the video series. “However, that safety net will collapse if crop insurance policies aren’t widely available, aren’t affordable to producers, and aren’t economically viable to be administered by efficient private insurance providers.”
According to the first video, “Crop insurance is similar to other kinds of insurance. The more people who purchase policies, the more people who help share risk. And when risk can be spread out along a broader base, it helps lower the cost for everyone.”
That is why it is it is so important for insurance to be available for all kinds of crops and to farmers of all sizes and backgrounds, NCIS noted.
“The more the merrier. From corn and cotton to cherries and canola, every single acre enrolled helps strengthen the whole system,” the video explained.
The recently passed Farm Bill took big steps to make crop insurance more available to beginning farmers, organic producers, and fruit and vegetable growers. Lawmakers also stopped legislative attempts to reduce insurance benefits available to larger farms – a plan that would have raised costs on all farmers and increased taxpayers’ risk exposure.
“Congress got it right by making crop insurance more widely available and stronger than ever. Now, we just need to keep it that way,” the video concluded. “After all, not everyone farms, but everyone eats. So everyone depends on a strong farm policy.”
Vicki Needham reported yesterday at The Hill Online that, “The nation’s top trade official said Thursday that a final agreement on a massive Asia-Pacific deal won’t be in the offing next month.
“U.S. Trade Representative Michael Froman confirmed that, as expected, a Trans-Pacific Partnership (TPP) agreement won’t be announced at the Asia-Pacific Economic Cooperation (APEC) summit next month in Beijing.”
“‘APEC will be an opportunity when all the TPP leaders will be present, so it’s a good opportunity for them to have conversations with each other about TPP and about whatever outstanding issues are left, and give more political impetus to getting it done.’”
Reuters News reported yesterday that, “U.S. businesses urged President Barack Obama on Wednesday to make a case for fast-track authority on trade agreements before his upcoming trip to Asia, which is seen as an opportunity to push a Pacific trade deal.
“Myron Brilliant, head of international affairs for the U.S. Chamber of Commerce, said Obama should send a signal about trade in the time between mid-term U.S. elections on Nov. 4 and an Asia-Pacific Economic Cooperation (APEC) summit in China on Nov. 10-11.
“A bipartisan bill on so-called trade promotion authority (TPA), which allows lawmakers to set priorities for trade deals in return for a yes-or-no vote, was introduced in Congress in January but has not progressed to a vote.”
The U.S. Department of Agriculture’s Economic Research Service (ERS) released a report yesterday titled, “Agriculture in the Trans-Pacific Partnership,” which stated in part that, “The proposed Trans-Pacific Partnership (TPP) is a trade and investment agreement under negotiation by 12 countries in the Pacific Rim, including the United States. This report assesses the potential impacts of eliminating all agricultural and nonagricultural tariffs and tariff-rate quotas (TRQs) under a TPP agreement on the region’s agriculture in 2025—the assumed end date of the pact’s implementation—compared with baseline values for 2025 without a TPP. Cutting tariffs is only one of the many goals of the TPP negotiations, but it is an important one for agricultural trade. The value of intraregional agricultural trade in 2025 under a tariff- free, TRQ-free scenario is estimated to be 6 percent, or about $8.5 billion higher (in 2007 U.S. dollars) compared with baseline values. U.S. agricultural exports to the region will be 5 percent, or about $3 billion higher, and U.S. agricultural imports from the region in 2025 will be 2 percent, or $1 billion higher in value compared with the baseline.”
The ERS report also noted that, “While each member country will experience growth in both its agricultural imports and exports, Japan and the United States will account for the largest shares of the increases in intraregional imports and exports, respectively. The United States will supply about 33 percent of the expansion in intraregional agricultural exports—the value of U.S. agricultural exports to TPP partners in 2025 is estimated to be 5 percent ($2.8 billion) higher under the TPP scenario than in the baseline. Japan will account for almost 70 percent of the expansion in intraregional agricultural imports—the value of Japan’s agricultural imports from its TPP partners in 2025 is expected to be about 14 percent ($5.8 billion) higher than in the baseline.”