FarmPolicy

July 2, 2015

Thursday Morning Update: Ag Economy; Trade; and, Regulations

Remember, FarmPolicy.com ends tomorrow.

Agricultural Economy

Adam Nagourney reported on the front page of today’s New York Times that, “Gov. Jerry Brown on Wednesday ordered mandatory water use reductions for the first time in California’s history, saying the state’s four-year drought had reached near-crisis proportions after a winter of record-low snowfalls.

“Mr. Brown, in an executive order, directed the State Water Resources Control Board to impose a 25 percent reduction on the state’s 400 local water supply agencies, which serve 90 percent of California residents, over the coming year. The agencies will be responsible for coming up with restrictions to cut back on water use and for monitoring compliance. State officials said the order would impose varying degrees of cutbacks on water use across the board — affecting homeowners, farms and other businesses, as well as the maintenance of cemeteries and golf courses.

“While the specifics of how this will be accomplished are being left to the water agencies, it is certain that Californians across the state will have to cut back on watering gardens and lawns — which soak up a vast amount of the water this state uses every day — as well as washing cars and even taking showers.”

Today’s article explained that, “Owners of large farms, who obtain their water from sources outside the local water agencies, will not fall under the 25 percent guideline. State officials noted that many farms had already seen a cutback in their water allocations because of the drought. In addition, the owners of large farms will be required, under the governor’s executive order, to offer detailed reports to state regulators about water use, ideally as a way to highlight incidents of water diversion or waste.

Because of this system, state officials said, they did not expect the executive order to result — at least in the immediate future — in an increase in farm or food prices.”

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Tuesday Morning Update: Policy; Ag Economy; Trade; Immigration; and, Regs

Note: FarmPolicy.com ends publication on Friday.

Policy Issues

An interview with House Ag Committee Ranking Member Collin Peterson (D., Minn.) aired on yesterday’s AgriTalk radio program with Mike Adams.

The interview, which focused on the Farm Bill, trade, regulations, and biotech issues, was recorded last week and was conducted before a group of Farm Bureau members from Missouri, Minnesota, Iowa, and Texas.

An unofficial FarmPolicy.com transcript of the AgriTalk interview is available here.

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AgriTalk Transcript: House Ag Committee Ranking Member Collin Peterson

House Ag Committee Ranking Member Collin Peterson (D., Minn.) was a guest on Monday’s AgriTalk radio program; the conversation with Mike Adams focused on the Farm Bill, trade, regulations, and biotech issues.

The interview that aired on Monday’s program was recorded last week and was conducted before a group of Farm Bureau members from Missouri, Minnesota, Iowa, and Texas.

This is an unofficial FarmPolicy.com transcript of that discussion.

Mr. Adams: Last week in Washington, D.C., had an opportunity to talk with Congressman Collin Peterson, Ranking Member of the House Ag Committee. We talked about a number of issues, starting off with how he feels it’s going with the new dairy program, and was he happy with the signup.

Rep. Peterson: Well, I think relatively. You know, I think we could have had a higher turnout, but—or signup—but coming off one of the best years in dairy for a long time, and I think people looking at what’s going to happen this year, kind of figuring, well, might be payments, there might not, so they decided, some people decided to forego it. I think you’re going to see a lot more people sign up, the way things are looking, for next year.

And that’s one good thing about the dairy program: you don’t have to lock in for five years, you can sign up every year. And given what’s been going on, I think I’m not as worried as I was about us not having the program in there to try to limit production, if it gets out of control. It looks like that’s not going to be necessary anyway, so that was a maybe a fight we didn’t need to have.

Mr. Adams: We’ve had a lot of talk here this afternoon about trade. You have expressed some concerns about trade deals, and making sure that we’re protected. When you see what’s happening with TPP and the ongoing debate over TPA, what are your thoughts?

Rep. Peterson: Well, you know, I opposed NAFTA vigorously, and we had it defeated for a while. We were told, at the time, that we were going to have twice as many ag exports in NAFTA as we had imports, and what I predicted ended up happening—we had twice as many imports as we had exports under NAFTA. We had a problem in sugar that we’ve somewhat resolved now, but we had to work through that.

So one of my big issues with the TPP is that we finally solved some of the problems that were caused by NAFTA, and if we don’t solve it in the TPP, we’ll never solve it. And one of the biggest problems is dairy. And it’s Canada dairy. A lot of people aren’t focused on this, and a lot of people don’t even know about it.

But in the NAFTA, we allowed the Canadians to keep their supply management system. And so if you dairy farm in Canada, you are making a lot of money, considerably more than you make in the United States. Also, when we try to sell dairy products to Canada, there’s a tariff, but when they sell to us there’s no tariff. So the result of that has been, because the Canadian system can’t grow, and they’re making all this money in these co-ops, we now have the Canadian co-ops in Quebec owning—they’re No. 1 and 3 in ownership of dairy processing in the United States. That’s the effect of what we did.

And it’s got to be fixed, or at least get on a path to be fixed, in this deal for me to support it. So that’s one of my main issues. Also it applied—poultry and eggs are also supply managed in Canada. I’m not as familiar with the economics of that as I am of dairy. But that’s the big issue.

Another big issue is getting access in the Japanese market for beef and rice. Now, Froman sat in my office and said we will get a pathway or get changes in the Canadian supply management system, and we will get access to the Canadian rice and beef market or we won’t have a deal. And I said, well, you’re saying to me that we’re not going to have a deal, because I am very skeptical that the Canadians will be able to agree to anything in the supply management area.

Mr. Adams: RFS. We’re waiting for that announcement from EPA. Are you getting any feeling one way or another where they’re going with it?

Rep. Peterson: I don’t know. I’ve had so many meetings with the White House, with the EPA. You know, we have some speculation, I guess, but it could be wildly off. I don’t know, it just looks to me like maybe they’re going to lock in for three years and around 14.4 billion, but I really don’t know. We’re going to have to wait and see what they come out with.

I hope they don’t screw up the ethanol industry. That would be…you know, we’ve finally been able to balance the marketplace in corn and get the pricing situation at a more reasonable level. But if they screw up the RFS and we lose ethanol in this country, we’ll be back to $2 corn, and that ain’t gonna work very good with the prices that we got, land and inputs right now.

Mr. Adams: Is this EPA out of control?

Rep. Peterson: Yes. [Laughter.]  [Applause.] Well, and, you know, the problem is they don’t understand a lot of these issues. They just don’t. This Waters of the U.S., I’ve had Gina McCarthy in my office three times. She thinks she’s helping you. I just want you to know. And she sincerely believes that, that she’s somehow or another clarifying the wetland determinations with what she’s doing.

And she doesn’t know enough about all the problems that we’ve been through to understand that what they’re doing is putting, actually, one more chink in the thing that we never will get this determined, you know, so I don’t know. It’s…I don’t know what you do to fix this, but it’s a big problem.

Mr. Adams: We were talking with the Chairman earlier. Is this Congress willing to step in and stop funding things like WOTUS if they keep pushing it?

Rep. Peterson: Yeah, I think so. I think the first thing we’re going to try, as I understand it, is to use the Congressional Review Act, which has never been used, but it was put in place some years ago, with my support, that says that the Congress can stop a rule within 60 days after the final rule is published. So the first thing that I think we’re going to try to do is we’re going to bring it up under the Congressional Review Act. I think we can pass…or stop it in the House. I don’t know about the Senate, but, you know, hopefully we can do it over there, too.

If we aren’t able to do that, then we’re going to try to deal with it in the Appropriations Committee, somehow or another. We have a bill, you know. We’re going to try any way we can. We’ve got to stop this. This is a bad idea.

We still haven’t—in Minnesota, I don’t know about the rest of the country—but we still haven’t resolved the blue dots and yellow dots from the ’85 Farm Bill. We’ve still got people out there that haven’t gotten determinations from that. And we’ve got four agencies deciding what a wetland is, and in Minnesota we’ve got a wetland law at the state level, so you’ve actually got five people, and you can’t ever figure out what the bottom line is. So, you know, we don’t need this. This is just going to be a big problem.

Mr. Adams: We have a major lawsuit in Iowa over runoff. Regardless of how this turns out on this particular one, is this the future, we’re looking at this type of litigation and threat of litigation moving forward for farming?

Rep. Peterson: I don’t know. I mean, we…the way we’ve set up some of the, you know, the NEPA law, National Environmental Policy Act, you know, these things that have been put in place back in the ‘70s, Endangered Species, these things need to be overhauled, because they’re basically set up to help people that want to sue and try to change the policy through lawsuits and so forth, and there just needs to be more balance put into it.

Frank Lucas and I last week passed the Science Advisory Act for the EPA, and there was another bill that Lamar Smith had on the secret science bill that we passed last Congress, too. You know, in the EPA, I mean, I had the local guy back home come to the Rotary Club and go after me because I was trying to get a balanced, scientific advisory committee at the EPA, that this was going to destroy the environment.

And I said, well, this advisory committee has no authority to do anything, they’re strictly advising the administrator; why wouldn’t you want to hear all points of view? Why would you want to limit it to a bunch of egghead professors, which is what they’ve done, and three-fourths of the people that are on this advisory committee are getting grants from the EPA to tell them what they already want to hear. And then you wonder why the thing is screwed up? You know, but anyway. [Applause.]

Mr. Adams: One more question and we’ll turn it over to the audience.

Rep. Peterson: I’m not running for President. [Laughter.]

Mr. Adams: Yeah. [Laughs.] Well, we cleared that up. Okay, all right. Biotech labeling. National standards or leave it up to the states?

Rep. Peterson: Well, we need a voluntary label, national. We need to preempt these states from setting their own, you know, own laws. The last thing we need is to have 50 different states have 50 different labels. That’s not workable. And we had a good hearing yesterday. We got some people criticized it.

But, you know, the reality is, you know, I’ve told some of these big companies that if Vermont is successful with this appeal to their lawsuit, and they are allowed to go ahead with their labeling law, I wish that these big companies would just not sell to Vermont, and let them understand what the effect of what they’re doing is.

The same thing in California. I don’t want them to fix the egg problem. If those people created that problem, and I hope they run out of eggs, and I hope eggs go to 20 bucks a dozen, you know, so people figure out what’s going on, you know, so… [Applause.]

Mr. Adams: Congressman Collin Peterson, Ranking Member of the House Agriculture Committee, speaking last week before a group of Farm Bureau members from Missouri, Minnesota, Iowa, and Texas.

[End of recording.]

AgriTalk Transcript: House Ag Committee Chairman Mike Conaway

Categories: Farm Bill /Trade

House Ag Committee Chairman Mike Conaway (R., Tex.) was a guest on Thursday’s AgriTalk radio program; the conversation with Mike Adams focused on the Farm Bill and trade.

This is an unofficial FarmPolicy.com transcript of their discussion.

Mr. Adams: Welcome back to AgriTalk. Yesterday, here in Washington, D.C., had a chance to talk a number of issues with the Chairman of the House Agriculture Committee, Congressman Mike Conaway from Texas.

Let’s get right into it. Questions about the farm bill. Some have even questioned would the farm bill get reopened. Any chance of that happening?

Rep. Conaway: Well, you can never say any chance, but over my dead body. [Laughter.] No, we’re not interested in opening it. You know, the ink’s hardly dry. You producers are going through the agony of all those choices that we bragged about this time last year that we’re going to give you, that you could tailor the safety net for exactly your own farming operation, it wasn’t going to be one-size-fits all—yep, yep, yep.

And now that you got it, it’s like, oh my goodness, this is hard. But anyway, so…you’re just now in that first round of doing that, and it’s not even fully implemented yet, so we’ll fight off any attempt to do that, including attempts during the ag approps process to do anything, to do damage to our process.

You know, the whole appropriations process, it’s a pretty arrogant group that— including myself who used to come down there and do that—you come [tricky] trotting onto the floor, you’ve got a great amendment to strip something out, and it’s very disrespectful to the authorizing committees who’ve spent months or whatever trying to learn and get the policies just right, and then to come in and try to strip something out.

So we’re going to fight off all of those crop insurance issues and other things that might come up here in the ag approps process, but we won’t open the farm bill, certainly not…I’m not going to do anything that would do that, so the answer is—the short answer is no. But again, you never say never. Something might happen, but it’ll be over my dead body.

Mr. Adams: All right. Let’s go to trade. A lot of talk about Trade Promotion Authority. Where does that stand? What are the chances that’s going to get passed in Congress?

Rep. Conaway: Well, if we’re going to do a trade deal on TPP or T-TIP, either one of those, we have to have TPA. And there’s a lot of misinformation. We don’t typically be partisan in this room, but there are a lot of folks on our side of the aisle that are not interested in doing anything to help President Obama, and it’s misguided as to what Trade Promotion Authority does or doesn’t do. As you sit and talk to them and help them understand that right now the President has unfettered negotiating authority, just like he is with Iran, and Trade Promotion Authority brings him into a set playing field to say how he’s going to negotiate, how he’s going to work with Congress over that, and at the end of the day, we still get the up or down vote on the deal. So it’s vital that we get it done.

It actually hems up the President and narrows down what he could or couldn’t do, and it goes the direction folks want. We’ve just got a bad name for it. So maybe we need to name it, I don’t know, something different that—better be careful there—something different that just is not as counterintuitive to what you think they’re doing.

I sat the day before yesterday with a member who’s been here a long time, and I asked him, I said, so kind of where are you on TPA? He said oh no, I’m not going to give this President any whatever. I said, well, take a deep breath. So I walked him through the mechanics of it and he goes, oh, well I’m for that. So it’s a matter of educating. We’ve got to educate not only members, but educate their supporters and their constituents. Got a lot of folks back home who feel the same way that their member does, and so it’s going to take an educational process.

I met with the Canadians today. They’re not going to sign fully onto TPP unless we have Trade Promotion Authority. Think about the mechanics. What we’re asking them to do without TPA is to sign a deal, negotiate a deal with all these other countries, get the best deal they can, and then send it to Congress, where 535 individuals can amend the deal, can change it. Well, none of you would put yourself in that circumstance, so Canada and Japan, they’re going to wait. I mean, they’re not going to come on board until we get TPA done, and they know that once they make a deal with Froman, then he can bring that deal to Congress for an up or down vote, and that makes the most sense.

So in the mean time we’re losing trade opportunities. Bilateral deals are being done that undermine our negotiating positions with respect to the current TPP negotiations, so time is of the essence. I know in my conversations with Paul Ryan, he’s ready to go. There’s some conversations with the leadership of the Senate as to how mechanically they want to do. They’re still trying to decide does the House go first, they go first. All those kind of questions are being bandied around. But time is of the essence, because we need to get this done.

Mr. Adams: Do you get the sense there are the votes to pass TPA or not?

Rep. Conaway: Well, we’re going through the whip exercise right now. There’s a group of us that already know how we want to vote, and we’re working with our other members across. Pete Sessions is kind of heading that up, and I’ve not talked to Pete about the numbers. But the folks I’ve talked to, I’ve got great responses, and I think we’ll get there.

Mr. Adams: From what you’ve seen and heard of the TPP deal, are you satisfied that we’re being protected, especially agriculture? I know there are concerns about what is Japan willing or not willing to do. Are you happy with what you’re hearing so far?

Rep. Conaway: Well, I’m happy with what I’m hearing from you producers and your groups. Michael Froman, the trade rep, I think is doing a good job. He’s listening to you. You’re engaged with him. And so the mechanics of how that’s coming together, I don’t know any of the details of the actual trade deal itself that’s being talked about, but I do know that he’s working with the trade associations and the various producer groups and others as he negotiates the ag pieces of what’s going on, so I’ve got confidence in the process.

I’ve met multiple times with Michael Froman. In fact the first meeting that I had for the full committee was a briefing with Michael Froman on trade for all of our members, because it’s a big deal and many of our members have not voted on any trade deals yet, and I wanted them to have the facts before they’re confronted with folks who don’t know the facts, but are really sold out on their position, and try to sway them one way or the other. So actually, our first group gathering as the Ag Committee under my leadership was with Michael Froman on this deal.

So again, don’t know the specifics about what’s being traded where and when, but I am pleased with what I’m hearing, both from him saying I’m listening to those guys when I have a particular section that I’m trying to negotiate, and I’m talking to them [as going], and then on the back side, when I talk to the producer groups, they’re saying the same thing—yep, we’re talking to Froman, we’re involved. And that’s to your credit, because previous trade deals, you could argue that ag got thrown under the bus a little bit.

And almost from the start, when I began hearing from all of you is that that’s not going to happen again, we’re going to be engaged in the process, we’re going to be at the table, and we’re going to get our interests represented much better than we’ve done in the past. So that’s a real credit to collectively everybody who’s been involved in that process and making that happen over the last, you know, two or three years, whenever this TPP’s been coming together. You’ve done a better job of inserting yourself into the conversation.

Mr. Adams: On the topic of trade, are you supportive of opening up trade with Cuba?

Rep. Conaway: Not at this time. And I think we need the Castro boys to meet their maker and, you know, all the other…there’s good arguments for why you do that. I’m… But all those other countries that we’ve fought and had disagreements with, and then reestablished relationships with, we’ve done it with a new regime, at least some different face. It is inevitable that we will open up and reestablish full out diplomatic relations with Cuba.

I think where we are right now, we have some leverage. We should use that leverage to try to push on certain human rights issues and democracy issues within Cuba that’s not going to happen on its own. And we’re squandering that leverage, in my view, to get some things done that would make the lives of everyday Cubans better. What we will do in the interim is make the lives of the thugs and the folks who run that country, their lives will be improved, their cash flows will be better, etc., etc. This argument that if we just had Americans coming down there as tourists, that things would be so much better, that democracy would break out and we’d have elections and all this kind of stuff, Canadians and Europeans have been going to Cuba for a long, long time, and that hasn’t had one whit of a difference.

The last time I was there, I went to Cuba on a group with nine other members, and it was one of those wonderful experiences where we’d go to the head of the Communist Party to meet with him, and either Greg Meeks or one of the others would say, you know, so-and-so, there are nine of us on this trip who are in favor of full out open trade with Cuba, and one of them is not, and it’s Conaway. And so I got thrown under the bus at every one of those meetings.

But at the end of the deal we had a big press conference, and I was last to speak, and I said, you know, a regime that is afraid to let its people see the Major League box scores, baseball box scores each day, they restrict the amount of information that comes in, including box scores, if you’re so terrified of letting your people know that the box scores, that those Cubans who have defected that are playing good baseball, and that you might find that the folks back home might find that out, that’s a regime that I’m not sure we’re ready to deal with.

So we’ve got some leverage, it’s inevitable. I am in favor of lifting any kind of trade restrictions with respect to agricultural products. If you want to make a deal with Cuba, and you want to trust that you’ll get paid, that’s your business. I disagreed with President Bush on requiring the cash to be in your pocket before the goods could leave U.S. ports. That’s a business deal that the ag folks should be making, and so that part of it I’m good with. But overall, we need to use what little leverage we have left to try to make things a little bit better in Cuba.

Mr. Adams: We’ve got just about a minute left, but I have to ask you this question. I’ve been to Cuba, too. To me it’s hypocritical if you—I understand all the things you just said, but yet we trade with China. And it seems to me like we’re saying well, if Cuba was bigger and bought more from us, we could overlook some of those things like we do with China. What’s the difference between the two other than the size?

Rep. Conaway: Ninety miles.

Mr. Adams: I mean, they’re not a threat to us.

Rep. Conaway: Not a threat to us. But we have leverage. We have a responsibility to use that leverage where we can. It’s not likely that our leverage with China would work, but I think our leverage with Cuba would work, and we’ve got an opportunity to be a proponent of helping the lives of ordinary, everyday Cubans be better. But it’s inevitable that we’ll open up full trade with Cuba at some point in time.

Mr. Adams: Chairman of the House Agriculture Committee, Mike Conaway.

[End of recording.]

AgriTalk Transcript: Senator Marco Rubio

Senator Marco Rubio (R., Fla) was a guest on Thursday’s AgriTalk radio program with Mike Adams, where the conversation focused on immigration, trade, and regulation.

This is an unofficial FarmPolicy.com transcript of their discussion.

Mr. Adams: Welcome back to AgriTalk here in Washington, D.C. Yesterday I had the opportunity to talk with Florida Senator Marco Rubio. We had an exchange back and forth, difference of opinion on Cuba. We also talked a number of ag issues. But I started off asking Senator Rubio does he have any plans, any announcements coming about possibly running for President.

I have to start off—I mean, you’ve got a great setting here, this is going to be on the radio—we keep a pretty good secret. We wouldn’t let it get out of this room. Do you want to make any announcements while you’re here?

Sen. Rubio: Yes, I do. I do. I saved a bunch of money by switching to Geico. [Laughter.] That’s actually not true, I’m still on State Farm, but I thought it was funny, you know. [Laughter.]

Mr. Adams: Be careful Brian Williams, in how you tell your stories now, okay? We don’t want you to get in trouble. Well, we’re so glad that you are with us. And let’s just talk for a little bit and then we’ll open it up to the audience. We just heard from Chairman Conaway his thoughts on how we can address the immigration issue. I know you’re very involved in this.

We look at it in this group, I think, two different ways. Obviously we want to get some kind of resolution nationally, but there’s also the ag labor component to this we’re trying to get resolved as well. How do we approach it? Does it have to be all or nothing or can it be piece by piece?

Sen. Rubio: Well, a couple points. First of all, it’s a critical issue with regards to workforce, and that’s true all over the country. Virtually, there’s no sector—there are some mechanized sectors in agriculture, but by and large agriculture is reliant upon labor. And I’ve actually met some of these folks, both in Florida and in other parts of the country, in South Carolina very recently, in a peach operation, that are dealing with labor problems.

We need a reliable system that allows us to bring to this country, on a seasonal or year-round basis, temporary workers who want to work in agriculture, but do not want to be here permanently—and those are millions of people. And there’s a recognition of that in this country. I think there is a broad recognition of that, that we need to address that. The problem is that it has been wrapped up in the broader issue of immigration, which is much more complex.

Now I would start by saying there’s a significant amount of people in this country illegally who quite frankly never want to be citizens, do not want to be permanent residents, they just want to work for nine months out of the year, or six months, or eight months, they want to go back home for a period of time, and they want to come back again next year when their labor is needed. But they’re afraid to leave because if they do, they’re going to have to sneak back in again next year, so they stay. Because again, we don’t have a cost effective program that works for every part of agriculture, and that has to be fixed.

I personally worked on negotiating the differences out there between different ag groups across the country, those who represent farm workers, on a program as part of the comprehensive approach. But the lesson of 2013 and our efforts is that you’re not going to be able to deal with something like immigration in one massive piece of legislation. And the primary reason for it is because there is the belief in this country, increasingly, rightfully so, that any massive piece of legislation will never follow through on the enforcement pieces.

And so if you do something to deal with ten million people that are here illegally, unless you enforce the law, you’re going to have ten million more a decade from now, and people aren’t prepared to do that. So I think the key to doing anything on immigration is to prove to the American people that we’re serious about enforcing our immigration laws, but as part of that, one of the things that would really relieve the pressure is to have a system that allows people to come here legally and work when their labor is necessary, and return back to their home country, and return again in the future if their labor is needed again, as it will be. And so I do have hope that we can deal with that.

And if we were only dealing with that issue, I think we could make tremendous progress. The problem has been that many advocates for immigration reform want it all or nothing, because they’re afraid that the minute agriculture gets what it wants, it will stop lobbying on behalf of immigration reform; the day technology companies get what they want, they’ll stop lobbying, and so forth, so they want to hold everyone together as a coalition, and that’s been the impediment.

Mr. Adams: The next topic—and I assume you and I are probably going to disagree on this—I just disagreed with Chairman Conaway, so…

Sen. Rubio: Yeah, okay.

Mr. Adams: Let’s talk Cuba. The President’s pushing to open up Cuba. Agriculture groups want to do more trade with Cuba. How do you feel about it?

Sen. Rubio: Well, first of all, there are agricultural goods that are allowed to be sold in Cuba, but they’re not allowed to do it on credit, and there’s a reason why: they don’t pay. And that’s a big problem. The second point I would make is the following. My interest in Cuba—this is my only interest in Cuba. I want Cubans to be free in a democracy.

I believe, in addition to my personal connection to the issue, I believe it is bad for the national security of the United States to have an anti-American dictatorship 90 miles from our shores. I’ll support any policy towards Cuba that achieves that goal.

I do not believe that a unilateral opening to Cuba will achieve that goal, for the following reason: there is no such thing as the Cuban economy. The entire Cuban economy is owned by the Cuban government, primarily the Cuban military, through a holding company by the name of GAESA, G-A-E-S-A. They own everything. They own the hotels, they own the farms, they own everything.

To do business with Cuba requires you to do business with the military dictatorship. And doing business with them is not a two-way street. It is they will pick and choose who they allow in, what they allow in on their terms, and they will not allow anything in that could provide any sort of democratic opening on the island, which is what I primarily care about in terms of the future of the Cuban people.

And that’s my concern, that you’re going to have a leadership transition, because the actuarial tables tell you that the current leaders, who are all over 80 something years of age, will not be there forever. And I want us to have leverage to be able to say if you want a better relationship with the United States, we need to see these things: we need to see independent political parties, we need to see the ability of people to organize themselves and speak openly, and have freedom of the press, and so forth. If you give these things away without any of those openings, what leverage do you have in the future for that?

And here’s one more point I would make. Every single piece of farmland in Cuba today, every major agricultural property in Cuba today was once owned by a private owner, including American companies. They were stolen. They were confiscated. There’s $7 billion worth of American claims on the island of Cuba that we were never compensated for.

If you allow the import—this is the reverse of perhaps what the farm bureaus around the country want—if you allow the import of agricultural goods from Cuba to the United States, you are allowing them to traffic in stolen goods. They stole someone’s farm, they stole someone’s equipment, and they’re now going to make a profit off what they stole without compensating, including American companies—United Fruit Company—but also individuals.

You know, my family comes from a farming background in Cuba. They weren’t landowners, they were sharecroppers. They grew tobacco. But that property today is completely in the control of the Cuban government. There’s no profit motive. That’s why Cuban cigars are no longer any good. But the point being that that’s a factor that no one’s talking about. There are $7 billion worth of claims that are completely uncompensated.

Imagine if someone came in and stole your farm and 15 years later, they are growing crops on that farm and selling it to the country you went to for a profit, using the things you…your land, your equipment, what you invested in. That’s another part of it we haven’t discussed.

Mr. Adams: In case you do have aspirations for another job somewhere down the line, what would you say to agriculture? Many in agriculture and other parts of the country not really familiar with you or your policies or what you would push for if you got that new job. What can you tell this group about your ag positions?

Sen. Rubio: Well, first of all, as I said, I have a family connection. My grandfather was the single greatest influence on my life growing up, and it all entailed…you know, he was one of 17 children. Was a labor program, I guess, that they were undergoing, but… [Laughter.]  He was the only one that couldn’t work on the [field]. He had polio when he was six years old, so he actually went out and learned how to read and write, and struggled because he was disabled from polio.

But nevertheless, Florida is an enormous agriculture state. People associate Florida with real estate, no income tax, and Walt Disney World. All are great—and beaches. But we have an enormous ag component. And it’s one that’s endangered by a number of things.

First of all, by unfair trade practices that we see, whether it’s dumping of tomatoes from Mexico or some of the other issues. But the other issue we’ve really begun to face is both environmental regulations from the EPA—we had a [numeric] nutrient content fight a year ago where they basically tried to come in and impose standards that would make the water even cleaner than what comes out of your tap, in some instances, on agriculture.

And the other threat we face is invasive species. And in particular we’re having a problem now—we’ve got a [canker] problem in Florida that almost wiped out the citrus industry, and now we have a greening problem that actually—the canker ruined the fruit, the greening destroys the trees.

And the problem with losing agriculture is when you lose agricultural land and it becomes developable now because it becomes the highest, best use, you can never get it back. Once someone builds a multifamily housing complex on a piece of agricultural land, you can never come back ten years later and turn it back into farming. And that’s a major problem. You lose the capacity to grow food and to feed your people.

We take that for granted in the United States. We have a lot of people in this country that, when you ask them where does food come from, they’ll say the supermarket. They don’t realize that someone had to grow it. And we take for granted that we have a plethora of food and that we have it in what’s basically still affordable in comparison to the rest of the world, although prices have gone up a little bit, but not necessarily because of agriculture’s fault. And we take that for granted. Food security is even more important than energy security in terms of the future of our country. And if you lose the capacity to feed your people, not to mention export and provide products to others, you lose a major component of your economy.

So what are the threats from government in that regard? The first, of course, is these environmental regulations. The second, for example, is the interpretation of existing law from regulatory agencies like the Waters of the United States issue that we’re trying to address in the budget.

And the third role government can play is with basic research. This greening issue, as I pointed out, is something that the University of Florida, through a program called [IFAS], has been doing round the clock research to try to fix. If we don’t fix that issue, it is not unforeseeable that in less than a decade we will have no Florida citrus left. That, to me, is unimaginable for a state so identified with oranges and grapefruits.

And last is I think it’s important for us to open up free and fair trade with allies and partners around the world. It has to be on terms that are fair. So I believe in the Trans-Pacific Partnership, but that means that we need to have a deal with Japan that allows us to sell beef and other products into their markets. I think it’s important for these deals. It’s good for us to have millions of people around the world that can afford to buy what we grow, millions of people in the consumer class.

But it has to be on terms that are fair to the American agriculture sector, because I can tell you many of our agricultural products have to compete against other nations that heavily subsidize their industries and have zero environmental or labor regulations over their head compared to ours. And if they can undercut our growers, wipe them out, put them out of business, they then control the global market and can charge us anything they want, and as I said, we lose the growing capacity.

Mr. Adams: See, he can talk ag. There we go. All right. [Applause.]

[End of recording.]

Thursday Morning Update: Policy Issues; Estate Tax; Trade; and, Biofuels

Note: Thanks again very much to the many readers who have expressed how much they have enjoyed the FarmPolicy newsletter over the years. The numerous Emails and tweets from readers about the newsletter ending next week have been extraordinarily gracious and very much appreciated.

Policy Issues

The House Agriculture Subcommittee on General Farm Commodities and Risk Management will hold a hearing this morning to take a closer look at Farm Bill implementation issues.

Secretary of Agriculture Tom Vilsack and Deputy Agriculture Secretary Krysta Harden were both guests on yesterday’s AgriTalk radio program with Mike Adams, where a good deal of the discussion focused on the Farm Bill.

During a portion of his discussion with Dep. Sec. Harden (related FarmPolicy.com transcript here), Mr. Adams asked, “What’s your feel overall how implementation’s been going?”

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Wednesday Morning Update- Policy Issues; Trade; and, the Ag Economy

Note: Thanks very much to the many readers who have expressed how much they have enjoyed the FarmPolicy newsletter over the years. The numerous Emails and tweets from readers about the newsletter ending next week have been extraordinarily gracious and very much appreciated.

Policy Issues

Philip Brasher reported yesterday at Agri-Pulse that, “Republicans and Democrats slammed the Agriculture Department over allegations of abuse at a livestock research facility in Nebraska and accused agency officials of stonewalling lawmakers’ requests for information.

“‘It sounds like it was a house of horrors that was going on there,’ said Rep. Tom Rooney, R-Fla., referring to allegations about the U.S. Meat Animal Research Center contained in a New York Times article published in January.

“Rooney, one of several members of the House Agriculture Appropriations Subcommittee who grilled USDA officials about the issue, said the allegations cast the cattle industry in a bad light. The idea that the research highlighted in the article was undertaken at the industry’s request was ‘bull-you-know-what,’ Rooney said.”

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Friday Morning Update: Ag Economy; Policy- Trade Issues; and, Regulations

Agricultural Economy

Reuters writer Christine Stebbins reported yesterday that, “Drought pressures will increase in California and western areas of the United States this spring even as the dry season begins, the government’s Climate Prediction Center said on Thursday.

“‘Periods of record warmth in the West and not enough precipitation during the rainy season cut short drought relief in California this winter and prospects for above-average temperatures this spring may make the situation worse,’ Jon Gottschalck, chief of the Operational Prediction Branch at the Climate Prediction Center, said in issuing its spring outlook.

“The center, a division of the National Oceanic and Atmospheric Administration, also said rivers in western New York and eastern New England have the greatest risk of spring flooding in part because of heavy snowpack coupled with possible spring rain.”

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Thursday Morning Update: Budget- Policy Issues; Trade; and, the Ag Economy

Budget- Policy Issues

Janet Hook and Kristina Peterson reported in today’s Wall Street Journal that, “House and Senate Republicans have resurrected efforts to curb spending for Medicare and other safety-net programs, releasing budgets this week that bring government entitlements back to the center of political conversation.

“The Senate GOP budget released Wednesday calls for saving $5.1 trillion over 10 years, including $4.3 trillion by repealing the Affordable Care Act and curbing entitlement programs such as Medicare, Medicaid and food stamps.”

The Journal article noted that, “Each chamber will vote on its own budget, before merging them and voting on a unified budget setting overall spending levels for the fiscal year. The policy proposals described in the budgets aren’t binding and stand little chance of becoming law under Mr. Obama, but they send a message about GOP priorities.”

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Tuesday Morning Update: Policy- Budget Issues; Regulations; Trade; and, Bird Flu

Policy, Budget Issues

Seung Min Kim and Jake Sherman reported yesterday at Politico that, “As budget season kicks off in earnest this week, defense hawks are clashing with fiscal hard-liners over military spending, Republicans are scaling back their deficit reduction targets, and Democrats are waiting in the wings to hammer GOP lawmakers with politically tough votes on education, infrastructure and health care.

“In the House, Speaker John Boehner of Ohio, Majority Leader Kevin McCarthy of California and Majority Whip Steve Scalise of Louisiana are stuck between the budget-cutting demands of conservatives and the desire of defense hawks to provide the military with more robust funding. In the Senate, Republicans are already getting hit by Democrats after indicating they’ll target Medicaid and food stamps.

The blueprints due out this week in each chamber will provide the first hard evidence of how aggressively the GOP intends to pursue its top stated priority of fiscal discipline. Though the budgets are partisan documents that won’t be signed into law, failing to marshal enough GOP support to pass one would be a debilitating setback for a party trying to prove it can govern after taking full control of Congress.”

The article noted that, “As some details of the Senate budget became clear last week, Democrats began their attack — pointing to savings that Republicans would like to extract from Medicaid and food stamps for the poor.

“‘Balancing the budget on the backs of working families who have borne the brunt of the recession makes no economic sense,’ said Sen. Bob Casey (D-Pa.).

If the two chambers ultimately can’t come together on a budget, Republicans won’t be able to wield a powerful budget maneuver known as reconciliation, which would allow them to enact policy changes with 51 rather than 60 votes.”

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Sunday Night Update: Budget- Policy Issues; Trade, and, the Ag Economy

Budget, Policy Issues

The House Appropriations Subcommittee on Agriculture resumes hearings this week and will garner additional details regarding USDA budget requests from three Agency Under Secretaries.

On Tuesday the Subcommittee will hear from Kevin Concannon, Under Secretary for Food, Nutrition, and Consumer Services, and on Wednesday, Under Secretary for Rural Development Lisa Mensah will testify before the Subcommittee.

Michael T. Scuse, Under Secretary for Farm and Foreign Agriculture Service and Brandon Willis, the Administrator for the Risk Management Agency will be at the Subcommittee on Thursday.

Meanwhile, the Senate Appropriations Ag Subcommittee will hear perspective on USDA’s budget from Secretary of Agriculture Tom Vilsack on Tuesday.

Recall that last month Sec. Vilsack presented testimony at the House Appropriations Ag Subcommittee (February 25) , as well as the House Ag Committee (February 11) and Senate Ag Committee (February 24).

In addition to the USDA budgetary hearings, the full House Ag Committee will hold a hearing Wednesday on the importance of trade to U.S. agriculture, while the House Ag Conservation and Forestry Subcommittee will hold a hearing on Tuesday, “To review the definition of ‘waters of the United States’ proposed rule and its impact on rural America.”

As these hearings regarding the USDA budget and ag policy issues are going on this week, the House and Senate Budget Committees will also be holding important meetings that have potential ramifications for the Farm Bill.

Recall that an update on Thursday at FarmPolicy.com explored recent budget related developments that could potentially have significant implications for the Farm Bill– the update can be viewed here: “Budget Issues Move to the Front Burner- Potential Farm Bill Implications.”

More recently, Jordain Carney reported on Friday at The Hill Online that, “Senate committees are laying the groundwork for the budget next week.

“Sen. Bernie Sanders (I-Vt.) said this week that the Budget Committee will mark up a budget proposal on Wednesday and Thursday. Sanders, the ranking member of the committee, said Democrats will likely offer ‘very strong amendments’ during markups next week.”

And an update on Friday at the National Sustainable Agriculture Coalition (NSAC) Blog (“The Farm Bill Reloaded”) explained that, “The House Budget Committee is expected to markup the fiscal year 2016 budget resolution on Wednesday March 18. The Senate Budget Committee is expected to follow suit the next day. Assuming the measures pass out of committee they will be debated and voted on in the full House and Senate the following week.

“While the chairmen of the two Committees have kept details of their proposed budget bills very close to the vest, it is widely expected that they will include ‘budget reconciliation’ instructions to various committees of Congress, including the Agriculture Committees. Budget reconciliation is a congressional process used primarily as a means of reducing government spending for mandatory programs.

“It is still unclear exactly what the reconciliation instructions to the Senate and House Agriculture Committees will be, but it has become increasingly clear that there will be instructions to the Agriculture Committees.”

The NSAC update added that, “The rumor in D.C. is that the Committees will be instructed to cut $20 billion, over 10 years, from the 2014 Farm Bill. This amount would be eerily similar to the House’s original 2013 proposal for $20 billion in cuts to the food stamps or Supplemental Nutrition Assistance Program (SNAP).

Whatever the dollar figure is, it doesn’t come with any dictates on what programs to cut. It will be up to the two Agriculture Committees to determine what parts of the farm bill to cut.”

Also on Friday, Kimberly Leonard reported at USNews Online that, “The days of mystery meat and soda-dispensing vending machines may be gone, but that doesn’t mean that the new era of school meals and snacks hasn’t come without its own challenges.

Nutrition guidelines for schools, which have gradually gone into effect since Congress passed the Michelle Obama-backed Healthy Hunger-Free Kids Act in 2010, can be logistically and financially difficult for already strapped district budgets.”

The article noted that, “In response, earlier this month 1,000 members of the School Nutrition Association, which represents school cafeteria workers and companies that supply food and equipment to districts, lobbied Congress for more funding and flexibility when it comes to school meals.

Critics have called out the group for attempting to roll back quality nutrition standards, but the members maintain they are asking for a more realistic approach.”

 

Trade

William Mauldin reported on Sunday at The Wall Street Journal Online that, “Sweeping trade deals of the past—with Canada and Mexico in 1993, for instance, or China in 2000presented big upsides and big risks for a broad swath of U.S. companies.

By contrast, the trade bloc President Barack Obama is trying to hammer out with 11 Pacific countries shows how much smaller both the benefits and perils of trade liberalization have become.

“Complicating the pact’s path, meanwhile, are a host of accompanying fights over issues like environmental regulations and drug-pricing rules.”

The Journal article stated that, “Washington already has trade agreements with more than half the countries in the TPP, among them Singapore, Australia, Peru and Chile… Administration officials and business groups are saying the TPP would lower traditional barriers at the border but also open up U.S.-dominated services industries, boost intellectual-property protection for Hollywood movies and Silicon Valley software, and set rules on the international free flow of data, foreign investment and the environment. A successful deal would also lower regular agricultural and food barriers in Japan and other countries, raising profits for American farmers, an increasingly small but influential part of the electorate.”

Christopher Doering reported in Sunday’s Des Moines Register that, “Congress is wrestling with whether to grant President Barack Obama authority to negotiate potentially lucrative trade deals that could be a boon to an Iowa economy already dependent on trade to support thousands of jobs and pump millions of dollars into the state each year.

“Exports provide a major boost to Iowa’s economy, helping a host of industries ranging from agriculture and construction equipment manufacturers to bioscience and aerospace companies.

“The state shipped a record $15.1 billion in goods and services last year — up sharply from $6.4 billion a decade ago, according to the Commerce Department’s International Trade Administration. Trade now supports more than 80,000 jobs in the state.”

The article noted that, “Without trade, [Gov. Terry Branstad] said, the state’s unemployment rate of 4.1 percent in December would likely be higher, while agriculture, manufacturing and other industries in Iowa would be far less profitable.”

Sunday’s article added that, “Agriculture Secretary Tom Vilsack said recently that agricultural exports have been among the biggest beneficiaries of trade, representing 9.2 percent of the record $1.64 trillion in U.S. goods exported in 2014, compared to 6.6 percent in 2000. Overall, exports are equal to about 30 percent of U.S. farm sales.

“‘Without exports, American agriculture would not be a particularly profitable venture,’ he said.”

 

Agricultural Economy

A FarmPolicy.com update on Saturday looked more closely at the persistence of California’s ongoing drought; while an update on Sunday morning at FarmPolicy.com contained recent news items regarding bird flu issues in the U.S.

Keith Good

Friday Morning Update: Budget; Appropriations Hearing; Animal Production Issues; and, Trade

Budget

An update on Thursday evening at FarmPolicy.com explored recent budget related developments that could potentially have significant implications for the Farm Bill– the update can be viewed here: “Budget Issues Move to the Front Burner- Potential Farm Bill Implications.”

 

Appropriations Hearing

On Thursday, the Senate Appropriations Subcommittee on Agriculture heard testimony from FDA Commissioner Dr. Margaret Hamburg.

During the discussion portion of the hearing, a couple of Senators sought more detail and perspective about the FDA’s role as it relates to the recent Dietary Guidelines Advisory Committee Report– additional details on the hearing and the Dietary Guidelines report have been posted here, at FarmPolicy.com.

 

Animal Production Issues

In other news, Lisa Baertlein and P.J. Huffstutter reported yesterday that, “KFC, the world’s largest chain of fried chicken restaurants, may face pressure from consumer and environmental groups to change how its poultry are raised after McDonald’s Corp said it would switch to chicken raised without human antibiotics.

“McDonald’s will phase out chicken raised with antibiotics that are important to human health over two years to allay concern that use of the drugs in meat production has exacerbated the rise of deadly ‘superbugs’ that resist treatment, Reuters reported last week. Within days, retailer Costco Wholesale Corp told Reuters it aims to eliminate the sale of chicken and meat raised with human antibiotics.

KFC is owned by Louisville, Kentucky-based Yum Brands Inc, which has no publicly stated policy on antibiotic use in the production of meat it buys. Chick-fil-A, another chicken restaurant chain that competes with KFC, says about 20 percent of the chicken it serves is raised without any antibiotics, and that its entire supply chain will be converted by 2019.”

Also, a news release this week from Cargill indicated that, “Dr. Stephanie Cottee joins Cargill animal welfare team with global responsibility for poultry.

“She will be based in Guelph, Ontario, Canada and report to Dr. Mike Siemens, PhD, Cargill’s head of animal welfare based in Wichita, Kan. Dr. Cottee’s appointment is effective immediately.”

And Reuters writers Tom Polansek and P.J. Huffstutter reported yesterday that, “A case of bird flu confirmed Wednesday in the heart of America’s poultry region, is certain to mean more export restrictions, increasing U.S. supply and likely forcing the world’s biggest poultry companies to trim prices.”

The article noted that, “The USA Poultry & Egg Export Council said it expects 30 to 40 additional countries to impose new trade restrictions on U.S. poultry and eggs in the $5.7 billion export market. Additional limits could come from Mexico, the top U.S. chicken importer, which already is blocking poultry imports from Minnesota, Missouri and California due to bird flu, the trade group said.

“Previous cases of avian flu in other states triggered China and South Korea to recently impose bans, still in effect, on U.S. poultry imports. Last year, they accounted for about $428.5 million in export sales of poultry meat and products, according to U.S. Department of Agriculture data.

“Other countries have banned exports from only states or counties with positive cases of avian flu.”

See also this update yesterday from Kansas State University Extension, “Poultry bans by overseas buyers could weigh on pork and beef, as well as poultry prices.”

 

Trade

Chris Kirkham reported yesterday at the Los Angeles Times Online that, “The short-term economic impact of the recent labor standoff at West Coast ports will be small, according to a new economic forecast, but the ports face a long-term struggle to remain competitive in the rapidly changing realm of global trade.

Many businesses in California, particularly those tied to agriculture, suffered from missed orders and produce spoiling on docks. But many other shipments were simply delayed rather than lost entirely, according to the quarterly UCLA Anderson Forecast.”

And Ann M. Veneman and Dan Glickman, who respectively served as Agriculture Secretary for George W. Bush and Bill Clinton, indicated in a column this week at The Hill Online that, “As former secretaries of Agriculture, we know firsthand the importance of international trade to America’s farm and ranch families, to our nation’s rural communities, and to the U.S. economy as a whole. There’s no other sector of the U.S. economy where the link between trade and prosperity is clearer than in agriculture.”

The column noted that, “Key to our ability to negotiate and implement market-opening agreements has been enactment of trade negotiating authority. This authority, now called trade promotion authority (TPA), ensures U.S. credibility to conclude the best deal possible at the negotiating table. TPA also ensures common negotiating objectives between the president and Congress, and a continuous consultation process prior to final Congressional approval or disapproval of a trade agreement.

That’s why we, together with all living former secretaries of Agriculture, recently signed an open letter urging Congress to reinstate Trade Promotion Authority to allow the president to effectively negotiate job-supporting trade agreements as other presidents have done.

“With TPA, the United States will be able to pursue trade agreements that support high-paying U.S. jobs while helping America’s farmers and ranchers increase U.S. exports and compete in a highly aggressive globalized economy. TPA will signal to our TPP partners that Congress and the administration stand together on the high standards our negotiators are seeking.”

Keith Good

Thursday Morning Update: Crop Insurance; Policy; Regulations; Ag Economy; and, Biotech

Crop Insurance- GAO Report

On Wednesday, the Government Accountability Office (GAO) released a report on crop insurance titled, “In Areas with Higher Crop Production Risks, Costs Are Greater, and Premiums May Not Cover Expected Losses.”

A summary and highlights of the report have been posted here, at FarmPolicy.com.

Agri-Pulse reporter Philip Brasher, in an article from yesterday, provided a brief and thorough look at the GAO report.

Mr. Brasher reported that, “Farmers in drought-prone areas of the Plains and other high-risk regions often aren’t being charged enough for crop insurance, according to congressional auditors.”

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Wednesday Morning Update: Policy Issues-Ag Economy; Regulations; and, Trade

Policy Issues, Budget Baselines, USDA Reports

Corey Paul reported on Monday at the The Odessa (Tex.) American Online that, “[House Ag Committee Chairman Mike Conaway (R., Tex.)] said when he was appointed chairman in January that his chief priority was launching a review of the country’s Supplemental Nutritional Assistance Program, or food stamps, criticizing a lack of oversight for the $80 billion annual program.

“Conaway said Monday that review is underway and that he does not want his fellow legislators to make cuts to the program before he is finished.

“‘I’m trying to maintain this idea that we don’t have any preconceived reforms in mind right this second, and we want to let those percolate out of the review itself,’ Conaway said. ‘One of the fights I’m having with the budget is to make sure they don’t do things there that would taint the water.’”

Meanwhile, with respect to the commodity title of the Farm Bill, Reuters news reported yesterday that, “Government support for U.S. grain farmers under the new five-year farm bill will peak with the coming 2015 crop, the Food and Agricultural Policy Research Institute said in a new report.”

The article noted that, “‘Payments under 2014 farm bill programs increase when crop prices fall,’ FAPRI said in its 2015 U.S. Baseline Briefing Book. The think tank estimated that $3.9 billion in ARC and PLC payments for last year’s 2014 crop would be made after fiscal 2016 begins on Oct. 1.

“‘ARC spending is greatest in 2015/16 but declines in later years as the moving averages that determine benchmark revenues adjust,’ FAPRI said. ‘Projected average ARC and PLC payments peak with the 2015 crop at about $6.5 billion but decline to $3.4 billion for the 2018 crop.’”

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Tuesday Morning Update: Baseline Updates- Policy Issues; Animal Research; Trade; Iowa Ag Summit; and, the Ag Economy

Baseline Updates- Policy Issues

On Monday, the Congressional Budget Office (CBO) released its updated baseline Budget Projections for 2015 to 2025.

A brief overview of CBO’s January baseline projections can be found here.

Also on Monday, the Food and Agricultural Policy Research Institute (FAPRI) released its latest baseline-briefing book.

Both baseline updates showed a change in farm program spending projections from previous baseline reports.

Politico writer David Rogers, and Philip Brasher of Agri-Pulse, separately examined the numbers in greater detail on Monday- details of their reporting can be found at this FarmPolicy.com update from yesterday.

More broadly, yesterday’s FAPRI update stated that, “Lower prices have resulted in a large decline in crop producer income and could result in significant federal spending under new programs established by the 2014 farm bill. After reaching record levels in 2014, most livestock sector prices are also expected to decline in 2015. As a result, net farm income is projected to fall sharply.”

Average projected corn prices recover to $3.89 per bushel for the 2015/16 marketing year in response to reduced U.S. production. Wheat and soybean prices both fall in 2015/16, to $5.17 per bushel and $9.29 per bushel, respectively, given continued large global supplies,” FAPRI said.

In addition, CBO’s outlook for the SNAP program is available here, while the CBO’s outlook for child nutrition programs can be found here.

Meanwhile, Marcia Zarley Taylor reported yesterday at DTN (link requires subscription) that, “U.S. crop farmers have just weeks left to make their five-year farm program decision. For most, the March 31 choice will be narrowed between ARC-County and Production Loss Coverage (PLC). Many corn-soybean growers in the northern Corn Belt see good reason to go with what they call the ‘surer thing’ of ARC payments, DTN interviews have found.

“Even in counties that experienced bumper yields in 2014, growers may face little or no ARC payments in 2014 but still are banking that ARC will outpay PLC for 2015 and beyond. For example, McLean County, Illinois, averaged an amazing 217 bpa corn yield in 2014, so stands to collect no ARC payments, the University of Illinois estimates. However, with a return to average or below average yields in 2015, ARC-County payments could jump to $78/base acre in 2015.”

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Sunday Update: Iowa Ag Summit; Policy; Budget; Trade; and, Regs

Iowa Ag Summit

A summary and highlights of Saturday’s Iowa Ag Summit are available here, at FarmPolicy.com Online.

 

Policy Issues

In other news, Lydia Wheeler reported on Friday at The Hill Online that, “The U.S. Department of Agriculture is giving schools $5.5 million in training grants, in addition to the $25 million being allocated this year for new kitchen equipment, to help districts prepare healthier meals.

“‘Our kids today are growing up in a very competitive economy and in this competitive economy it’s going to be very important for them and their country to be on top of their game,’ Secretary of Agriculture Tom Vilsack said Friday.”

Beena Raghavendran reported on Saturday at the Minneapolis Star-Tribune Online that, “In Moorhead, to qualify for government cash assistance, residents must have lower incomes than people living right next door in Fargo, N.D.

“This discrepancy upsets U.S. Rep. Collin Peterson, a Democrat whose Seventh Congressional District includes Moorhead. Some Minnesota residents make slightly too much to receive benefits by Minnesota law while their counterparts making the same income across the state line are getting help. It’s a problem echoed across the country because states set their own cash benefit standards.

“‘We have to work on how we treat different people differently in different parts of the country,’ Peterson said.”

The article added that, “The House Agriculture Committee — where Peterson is the highest ranking Democrat — just began its review of the Supplemental Nutrition Assistance Program, or SNAP, formerly known as the food stamp program, to address a glaring problem: Though unemployment has fallen since the recession, numbers of food stamp recipients have remained constant.

“Some Republicans wonder whether the program is increasing its recipients’ dependency on welfare.

Peterson understands the concern, but he doesn’t think the food stamp program should be touched — at least for now.”

The article indicated that, “‘I don’t think we should do anything because we did the farm bill and it’s a five-year bill and they [Republicans] had their chance and it didn’t get done,’ Peterson said.

“The committee’s GOP Chairman Rep. Michael Conaway, of Texas, said there may be a legislative proposal to tackle food stamp inconsistencies.

“‘What we don’t want is for this program to hold people back from achieving their potential,’ he said.”

Julie Harker reported late last week at Brownfield that, “Missouri Attorney General Chris Koster and plaintiffs from five other states have filed an appeal in the case of the California egg legislation they are fighting. Last October, a district judge in California tossed out their lawsuit against California’s Proposition Two, which requires eggs produced in California and elsewhere to meet that state’s new enlarged-cage standards for egg laying hens. Koster tells Brownfield Ag News, ‘The egg case is a very important case. A lot of people have made fun of us for bringing this case and yet, increasingly as egg prices are now soaring because of the acts of the California legislature, they are recognizing that we were right to bring this case.’”

Meanwhile, The Washington Post editorial board indicated on Saturday that, “Farmers and ranchers have often argued they are not responsible for the rise of antibiotic resistance and have balked at change. The McDonald’s decision is certain to get their attention and cause change by market incentives. Also, as chicken producers adapt and learn how to keep their flocks healthy without the routine use of antibiotics, the know-how they develop may spread. Of course, the McDonald’s decision is good marketing, too — consumers say they want it. More power to the marketplace.

“This is the latest in a string of developments that suggest, at last, a more serious approach to the problem of antibiotic resistance, which the Centers for Disease Control and Prevention say leads to 2 million illnesses and 23,000 deaths a year in this country alone. The Food and Drug Administration has asked antibiotic manufacturers to stop selling the drugs for growth promotion in farm animals (although the FDA would permit continued use for disease prevention) and is giving veterinarians more control. Meanwhile, President Obama has proposed to double funding for combating antibiotic resistance, and the White House has mapped out an ambitious strategy. Bacteria have been evolving and adapting for many years, so it is encouraging to see the government and private sector doing more to address a major public health threat.”

 

Budget Issues

A recent Congressional Budget Office (CBO) news item indicated that the agency is set to release updated baseline projections on Monday.

A recap of January’s CBO baseline is available here.

Also, Jesse Byrnes reported on Sunday at The Hill Online that, “Senate Majority Leader Mitch McConnell (R-Ky.) on Sunday vowed that Republicans would figure out a way to handle the nation’s debt ceiling in order to avoid a government shutdown.

“‘The debt ceiling will be handled over a period of months,’ he said on CBS’s ‘Face the Nation’ when asked if Republicans would vote to lift the debt ceiling. ‘The secretary of the Treasury has a number of what we call ‘tools in his toolbox,’’ he added.”

 

Trade

In trade related news, an update on Saturday at The Japan Times stated that, “Japan and the United States failed to bridge the gap over tariff issues related to agricultural and auto trade as they wrapped up working-level bilateral talks associated with Trans-Pacific Partnership multilateral free trade negotiations on Friday.

Hiroshi Oe, Japan’s deputy chief TPP negotiator, told reporters after the two-day meeting that there still remain some thorny issues.”

The article added that, “Of the unresolved issues, Japan and the United States will hold talks on agricultural tariffs on the sidelines of a meeting of chief negotiators from all 12 members in the TPP talks set for Monday through Sunday in Hawaii.”

Vicki Needham reported on Sunday at The Hill Online that, “Labor unions and other groups opposed to free-trade policies are ramping up a spring offensive against the White House and congressional Republicans with new trade legislation set to emerge in the coming weeks.

“The AFL-CIO along with other groups this week trumpeted how trade promotion authority (TPA) will rubber stamp agreements like the Trans-Pacific Partnership (TPP) that they say would hurt American workers by leading to job and wage losses.

“Hundreds of members from the various groups canvassed Capitol Hill, bringing their anti-fast-track message to more than 100 congressional offices. It’s just the latest push from the left to stop the Obama administration’s push for TPA or fast-track, which would prevent trade deals from being amended by Congress.”

 

Regulations

A news release Friday from Rep. Randy Neugebauer (R., Tex.), Vice Chairman of the House Agriculture Committee, indicated that he “….introduced H.R. 1267 this week, a bill that would make it easier for farmers, custom harvesters, and agricultural producers to safely transport the fuel they need for a day of field work. Rep. Collin Peterson (D-MN), Ranking Member of the House Agriculture Committee, joined Neugebauer in introducing the bill. In the Senate, a companion bill was introduced by Senator Pat Roberts (R-KS), Chairman of the Senate Agriculture Committee, Senator Heidi Heitkamp (D-ND), and Senator Jerry Moran (R-KS).”

Keith Good


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