READ the NAFB’s National Ag News for Tuesday, April 4th

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READ the NAFB’s National Ag News for Tuesday, April 4th

Farm Groups Urge Senate to Confirm Perdue This Week

The American Farm Bureau Federation and the National Grain and Feed Association are calling on the U.S. Senate to confirm Sonny Perdue as Agriculture Secretary this week, before a two-week recess that starts Friday. In a joint statement, the two groups said: “We need him at USDA to begin addressing a backlog of policy issues that are awaiting his attention and to begin the process of filling key positions within the department.” AFBF and NGFA noted that Perdue has the bipartisan support of six former agriculture secretaries, as well as the support of nearly 700 agriculture groups from across the nation. If the Senate fails to schedule a vote this week, his confirmation vote may be delayed until the last week of April, due to the two-week recess. However, getting the vote on the schedule this week may be held up by the confirmation vote for Supreme Court Justice nominee Neil Gorsuch, which is subject to threatened opposition by Senate Democrats.

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Agriculture Groups Pushing Estate Tax Repeal

A coalition of more than 30 agriculture groups is pressing Congress to repeal the estate tax. A letter sent to the House Ways and Means Committee asked that any tax reform package include permanent repeal of the estate tax. Sometimes referred to as the “death tax,” the levy is imposed on the net value – less an exemption – of an owner’s assets transferred at death. For the 2016 tax year, the exemptions for the estate tax are $5.45 million for an individual and $10.9 million for couples. Transferred estates valued at more than those figures are subject to a maximum tax rate of 40 percent on the amount of assets above those levels. The agriculture groups, which includes the National Pork Producers Council, wrote in the letter saying: “The estate tax is especially damaging to agriculture because we are a land-based, capital-intensive industry with few options for paying estate taxes when they come due.”

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Guatemala to Eliminate Tariffs on U.S. Chicken Products

Guatemala has agreed to end tariffs on select U.S. chicken products years earlier than planned. The U.S. Trade Representative’s office Monday said an agreement between the U.S. and Guatemala calls for the elimination of the 12.5 percent tariff on U.S. exports of fresh, frozen and chilled chicken leg quarters this month. The agreement is part of negotiations under the Central American Free Trade Agreement, according to Politico. Under the agreement, the U.S. and Guatemala will also establish a tariff rate quota allowing imports of 1,000 metric tons of processed chicken leg quarters to enter duty-free each year through December 31, 2021. Any remaining tariffs and quotas will be eliminated, effective January 1, 2022. Sales of U.S. chicken leg quarters to Guatemala totaled $82 million in 2016, about eight percent of the country’s total U.S. agricultural imports of $1.1 billion last year.

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Canada Attempting to Deepen Trade Ties with China

Canada is doubling down on a push to deepen trade ties with China in a new effort that allows the nation to move ahead on a free-trade deal without quickly advancing extradition treaty talks. Bloomberg reports cabinet members for Canada Prime Minister Justin Trudeau (True-doh) will begin following through on a plan by Trudeau to increase trade. Trudeau’s Trade Ambassador says: “It takes two to tango, but I think the Chinese are also wanting to go in this direction.” Bloomberg points out that the China file is one of Trudeau’s most delicate balancing acts. On one hand, it’s a massive economy with ample demand for Canadian resources. On the other, its human-rights record is a political problem for Trudeau, with polls showing at best lukewarm support for closer ties. The expanded ties Canada is seeking aren’t limited to a free trade pact, it wants more foreign investment, more Chinese tourists and to send more Canadian students to China. There’s little word yet what any expanded trade ties would mean for Canadian agriculture.

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Protectionist Trade Rhetoric Not Beneficial for Global Ag Companies

The CEO of Deere and Company told CNBC trade rhetoric by President Donald Trump and prospects of a border tax are “worrisome” for global companies. Deere’s Samuel Allen says that “any form of protectionism or nationalism, on the whole, is not beneficial for a company like ours, or any global company.” While Allen notes that a border adjustment tax slapping a 20 percent tariff on imports could help Deere, he says the company is “very concerned” about the proposal’s potential impact on its farmer customers. Allen stated: “If, as a result of the adjustment tax, it has an unintended consequence of causing countries like China and Mexico to buy their ag commodities from other countries, that would be negative for U.S. farmers that do a lot of exporting to China, Canada and Mexico.” Mexico, the top buyer of U.S. corn, has threatened to counter any proposed tax or negative trade impacts from changes to the North American Free Trade Agreement to purchase agricultural commodities from other nations.

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FMC Deal to Slow Dow-DuPont Merger

An agreement between FMC and DuPont to swap some agricultural business units will delay the Dow-DuPont merger. FMC announced last week it would purchase DuPont’s crop protection business and sell off most of its health and nutrition business to DuPont, a move that will allow the Dow-DuPont merger to gain approval by the European Union. However, Reuters reports the move will slow the approval process for the merger between Dow and DuPont. The merger, which was expected to close in the first half of 2017, is now anticipated to close between August and September of this year. The Dow-DuPont merger is still to be approved by regulators in the United States, Brazil, China, Australia and Canada. The deal with FMC is expected to close in the fourth quarter of this year, subject to the closing of the DuPont-Dow merger.

SOURCE: NAFB News Service

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