READ the NAFB’s National Ag News for Tuesday, May 2nd

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READ the NAFB’s National Ag News for Tuesday, May 2nd

New Spending Bill’s Impact on Agriculture

Congress put together a spending package on Sunday night that would keep the government running through the rest of fiscal year 2017. Politico’s Morning Agriculture Report says the bottom line for agriculture is Congress appropriated $153.4 billion in mandatory and discretionary spending levels at the U.S. Department of Agriculture and the Food and Drug Administration. That number is almost $13 billion above last year’s spending levels. Unfortunately for agriculture, provisions that would trigger addition subsidies for the cotton and dairy industries didn’t make it into the spending bill. Instead, there’s a congressional directive instructing the Secretary of Agriculture to put together a report on potential options for providing financial assistance and relief to the nation’s cotton and dairy farmers. A rider that would block the USDA from enforcing three rules under its Grain Inspection, Packers, and Stockyards Administration designed to protect chicken producers in contracts with processors didn’t make it in the bill. The department isn’t planning to enforce the rules until at least October, while it takes comments in the meantime. Lawmakers also included funding to fight wildfires out west and allowed the Farm Service Agency to make more direct and guaranteed loans to farmers who need access to credit when commodity prices are low.


National Cotton Council Disappointed to be Left Out

National Cotton Council Chair Ronnie Lee said the NCC is extremely disappointed that the 2017 omnibus appropriations spending bill doesn’t contain the “cottonseed policy developed by the cotton industry in consultation with Congress.” Lee says the cottonseed policy was broadly supported by the entire industry and other Farm Bill stakeholders. He says it was budget neutral, with the costs offset only by cotton-related provisions. It was supported by a bipartisan group in Congress and actually was designed to help facilitate the 2018 farm bill. Lee, a Georgia cotton producer, says Senators Pat Leahy, a Vermont Democrat, and Michigan Democrat Debbie Stabenow chose to play politics at the expense of cotton producers as they and their families continue to struggle with negative financial returns and increasing pressures. “The Senators’ desire to help dairy farmers somehow became a pre-requisite for whether or not Congress could help cotton producers respond to ongoing financial and trade challenges,” says Lee. He adds there was no reason to link support for dairy and cotton farmers, who are now left with no short-term options to help them deal with financial issues.  


Groups Want Checkoff Reform

Over 80 organizations recently sent letters to both the Senate and House of Representatives, calling on lawmakers to fix the government’s “failed commodity tax support programs.” The 80 organizations represent over 250,000 farmers, ranchers, and businesses that want recently introduced legislation passed by both chambers and signed into law. The letters say the legislation would bring much-needed transparency and accountability to the programs. The legislation comes in two separate bills introduced in both chambers. The “Opportunities for Fairness in Farming Act” would put an end to the most egregious abuses by the boards of federally mandated checkoff programs. The “Voluntary Checkoff Act” has also been introduced, with the goal of ensuring that no farmer is forced to pay money to programs that don’t promote their market segment. The letters were signed by organizations like the National Farmers Union, Organization for Competitive Markets, and R-CALF. The more than 80 groups point to the checkoff programs’ history of acting “beyond the scope of their statutory mandate.” They also accuse the USDA of lax oversight of the checkoff programs, resulting in collusion and illegal relationships between the checkoff programs and lobbying organizations. They say the groups have used checkoff funds for lobbying activities, which is strictly prohibited.


Canada/Mexico Doing NAFTA Renegotiations “Together”

The relationship between Mexico and Canada amid the upcoming North American Free Trade negotiations is said by both countries to be more important than ever. The Canadian Broadcasting Company website says Mexican President Enrique Pena (payn-ya’) Nieto (Knee-eht-oh) and Canadian Prime Minister Justin Trudeau were both caught off guard by media reports saying U.S. President Donald Trump was readying an executive order to withdraw from the agreement. They both phoned Washington and asked Trump to renegotiate, not withdraw, and Trump agreed. Both countries previously agreed to renegotiations months ago. American corn producers are looking on nervously. The Mexican Ag Secretary recently led a tour of his country’s corn importers to Brazil and Argentina as part of a plan to diversify, especially if NAFTA negotiations fall apart. Last year, 98 percent of Mexico’s corn imports came from the United States, roughly $3.25 billion dollars worth of business for American farmers. Mexico’s Ag Secretary said, “This isn’t a commercial visit, or to generate good will, we are going there to sign purchase agreements.” Beyond just corn, Mexico is also the third-largest agricultural export market for the U.S.


Brazil Looking at Tariffs on U.S. Ethanol Imports

Reuters says the Brazilian Ag Minister is asking the country’s Foreign Trade Council to impose tariffs on U.S. ethanol imports after a recent surge in shipments coming in from America. The article says a move like that could potentially stir up trouble with the Trump administration, which is already looking at renegotiating the North American Free Trade Agreement. Brazil is the biggest market for U.S. corn ethanol and American exports have swelled in recent months because of a domestic shortfall in production. Brazilian cane farmers have harvested more of their crop for sugar production because of recent higher sugar prices. Less of the product is going into the Brazilian ethanol industry. Ethanol imports grew five times larger in the first quarter of the year, totaling a record 720 million liters that were worth $363 million. Most of the increased production landed in Brazil’s northeast ports and ethanol producers from that part of Brazil are leading the call for a 20 percent tariff. The Council is set to meet this week but doesn’t have a deadline for making a decision.  


NFU Urges FTC to Oppose ChemChina/Syngenta Merger

The National Farmers Union urges the Federal Trade Commission to oppose China National Chemical Company’s acquisition of Syngenta. In comments to FTC Secretary Donald Clark, NFU President Roger Johnson says this deal would further consolidate an already consolidated global agricultural inputs sector. Johnson says the deal would further limit competition among the few companies that dominate the marketplace. The Farmers Union feels a move like this will limit competition and ultimately raise prices for family farmers. “Chem China’s proposed takeover of Syngenta would disrupt trade flows and accelerate the international consolidation of food and agribusiness industries,” Johnson says, “and we urge you to stand up for family farmers and ranchers and oppose the merger.” He says the ChemChina-Syngenta merger occurs against the backdrop of an industry that’s already marked by highly concentrated agricultural biotechnology and seed markets. The global ag input market is currently going through the third wave of consolidation, with mergers also pending between Bayer and Monsanto and between Dow and DuPont. Johnson said because ChemChina is owned by the Chinese government, the ChemChina-Syngenta company would have a significant advantage over other companies in accessing the large Chinese market.

SOURCE: NAFB News Service