5 years, 4 months ago American Farm Bureau Federation
The farm bill conference committee could have an agreement in place as this week starts. “We’re darn close,” House Ag Committee Chair Mike Conaway told Politico a couple days after a bout of finger-pointing between conference committee members, who have since downplayed previous comments. Senate Ag Chair Pat Roberts was hopeful a deal would come together by (today) Monday. Roberts had reportedly received a House proposal Friday afternoon. Senate Leader Mitch McConnell, meanwhile, discussed the farm bill with President Trump and said that he and the President are determined to finish the bill this year. McConnell previously told reporters the farm bill is one of two items that “absolutely have to be accomplished” before the end of 2018. Conference committee talks remain fluid, and as of Friday afternoon, unresolved issues included the conservation title and regulatory language, along with negotiations ongoing regarding the nutrition title.
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Eastern Corn Belt: Economic Conditions Deteriorate More Than Expected
Eastern Corn Belt farmers are facing similar conditions reported by the Western Corn Belt. The St Louis Federal Reserve Bank, following a Kansas City Fed report, says bankers reported that farm income had declined, and that farm household spending and capital expenditures remained below levels compared with a year ago. The survey includes seven Midwest and Midsouth states, including Illinois, Indiana and Kentucky. Overall, bankers were slightly less optimistic when asked about the prospects for farm income in the fourth quarter of 2018. As one Missouri lender stated, farmers are hurting, expecting “no change in the marketing plans because they have bills to pay and will need to sell the crop to make those payments.” The report says small farmers are hurting because of the low prices and are usually the ones who do not have on-farm storage to allow them to hold their harvested crops.
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Trade Aid Payments near $840 Million
Nearly $840 million in trade aid has been handed out to farmers from the Department of Agriculture so far this year. The payments stem from the trade mitigation package announced by USDA to help offset trade war loses for farmers. The package, worth $12 billion, has paid out $837.8 million to farmers. Top aid recipients are soybean, wheat, corn dairy and hog producers, according to Reuters. The five states that received the highest amount of aid were Illinois, Iowa, Kansas, Indiana and Minnesota. The second set of payments is expected in December, and USDA says producers who signed up for the first round will be automatically included in the second round of payments. Agriculture Secretary Sonny Perdue has said that there are no plans to extend the aid into 2019, for now.
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U.S. Wants Soybeans in Any China Trade Deal
The Trump administration will push China to resume U.S. soybean imports in any potential trade deal. The tit-for-tat trade war has moved China's purchases lower as the nation slapped a 25 percent tariff on U.S. soybeans. The Trump administration says, ahead of broad-based talks at the G20 Summit, the U.S. will push to secure future sales to China, to curb lingering effect following the trade war. Steve Censky, Deputy Agriculture Secretary, told Reuters Trump would be looking for a “robust level of commitments from China for purchases, because we want to make sure that we resume our sales.” Censky is the former American Soybean Association executive director and said previously China was “strategic” in inflicting “pain” on Trump’s rural political base. However, even if the trade war comes to an end, the talks at the end of this month are just the first stepping stone, meaning tariffs are expected to remain well into next year.
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Canada Strengthening Ties with China
The Canadian government says it is strengthening ties with China following the third Canada-China Annual Leaders' Dialogue. Prime Minister Justin Trudeau (true-doh) discussed bilateral trade and investment by expanding cooperation in sectors including agriculture. They also pledged to continue to promote multilateralism, free trade, and the rules-based international order, such as the World Trade Organization. Canada is working to enter a trade agreement with China, as the U.S. remains embattled in a trade war. The move comes even as the updated North American Free Trade Agreement, now the U.S.-Mexico-Canada Agreement, tries to block member nations from engaging with China. Canada maintains the upgraded agreement that is not yet in force or approved, does not bar Canada from talking with China on improving trade relations.
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USGC: USMCA A Gold Standard in Removing Non-tariff Barriers
In testimony to the U.S. International Trade Commission last week, the U.S. Grains Council called the U.S.-Mexico-Canada Agreement a “gold standard” in removing non-tariff barriers for trade and increasing trade volume. The Grains Council says USMCA, the negotiated update to the North American Free Trade Agreement, would remove remaining barriers to grains trade in the region and bolster continued growth in North American markets for commodity grains and value-added grain products like meat and ethanol. The agreement represents top trade markets for U.S. grains. Exports of grains in all forms, including U.S. corn, barley, sorghum, distiller’s dried grains with solubles, ethanol and certain meat products, have increased 279 percent to Mexico and 431 percent to Canada since NAFTA went into effect. USGC says Mexico and Canda offer significant additional potential growth, adding that USMCA, like NAFTA, “will be the foundation of that success.”
