6 years, 5 months ago American Farm Bureau Federation
NAFTA Withdrawal Would Not Lower Deficit With Mexico
President Trump often cited withdrawing from the North American Free Trade Agreement as a way to reduce America’s trade deficit with Mexico. However, a Forbes Dot Com article says that isn’t the way it works. If the U.S. should no longer be involved in NAFTA, all three countries revert to Most Favored Nation trade status under the World Trade Organization. In order to join the WTO, each country had to agree to limit its tariffs to a certain level. The average U.S. tariff on imports from non-FTA countries is 2.8 percent. The World Bank says Mexico’s average tariff is 4.5 percent. If freed from NAFTA, the president could increase tariffs on Mexican imports to help reduce the imbalance. However, WTO rules require the U.S. to also raise tariffs by an equal amount to all of its other partners that don’t have a free trade agreement with America. Most economists say there is no scenario under which withdrawing from NAFTA will be a good thing for America. Should the U.S. follow through on the withdrawal threat, Mexico and Canada would look elsewhere for free trade agreements. Canada has a new free trade agreement with the European Union, while Mexico and the EU are currently negotiating a free trade agreement of their own.
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NPPC Urges Congress to Fund Ag Research
The National Pork Producers Council wants Congress to renew its commitment to funding ag research. That was the message during testimony on Thursday before a subcommittee of the House Space, Science, and Technology Committee. NPPC Chief Veterinarian Dr. Liz Wagner told the Subcommittee on Research and Technology that the U.S. is the most technologically innovative food producer in the world. America also has the safest and most affordable food supply in the world. All of that is because of a commitment to agricultural research. As an example, Wagner said research helped the pork industry deal with the Porcine Reproductive and Respiratory Virus, as well as the H1N1 virus. Wagner says a virus that the pork industry is particularly concerned about is Foot-and-Mouth Disease. The U.S. doesn’t have enough FMD vaccine on hand to deal with a potential outbreak. An unchecked outbreak of FMD would cost the pork, corn, and soybean sectors over $200 billion dollars through the next ten years. Wagner said the federal commitment to research has dropped off in recent decades. Between 1970 and 2008, half of the USDA budget went to research. By 2013, that number had dropped to 30 percent.
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House Committee to Hold Hearing on Glyphosate Allegations
The House Committee on Science, Space, and Technology announced that it may soon hold a hearing on the International Agency for Cancer Research’s 2015 assessment that glyphosate is a carcinogen. The Committee has been looking into the IARC, which receives American taxpayer funding, and it sent a letter to the agency’s director citing concerns over the “scientific integrity” of the group. The letter also sheds light on the allegations of data manipulation in the IARC review of glyphosate. It also questions the involvement of Christopher Portier, a statistician with no previous experience regarding glyphosate, who testified during a high-profile European hearing that he was in favor of banning the herbicide. At the same time Portier chaired the IARC Working Group that proposed the assessment on glyphosate, he was also a private litigation consultant for two law firms, directly benefitting from the classification of glyphosate as a “probable” carcinogen. The House Committee may soon be asking IARC officials to appear before them to give testimony about the methodology they used to come up with their findings.
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DowDuPont Closes Iowa Ethanol Plant
DowDuPont has shut down a 30-million gallon ethanol plant in Nevada (Ne-vay-da), Iowa. The $225 million operation uses corncobs, husks, and stalks to produce the renewable fuel. 90 workers are out of a job as a result of the move. The project has received about $14 million in state grants since 2010, and was granted $3.4 million in tax credits. State officials are looking at what the company may need to repay. The plant closing was part of a DowDuPont announcement that the company will be downsizing its global workforce by 5-7 percent, along with consolidating and shutting down some facilities. DowDuPont finalized its $150 billion merger on August 31. The company is planning to cut $3 billion in costs as it spins off three separate businesses, including agriculture, material sciences, and specialty products. DowDuPont is the parent company of DuPont Pioneer, and says the restructuring will begin next year even though some job losses had already taken place. A skeleton crew will maintain the Iowa ethanol plant in until a buyer is found. The company says the next-generation plant no longer fits into its future plans.
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Natural Disaster Legislation Aims to Aid Farmers and Ranchers
Kansas Senator Jerry Moran and Kansas Representative Roger Marshall introduced legislation today (Friday) to reform and improve livestock disaster programs that ranchers rely on in times of disaster. The new legislation contains four bills that would make changes to the Farm Service Agency’s Livestock Indemnity Program and the Emergency Conservation Program. The Kansas lawmakers introduced the legislation after getting feedback from their state’s farmers and ranchers following wildfires in southeast Kansas, the Anderson Creek fire, and many other recent natural disasters. Moran says the new legislation will provide greater financial assistance and ease the burden on farmers and ranchers who feed the nation, even during the most difficult times. The changes to the LIP and the ECP programs will make certain that FSA resources get to the people who need them in the most timely manner possible. Marshall says they found several areas in each program where they could make adjustments to improve the delivery of the assistance, making it more easily available.
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Grain Traders Getting Squeezed by Oversupply
Over the past few years, farmers have cut their spending due to low commodity prices caused, in part, by a global glut of commodities. A Dow Jones report says it’s now commodity traders’ turn to do the same. Companies that dominate the global grain trade, including Archer Daniels Midland and Bunge, Ltd., are cutting spending by hundreds of millions of dollars and restructuring their operations. Bunge reported a decline in quarterly profit, with the company’s chief executive saying it’s been a “humbling year for grain traders.” Five years of continuous bumper crops all over the globe have kept grain prices low and overturned the traditional dynamics in the farm sector. The largest trading companies that buy and sell farmers’ products are getting squeezed. Farmers are choosing to store a lot of their corn, rather than sell it to grain companies at low prices. Some food companies are placing fewer long-term orders as prices continue to stay low, putting even more pressure on the largest grain trading companies.
