Agriculture Secretary Tom Vilsack is making it increasingly clear that he’s going to make it a priority to challenge the market power of big food processors and ag input suppliers. How far he ultimately goes remains to be seen. But he’s getting plenty of encouragement from both sides of Capitol Hill.
During a Senate hearing Tuesday, Vilsack said his department is working on “creative” ideas to facilitate a meaningful expansion of U.S. meat processing capacity. And in an exchange with Indiana GOP Sen. Mike Braun, Vilsack suggested farmers are being unfairly hurt by the patent protection that their suppliers enjoy.
Keep in mind: USDA announced Friday that it would issue three proposed rules meant to strengthen enforcement of the Packers and Stockyards Act.
Read more about Vilsack’s concerns in this week’s Agri-Pulse newsletter. We also report on the latest trade developments with the EU and look at the farmworker overtime laws that some states are enacting.
Vilsack hopeful on meeting CRP acre goals
Vilsack expressed optimism that the department can meet goals for increasing the Conservation Reserve Program by 4 million acres. “With the changes that we’ve made, with the flexibilities we’ve created, with the expansion of continuous signups, we are hopeful that we get to 4 million acres,” he told Agri-Pulse after Tuesday’s Senate Ag Appropriations Subcommittee hearing.
Landowners have until July 23 to apply for the CRP general signup, which opened in January. Vilsack hopes payment rate increases will spur interest in the program; the National Grain and Feed Association fears those increases will result in idling valuable land.
By the way: Vilsack says it will take some more time before local Farm Service Agency and Natural Resources Conservation Service offices are fully staffed. Lower vaccination rates in rural areas are one factor, he says.
A&M study details inheritance tax impact
Farmers could face hefty capital gains tax bills under President Joe Biden’s tax plan, according to a new Texas A&M University study. Biden has proposed to tax capital gains at death, effectively eliminating the stepped-up basis on inherited assets. The tax liability would be deferred for family farms and other small businesses as long as they stay in operation.
A&M researchers, who track 94 representative farms around the country, say 92 of them would be affected by a legislative version of the Biden proposal called the STEP Act. The average tax liability would be $726,104, the study found.
“The data speaks for itself and should give pause to anyone considering this approach as an option to pay for new additional federal spending. If changes of these magnitude are pursued, as some have discussed, the economic harm it will cause will have a lasting impact on rural America,” said Sen. John Boozman, the top Republican on the Senate Ag Committee.
Keep in mind: Any tax increases are going to be tough for Democrats to get through the House and Senate, and House Ag Committee Chair David Scott warned Biden in a recent letter that his proposal would impose a “significant financial burden” on farms.
US sill gathering evidence on international shipping violations
Federal Maritime Commission Chairman Daniel Maffei believes some international shipping carriers are violating U.S. law amid record port traffic, but he says an official investigation needs to continue to gather solid evidence before his agency can act.
The investigation has been titled Fact Finding 29 and is being led by Commissioner Rebecca Dye. Maffei said it “could lead to a formal enforcement proceeding.”
Meanwhile, U.S. ag exporters continue to pay exorbitant costs to get containers on cargo ships and many cannot get space for their goods at all, he told a House Transportation and Infrastructure subcommittee.
One of the biggest problems for U.S. ag is that Chinese exporters are paying premiums for shippers to unload at U.S. ports and return immediately to China without taking on Asia-bound commodities like beef, pork, tree nuts, fruits and vegetables.
Take note: The U.S. dairy sector is being hit particularly hard, says National Milk Producers Federation President and CEO Jim Mulhern, who stressed that “producers throughout the country are feeling the consequences of port congestion as delays in loading U.S. dairy exports onto carriers creates a chilling effect on farm-gate milk prices.”
Deal to suspend EU tariffs rescues US grapefruit exports
Tariffs were killing Florida’s grapefruit exports to the European Union until the U.S. and EU agreed to pause trade hostilities over aircraft subsidies for four months in March. On Tuesday the U.S. and EU announced a deal that would suspend those tariffs for five years.
“That’s a pretty good market for our fresh grapefruit,” said Florida Citrus Mutual spokesman Andrew Meadows. “We were very much in danger of losing that market before the pause.”
The U.S. exported about 26.4 million pounds of grapefruit to the EU in 2020, according to Florida Citrus Mutual data.
Counting emissions by the calorie.
Bon Appétit, a progressive food service company operating in some colleges, office buildings, and cultural institutions, is pledging to slash its emissions by 38% per calorie by 2030.
Bon Appétit says that by measuring its carbon footprint in calories it’s highlighting food as a significant contributor to climate change. In its climate plan, Bon Appétit set a target of serving less than one ounce of beef and less than 2.5 ounces of all meat, poultry, and seafood per guest at each meal.
The company intends to reach its 2030 goal without buying carbon offsets.
Senators optimistic on infrastructure deal
A bipartisan group of senators has been working to finalize a deal on infrastructure, despite concerns from some progressive Democrats who fear they’ll lose momentum on other issues.
Of interest to the biofuel industry, the senators’ deal would fund some electric vehicle charging stations but wouldn’t fund rebates for buying EVs, Sen. Susan Collins, R-Maine, told PBS. The deal also would index the gas tax to inflation and impose user fees on EV owners.
Sen. Bernie Sanders, I-Vt., ruled out supporting an increase in the gas tax. “Gas taxes are regressive taxes,” he told reporters Tuesday.
He said it. “If you control food, you tend to control people.” – Sen. Jon Tester, D-Mont., on his concerns about the susceptibility of the food system to hackers.
Questions? Tips? Contact Bill Tomson at bill@agri-pulse.com
