June 24, 2022 – The past seven days saw agricultural policy get the spotlight in Washington D.C., and outside of it. Last Thursday, President Biden signed the Ocean Shipping Reform Act in to law. This was a package of measures designed to give US exporters more oversight over the multinational cargo carriers delivering goods around the world. During the pandemic, American consumers were buying so many goods from Asia that cargo ships could make more money racing back across the Pacific loaded with empty containers, rather than waiting for those containers to get loaded with exports at the ports. Those same firms were then charging Detention and Demurrage (D&D) charges to exporters here in the US. The OSRA allows the federal government to set limits on D&D fees and requires shipping firms to report their quarterly inventory of import containers, export containers, and containers shipped empty. Agricultural groups have largely supported this law through Congress, with the IDFA calling the passage “A bipartisan win for American Dairy Exports” and the US Meat Export Federation saying, “This legislation takes important steps forward in improving shipping services available to US exporters.”
The next day, Friday June 17th, the Senate Ag Committee held their second Farm Bill listening session in Jonesboro, Arkansas; home state of the Committee’s ranking member Senator John Boozman. The session followed the same format as the one held several weeks ago in Michigan, with two panels composed of farmers and other stakeholders. Largely, as Jacqui Fatka reported, the farmers highlighted the importance of crop insurance and of updating the safety net to account for sharply higher input costs; while others spoke about the importance of conservation.
As this week kicked with the first Federal recognition of the Juneteenth holiday on Monday, the action was saved until Tuesday when the House Ag Committee held a hearing for the dairy industry’s input on the 2023 Farm Bill. From the producers side, Lolly Lesher testified as a DFA and NMPF member about the importance of the Dairy Margin Coverage insurance particularly with the volatility of the COVID years, and also about the challenges created by modifying the “Class 1 Mover”, the formula for setting the value of fluid milk. The change, coupled with pandemic related spending, saw dairy farmers lose approximately $750 million from the value of their milk checks.
Also on Tuesday, the Biden Administration Solicitor General, effectively the top attorney at the White House, sent a brief to the Supreme Court arguing that California’s Proposition 12 overstepped the bounds of the Commerce Clause. This puts the White House on the same side of the issue as AFBF, NPPC, and most other livestock groups and ag groups. Two weeks ago, Senate Ag Committee Chair Debbie Stabenow (D-MI) and 11 other Democrats asked the White House in a formal letter to support Prop 12, but it seems that California’s claims under the law were too much for Biden to back.
On Wednesday, the Senate Ag Committee met again for a general business session, and in so doing marked up and voted on both the Cattle Market Price Discovery and Transparency Bill, and the Meat and Poultry Special Investigator Bill. Both were voted out of Committee and on to the full Senate, with the Meat and Poultry Special Investigator bill likely having the best chance to actually see passage. The House passed it’s version of the bill last week as HR 7606, and Senator Grassley added an amendment to the Senate Bill to make it conform to the House version, simplifying it’s passage. The CMPDT bill is the piece of legislation that encompasses a whole host of tweaks and broadly accepted changes to the way cattle trade works and is reported, but it also contains a clause that would require packers to make a mandatory minimum number of cattle purchases in every two week window. That clause has caused quite a division in the cattle industry with support broadly coming from the north and opposition coming from the south. The path to a full Senate vote, a House vote, and a Presidential signature might be difficult, however, as the legislative calendar is running out of days.
Despite all of this progress over the past week, the recent decisions from the Supreme Court have very likely changed the political calculus headed in to November, so it remains to be seen how much more action will be devoted to these topics before the election.
- Mike Pearson