U.S. trade negotiators should make every effort to do no harm to U.S. agriculture when modernizing the North American Free Trade Agreement (NAFTA) and should proceed quickly to help allay uncertainty felt by both customers and U.S. grain producers, USGC Chairman Chip Councell testified this week before a panel assembled by the Office of the U.S. Trade Representative. Councell, who farms on the Eastern Shore of Maryland, told members of the panel and public closely following the three-day series of NAFTA hearings that concerns about the stability of the agreement have disrupted relationships with longstanding customers and sparked significant unease in farm country, even though the renegotiation process is just beginning.

Councell said that rising demand for feed and food has created new opportunities for grain and oilseed exports to Canada and Mexico over the past three decades, which have been tariff-free thanks to NAFTA. Proximity and natural logistical advantages have led to efficiencies and integration on both sides of the border and helped dramatically expand U.S. farmers' exports to Mexico, in particular. With these successes in mind, Councell urged panelists to ensure negotiators make every effort to do no harm to existing markets and avoid retaliation against U.S. agriculture. He also outlined improvements the Council would suggest for the agreement, including elements drawn from the Trans-Pacific Partnership text as well as updated sanitary and phytosanitary, biotechnology synchronization and energy provisions.

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Maryland Grain Producers staff member Danielle Bauer joined Kathy Bergen of the National Corn Growers Association in meeting with members of Senator Cardin’s staff on Senate Bill 517, the Consumer and Fuel Retailer Choice Act this week.

In 1990, Congress limited the amount of evaporative emissions from fuels to 9 pounds per square inch (psi) of Reid Vapor Pressure (RVP). Pure ethanol has a 3 psi RVP, but when combined with gasoline at low levels, fuel RVP can exceed 9 psi. As a result, Congress allowed fuel with 10 percent ethanol to have a 1 psi RVP waiver in order to encourage ethanol use as a means to reduce tailpipe emissions. To date, EPA has declined to extend the RVP relief Congress granted to E10 to blends greater than 10 percent. E15 did not exist when Congress and EPA provided the E10 RVP relief, so Congress has never considered how E15 should be treated. S. 517 removes an unnecessary EPA limitation on fuel retailers, providing consumers choice at the pump that saves them money, enhances vehicle performance and improves the environment.

Ethanol markets, corn production and prices, and flex fuel vehicles were all topics discussed at the meeting. Concerns the staff expressed over the bill included misfueling and loss of habitat due to increased row crop production. Danielle also informed the staff on the outreach campaign that Maryland Grain Producers has been doing with the USDA Biofuel Infrastructure Partnership grant.  

On Wednesday, the House Agriculture Appropriations Subcommittee met for the mark-up of the FY2018 Spending Bill. No amendments were offered at the markup, but more debate on the bill is expected if a full Appropriations Committee markup is scheduled in July.  The House Agriculture Appropriations Subcommittee draft bill totals $20 billion in discretionary funding, which is $876 million lower than the fiscal year 2017 enacted level.  The discretionary spending proposed in the bill is about $4 billion above the President’s budget request. 

President Trump’s budget proposed to reduce discretionary spending at USDA and related agencies by $4.8 billion through cuts across a number of programs and eliminations of a number of programs such as Food For Peace and several Rural Development programs.  The House Agriculture Appropriations Subcommittee, while making some program reductions, did not propose the degree of discretionary spending cuts and program eliminations recommended by President Trump in this draft bill.

The Subcommittee draft also does not include any of the mandatory spending changes to farm commodity programs and crop insurance proposed in President Trump’s budget.  The bill does not change Farm Bill funding levels for the MAP and FMD programs, which the President’s budget proposed for elimination.

As President Donald Trump approaches the 200-day mark of his administration, more than a dozen prominent agriculture organizations are urging him to move quickly to fill vacancies within the U.S. Department of Agriculture (USDA). “With a struggling rural economy—which has seen a 55 percent decrease in income over the last three years—we need leaders and decision makers in place to serve farmers, ranchers and consumers,” reads a letter sent to the White House today by groups including the National Corn Growers Association, National Association of Wheat Growers, American Soybean Association, American Farm Bureau Federation, and National Barley Growers Association. The organizations praised the selection of Sonny Perdue to lead USDA, but noted that the agency has more than 100,000 employees and needs a full leadership team.

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