Ethanol Groups File FOIA Suit Seeking Data on Small Refinery Exemptions

Two ethanol trade associations as anticipated are asking a federal court to force EPA and the Energy Department to hand over documents on exemptions granted to the Renewable Fuel Standard (RFS). The Renewable Fuels Association (RFA) and Growth Energy want to know which refineries EPA has exempted from complying with the RFS to then challenge the exemptions in court. The groups filed a lawsuit Thursday in U.S. District Court for the District of Columbia alleging EPA and DOE violated the Freedom of Information Act (FOIA) by not responding to their requests for the information.EPA has previously said the names of refiners that received waivers is exempt from disclosure under FOIA because it is commercially sensitive information. RFA President Bob Dinneen noted in a statement that, as recently as 2016, the EPA proposed a rule to make basic information on the refinery exemption process made public. “So, why is EPA continuing to hide this information from public scrutiny and protect both the previous EPA administrator and highly profitable refiners who probably exploited and abused the exemption provision?" he asked.

Specialty Crop Farm Bill Alliance Urges Congress to Pass Farm Bill

Passage of a five-year farm bill before current legislation lapses in September is critical and will help "enhance the competitive position of specialty crop growers across the country," the Specialty Crop Farm Bill Alliance wrote in a letter to House and Senate ag committee leaders. Among the ag groups represented by the Alliance are the National Potato Council, Western Growers Association, Florida Fruit and Vegetable Association and United Fresh Produce Association.In its letter, the Alliance thanked members of the House and Senate Agriculture Committees work on their respective farm bill versions, saying "these critical legislative endeavors build on the strategic funding and policy direction the Alliance has pursued in previous farm bills." The Alliance said both the House- and Senate-passed farm bill versions "will enhance the competitive position of specialty crop growers across the country." It noted both "include initiatives and programs related to market access and expansion, production research, combatting invasive pest and disease, increasing consumption of fruits, vegetables, and tree nuts, promotional tools and infrastructure investment.

Washington Insider: Trump's Tariff War Channels 1980 Export Embargo Debate

So, the Trump Administration’s trade fight is continuing on many fronts, and is generating increasing discussion at state fairs and farm shows around the country--along with debates concerning the administration’s “farm aid” program that is intended to offset some trade policy impacts.It also is generating comparisons with the 1980 partial embargo of ag exports to Russia and is resurrecting some of the numerous economic studies done in the mid-1980s by land grant universities, USDA’s Economic Research Service and other institutions.Now the results of all this are complicated, as you might expect, but this history does not seem to be turning up much good news for the administration. For example, USDA’s Economic Research Service concluded in 1986 that “the embargos and moratoria had limited impact on the quantity of U.S. exports in the short run.”Looking back at the ag situation in 1980 and after, the Daily Oklahoman said that “for President Carter's action to be successful, two factors were imperative: Cooperation of other exporters particularly Australia, Canada, the European Community and Argentina and the major grain companies were needed. In addition, exporters and farmers would have to be compensated to offset losses.”The Oklahoman continued, “as it turned out, cooperation from other exporters, particularly Argentina, was insufficient. And predictions by the Central Intelligence Agency that disrupting grain supplies would trim Soviet meat consumption didn't occur, either. That was because “the Soviets were able to make up for loss of American imports by buying from the United States' key competitors.In addition, the Oklahoman concluded in 1986 the “shift from U.S. supplies has plagued American farmers ever since."USDA was similarly cautious. While acknowledging the difficulty in assessing long-term impacts, it attributed most of the decline in U.S. exports that followed the 1980 USSR grain embargo to the increase in the value of the U.S. dollar and a slowing of world economic growth—as well as interference from emergency programs that raised “already high loan rates for corn and wheat in the wake of the 1980 embargo, and which provided an umbrella for the rest of the world to expand production,” which it did.The “umbrella” remained in place until the 1985 farm bill substantially reduced loan rates,” USDA said.So, what do the universities think of the current trade policy? They seem to be concentrating on a longer-term view of the impacts this time. For example, a University of Illinois report says that U.S. exports of corn and wheat “have never exceeded early 1980 levels” despite long-term world economic growth, large fluctuations in the value of the U.S. dollar, and the dramatic U.S. farm policy changes in 1985. The report notes that U.S. share of world exports for main U.S. crops has continued to decline; and that “now, after nearly 40 years, it is reasonable to ask whether the long-term impacts of the embargos and moratoria of the 1970s/1980s were more than the USDA thought in the 1980s.”The report hedges this conclusion a bit by noting that exports can be “shuffled” among world buyers, and as long as China continues to buy farm commodities, the main impact on the quantity of exports in the short run may once again, be a “rearrangement” of their destination.But it suggests that “more troubling is the potential long-term impact.” And, even though the U.S. “is not using food as a weapon” in the current trade war but food availability and price are politically sensitive topics in all countries,” and that it is not unreasonable to think that U.S. trade actions could impact the thinking of importers for a long time when it comes to sourcing food—and, it may make U.S. products less competitive, as well.The study concludes that it “should be sobering to the U.S. that the quantity of U.S. corn and wheat exports have never really exceeded the levels of the early 1980s, a time span now approaching 40 years and that “it is the long-term consequences of current U.S. trade policy for U.S. ag exports that bear watching and will likely be the most important ag trade storyline coming out of the current trade war.”That’s far short of the short and intermediate term disaster some are predicting—one Canadian ag opinion writer called the impacts of administration policy the “equivalent of nuclear winter for ag trade.” Still, it is ammunition for critics of the “get tough” tariff policy now being used, and for the farm aid program the administration is proposing.So, this is a policy and political fight that is still under way, and should continue to be watched closely by producers—and that, based on evidence from the 1980 experience, could mean both fundamental an long term impacts for U.S agriculture, Washington Insider believes. 

Administration on E15: “Let’s Get it Done”

Year-round E15 sales are nearing reality. Agriculture Secretary Sonny Perdue told reports in Boone, Iowa at the Farm Progress Show that he has spoken with the President, who wants to make an announcement next week. Perdue told the Iowa City Gazette he received a phone call from the White House while attending the outdoor farm show. Trump told Perdue "let's get it done," ordering him to meet with Environmental Protection Agency acting administrator Andrew Wheeler. Following the call, Perdue told reporters he expects to have an announcement "sooner rather than later." Perdue says the action needs to clear some legal and regulatory hurdles, but added Trump gives executive orders, not suggestions, saying "so we're going to get it done." The question remains though, at what cost would E15 sales come under the give-and-take operating nature of the Trump administration, more so with the controversial actions around the Renewable Fuel Standard.

Farm Bill Differences Remain

Lawmakers met this week on the farm bill, making "good progress." However, major differences remain between the House and Senate bills that the conference committee will address next week. Congress returns next week with 16 days in-session scheduled for the Senate in September, and 11 in-session days in the House of Representatives. That means differences in the farm bill must be ironed out quickly to pass the bill before the current one expires at the end of September. Agriculture Chairman Pat Roberts told Bloomberg "some real progress was made," including on the nutrition title. However, Debbie Stabenow, the top Democrat on the panel, indicates there is much work left to do. Stabenow says “there are big differences between the House and Senate farm bills, not just nutrition,” citing specifically the commodity and conservation provisions. The House version of the bill includes work requirements for recipients of the Supplemental Nutrition Assistance Program, and Freedom Caucus members in the House, the same lobby the voted down the farm bill earlier this year, say: “We want what we have in the House farm bill.”

Texas Rep. Says Farm Bill Must Meet Objectives

A U.S. Representative from West-Texas says the farm bill must ensure a strong, viable ag sector. Republican Jodey Arrington, a member of the farm bill conference committee, penned an editorial this week. The congressman says the mission of the committee is clear: “to establish policies that support a vibrant agriculture economy, strengthen rural communities, maintain food security in America and tighten up work requirements for food stamp recipients.” The Supplemental Nutrition Assistance Program includes the most controversial changes in the bill, but is largely only supported by House Republicans. Arrington said in his editorial he believes “it would be a travesty” to not make reforms to SNAP, pointing out that SNAP accounts for more than 80 percent of the farm bill’s funding and costs taxpayers more than $70 billion a year. Arrington is one of two West-Texas voices on the conference committee, joining House Agriculture Committee Chairman Mike Conaway.

Beef and Pork Export Values Expected to Soften in 2019

The tit-for-tat trade war with China means a lower forecast for the value of U.S. beef and pork exports next year. The Department of Agriculture’s Economic Research Service said in its latest quarterly Situation and Outlook Report released this week that forecasts total exports of beef, pork, dairy, poultry and other livestock products combined are expected to decline $300 million to $30.3 billion next year, compared with 2018. Beef is projected down $100 million as growth in volume is offset by lower values, and Pork is forecast down $300 million despite volume growth. USDA says the lower values are expected due to weaker demand and the pressures from retaliatory tariffs. However, poultry exports are expected to be slightly higher next year. Exports of poultry and poultry products are forecast $100 million higher to $5.3 billion, due to elevated prices and volumes for most products.

Environmental Groups Urge EPA to Revoke Dicamba Approval

Environmental groups are using the courts to argue against renewing approval of dicamba. The groups are arguing that the Environmental Protection Agency failed to analyze the risks of now Bayer’s dicamba-based weed killer posed to nearby crops before approving it in 2016, according to Reuters. Monsanto, a unit of Bayer, urged the court to dismiss the lawsuit. Bayer expects the EPA to announce its decision on the renewal of dicamba registration by October. The expectation is that the EPA will approve the registration for dicamba. The environmental groups want the courts to force the EPA to vacate its approval of XtendiMax, a Monsanto dicamba-based product, arguing it not only harms nearby crops and plants but wildlife as well. The lawsuit was filed in February.

Companies Targeted by Senator Sanders Fire Back

Companies targeted by Senator Bernie Sanders are firing back, calling his statements inaccurate in his accusations over food stamps. Sanders plans to introduce legislation that would require large companies, specifically, Amazon, Walmart, and others, to pay a 100 percent tax on government benefits to their employees, including the Supplemental Nutrition Assistance Program, a significant portion of the farm bill. Amazon countered this week saying Senator Sanders “continues to spread misleading statements about pay and benefits.” Amazon says Senator Sanders’ references to SNAP are also misleading because they include people who only worked for Amazon for a short period of time and/or chose to work part-time, both of which would almost certainly qualify for SNAP. Sanders says Amazon's median U.S. salary is $28,446, but Amazon counters that excluding part-time and global salaries, the U.S. median salary is $34,123. 

Hoofin’ it for Hunger Race held in October in Miles City

Get out those running shoes and start preparing for the annual Montana Farm Bureau Young Farmers and Ranchers (YF&R) Hoofin’ it for Hunger trail run Saturday, Oct. 6 in Miles City. Sign up for the half-marathon, 10K or 5K. The course takes you through the beautiful farming and ranching grounds at Fort Keogh and there is also a one-mile walk. The race is hosted by the Montana Farm Bureau Young Farmers and Ranchers Committee and the employees of  the USDA/ARS Fort Keogh.If even a walk sounds like it’s too much—or you just can’t get over to Miles City—sign up to be a virtual runner. As a virtual runner you’ll still “get the t-shirt” while supporting the event and raising money for the Montana Food Bank Network.This will be the eighth year for Hoofin’ It for Hunger, which was launched during the Montana Farm Bureau Convention in Missoula in 2011 as part of the national Young Farmers and Ranchers work with the Harvest for All program. To date, the YF&R Committee has donated enough money raised from the race to provide 132,000 meals to hungry people across the state.If you get to town early, don’t miss the free dinner Fri­day evening for all race participants at the Range Riders Museum.  Onsite registration will also be available, as well as race packet pick up.Registration fees are $50 (half-marathon), $40 (10K) and $30 (5K and virtual). Race start time varies from 8:30 a.m. to 10:30 a.m., depending on the category. The awards ceremony will take place at Fort Keogh following the conclusion of the races. In addition, during the awards ceremony, the recipients of the Triple Crown and Trifecta in the Miles City Triple Crown race series will be recognized.Register at https://runsignup.com/Race/MT/MilesCity/HoofinItForHunger. Be sure to check out the Hoofin’ it for Hunger page on Facebook. Questions? Contact Sue Ann Streufert, 406-587-3153, sueanns@mfbf.org. 

U.S., Canadian official are at a critical stage in talks toward deal to replace NAFTA

U.S. and Canadian official are at a critical stage in talks toward a trade deal to replace the 24-year-old North American Free Trade Agreement, with a resolution expected as early as today, according to several media reports.Canadian Foreign Minister Chrystia Freeland has been in Washington since Tuesday for negotiating sessions with U.S. Trade Representative Robert Lighthizer. Freeland is seeking a three-country deal by Friday, while President Donald Trump has said he could proceed with Mexico alone, the National Chicken Council said in a summary on its website.Mexico and the United States announced a bilateral deal on Monday following a year of talks. NAFTA, including Canada, accounts for over $1 trillion in annual trade between the three countries.On Thursday, Freeland told reporters: "We continue to be encouraged by the constructive atmosphere that I think both countries are bringing to the table," ABC News reported. A deal by Friday would provide a 90-day window for Mexican President Enrique Pena Nieto to sign the pact before leaving office Dec. 1, the report said.Both President Donald Trump and Canadian Prime Minister Justin Trudeau on Wednesday made their most optimistic comments yet on the year-old negotiations, the Toronto Starreported. Both Trump, at the White House, and Trudeau, in Ontario, told reporters that they were aiming for a Friday deadline to work out an agreement. According to the Star, the deal could involve Canada giving the U.S. more access to its tightly protected dairy market while the U.S. would agree to the keep the Chapter 19 system for resolving certain tariff disputes. 

Perdue Comments on Payment Rate For Corn Producers In Trump Tariff Aid Package

USDA Secretary Sonny Perdue responded to criticism from a top corn producers group of his agency's trade aid plan for farmers, insisting the level of assistance corresponded with calculations of economic damage caused by new tariffs.National Corn Growers Association (NCGA) President Kevin Skunes, told USDA Sec. Sonny Perdue on Wednesday he is disappointed corn growers stand to receive a penny per bushel for losses incurred in the summer's trade disputes. Skunes said the federal government's $12 billion aid package fails to calculate losses corn growers have suffered from tariffs — especially on ethanol and dried distillers’ grains, a high-protein ethanol byproduct fed to livestock."Prices have declined about 44 cents a bushel — or $6.3 billion," Skunes said referencing an industry study. "We don't feel it's fair and equitable."Perdue responded that the calculations are based on "actual tariff disruption damage to the crop,” adding, "The numbers are the numbers. …These are the calculations you have to defend in court," considering the possibility of a World Trade Organization (WTO) challenge, Perdue said. "The damages they've had from tariff retribution has been minimal."

Trump Pushes to Find Win-Win On RFS Changes, Including Year-Round E15

USDA Secretary Sonny Perdue was upbeat when asked about prospects for year-round E15 ethanol sales at the Farm Progress Show. “The president called me this morning and said …we need to get this RFS straightened out and get E15 twelve months,” said Perdue. “He wants something done quickly. We’ve just got to balance it out and talk with our corn constituency, our corn growers, and the ethanol community, about what is the balance with the refineries ... He needs to have something he can demonstrate to them as well.”Six White House-instructed meetings in the past have failed to find a win-win announcement that would please an ethanol industry that has said it feels no reason to compromise, with a crude oil industry wanting some things that ethanol supporters deem would be negative to biofuels.Perdue noted some legal issues and regulatory “hiccups” remain in implementing year-round E15 sales but said of President Trump: “This is what he wants to do, and he doesn’t give executive suggestions, he gives executive orders, so we’re going to get it done.”

Washington Insider: Canadian Unity on NAFTA Shows Cracks

Bloomberg suggests this week that the administration’s strategy of working deals with first, Mexico and then Canada may be working. Until now, pretty much all of Canada had Justin Trudeau’s back in his NAFTA fight with President Trump -- but cracks are emerging as some pivot to blame him if the pact falls apart, Bloomberg says.Specifically, the U.S. is using a deal it announced with Mexico on Monday to pressure Canada into signing on and that is exposing rifts within the Canadian Conservative Party, Trudeau’s main opposition, which had mostly refrained from criticizing the prime minister on this issue. Prominent former Conservative lawmakers stuck to supporting the government in talks, but Conservative Leader Andrew Scheer now is blaming Trudeau.Bloomberg says this development creates a problem for the prime minister, who was elected in 2015 in spite of Conservative attacks that he was “just not ready” to govern—so that now, any indication he allowed NAFTA to collapse could sour public opinion. So too could horse-trading if, for instance, he makes concessions on a dairy regime that’s more popular in some parts of the country than others.“Canadians generally supported the approach when it looked like Canada and the United States were the ones working things out,” pollster Nik Nanos of Nanos Research said. “The narrative now for some Canadians is ‘have we become a passenger in the NAFTA negotiation process’ -- because that’s clearly the signal Donald Trump sent.”Scheer launched a political attack--if only by Canadian standards--this week. “Once again Justin Trudeau has failed Canadian workers,” Scheer tweeted amid reports of a U.S.-Mexico deal. “With the U.S. and Mexico coming to a trade agreement without Canada, Canadians are now on the outside with 1000s of jobs on the line.”While hardly fire and fury, it raised eyebrows as a break in the political solidarity to date. Other prominent Conservatives have avoided doing so. James Moore, a former industry minister and Rona Ambrose, former Conservative leader--who both served on a multi-partisan government NAFTA advisory council--each said this week that now was the window to haggle to reach a deal.“We clearly have some momentum. We have a window here for a modernized NAFTA that will have some broad support from business and the general public,” Moore, now a senior adviser at Dentons, told Bloomberg Monday. “The alternative is economic chaos.”John Baird, foreign minister under Stephen Harper, said there was no reason for Canada to be at the table for the recent U.S.-Mexico talks focused on auto rules. “Trump is now going to play hardball with Canada. However, our competent and highly experienced team of trade negotiators knew this all along. Trade negotiations are always toughest just before a deal is reached,” he tweeted.Politically, what’s been apparent in Canada is a “really united front,” said Shachi Kurl, executive director of the Angus Reid Institute, a polling firm. “Much of this will hinge on what people see in front of them,” such as changes to the dairy system, known as supply management. “I suspect we’re going to find deep divisions in the country on this issue.”Maxime Bernier, an outspoken Conservative lawmaker, quit the party this month partly to protest its support for supply management. That may force Scheer, who only barely beat Bernier for the party leadership, to soften his support for the dairy regime, she said.Trump’s press conference Monday drew sharp rebukes from some observers in Canada. “I thought it was a disgraceful display of bad faith on the part of the Trump administration and the president in particular,” trade lawyer Lawrence Herman said in a telephone interview. The relationship has descended to an all-time low.” Canada can’t agree to accept a deal that’s forced on it as a take-it-or-leave-it offer, he said.The political fallout will hinge, of course, on the outcome.“This file changes day by day and tweet by tweet. Today, the narrative is the Liberals have to watch out that it doesn’t look like they’re going to get steamrolled by the Americans on NAFTA,” Nanos said. But a deal “would be a significant accomplishment and political win.”So, we will see. The supply managed commodity systems have been a sore point with the United States and other for decades, and are thought to still have strong, if regional support. If it turns out that Bloomberg is right about growing internal concerns in Canada about those sectors, it could be beneficial to both Canadian consumers and U.S. dairy producers. This is a tough debate for Canada that U.S. producers should watch closely as it intensifies, Washington Insider believes. 

Top Ag Lawmakers Meet Ahead of Farm Bill Conference

The top lawmakers on the farm bill conference committee met this week, ahead of the first formal meeting next week. The farm bill conference is set to meet September 5th, in the first public meeting likely dominated by posturing and speeches. Senate Agriculture Committee Chairman Pat Roberts told Politico that he, Senate Agriculture ranking member Debbie Stabenow, House Agriculture Committee Chairman Michael Conaway ranking member Collin Peterson, had made “real progress” during the meeting, but did not get into specifics. Roberts is hopeful to submit a conference report to the committee, if ready at the time. Much of the work on the farm bill is ongoing at the staff level, and that’s expected to continue. The committee faces the task of merging the two versions of the bills, including the controversial Supplemental Nutrition Assistance Program work requirements.

BSE Confirmation in Florida Considered Atypical, Not Worrisome

The Department of Agriculture says a Florida case of Bovine Spongiform Encephalopathy (in-sef-o-lop-athy)  has no impact on the BSE free status of the nation. USDA says the BSE case is considered atypical, not classical, the much more worrisome form of BSE. The disease was discovered on a six-year-old mixed-breed beef cow in Florida and was tested by a lab at Colorado State University as part of routine surveillance of cattle that are deemed unsuitable for slaughter. BSE is not contagious and exists in two types - classical and atypical. Classical BSE is the form that has been linked to disease in people. Atypical BSE is different, and it generally occurs in older cattle, usually eight years of age or greater. It seems to arise rarely and spontaneously in all cattle populations, according to USDA. This is the nation’s 6th detection of BSE. Of the five previous U.S. cases, the first, in 2003, was a case of classical BSE in a cow imported from Canada. The rest have been atypical.

Canada Ready to Make Concession on Dairy Trade

Despite posturing by Canadian Prime Minister Justin Trudeau (true-doh) that Canada ‘won’t back down’ on dairy issues, Canada is ready to make concessions. Canadian Foreign Minister Chrystia Freeland rejoined the discussion in Washington this week. The Globe and Mail reports Canada is ready to make concessions to the Trump administration on Canada's protected dairy market in a bid to save a key NAFTA dispute-settlement system, preserve safeguards for cultural industries and avert tougher pharmaceutical patent protections. Canada's dairy, egg and poultry sectors operate under supply management that protects Canadian producers from foreign competition by charging tariffs up to 275 percent on imports. Trudeau said this week Canada will “defend supply management.” However, sources close the negotiation say Canada’s plan is not to dismantle the supply management system entirely, but that negotiators will agree to change one rule that blocks U.S. farmers from exporting ultrafiltered milk to Canada, and also offer the United States a percentage of the Canadian dairy market.

R-CALF Looking for COOL in NAFTA

R-CALF is hopeful the details of the U.S.-Mexico announcement as part of the North American Free Trade Agreement negotiations will include country-of-origin meat labeling. R-CALF, a long-time supporter of COOL, in a statement by its CEO said: “We hope that a further release of details will show that COOL will be required for Mexican beef and beef from Mexican cattle.” The organization says trade agreements, like NAFTA, allow unlimited numbers of tariff-free cattle from countries like Mexico, where cattle are overproduced at a significantly lower cost, and displace opportunities for current and aspiring U.S. cattle producers to expand or start their herd. R-CALF continues to argue that because beef from these imported cattle can be sold as a “Product of USA,” multinational beef packers “wallow in higher profits” because they can import lower-cost cattle into the U.S. market. The organization claims that Since NAFTA, the U.S. imports on average 1.1 million Mexican cattle each year, and since U.S. domestic cattle shrank by 6.5 million.

Environmental Groups Seek Clean Water Language in Farm Bill

Environmental groups want clean water regulations in the farm bill. A coalition of environmental groups penned a letter to the farm bill conference committee with suggestions the coalition claims will "help address the challenges facing the nation’s drinking water supplies.” In a news release on the topic, the Environmental Working Group claims that America’s drinking water is under threat from polluted farm runoff, noting that About 1,700 public water systems across the country are contaminated with levels of nitrate that exceed what the National Cancer Institute says increases the risk of cancers. Much of the provisions in the letter pertain to the Department of Agriculture’s Environmental Quality Incentives Program. The letter seeks several reforms under the conservation title of the farm bill, including a proposal that reserves 40 percent of the acres enrolled through the continuous CRP sign-up for practices that will protect water quality in watersheds where lakes, rivers and streams are impacted by sediment and nutrients or by harmful algae blooms.

Vegetarian Food Company Sues Missouri over New Law

A vegetarian food company is challenging a new law in Missouri regarding meat labeling. The law, taking effect next week, prohibits food manufacturers from using the word “meat” on products made without animal flesh, and will make Missouri the first state to regulate meat labeling. However, Tofurky, the manufacturer of vegetarian products labeled as hot dogs, burgers and others, is challenging the law in court. The Oregon-based company contends that the provision barring food producers from “misrepresenting” their products as meat – as in calling them sausage and hot dogs – if they are not made from livestock or poultry is too vague, according to meat industry publication Meatingplace. Missouri lawmakers passed the law earlier this year, and it was signed by now-former governor Eric Greitens. Missouri Attorney General Josh Hawley is expected to defend the law in the wake of the Tofurky lawsuit. 

California Federal District Court Rules Organic Animal Welfare Regulations Lawsuit Can Proceed

A federal district court in northern California has ruled that a lawsuit challenging USDA’s withdrawal of organic animal welfare regulations can proceed.The Center for Food Safety is suing USDA after the agency withdrew the Organic Livestock and Poultry Practices final rule that would have increased federal regulation of animal housing, healthcare, transportation and slaughter practices for certified organic producers and handlers. Existing organic livestock and poultry regulations remain in place."We are very gratified that the court agrees we can challenge the unlawful withdrawal of these hard-won animal care protections in organic production," George Kimbrell, legal director for the Center for Food Safety, said in a press release.The regulation was finalized by the Obama administration in early 2017. USDA, under President Donald Trump, withdrew the final rule after the agency said it identified policy and legal issues. In April, the Government Accountability Office determined that USDA had complied with rulemaking procedures in its decision.The rule established minimum spacing requirements for animals on organic farms and specified the quality of outdoor space that must be provided.The California district court held that the withdrawal of the rule injures the organization's members because it undermines the organic label for consumers. 

USDA Takes Issue With Consumer Reports Article Suggesting Banned Drugs In US Meat Supply

In a strongly worded official statement released this morning, USDA FSIS Acting Deputy Under Secretary Carmen Rottenberg took issue with the conclusions of a newly published Consumer Reports (CR) article that suggests that banned or restricted drugs may appear in the U.S. meat supply more often than was previously known."You may have seen a Consumer Reports story claiming that the poultry and meat you purchase in the grocery store and feed your families could contain harmful drug residues," Rottenberg wrote in the FSIS statement. "That is not true. This story is sensational and fear-based infotainment aimed at confusing shoppers with pseudoscience and scare tactics."The article, "Are Banned Drugs in Your Meat?", asserts that data obtained from the agency via a Freedom of Information Act (FOIA) request show that trace amounts of prohibited drugs — including ketamine, phenylbutazone and chloramphenicol — were found in meat and poultry samples taken between October 2015 and September 2016. Based on analysis by CR's food safety scientists, the report calls into question FSIS drug residue testing methods and acceptable level cutoffs and accuses the agency of "failing to ensure that meat is free of potentially unsafe drug residue."  In her response, Rottenberg stated that the FOIA data on which the CR report is based are misleading. "On March 3, 2017, in our haste to be transparent and responsive, we mistakenly released in response to a FOIA request, unconfirmed, preliminary test results for samples taken from poultry," she wrote. "We corrected our mistake with the requestor. However, the unconfirmed sampling results continue to be passed around as accurate, truthful information – they are not."FSIS performed the complete screening and testing process on all the samples represented, wrote Rottenberg. "The final, confirmed and validated test results show that there were no drug residues in the chicken. If violative drug residues are found in any meat or poultry product, FSIS does not allow that product to be sold for human food."Consumer Reports admits in their closing paragraph that the real agenda behind this piece is to convince Americans to eat less meat," she added. "Shame on Consumer Reports for attempting to advance a rhetoric that lacks scientific support or data, at the expense of American producers and the 9,000 food safety professionals who ensure the safety of meat and poultry in this country every day."The National Cattlemen's Beef Association (NCBA) issued a statement calling the Consumer Reports article "sensationalist journalism.""Knowingly printing inaccurate and misleading articles, which rely on information that is known to be false, misleads consumers about the competency of the current food safety programs in place at USDA. Those programs have long been the global gold standard for food safety and today they continue to provide overlapping safeguards to ensure consumers are receiving wholesome and safe products," NCBA said. 

U.S. and Canada met to continue negotiations around NAFTA

The U.S. and Canada met to continue negotiations around the North American Free Trade Agreement (NAFTA) and it appears Canada is ready to give concessions on access to its dairy market.According to Jim Wiesemeyer, Pro Farmer Washington policy analyst, Canada may agree to change one rule that blocked U.S. producers from exporting ultrafiltered milk to Canada, and also offer U.S. a percentage of its dairy market.The Trump administration says it will give Canadian negotiators until Friday to work out a deal, including issues around dairy trade, but it may be September before a final deal is reached between the U.S. and Canada.It appears that the U.S./Mexico Trade Agreement signed earlier this weekwas a spark to get negotiations moving.“Canadian officials are surprised and perplexed over Mexico’s recent ‘gives’ in reaching a preliminary bilateral trade deal with the Trump trade team,” Wiesemeyer says. Much of the motivation for Canada to move on a trade deal with the U.S. centers on automobiles. President Trump has threatened to impose 25% auto tariffs on Canada if negotiators are unwilling to compromise on sensitive issues, Wiesemeyer says.An agreement between the U.S. and Mexico was signed earlier this week. Without Canada as part of the agreement, Wiesemeyer says the chances of the deal being approved by Congress would diminish. With Canada potentially on board, he says there are “better odds” of Congressional approval. “Ideally we’ll have Canada involved,” says Robert Lighthizer, U.S. Trade Representative. “If we don’t have Canada involved, we will notify [Congress] that we have a bilateral agreement that Canada is welcome to join.” Mexico, which for months has said that a new NAFTA must include Canada, has changed its tune, Wiesemeyer says.  Mexican Foreign Minister Luis Videgaray said that there will be a trade agreement between the U.S. and Mexico “regardless of what happens with Canada.”The administration is trying to get this and other trade deals through Congress before the November election. There is a sense that Democrats will gain more seats, if not the full majority at least in the House, and Democrats have historically have been less willing to accept free trade agreements. 

Atypical case of BSE was detected in a six year-old Florida beef cow

An atypical case of BSE was detected in a six year-old Florida beef cow, but never entered the slaughter channels and poses no threat to the U.S. food supply. ( Wyatt Bechtel )The U.S. Department of Agriculture confirmed the discovery of an atypical case of bovine spongiform encephalopathy (BSE) in a six year-old mixed-breed beef cow in Florida. USDA says the animal never entered the slaughter channels and never presented a risk to the food supply, or to human health in the United States.The Florida Department of Agriculture and Consumer Services said it is working closely with USDA on the case.“This detection shows just how well our surveillance system works. We’re grateful to our partners at the U.S. Department of Agriculture who work alongside us day in and day out to conduct routine surveillance and protect consumers,” stated Florida Commissioner of Agriculture Adam H. Putnam.Atypical BSE is different than classical BSE, and it generally occurs in older cattle and seems to arise rarely and spontaneously in all cattle populations.“The atypical form of BSE identified in this case is very different from classical BSE and is believed to occur spontaneously. These cases occur very rarely in cattle populations and are not the result of contaminated feedstuffs,” said National Cattlemen’s Beef Association (NCBA) chief veterinarian Kathy Simmons.The news of the BSE discovery had little – if any – impact on cattle markets Wednesday. CME August cattle futures were up slightly mid-morning, with deferred contracts modestly lower. CME August feeder cattle also traded higher, with deferred contracts down slightly.The Florida case is the sixth confirmed BSE detection in the United States.Of the five previous U.S. cases, the first, in 2003, was a case of classical BSE in a cow imported from Canada; the rest have been atypical (H- or L-type) BSE.USDA Animal and Plant Health Inspection Service’s (APHIS) National Veterinary Services Laboratories (NVSL) confirmed that the Florida cow was positive for atypical H-type BSE. The animal was initially tested at the Colorado State University (CSU) Veterinary Diagnostic Laboratory (a National Animal Health Laboratory Network laboratory) as part of routine surveillance of cattle that are deemed unsuitable for slaughter. BSE is not contagious and exists in two types - classical and atypical.  Classical BSE is the form that occurred primarily in the United Kingdom, beginning in the late 1980’s, and it has been linked to variant Creutzfeldt-Jakob disease (vCJD) in people. The primary source of infection for classical BSE is feed contaminated with the infectious prion agent, such as meat-and-bone meal containing protein derived from rendered infected cattle.  Regulations from the Food and Drug Administration (FDA) have prohibited the inclusion of mammalian protein in feed for cattle and other ruminants since 1997 and have also prohibited high risk tissue materials in all animal feed since 2009.Atypical BSE is different, and it generally occurs in older cattle, usually 8 years of age or greater. It seems to arise rarely and spontaneously in all cattle populations.The World Organization for Animal Health (OIE) recognizes the U.S. as negligible risk for BSE. As noted in the OIE guidelines for determining this status, atypical BSE cases do not impact official BSE risk status recognition as this form of the disease is believed to occur spontaneously in all cattle populations at a very low rate. Therefore, this finding of an atypical case will not change the negligible risk status of the United States, and should not lead to any trade issues.“Consumers can rest assured that the U.S. continues to be the global leader in the production of safe and wholesome high-quality beef,” Simmons said.The United States has a longstanding system of interlocking safeguards against BSE that protects public and animal health in the United States, the most important of which is the removal of specified risk materials - or the parts of an animal that would contain BSE should an animal have the disease - from all animals presented for slaughter. The second safeguard is a strong feed ban that protects cattle from the disease. Another important component of our system - which led to this detection - is our ongoing BSE surveillance program that allows USDA to detect the disease if it exists at very low levels in the U.S. cattle population.More information about this disease is available in the BSE fact sheet. 

Commodity farmers can expect to collect a combined $4.7 billion in trade aid payments from USDA

OMAHA (DTN) -- Commodity farmers can expect to collect a combined $4.7 billion in trade aid payments from USDA with soybean farmers receiving the bulk of those funds as USDA works to spread money around based on retaliatory trade tariffs against U.S. farm commodities.USDA leaders announced more details of the trade aid package on Monday. Sign-up starts Sept. 4, but farmers will need to show actual production for fall-harvested crops such as soybeans, corn, sorghum and cotton before they can sign up for the aid checks.The heart of the aid program, the "Market Facilitation Payments," will total $4.7 billion and are based on 50% of a farmer's production this year for the commodity. That 50% figure is multiplied by the payment rates below:-- Soybeans: $1.65 a bushel; total payments expected, $3.7 billion;-- Sorghum: 86 cents a bushel; total payments expected, $156 million;-- Wheat: 14 cents a bushel; total payments expected, $119 million;-- Corn: 1 cent a bushel; total payments expected, $96 million;-- Cotton: 6 cents a pound; total payments expected, $277 million.To pencil out a payment, for example, a farmer with 1,000 acres of soybeans that yield 50 bushels per acre this fall would calculate 25,000 bushels x $1.65 for a payment, resulting in a payment of $41,250 on those soybean acres.Pork farmers also will be paid $8 a head for 50% of the pigs they owned on Aug. 1. Pork producers combined are expected to receive $290 million.Dairy farmers will receive a payment based on the Margin Protection Program historical production figure, multiplied by 12 cents per hundredweight to calculate a payment. For dairy farmers who are not in the MPP and don't have that number, USDA has alternative ways to come up with a calculation, said Bill Northey, USDA's undersecretary for farm production and conservation.To be eligible, a farmer must have an adjusted gross income under $900,000 and be in conservation compliance. The aid payments will have a cap of $125,000 per person, but that payment cap will also be separate from any payments a farmer might receive this year from the Agricultural Revenue Coverage (ARC) or Price Loss Coverage (PLC) programs.Northey reiterated it is important for farmers to have the information on this year's crop production before going into the local FSA office. "But this should be, potentially, one visit for producers with that production evidence, signing the form," Northey said. He later added, "Producers obviously need to have their production evidence certified."The aid is based on this year's production. It will not be adjusted for those who suffered low yields due to factors such as drought.Payments could go out within weeks for farmers once their crops are harvested and they sign up for the aid.Some groups were not happy with the payment amounts, arguing they do not begin to equate to the damages.The National Milk Producers Federation President and CEO Jim Mulhern said the aid package of roughly $127 million in payments to dairy farmers "represents less than 10% of American dairy farmers' losses caused by the retaliatory tariffs imposed by both Mexico and China."The National Corn Growers Association put the onus of the trade aid back on the White House's own tariff actions, stating USDA's package "would be insufficient to even begin to address the serious damage done to the corn market because of the administration's actions." NCGA also indicated the trade disputes had lowered corn prices by 44 cents a bushel, which equates to about $6.3 billion in lost value to the corn crop."National Corn Growers Association President Kevin Skunes, a North Dakota farmer, said, "NCGA has understood from the beginning that this aid package would neither make farmers whole nor offset long-term erosion of export markets. But, even with lowered expectations, it is disappointing that this plan does not consider the extent of the damage done to corn farmers."In announcing the details, Agriculture Secretary Sonny Perdue first praised President Donald Trump for getting a trade deal done with Mexico and looking forward to completing trade work with Canada."I would take a look at this announcement with Mexico today and say 'This is how you do it,'" Perdue said. "This validates the president's approach to bringing other nations to the negotiating table."However, Perdue said the farm payments were necessary because other countries have been "recalcitrant and intransigent" in agricultural trade barriers, especially by placing what Perdue and other USDA officials called "illegal retaliatory tariffs" against the U.S. because of the Section 232 and Section 301 tariffs the U.S. has imposed because of steel, aluminum or national security purposes."For months now, President Trump has been standing up to China and other nations, sending the clear message that the United States will no longer tolerate their unfair trade practices," Perdue said. "Those practices include non-tariff trade barriers to American trade products and the forced transfer or outright theft of or intellectual property."Payments could be "bifurcated" depending on what else happens on the trade front this fall, USDA said.The second piece of the program, the Food Purchase and Distribution Program, will have USDA buy up to $1.24 billion in commodities, which includes some major buys such as $558.8 million for pork purchases, up to $84.9 million for dairy and $93.4 million in apples, for example.Still, there will be a broad array of specialty crops, such as nuts and fruits, that will be bought then distributed to local feeding programs. The purchases will be made over four different phases in the coming months."Many of the commodities we will be purchasing are different from the regulated commodities we purchase through a program many people are more familiar with, our Section 32 purchases," said Greg Ibach, the undersecretary for marketing and regulatory affairs at USDA. "That means we are working to attract new vendors and have them qualify to make new purchases."Another $200 million will be added to Foreign Market Development for both trade programs with existing trade partners and opening up new foreign markets. This program will operate more as a cost-share effort -- similar to current programs already in place -- with commodity checkoff organizations and companies submitting proposals to tout agricultural goods overseas.

Canada's Freeland Hails Mexico NAFTA Concessions

Concessions made by Mexico in the negotiations to update NAFTA with the U.S. were labeled as "major" by Canadian Foreign Minister Chrystia Freeland as she came out of a session with US Trade Representative Robert Lighthizer in Washington."The fact that Mexico was able to do something that I think must have been quite difficult for Mexico and make those concessions does really set the stage for some productive conversations here this week," Freeland remarked.The deal cut by the U.S. and Mexico on auto rules of content and a requirement that auto parts be made by workers earning at least $16 per hour were called "significant" by Freeland."These concessions really are going to be valuable for workers in Canada and in the United States who have been concerned for some time about their jobs going to lower-wage jurisdictions."Freeland was to meet with Mexican Economy Secretary Ildefonso Guajardo later Tuesday and return for another session with Lighthizer Wednesday, but did not say whether that session would include Guajardo. 

Canadian Business Council Says NAFTA Agreement Possible this Week

Business groups in Canada say it is possible that Canada could agree to a framework deal on the North American Free Trade Agreement this week, in line with a Trump administration goal. Talks are underway between the U.S. and Canada in hopes an updated handshake agreement can be reached, after the U.S. announced an agreement with Mexico. The CEO of Canadian American Business Council told CNBC Tuesday “I think we can get there this week,” saying there’s just a handful of issues left. Although, the talks are expected to be “harsh” and intensive.” The U.S. remains hopeful Canada can get on board quickly, but is ready to go ahead with just Mexico, for now, to avoid political pressures later. President Trump spoke with Canadian Prime Minister Justin Trudeau Monday, and Canadian Foreign Minister Chrystia Freeland arrived in Washington, D.C. Tuesday for continued trade talks.

Canada Returns to NAFTA Talks

Negotiators from Canada rushed to Washington, D.C. this week to resume talks on the North American Free Trade Agreement with the United States. The U.S. is pushing to get a so-called handshake agreement with Canada, following a framework agreement with Mexico. The U.S. seeks to announce a deal by the end of this week, placing a deadline of Friday. However, that deadline is purely political, as the U.S. wants to notify Congress 90 days before the outgoing Mexican President’s term expires. Under Trade Promotion Authority, the administration must give Congress a 90-day notice before sending the agreement to Congress for consideration. Trump has suggested breaking up NAFTA, and signing separate deals with Mexico and Canada. However, Politico points out that by doing so, Trump could forfeit his ability to get a straight up-or-down vote in Congress without any amendments under trade promotion authority. Trump notified Congress last year he intended to renegotiate NAFTA, not strike bilateral trade deals. For agriculture, the updated agreement with Mexico included improved food safety standards, biotech approvals and no new tariffs.

Trade Relief Package Favors Soybeans

The Department of Agriculture’s trade relief package is drawing criticisms that it favors soybean production over corn. Soybeans, no doubt a hotter commodity for China, which is targeting U.S. ag as part of the trade war with the U.S., have a much larger payout than corn. The payments are based on 2018 production levels that must be certified and provided to USDA. For soybeans, that’s $1.65 a bushel, for 50 percent of production. For corn, it’s a one cent per-bushel payment, for 50 percent of production, or considered as a half-cent payment on total production. The payout for soybeans is estimated to reach $3.7 billion, while the payments for corn are forecasted to reach $96 million. Texas Corn Producers Association President Joe Reed called the package a “slap in the face” to farmers working to make ends meet. Kansas corn President Ken McCauley says of the payments, “A half-cent is no relief from the market destruction we’ve seen for corn,” adding he’s “starting to feel picked on by the administration,” citing trade and the Renewable Fuel Standard. The payments become more troublesome for producers in drought pockets, such as Texas and Missouri, where corn production will be much lower than the rest of the nation.

Senator Sanders Wants Big Employers to Pay for SNAP

A bill by Senator Bernie Sanders seeks to make big companies pay up for SNAP benefits their employees receive. Sanders, of Vermont, plans to introduce the bill next week on the same day the farm bill conferees meet. The bill would impose a 100 percent tax on government benefits including food stamps received by workers at companies with 500 or more employees, according to the Washington Post. For example, “if an Amazon employee receives $300 in food stamps, Amazon would be taxed $300.” Sanders wants those large employers to fully cover the costs of food stamps, public housing and Medicaid, among other federal assistance program received by their employees. The Senator specifically mentioned companies such as Amazon, Walmart and McDonalds. Sanders says the goal is to “force corporations to pay a living wage and curb roughly $150 billion in taxpayer dollars that go to funding federal assistance programs for low-wage workers each year.”

USDA Announces Assistance to Pecan Growers

The U.S. Department of Agriculture Tuesday announced additional assistance for pecan growers to replant and replace trees through the Tree Assistance Program. Pecan growers are recovering from weather events in 2017, and the funding through the Consolidated Appropriations Act of 2018 will help the industry recover and replace lost and damaged trees, according to USDA undersecretary Bill Northey. Up to $15 million is available to eligible pecan orchards or pecan nursery tree growers for certain mortality losses suffered in 2017. To be eligible, the grower must have suffered a mortality loss on a stand in excess of 7.5 percent, but less than 15 percent, adjusted for normal mortality. Growers may also be eligible for other 2014 Farm Bill programs. For example, pecan growers who suffered greater than a 15 percent mortality loss remain eligible under the regular Tree Assistance Program provisions. Northey urged those who may be eligible to visit their local state or county FSA office

Dairy Farms Turning to GoFundMe to Stay in Business

The wife of a Wisconsin dairy farmer started a GoFundMe page to help their family farm survive. With a goal of $35,000, the story made national headlines over the weekend, and as of Tuesday, donations have reached $90,000. In her message, the wife was “asking for help to keep our small family dairy farm going.” The family farm recently went to take out a $35,000 loan to purchase half a herd of cows from a fellow farmer who was going out of business, but they were denied because of projected milk prices. The fourth-generation farm dates back to 1873. However, with the dairy market muddled in oversupply and impacting prices, the farm was set to go out of business, unless it could take on more cows to bring in more milking money. The plea, now well past its goal, concludes: “Please donate to help keep this farm going for more generations to come, the money will go to purchase new animals, hay and anything over would be applied to the farm loans.” The page is now one of several found on the GoFundMe website seeking donations for dairy farms.https://www.gofundme.com/wife-of-a-dairy-farmer 

Polaris continues sponsorship of Young Farmers and Ranchers competition

The Montana Farm Bureau Young Farmer and Rancher Committee is thrilled that for the fourth year, Montana Polaris is the sponsor of the YF&R Discussion Meet, awarding a Ranger® Side by Side UTV to the winner of that competition.  The Discussion Meet, which is open to Farm Bureau members age 18-35, is meant to simulate a committee meeting with ideas discussed and solutions developed. The MFBF YF&R Discussion Meet will take place Thursday, November 8 during the MFBF Annual Convention in Billings. “What I’d especially like to point out is that this Polaris Ranger is donated by participating Montana Polaris dealers. It’s not the corporate office just writing a check,” said MFBF YF&R Chair Gil Gasper.  “This is from the Montana dealers who believe enough in this program to provide this amazing prize.  These are the dealers who know their customers. It’s truly a local collaboration, and our MFBF YF&R Committee really appreciates that.”Gasper, who won the Discussion Meet in 2016, keeps his Polaris Side-by-Side busy. “We used it every single day whether it’s for our meat shop and when we’re fixing fence or moving cows—really everything. It’s allowed us to put less miles on our trucks, yet it is like having another pickup. We have a lot of creek bottoms and the Ranger allows us travel across those and all around the ranch. It really is a God send.” Sophi Davis won the 2017 Discussion Meet and was awarded a Polaris Ranger. “We’ve been driving it all the time on the ranch,” she said. “We used it all winter, and it was very helpful during calving season. It’s our go-to vehicle for putting out salt and mineral and for bringing the horses in from the pasture.” Davis credits the Discussion Meet for increasing one’s understanding of agricultural topics. “It provided me with a great opportunity to research different topics and made me more aware of where I stand on agricultural issues.” Not only will the winner of the Montana Discussion Meet receive a Polaris, but an all-expense-paid trip to compete in the national Discussion Meet New Orleans, LA in January. Thanks to these participating Polaris dealers for supporting our Young Farmers and Ranchers: Gallatin Recreation, Helena Cycle, Sports City Cyclery, Yellowstone Polaris, Beaverhead Motors, Riverside Marine & Cycle, Montana Power Products, Jesco Marine, Kurt’s Polaris, Redline Sport and Lewistown Honda & Polaris. For details visitwww.mfbf.org. Be sure to stop by their dealerships to say thank you for supporting the Montana Farm Bureau Young Farmers and Ranchers, and check out their inventory.For more information on the 2018 MFBF YF&R Discussion Meet and to view the 2018 Discussion Meet questions, visit www.mfbf.org/programs/young-farmers-ranchers  or contact Sue Ann Streufert, 406-587-3153, sueanns@mfbf.org. 

Missouri will become the first U.S. state to regulate the use of the word “meat” to describe food products

A new law prohibiting food manufacturers from using the word “meat” on products made without animal flesh is being legally challenged even before it goes into effect next week.Missouri will become the first U.S. state to regulate the use of the word “meat” to describe food products that do not contain animal flesh when the law goes into effect Sept. 4. The law, however, already is being challenged in a lawsuit filed by Tofurky, the manufacturer of vegetarian products developed using plant-based sources but labeled as hot dogs, sausages, burgers, roasts and other food products.The Hood River, Ore.-based company contends that the provision barring food producers from “misrepresenting” their products as meat – as in calling them sausage and hot dogs – if they are not made from livestock or poultry is too vague. Tofurky contends that it would be forced to change its packaging if the law is enacted as planned. The lawsuit includes the advocacy group the Good Food Institute as a co-plaintiff.Missouri lawmakers passed the statute forming the basis of the law in May and Gov. Mike Parson signed the bill June 1. The marketing of plant-based or cell-cultured food products labeled as “meat” has been a focus of such trade groups as the National Cattlemen’s Beef Association, among other industry organizations. Missouri Attorney General Josh Hawley is expected to defend the law in the wake of the Tofurky lawsuit.

USDA Announces Farm Trade Relief Package

Agriculture Secretary Sonny Perdue Monday announced details of the trade assistance package for farmers hurt by the President’s trade agenda. The $12 billion package will provide payments to producers as part of a “short-term relief strategy” to protect agriculture. The Department of Agriculture’s Farm Service Agency will administer the Market Facilitation Program to provide payments to corn, cotton, dairy, hog, sorghum, soybean and wheat producers starting September 4th, 2018. It’s important to note that payments will be based on actual production. Producers must harvest a crop and provide their production numbers to USDA before payment can be sent. The payments to producers will total $4.7 billion. Also included in the relief package, USDA’s Agricultural Marketing Service will administer a Food Purchase and Distribution Program to purchase up to $1.2 billion in commodities targeted by “unjustified” retaliation. And, through the Foreign Agricultural Service’s Agricultural Trade Promotion Program, $200 million will be made available to develop foreign markets for U.S. agricultural products.

Payments include:
Soybeans             1.65 per bushel for 50 percent of production
Corn                    One cent per bushel for 50 percent of production
Pork                    50 percent of the total number of pigs on hand as of August 1, $8 per pig.
Cotton                 Six cents per pound of 50 percent production.
Sorghum             86 cents per bushel of 50 percent production.
Dairy                  The margin protection historic number at 12 cents per hundredweight times that production number. 

USDA has a number for 21,000 producers but for&; those who don’t have it can be calculated by USDA.Eligible applicants must have an ownership interest in the commodity, be actively engaged in farming, and have an average adjusted gross income for tax years 2014, 2015, and 2016 of less than $900,000. Applicants must also comply with the provisions of the “Highly Erodible Land and Wetland Conservation” regulations. On September 4, 2018, the first MFP payment periods will begin. The second payment period, if warranted, will be determined by the USDA.The initial MFP payment will be calculated by multiplying 50 percent of the producer’s total 2018 actual production by the applicable MFP rate. If the Commodity Credit Corporation announces a second payment period, the remaining 50 percent of the producer’s total 2018 actual production will be subject to the second MFP payment rate. Payments are capped per person or legal entity at a combined $125,000 for dairy production or hogs. Payment for dairy production is based off the historical production reported for the Margin Protection Program for Dairy. Payment for hog operations will be based off the total number of head of live hogs owned on August 1, 2018.

Agriculture Welcomes USDA Help, Urges End to Trade Disputes

Agriculture groups welcomed the aid offered by a Department of Agriculture relief package announced Monday, but urged the administration to end trade disputes. Pork exports are one of the hardest-hit export categories, as U.S. pork exports to China are down significantly for the year, with the value falling nine percent through June. The drop has come mostly because of the 50 percent additional tariff from China. The package will provide producers $8 per hog based on 50 percent of the number of animals they owned on August first. National Pork Producers Council President Jim Heimerl (Hi’-merle) stated that the U.S. pork sector was “grateful” for the relief package, “what pork producers really want is to export more pork, and that means ending these trade disputes soon.” Iowa Senator Chuck Grassley said the relief package was “welcome news” for farmers, but added "what they really want are long-term markets, not handouts."

NCGA: USDA Trade Aid Won't Make Up for Lost Markets

In response to the Department of Agriculture’s tariff mitigation package, the National Corn Growers Association says the plan “won’t make up for lost markets.” The organization reiterated its call for the Administration to rescind tariffs, secure trade agreements and allow for year-round sales of higher blends of ethanol; “no-cost actions that would allow for the marketplace to drive demand.” NCGA President Kevin Skunes says that corn farmers appreciate the help from USDA, but adds that the plan “provides virtually no relief to corn farmers." According to an NCGA-commissioned analysis, which NCGA provided to USDA and the Office of Management and Budget, trade disputes are estimated to have lowered corn prices by 44 cents per bushel for crop produced in 2018. This amounts to $6.3 billion in lost value on the 81.8 million acres projected to be harvested in 2018. USDA's plan sets the payment rate for corn at just one cent per bushel.

Trump Terminating Current NAFTA

The U.S. and Mexico have agreed to a new North American Free Trade Agreement framework, prompting President Trump to announce his intent to terminate the current agreement. That means Trump is seeking to replace NAFTA with an agreement that for now does not include Canada. The expected agreement between the U.S. paves the way for the U.S. to shift its negotiating efforts towards getting Canada to agree to the deal. Although, Trump said he preferred to rename the trade pact to the “United States-Mexico trade agreement.” There are still issues to work out with Canada, but administration officials a hopeful the issues can be resolved quickly. Trump Monday told reports Canada could have a separate deal or be included in the U.S.-Mexico deal. However, authority over his moves resides with Congress. U.S. Trade Representative Robert Lighthizer indicated he would send a notification letter to Congress later this week to withdraw from the current NAFTA and sign a new agreement with Mexico.

Farm Groups Respond to NAFTA Announcement

Farm country overall shows reserved optimism regarding the North American Free Trade Agreement announcement Monday. The announcement marks a step forward, as Mexico and the U.S. have a basic agreement in place. However, with Canada yet to be included, many questions remain. Farmers for Free Trade director Brian Kuehl says there is “significant work that remains” in delivering on trade priorities for agriculture.” The organization maintains that farmers will ultimately be judging any new NAFTA deal by two crucial measures: will it provide any new market access for American ag exports and will it do anything that erodes the gains the original NAFTA provided. Kuehl says U.S. farmers are looking for certainty and a “de-escalating” of the trade war that is putting U.S. agriculture “in the crosshairs.”  Meanwhile, the U.S. Grains Council noted the importance of Mexico to U.S. farmers in a statement by CEO Tom Sleight. Mexico is a top export market for U.S. corn and other products. However, Sleight says Canada is the second largest ethanol market and a top ten corn market for the United States. While hopeful Canada will soon re-engage in the talks, Sleight says "we continue to oppose withdrawal from the existing NAFTA under any circumstances except the adoption of a new, beneficial and trilateral pact."

China Grain Imports Plunge Amidst Tariffs

Imports of grain to China plunged in July after rounds of heavy tariffs between the U.S. and China were enacted. Data reviewed by Reuters shows China imported 220,000 metric tons of sorghum in July, down 62.5 percent from 588,300 metric tons a year ago. The imports were also below June’s 450,000 metric tons, when buyers scooped up U.S. shipments of sorghum. The customs figures do not give a country by country breakdown, but China imports almost all its sorghum from the United States. In July, China imported 330,000 metric tons of corn, down 63 percent from last year, and wheat imports declined 43 percent from a year earlier. Customs data from China shows that the nation imports one-third of its corn and wheat from the United States. Market experts from China blame the ongoing trade war between the U.S. and China as the likely culprit for lower imports of grains. The trade war has targeted agricultural products from the U.S., including staple imports of pork and soybeans. Meanwhile, China has begun importing pork from Chili and the European Union. 

Farm Bureau pleased with progress on Mexico trade talks

The Montana Farm Bureau, which has been extremely concerned about the effect of tariffs on farmers and ranchers, was pleased to see some movement in the renegotiation of the NAFTA agreement in regards to Mexico. “Today’s announcement that the U.S. and Mexico have come to a preliminary agreement is very encouraging,” said Nicole Rolf, Montana Farm Bureau National Affairs Director.  “Mexico has become one of our major agriculture markets since the inception of NAFTA so securing those markets for the future is of utmost importance.  We’ve been hearing for months now that an agreement was close with Mexico and that Canada would follow soon after. I certainly hope that proves true, as we’d like to see our markets to the north—Canada is our number-one trade partner—secured before harvest is completely over.” Rolf added, “We are hearing reports the agreement preserves the arrangement of zero tariffs on farm goods between the U.S. and Mexico, which is a big relief to Montana farmers and ranchers. I look forward to learning more about new provisions which will treat American farmers more fairly, especially with regard to agriculture biotechnology and modern agriculture practices.” The American Farm Bureau Federation has been closely tracking the progress of trade talks between the two countries. “This is the kind of trade news we have been waiting for. In a time when the U.S. economy is booming, our farmers have been left behind,” noted American Farm Bureau President Zippy Duvall. “Open markets and good trade agreements will give American agriculture the opportunity to be a part of this booming economy. We need negotiators to convince Canadian officials that they, too, will benefit from a revised treaty. We are hopeful that the value of a continued and improved NAFTA for all will bring everyone back to the negotiating table.” Although Farm Bureau applauds the work with Mexico, there is still a lot of work to do outside of North America. “We need to resolve our trade issues with China to create better opportunities for American farmers and ranchers there. We look forward to working with the Administration to strengthen agricultural exports in new and existing markets around the world,” Duvall concluded. 

Washington Insider: Fed Appears to Keep Cool as President Criticizes

The one thing everybody in the financial world knows is that President Donald Trump is annoyed that the Federal Reserve is slowly increasing interest rates as the economy remains strong. So, it is news this week, Bloomberg says, that Fed officials are “trying hard to ignore” President Trump, and they’re going to keep doing that even if he continues to put pressure on the central bank to slow down or stop its interest rate increases.Recently, at the Kansas City Fed’s annual symposium in Jackson Hole, Wyoming, several policy makers responded to questions about recent remarks by the President with straightforward comments that their rate decisions won’t be affected.“The job of a central bank and my job is to make decisions on monetary policy without regard to political considerations or political influence,” Dallas Fed President Robert Kaplan said in an interview. “I’m very confident we’ll do that.” The context is that observers believe that on other occasions, Fed officials have responded to politics — but it will not now.The President told a group of Republican donors earlier this month that he was disappointed with his appointee, Fed Chairman Jerome Powell, over interest-rate hikes, having expected Powell to be a cheap-money central banker. That followed complaints last month, including via Twitter, about Fed rate hikes.Pressed on whether Trump’s comments complicate their job, Kaplan and his colleagues mostly shrugged and repeated that the Federal Open Market Committee will simply carry on with its job.“This committee is very focused on the mandate given to us by Congress to try to make decisions that are in the long-run interest of a growing economy,” said Esther George, president of the Kansas City Fed and host of the event that annually draws leading central bankers and economists from around the world to Grand Teton National Park.On the sidelines, a number of the conference attendees said the Fed has very little choice but to demonstrate a thick skin and ignore the president just now. A suggestion that Fed officials should respond by raising rates more aggressively to prove their independence was roundly rejected, as was the idea that Powell should warn the president publicly against further commentary on rates.“I think he should avoid any tit-for-tat exchanges with the president,” said Alan Blinder, a former Fed vice chairman. Powell, he added, should respond mostly with actions to show the Fed will act independently and remain focused on making the right decisions for the economy.The chairman made no public response about Trump’s comments, Bloomberg said. He said in a July 12 interview with American Public Media’s “Marketplace” program that the Fed does its work “in a strictly nonpolitical way, based on detailed analysis” that doesn’t take political considerations into account.Another former Fed vice chairman, Donald Kohn, said he was confident the committee would not be distracted from following its legislative mandate, but added that Powell could help shield the Fed from pressure by better communicating to the public the rationale for its policy decisions.“The key is the Fed has to continue to explain in economic terms why it’s doing what it's doing, and how it’s related to its objectives,” he said.So, Powell forges on with gradual Fed rate hikes amid strong growth, Bloomberg said.Other attendees noted the irony that Trump is complaining about rate hikes, since Powell is widely seen by economists as having taken a very cautious approach so far to tightening policy, even as U.S. economic growth accelerates and unemployment, now at 3.9%, is at levels not seen in nearly 20 years.“I am sure that the Fed is not going to depart from its very responsible strategy,” Jacob Frenkel, chairman of JP Morgan Chase International told Kathleen Hays in an interview on Bloomberg Television. “It may be politically attractive to bash the Fed for short-term causes. But really, it will not change anything.”The Fed has raised rates five times since Trump took office in January 2017, a slower pace than during most past economic expansions.At Jackson Hole on Friday, Powell said gradual increases will remain appropriate, but he made clear that with inflation still low he was not worried about the economy overheating and would not seek a more aggressive policy unless inflation expectations jumped.So, we will see. Clearly, the president has an important stake in rapid economic growth — but the dangers of inflation are real and very important and require continuing vigilance. Chairman Powell’s current approach seems appropriate and should be applauded even as the political debates intensify, Washington Insider believes. 

U.S./China Talks Draw a Blank

The trade war between China and the U.S. seems primed to worsen as the governments failed to make progress in two days of discussions. Reuters says the two sides met last week with low expectations of progress and there are no further talks scheduled at this time. A source close to the negotiations told Reuters that Chinese officials have raised the possibility of no further talks until after the U.S. elections in November. The lack of progress adds to uncertainty for businesses who now have to weigh the risks when considering investments in the U.S. or China. A new round of tariffs could take effect as soon as early September. There’s no guarantee they’ll be the last tariffs or that there won’t be other measures taken as well. The two countries engaged in talks for the first time since last June. U.S. officials were due to meet with delegations from the European Union and Japan to discuss joint efforts to confront China at the World Trade Organization over its industrial subsidies and conduct of its state-owned enterprises.

Russia Selling 2.5 Million Acres to China for Soybean Production

Soybeans were one of the first major casualties in the ever-escalating trade war between the U.S. and China. Russia is hoping to take advantage of the situation and cut deals with Chinese agribusinesses to make up for lost supply. The Washington Post says the Kremlin will offer roughly 2.5 million acres of arable land to foreign investors. Analysts are describing it as a bid to replace the U.S. as China’s most reliable soybean supplier. China is short on filling its soybean needs after the high stakes trade war got going with the U.S. through the summer. Beijing dramatically cut purchases of U.S. soybeans in response to the tariffs imposed on Chinese products by the Trump Administration. The Post article says Chinese officials are making plans to trim around seven million soybean tons off of the nearly 33 million tons it’s been buying annually from U.S. farms. Soybeans represent U.S. farmers’ single largest agricultural export to China, which takes approximately 60 percent of the world’s supply every year. Beijing’s cut in American purchases as sent U.S. bean future prices tumbling.

Bayer CEO Says Monsanto Merger Still a Win-Win

Werner Baumann, Bayer Chief Executive Officer, tried to soothe the frayed nerves of investors after a recent jury award of $289 million during a trial regarding glyphosate. Baumann says the merger between Bayer and Monsanto still makes sense in spite of the challenges ahead. Baumann told a German newspaper that there is “no reason to break out in nervousness” in the aftermath of the verdict on August 10th. In his first public comments since the decision, Baumann says, “The fact is that absolutely nothing has changed about the compelling logic of the Monsanto takeover, the potential value creation for our shareholders, the attractiveness of the agriculture market, and the goals we communicated.” The California court awarded damages to a school groundskeeper that claimed Roundup caused his non-Hodgkin’s lymphoma because of allegations the herbicide causes cancer. Bayer has said it will appeal. The verdict shocked case observers both inside and outside of Bayer in the first of what may amount to thousands of cases. While jury verdicts are typically either overturned or reduced, financial analysts say Bayer could still face as much as $5 billion in costs linked to cases involving glyphosate, the main ingredient in Roundup.

USDA Postpones Farmer Aid Package Details

Ag Secretary Sonny Perdue said the expected announcement regarding details of the Trump Administration’s aid package for farmers was delayed over the weekend. Full details will come out on Monday. Politico says Perdue made the announcement during an appearance at a dairy farm in New York. “We acknowledge that dairy, pork, and soybeans will be the commodities most affected by the tariffs,” says Perdue. He says the Ag Department is still on track to “roll the program out right after Labor Day.” Commodity groups are unsure about how the payments will be determined. The groups are on edge after a report earlier this week saying soybeans would get $1.65 per bushel and corn will only receive a penny per bushel. If true, that will mean soybean growers get the majority of the payments. However, Perdue cast doubt on those figures last week. The Secretary made several appearances at dairy farms in upstate New York and fielded a lot of questions about the direction of the administration’s trade fight. Perdue says he’s hopeful the administration will get an agreement with Mexico on two-way NAFTA issues soon. That should pave the way for a larger agreement once Canada returns to the talks.*

Memphis Meats, NAMI Want Joint Regulation of Cell-Based Meat

The North American Meat Institute joined up with Memphis Meats, a San Francisco-based company that’s developing cell-based meat to send a letter to the Trump Administration. The Hagstrom Report says they’re asking that the Food and Drug Administration and the Ag Department’s Food Safety and Inspection Service share regulatory responsibilities for cell-based meat. The letter says in the case of new or novel food ingredients like this, the FDA should have oversight over pre-market safety evaluations for cell-based meat and poultry products. USDA has traditionally given input to the FDA as part of the regulatory process for new products, which the letter says should continue. “After pre-market safety has been established, USDA should regulate cell-based meat and poultry products, as it does with all other meat and poultry products,” the letter says. “USDA will apply relevant findings from FDA’s safety evaluation to ensure that products are safe, wholesome, and properly labeled.” The U.S. Cattlemen’s Association weighed in, saying it’s “concerned about the use of the term ‘meat,’ but the commitment to come to the table to propose solutions is a step in the right direction.”

Three More States Enter WOTUS Court Battle

Texas, Louisiana, and Mississippi are asking a federal court to expedite its consideration of a nationwide injunction against the 2015 Waters of the U.S. Rule. A DTN report says a South Carolina court recently issued a ruling that allows the rule to go back into effect in 26 states. Texas Attorney General Ken Paxton filed a motion in the southern district of the U.S. District Court in Texas. “This court should enjoin the WOTUS rule that’s already enjoined in 24 other states, in order to give much-needed consistency in the applicability of WOTUS throughout the nation,” Paxton wrote in his motion. The WOTUS rule is currently enjoined in 24 states due to other court decisions. Groups including the American Farm Bureau filed an appeal with the U.S. Court of Appeals in Richmond, Virginia. The South Carolina Court’s ruling overturned a two-year delay for the Environmental Protection Agency to work on rewriting the WOTUS rule. The ag groups are asking the South Carolina Court to stay the injunction that essentially makes WOTUS the law of the land in 26 states, at least until the appeal is heard. 

USDA FOREST SERVICE ANNOUNCES NEW STRATEGY FOR IMPROVING FOREST CONDITIONS

The U.S. Department of Agriculture (USDA) Forest Service (USFS) announced today a new strategy for managing catastrophic wildfires and the impacts of invasive species, drought, and insect and disease epidemics.Specifically, a new report titled Toward Shared Stewardship across Landscapes: An Outcome-based investment Strategy (PDF, 3.7 MB) outlines the USFS’s plans to work more closely with states to identify landscape-scale priorities for targeted treatments in areas with the highest payoffs.“On my trip to California this week, I saw the devastation that these unprecedented wildfires are having on our neighbors, friends and families,” said U.S. Secretary of Agriculture Sonny Perdue. “We commit to work more closely with the states to reduce the frequency and severity of wildfires. We commit to strengthening the stewardship of public and private lands. This report outlines our strategy and intent to help one another prevent wildfire from reaching this level.”Both federal and private managers of forest land face a range of urgent challenges, among them catastrophic wildfires, invasive species, degraded watersheds, and epidemics of forest insects and disease. The conditions fueling these circumstances are not improving. Of particular concern are longer fire seasons, the rising size and severity of wildfires, and the expanding risk to communities, natural resources, and firefighters.“The challenges before us require a new approach,” said Interim USFS Chief Vicki Christiansen. “This year Congress has given us new opportunities to stand shoulder-to-shoulder with state leaders to identify land management priorities that include mitigating wildfire risks. We will use all the tools available to us to reduce hazardous fuels, including mechanical treatments, prescribed fire, and unplanned fire in the right place at the right time.”A key component of the new strategy is to prioritize investment decisions on forest treatments in direct coordination with states using the most advanced science tools. This allows the USFS to increase the scope and scale of critical forest treatments that protect communities and create resilient forests.The USFS will also build upon the authorities created by the 2018 Omnibus Bill, including new categorical exclusions for land treatments to improve forest conditions, new road maintenance authorities, and longer stewardship contracting in strategic areas. The agency will continue streamlining its internal processes to make environmental analysis more efficient and timber sale contracts more flexible.The Omnibus Bill also includes a long-term “fire funding fix,” starting in FY 2020, that will stop the rise of the 10-year average cost of fighting wildland fire and reduce the likelihood of the disruptive practice of transferring funds from Forest Service non-fire programs to cover firefighting costs. The product of more than a decade of hard work, this bipartisan solution will ultimately stabilize the agency’s operating environment.Finally, because rising rates of firefighter fatalities in recent decades have shifted the USFS’s approach to fire response, the report emphasizes the agency’s commitment to a risk-based response to wildfire. 

USDA Payments Expected After Labor Day

The Department of Agriculture expects to send payments to farmers after the Labor Day holiday as part of a trade relief package. The $12 billion package is intended for farmers who have been affected by foreign tariffs on U.S. farm products, all in retaliation to President Trump's trade agenda. A USDA spokesperson confirmed to the Hagstrom Report the department is “on track” to remit payments after Labor Day, but declined to offer further details of the plan, which was expected to be announced by the end of the week. USDA maintains that the agency is “currently engaged” in the federal rulemaking process, and Agri-Pulse reported this week the relief package was under review by the White House Office of Management and Budget. Preliminary reports suggest the proposed payment rate for soybeans would be $1.65 per bushel, while corn growers would get only one cent per bushel.

Canada Next for NAFTA

A trade official from Mexico is hopeful to bring Canada back into the North American Free Trade Agreement talks to reach a three-way agreement, as early as next week. The comments come as the U.S. and Mexico were close to a “handshake” agreement Thursday, helping calm some anxieties for agriculture amidst the global trade turmoil. Politico reports that the top trade negotiator for Mexico’s President-elect says reaching an agreement in principle between the U.S., Mexico and Canada next week "is an objective, a target." The trade official told reporters he "wouldn't bet (his) right hand," but added: "I'd bet money" on reaching an all parties "handshake" agreement.  Canada has not joined the talks over the last month, as the U.S. and Mexico were working towards a preliminary agreement. Many issues over the last month were strictly between the U.S. and Mexico. Canada and the U.S. have outstanding issues to resolve, quickly, if the Mexican official is correct. Those issues include dairy access and approval of certain U.S.-Mexico provisions.

China, U.S. Trade War Deepens with More Tariffs

The U.S. and China began rolling out more tariffs against each other this week as part of the tit-for-tat trade wat between the two nations. The U.S. will collect an additional 25 percent in duties on Chinese imports ranging from motorcycles to steam turbines and railway cars, and the Chinese retaliation will see a similarly sized tax on items including coal, medical instruments, waste products, and cars and buses, according to Bloomberg. The growing lists of tariffs continues to propel the U.S. and China further into a massive trade war, which is already seen as a hindrance to U.S. agriculture. A meeting this week between officials from China and the U.S. does show signs of further discussions on the horizon. Still, Moody’s Investors Service expects tensions between the U.S. and China to worsen this year, with most of the impact of trade restrictions to be felt in 2019.

8,000 Glyphosate Lawsuits Await Bayer

The California verdict against Monsanto has opened the door for what is estimated as 8,000 lawsuits against Monsanto, now being absorbed by Bayer. On a call with analysts and reporters, Bayer CEO Werner Baumann said the number of plaintiffs in both state and federal litigation was approximately 8,000 as of the end of July. Bayer acquired Monsanto in June and had previously tallied 5,200 lawsuits against Monsanto. The CEO says the number of cases “is not indicative of the merits of the plaintiffs’ cases.” Bayer shares have lost more than ten percent since the California verdict ordered Monsanto to pay $289 million in a lawsuit over glyphosate, the ingredient in Monsanto’s Roundup. Experts say that the lawsuit opened the door for thousands of other similar cases. Bayer contends that the jury’s verdict is the opposite of science-based conclusions of regulators and the company will “vigorously defend this case and all upcoming cases.”

Brazil to Plant Record Soy Crop for 2018/19

Farmers from Brazil are expected to plant another record soybean crop. This would be the 12th consecutive year that Brazil plants a record land area of soybeans, amid strong demand from Asia. Reuters reports that Brazil is likely to expand the area to a record 36.28 million hectares, the equivalent to 89.65 million acres, this season, which farmers will start planting around September. The expected planted area represents a 3.2 percent expansion from the previous growing cycle. A Rabobank analyst says the trade war between the U.S. and China is supporting Brazilian soybean prices in the export markets and could be a contributing factor to the increase. Brazil, the world's largest soybean exporter, is expected to collect an estimated 119.76 million metric tons of the crop in the next growing cycle, up 0.65 percent from the last growing season.

AFBF Exec Named North American Meat Institute CEO

The North American Meat Institute this week named Julie Anna Potts its next president and CEO effective September 24, 2018. Potts succeeds retiring President and CEO Barry Carpenter. Potts has served the American Farm Bureau Federation since 2011 as its executive vice president and treasurer. She first joined AFBF in 2004, serving as general counsel until 2009. In late 2009, she was named chief counsel of the Senate Agriculture Committee, serving under then-Chairman Blanche Lincoln of Arkansas. The North American Meat Institute is the nation’s oldest and largest trade association representing packers and processors of beef, pork, lamb, veal, turkey and processed meat products. Member companies account for more than 95 percent of United States output of those products. The Meat Institute provides regulatory, scientific, legislative, public relations and educational services to the meat and poultry packing and processing industry. 

USDA's Perdue Says Farmer Aid Package Details Coming Monday

The expected Friday release of details of the farmer aid package has been pushed to Monday, according to USDA Secretary Sonny Perdue. The rule covering USDA plans to make the aid payments and take other actions to help farmers impacted by trade actions is still under review at the Office of Management and Budget (OMB). "Those details are going to be out Monday," Perdue stated. As for the specific amounts of aid, Perdue would not comment on reports that the payments to soybean farmers would be $1.65 per bushel and one cent per bushel for corn. "We will acknowledge that dairy and pork and soybeans will be the commodities that are most dramatically affected by the tariffs," Perdue stated. "It's not going to make everybody whole. It's not going to make everybody happy. It's not going to seem like it's equitable."

US-China Talks End with No Major Breakthrough

Chinese leader Xi Jinping and his trade officials are not budging after two days of trade policy talks that ended Thursday in Washington. A Trump administration official acknowledged that President Trump and his team have repeatedly laid out for Chinese officials the changes in behavior they would like to see. “But so far,” the official said, “we have yet to see those.” Negotiators made no real progress at the two-day meeting, although Beijing described the talks as “constructive and frank" and said the two sides would stay in contact about the next steps. A fresh round of U.S. tariffs on $16 billion of Chinese imports went into effect on Thursday, and Beijing retaliated with tariffs on $16 billion of American imports.

Washington Insider: US a Currency Manipulator?

Although charges of currency manipulation are most often made against developing countries—and used to browbeat China — some Wall Street observers are saying that the President’s “sustained campaign” to weaken the dollar as a way to reduce the U.S. trade deficit “can’t be dismissed,” Bloomberg reports. “The trade debate will increasingly include the currency issues,” said Charles Dallara, a former U.S. Treasury official and one of the architects of the Plaza Accord, the 1985 watershed agreement between the U.S. and four other countries to jointly depreciate the dollar. “It’s inevitable.” Granted, Dallara didn’t specifically use the word manipulation, Bloomberg said. There’s something of a reluctance among analysts to associate the U.S., the standard-bearer for free-market principles, with the term. They prefer to refer to it as foreign-exchange intervention. Semantics aside, a shift to a more protectionist and interventionist policy, a la 1985, would not only reverberate across the $5.1 trillion-a-day currency market and undermine the dollar’s status as the world’s reserve currency, but could also weaken demand for U.S. assets. Since falling toward a three-year low in April, the dollar has appreciated almost 6%, according to the Bloomberg Dollar Spot Index. Its advance last quarter was the strongest since 2016, as it appreciated against all 16 major currencies. The dollar is also 11% above its average over the 13-year span of the dollar index. A strong-dollar policy has been a cornerstone for successive U.S. administrations. The U.S. was also a key supporter of the July Group-of-20 pact that member economies will “refrain from competitive devaluations, and will not target our exchange rates for competitive purposes.” Yet like many other things, this administration “has shown a penchant for upending the status quo,” Bloomberg said. After a flurry of recent tweets in which President Trump complained that the dollar is blunting America’s “competitive edge,” Michael Feroli, JPMorgan Chase’s chief U.S. economist, wrote that he can’t rule out the possibility the administration will intervene in the currency markets to weaken the greenback. Both Deutsche Bank and OppenheimerFunds echoed the view, saying dollar intervention was no longer far-fetched. For example, the President recently complained to wealthy Republican donors that he was “not thrilled” with the Federal Reserve’s interest-rate increases under Chairman Jerome Powell, which have boosted the dollar. So what tools does the administration have if it intended to go beyond mere talk? The President could order the U.S. Treasury to sell dollars and buy currencies using its Exchange Stabilization Fund, according to Viraj Patel, an FX strategist at ING. But because the fund only holds $22 billion of dollar assets, the impact would likely be minimal. Any direct intervention that is larger and more ambitious in scope would also require congressional approval, he said. However, Patel says there is a loophole the President could exploit to get around the fund’s constraints and bypass Congress altogether: he could declare FX intervention a “national emergency,” and then force the Fed to use its own account to sell dollars. Such a move would be a long shot by any stretch of the imagination, but since the President has invoked “national security” to impose tariffs, Patel says he can’t “completely rule out” the possibility. There are plenty of caveats, Bloomberg says, and the odds of any kind of U.S. intervention are still low. At the G-20 summit, Treasury Secretary Steven Mnuchin assured fellow finance ministers the U.S. wouldn’t meddle in foreign-exchange markets. And while White House trade adviser Peter Navarro has broached the subject of a global accord on currencies in the past, the chances of a multilateral agreement on the dollar are remote. Plus, there’s always the threat of retaliation by other nations if the U.S. goes it alone. Nevertheless, many who recall the events in the early 1980s that culminated in the Plaza Accord see certain parallels to what’s happening today. Then, as now, the dollar’s strength on the back of rising interest rates was at the center of trade tensions between the U.S. and other major economies. Protectionism was on the rise, as were fears of foreign imports costing American jobs. Then, the bogeyman was Japan. Today, it’s China. And as the trade war with China intensifies, some worry about the recent precipitous drop of the yuan. It has tumbled 9% since April, when trade friction with China started to intensify. The magnitude of the decline, by some measures the fastest since the 1994 devaluation, boosted speculation the People’s Bank of China is deliberately weakening the yuan to offset the tariff impact. And, while there is plenty of criticism from administration officials, Bloomberg emphasized that the Treasury Department, conducts twice-yearly reviews of international foreign-exchange policies and, in April declined to formally name China a currency manipulator based on its own criteria. However, Bloomberg says that bankers have long memories that many recall how in the early 1980s the Fed’s quantitative easing sowed frustrations in emerging markets over what some officials saw as a means to manufacture a weaker dollar. Whatever the case, Dallara is bracing for more turbulent times. He says he has “lived through a lot of market gyrations in my career, and I have an uneasy feeling that I can’t validate by data that tensions are going to, at some point, emerge into volatile market dynamics. This is a risk,” he told Bloomberg. So, currency policies and trends are yet another factor that producers should watch closely as the political season approaches, especially if the trade wars escalate to the point that they become major threats in the fall elections, Washington Insider believes.