For the Week Ending March 23, 2018

March 23, 2018

CONGRESS PASSES, PRESIDENT SIGNS OMNIBUS SPENDING BILL WITH NPPC-SUPPORTED PROVISIONS

A $1.3 trillion federal spending bill was passed by Congress today. The bill provides solutions for several priority issues for which NPPC and other agriculture groups have persistently worked for adoption. It includes a Section 199A fix to the Tax Cuts and Jobs Act that will restore free-market competition and ensure a level playing field for U.S. grain markets. Currently, Section 199A grants farmers a larger tax deduction if they sell their agricultural products to cooperatives, leaving independently-owned buyers at a disadvantage. The spending bill also provides a permanent exemption for farmers from reporting air emissions from manure under the Comprehensive Environmental Response, Compensation & Liability Act (CERCLA) and grants livestock haulers an exemption from the Electronic-Logging Device (ELD) rule until Sept. 30, 2018.

 

PRESIDENT TRUMP ANNOUNCES PLANS TO IMPOSE TARIFFS ON CHINESE IMPORTS; CHINA RESONDS WITH RETALIATION PLANS

President Trump on Thursday announced plans to levy tariffs of approximately $60 billion on yet-to-be determined Chinese imports. Based on Section 301 of the Trade Act of 1974 – which allows the chief executive to “take all appropriate action, including retaliation, to eliminate any act, policy or practice of a foreign government that violates an international trade agreement or is unjustified, unreasonable or discriminatory and that burdens or restricts U.S commerce” – the tariffs follow a U.S. Trade Representative investigation that concluded that U.S. companies have lost billions of dollars from being forced by China to disclose intellectual property and to transfer technology. China responded later in the day with plans to levy tariffs on a range of U.S. products, including a 25 percent duty on pork. NPPC, which, along with other sectors of U.S. agriculture, has expressed major concern about the risk of retaliation against food and agriculture exports to China, issued this statement. China is the number two export market for U.S. pork as measured by volume and number three based on value.

 

TRUMP ADMINISTRATION ANNOUNCES STEEL AND ALUMINUM TARIFF EXEMPTIONS; PROVIDES UPFDATE ON KORUS RENEGOTIATION

Testifying before the Senate Finance Committee on Thursday, U.S. Trade Representative Robert Lighthizer announced exemptions for Australia, Argentina, the European Union and South Korea from the implementation of President Trump’s proposed steel and aluminum tariffs. These countries join Mexico and Canada on the list of nations currently exempted, with conditions, from tariffs of 25 percent on steel imports and 10 percent on aluminum imports. Earlier in the week, at a hearing conducted by the House Ways and Means Committee, Ambassador Lighthizer said the administration plans to finalize its steel and aluminum tariff exemption process by the end of April. He also said South Korea – the fifth largest export market for U.S. pork – may become permanently exempt from the tariffs, pending the successful adoption of amendments to the U.S.-South Korea free trade agreement (KORUS), noting that he expected this negotiation to be completed soon. Appearing before the Ways and Means Committee on Thursday, U.S. Secretary of Commerce Wilbur Ross said the administration is mindful of the concerns over potential retaliatory measures that will be taken against U.S. agriculture goods based on U.S. steel and aluminum tariffs.

 

PUBLIC HEARING HELD ON SAN FRANCISCO’S ANTIBIOTIC ORDINANCE

California’s Department of the Environment this week held a public hearing in San Francisco on the implementation of the Antibiotic Use in Food Animals Ordinance signed on Oct. 24, 2017, and effective Nov. 23, 2017. The ordinance requires 120 large grocery retailers in San Francisco to report annually on antibiotics used in meat sold in their stores. Witnesses at the hearing countered those who support the measure by noting the unintended consequences of the ordinance. Diane Sullivan, an anti-hunger advocate, cited existing federal regulations that already ensure food safety and responsible antibiotic use and expressed concern about increased food costs caused by unwarranted regulations like this in a city where one in four struggle with food insecurity. A representative from the California Farm Bureau testified that responsible antibiotic use is a priority for agriculture and that healthy animals lead to decreases in food borne illnesses. The California Grocers’ Association said adherence to the ordinance would be a challenge since grocers do not have the ability to compel information from producers.

 

REPUBLICAN SENATORS PROPOSE NEW CHAPTER FOR RENEGOTIATING NAFTA

A group of Republican senators this week authored a letter advising President Trump to adopt a “competitiveness” chapter in the North American Free Trade Agreement (NAFTA) as part of the renegotiation process. Sens. Ted Cruz, R-Texas, Cory Gardner, R-Colo., and Steve Daines, R-Mont., urged the president to include in a new NAFTA deal provisions that encourage investment in the U.S. market, including a streamlined permitting process for U.S. infrastructure projects, common sense regulations and support for maintaining a skilled labor force. The proposal – which can avoid filibuster and pass the Senate with 50 votes – would allow the president to ratify a new version of NAFTA before November of this year. Separately, a report released this week by HBSC Commercial Banking found that close to half of the 750 companies surveyed across the United States, Canada and Mexico said that NAFTA will serve their businesses positively over the next two years. NPPC has been urging the Trump administration to maintain zero-duty market access for U.S. pork exports to Mexico and Canada and cautioning that a U.S. withdraw from NAFTA would cost the pork industry $1.5 billion. The eighth round of negotiations on the agreement is tentatively scheduled for early next month.

 

FDA WILL USE ENFORCEMENT DISCRETION FOR LIVE ANIMAL IMPORTS

This week the U.S. Food and Drug Administration, at the request of NPPC and other groups, released guidance on its intent to use enforcement discretion and not apply the Food Safety Modernization Act’s (FSMA) Foreign Supplier Verification Program (FSVP) to importers of live animals. The FSVP – issued by the FDA in November 2015 – requires food importers to ensure that foreign suppliers are held to the same food safety standards as those in FSMA. Though the rule did exempt the importation of meat products subject to inspection by USDA’s Food Safety and Inspection Service, it did not exempt the importation of live animals intended for food. This would have imposed costly requirements for importers of live food animals, despite the fact that inspection of most live animals imported for food use, including pigs, falls under the jurisdiction of the USDA’s Animal and Plant Health Inspection Service. The FDA – referencing the USDA’s predominant role in overseeing the inspection of live animals intended for food use – will now exercise enforcement discretion and not apply the requirements of the FSVP to any pigs imported for slaughter, feeding, breeding or exhibition purposes.

 

NPPC SPONSORS NATIONAL AG DAY EVENT

NPPC sponsored the Agriculture Council of America’s National Ag Day proceedings held this week in Washington, D.C. The program, which began in 1973, is designed to increase public awareness of agriculture’s crucial role in the United States and across the globe. President Trump issued a proclamation recognizing National Ag Day as March 20, marking the 45th anniversary of the observance.

 

NPPC RELEASES ‘WHY WE FARM’ VIDEO

NPPC this week released “Why We Farm the Way We Do,” a video designed to educate policymakers and other stakeholders about modern U.S. pork production practices. You can view the video, which features pork producers from around the country, by clicking here.

 

WHAT’S AHEAD

PORK PRODUCERS TO LOBBY CONGRESS ON INDUSTRY ISSUES

NPPC April 11-12 will host its spring Legislative Action Conference (LAC) in Washington, D.C. The biannual fly-in draws from around the country about 125 pork producers. Producers will lobby congressional lawmakers on issues of importance to the U.S. pork industry, including the importance of maintaining and expanding export opportunities, funding a Foot-and-Mouth Disease vaccine bank in the next Farm Bill and establishing a regulatory environment that keeps food affordable. The ever-popular Congressional Bacon Fest will be held Wednesday, April 11. NPPC is offering a series of issues webinars in advance of LAC for participating producers. For more information, please contact Jim Monroe NPPC’s senior communications director (monroej@nppc.org).