For the Week Ending May 28, 2021

May 28, 2021

NPPC URGES USDA TO INTERVENE IN DISASTROUS COURT RULING FOR SMALL U.S. HOG FARMERS 
On Tuesday, NPPC urged USDA to intervene in a recent federal district court ruling that, left unchallenged, will result in a 2.5 percent loss in pork packing plant capacity nationwide, and more than $80 million in reduced income for small U.S. hog farmers, according to an analysis by Dr. Dermot Hayes, an economist with Iowa State University. The federal court’s decision, which takes effect at the end of June, struck down a provision of USDA’s New Swine Inspection System (NSIS) allowing for faster harvest facility line speeds. NSIS, initiated during the Clinton administration and evaluated at five pilot plants over 20 years, was approved for industry-wide adoption in 2019. “We’ve modernized these plants to handle the line speeds. We’re dealing with a rule that’s 50 years old, and we don’t operate in that technology phase today. We’re asking the USDA to seek the stay and appeal the case….We definitely think the ruling is misguided,” said NPPC President-Elect Terry Wolters, a hog farmer from Pipestone, Minn., during an AgriTalk interview. One day after NPPC’s public offensive, USDA issued a notice that processing plants operating under NSIS should prepare to revert to the slower line speed by the end of June. NPPC is disappointed with USDA’s decision to support a flawed federal district court decision. While the agency has until the end of August 2021 to appeal the decision, irreparable harm will be exacted on small U.S. hog farmers when this court order goes into effect. NPPC will continue to pursue all avenues to reverse a court decision that will lead to pork industry consolidation and increased packer market power. To learn more, visit here

NPPC WARNS USDA OF ‘CATASTROPHIC’ PORK PRODUCER COSTS TO ADHERE TO PROP 12
On Thursday, NPPC President Jen Sorenson sent a letter to USDA Secretary Tom Vilsack requesting assistance for the pork industry as it faces “catastrophic” costs to implement Proposition 12. The initiative, set to go into effect on Jan. 1, 2022, will impose arbitrary animal housing standards that reach far outside the state’s borders to farms across the country, while driving up costs for both pork producers and consumers. The letter highlights an analysis by Dr. Barry Goodwin, an economist with North Carolina State University, which predicts dramatic changes—including the loss of small farms and further consolidation of the industry—as a result of Proposition 12 compliance costs. NPPC and the American Farm Bureau Federation have filed a lawsuit in the U.S. Court of Appeals for the Ninth Circuit, asking the court to strike down Proposition 12 as unconstitutional under the dormant commerce clause. Oral arguments were held in mid-April and a court ruling is anticipated by mid-summer. In related news, on Friday the California Department of Food and Agriculture issued its proposed rules for implementing Proposition 12; the rules were required to be finalized by Sept. 1, 2019. The agency is accepting public comments on its proposed rules through July 12. NPPC is currently reviewing the proposed rules and plans to file comments. Learn more here

SENATE AG COMMITTEE HOLDS HEARING ON USDA GENERAL COUNSEL NOMINATION
The Senate Agriculture Committee on Thursday held a hearing on the nomination of Janie Simms Hipp to be USDA’s general counsel. Hipp, a citizen of the Chickasaw Nation, served in several posts at USDA during the Obama administration, including director of the Office of Tribal Relations. She is currently the CEO of the Native American Agriculture Fund. During Thursday’s hearing, she was asked whether USDA has the authority to establish a carbon bank under the Commodity Credit Corporation (CCC). “I think the CCC has some very powerful authorities to support our farmers and ranchers and it has been used for years to support many different Farm Bill programs,” she responded, noting she hasn’t conducted sufficient legal research to provide an opinion. Earlier in the week, NPPC joined 18 food and agriculture trade associations in sending a letter to the committee in support of Hipp’s nomination. “Ms. Hipp is eminently qualified and has a fundamental understanding of the legal complexities surrounding agricultural law. We especially value Ms. Hipp’s distinguished career that spans over thirty-five years, which includes teaching agricultural law and food policy, and advocating on behalf of farmers and ranchers,” the letter explained. The committee may vote on Hipp’s nomination after it returns from Memorial Day recess.  

DOT EXTENDS HOURS OF SERVICE WAIVERS FOR LIVESTOCK, FEED 
On Wednesday, the Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) extended its COVID-19 emergency declaration for Hours of Service (HOS) waivers for the transportation of livestock and livestock feed through Aug. 31. HOS governs the amount of time commercial truckers can drive their loads and when they are required to rest between drives. The agency had previously extended the waivers through May 31. NPPC thanks the administration and FMCSA for ensuring the continuity of the U.S pork supply chain as an essential element of the nation’s food delivery infrastructure.   

COLOMBIAN ROAD BLOCKS PREVENTING TRANSPORT OF FOOD, GRAINS AND HOGS 
An ongoing national strike in Colombia has led to a number of road closures throughout the country, including those leading to major ports and economic hubs. Blockades are preventing food and grains from reaching hog farms, and halting the transport of hogs to processing plants, causing overcrowding at farms. NPPC met this week with PorkColombia—representing Colombian pork producer—and the Embassy of Colombia to discuss the situation. NPPC is concerned with how the delays are affecting domestic animal wellbeing and food security. NPPC is also concerned about the effect on U.S. pork exports to the country; last year, U.S. pork exported $146 million in product to Colombia. NPPC will continue to monitor the situation, and hopes a deal can be stuck to ensure food security and the health and safety of animals in the country. 

U.S., CHINA TRADE REPRESENTATIVES HOLD ‘CANDID’ MEETING
U.S. Trade Representative (USTR) Katherine Tai and Chinese Vice Premier Liu He held their first phone call this week, discussing the importance of the trade relationship between the two countries. “During their candid exchange, Ambassador Tai discussed the guiding principles of the Biden-Harris Administration’s worker-centered trade policy and her ongoing review of the U.S.-China trade relationship, while also raising issues of concern,” USTR explained in a brief statement. The Biden administration is conducting a comprehensive review of U.S.-China trade policy. U.S. pork faces a minimum 33 percent import tariff in China—a 25 percent retaliatory tariff, plus 8 percent Most Favored Nation (MFN) rate–while competitor nations only have the 8 percent MFN tariff—placing U.S. pork at a significant competitive disadvantage. NPPC continues to advocate for the removal of these punitive duties on U.S. pork in China.