Capital Update – For the Week Ending January 6, 2023
FAS Allocates Fiscal 2023 MAP, FMD Funds to Promote Exports
What happened: Before the end of the year, the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) awarded nearly $203 million to more than 60 organizations as part of its Market Access Program (MAP) and Foreign Market Development (FMD) Program to help expand export markets for U.S. farm and food products.
Why it matters: FAS allocated $175.6 million in fiscal 2023 MAP funding to 67 nonprofit organizations and cooperatives that will support U.S. producers with global marketing and promotion activities, including market research, technical assistance and support for participation in trade fairs and exhibits.
Through the FMD Program, FAS provided $27.1 million in funding for fiscal 2023 to 20 trade groups representing U.S. agricultural producers. The program focuses on the broad promotion of U.S. commodities rather than a consumer-oriented promotion of branded products. Preference is given to organizations representing an entire industry or nationwide in membership and scope. The organizations conduct activities that help maintain or increase demand for U.S. agricultural commodities overseas.
NPPC does not directly receive MAP or FMD funds, but does continuously lobby Congress to fully fund each, which is one of our Farm Bill priorities. These programs have benefitted the U.S. pork industry; a record $8.1 billion of products were exported in 2021.
Learn more: For more information on MAP, click here. For more on the FMD Program, click here.
Final Rule Defining WOTUS Released
What happened: On Dec. 30, 2022, the U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers released a final rule defining Waters of the United States (WOTUS) under the Clean Water Act (CWA). This is the third attempt by a presidential administration in seven years to define the extent of EPA’s authority under the Clean Water Act.
What does the final rule state: The agencies stated, in a joint news release, “The final rule will cover those waters that Congress fundamentally sought to protect in the Clean Water Act – traditional navigable waters, the territorial seas, interstate waters, as well as upstream water resources that significantly affect those waters.”
Background: The federal CWA is the primary statute protecting the nation’s surface waters. Historically, it was limited to navigable waters, tributaries and adjacent water bodies that are hydrologically connected to or otherwise affect navigable waters. In the 50 years since the CWA’s passage, several U.S. Supreme Court decisions have sought to clarify the scope of regulatory jurisdiction for federal agencies under the act. However, determining which waterbodies are subject to federal regulations has been problematic for two decades.
Timeline: Debate over WOTUS has gone on for nearly 50 years. Following a series of court decisions limiting the reach of the CWA in the1990s, environmentalists sought to amend it. When those efforts failed, EPA sought to make the changes by regulation. The first WOTUS rule, issued during the Obama administration, expanded the CWA’s jurisdiction over U.S. waters to include navigable waters, upstream waters and intermittent and ephemeral streams (such as the kind farmers use for drainage and irrigation). It was subject to significant litigation.
In 2020, the Trump administration repealed and replaced it with the Navigable Waters Protection Rule (NWPR). The NWPR more narrowly defined “navigable waters” and was more workable for farmers and the rest of the regulated community. This week’s rulemaking is intended to replace the NWPR (which the Biden administration has already repealed) and once again expand what is covered as WOTUS.
What’s our take: WOTUS must be workable for farmers, and this final rule causes concern for pork producers as it may require costly CWA permits for many activities on or near covered waters, which may now include many drainage features typically found in or next to farm fields. This could eventually force farmers to obtain permits to undertake some basic farming practices, such as planting seeds or applying nutrients or crop protectants to their fields.
This regulation overreaches and gives jurisdiction over most, if not all, drainage features, waters, and wetlands on farms across the country. A farmer’s decision to implement edge-of-field and in-field conservation practices and nutrient management methods should not be micromanaged and infringe on farmers’ freedom to operate with abusive citizen enforcement suits.
Learn more: For more information, visit our website.
Senator Debbie Stabenow Announces She Will Not Seek Re-election
What happened: On Thursday, Sen. Stabenow, Chairwoman of the Senate Agriculture Committee, announced she would not seek re-election in 2024, which was a big surprise to many.
What does this mean for the Farm Bill: Sen. Stabenow has stated she remains “laser-focused” on the Farm Bill and is committed to passing it this year. Her announcement provides an incentive for her to do so, as it could help shape her legacy.
What does the future of her seat hold: It is believed that Reps. Slotkin (D-MI-7) and Dingell (D-MI-12) are considering running to fill the seat; however, other potential candidates will surface in the coming months.
Senate Trade Panel Leaders Want Trade Talks With Ecuador, Uruguay
What happened: In a letter sent the week of Christmas, the Democrat and Republican leaders of the Senate’s trade committee urged the Biden administration to begin trade talks with Ecuador and Uruguay, using the U.S.-Mexico-Canada agreement (USMCA) as a guide.
USMCA, which took effect July 1, 2020, updated and improved the 1994 North American Free Trade Agreement (NAFTA). USMCA continued the tariff elimination under NAFTA for pork going to Canada and Mexico. In 2021, Mexico was the largest and Canada was the fourth largest export market for U.S. pork by volume, largely attributed to the tariff elimination negotiated under these agreements.
Why it matters: In Latin America, Ecuador has been a top market access priority for NPPC. U.S. pork exports to Ecuador are very limited because of the myriad tariff and non-tariff barriers that prevent access into the market. A trade agreement modeled under USMCA would be beneficial for U.S. pork producers.
The letter sent by Foreign Relations Committee Chairman Bob Menendez (D-N.J.) and Ranking Member Rob Portman (R-Ohio) to U.S. Trade Representative Katherine Tai and Secretary of State Antony Blinken said:
“Pursuing comprehensive agreements with each country would not only offer improved market access for U.S. exporters but also facilitate greater collaboration on labor rights, environmental sustainability, anti-corruption measures, inclusive development, and policies benefitting small and medium-sized enterprises.”
The lawmakers also warned that “[w]ithout further U.S. engagement, however, the United States risks losing market opportunities for American companies and the potential erosion of our influence in the region relative to China.”
Learn more: Click here to read the letter.
What’s Ahead:
Michael Formica to Speak at American Farm Bureau Convention
What’s happening: On Monday, Jan. 9, Michael Formica, NPPC Chief Legal Strategist, along with Travis Cushman, American Farm Bureau Federation (AFBF) Deputy General Counsel, Litigation and Public Policy, and Angelo Amador, National Restaurant Association Senior Vice President, Legal Advocacy and Regulatory Counsel, at the AFBF Convention in San Juan, Puerto Rico. The roundtable will revolve around litigation and ballot initiatives, e.g., California Proposition 12 and Massachusetts Question 3, and what comes next.