Capital Update – For the Week Ending March 17, 2023
In this week’s National Pork Producers Council (NPPC) Friday recap: Secretary Vilsack testifies, Farm Bill listening session, and ASF and animal welfare webinars. Also, increased pork exports, APHIS awards, letters of support for passing TPA and for further action for SHIP IT Act. Take a deeper dive below.
Agriculture Secretary Vilsack Testifies Before the Senate Agriculture Committee
What happened: On Thursday, March 16, Secretary of Agriculture Tom Vilsack testified to the Senate Agriculture Committee. The hearing was entitled “Oversight of the U.S. Department of Agriculture”, and Secretary Vilsack was the only witness.
What’s the scoop: Chair Debbie Stabenow (D-MI) emphasized that the farm bill is a jobs bill and highlighted that the 2018 Farm Bill made historic investments to address challenges faced by rural communities and expand clean energy and voluntary conservation programs. Stabenow urged the committee to continue to work to expand and strengthen crop insurance as farmers continue to face challenges, such as high input costs.
Ranking Member John Boozman (R-AR) drew attention to rural population loss across the country and urged the committee to consider policies that improve the quality of life in rural communities. Boozman shared that, as production costs have increased, farmers will rely more heavily on credit this year. He expressed concern that farm programs have not kept pace with the needs of modern agriculture and are not responsive to threats, including the pandemic and geopolitical issues.
A significant focus of the questioning of Secretary Vilsack was on the topic of the Supplemental Nutrition Assistant Program (SNAP). Additionally, there was substantial discussion about farm input costs, market expansion and securing supply chains.
NPPC’s take: NPPC is encouraged that the House and Senate Agriculture Committees continue to discuss the 2023 Farm Bill and urges them to move the legislation forward to pass this year.
Learn more: Watch the Secretary’s full testimony here.
Farm Bill Listening Session Held in Waco, Texas
What happened: On March 15, House Agriculture Committee Chair G.T. Thompson (R-PA), Congressman Pete Sessions (R-TX) and a bipartisan group of committee members held a 2023 Farm Bill listening session in Waco, Texas. Attendees from the agriculture community, ranging from farmers, ranchers and producers to agribusiness owners and other interested stakeholders, stressed various concerns. These included research needs and the need for an insurance program for poultry growers.
What’s the scoop: One attendee stated that workforce and labor issues are a major concern for farmers in the state. He explained that the current labor shortage is a “national food security crisis” because of the state’s population surge and the lack of Congressional action on H-2A visa reform. During the listening session, several individuals from the Texas agriculture community asked for more money in the Farm Bill to invest in tools and technology to compensate for a lack of workers and programs to protect producers from disasters and disease.
NPPC’s Zieba Participates in ASF Webinar
What happened: On Tuesday, March 14, NPPC Vice President of International Affairs Maria Zieba participated in a webinar on the impacts of African swine fever (ASF) on global supply chains and economies.
ASF is a highly contagious pig-only disease that is endemic in many parts of the world, including Africa, Asia and Europe. Nearly two years ago, it was detected on the island of Hispaniola, the first time in more than 40 years it had been in the Western Hemisphere.
During the webinar, the third in a series hosted by the University of Minnesota, Feedstuffs and National Hog Farmer, Zieba pointed out that pork trade from ASF-positive countries has all but halted. For example, since ASF was first detected in a domestic hog in Germany in July 2021, their pork exports have fallen significantly, with Spain filling much of the void.
Zieba also discussed USDA’s responses – supported by NPPC – to ASF, including dedicating $500 million to fight the disease, establishing a protection zone for U.S. island territories near the Dominican Republic and Haiti, and increasing inspections at U.S. ports of entry. Also mentioned was the use of more dogs to detect food, plants and other material that can carry foreign pests and diseases.
Why it matters: Pork exports are vital to the U.S. pork industry, which last year shipped $7.68 billion of product to foreign destinations. Those exports contributed more than $61 to the $208.47 average price producers received for each hog marketed in 2022.
An outbreak of ASF in the United States would immediately stop U.S. pork exports.
NPPC’s take: NPPC has been monitoring ASF since the mid-2000s when it began spreading in Eastern Europe and ramped up prevention and preparedness efforts after the disease was detected in China in August 2018.
Currently, the U.S. pork industry is conducting producer education on ASF, working to enhance traceability standards and disease surveillance, reviewing its ASF response plan and engaging on the Swine Health Improvement Plan – a collaborative effort among industry, state and federal partners to certify the health status of the domestic hog herd. The industry also is working with trading partners, particularly Mexico and Canada, to understand opportunities to continue trade should ASF be diagnosed in North America.
NPPC’s Participates in FMI Webinar on Supply Chain Issues and Animal Care
What happened: On Wednesday, March 15, NPPC Chief Legal Strategist Michael Formica and Vice President of Industry Relations Jeff Pigott participated in a Food Marketing Institute webinar on supply chain issues and animal care.
The discussion topics stemmed around recent animal welfare developments in the poultry and pork sectors and their implications for food retailers. The National Chicken Council (NCC) gave an overview of their updated broiler chicken policy and discussed what the changes mean for retailers and their customers.
Formica and Pigott examined California Proposition 12, including the regulations on sow gestation stall size and their impacts on pork production, provided an overview of NPPC’s current legal challenge before the Supreme Court of the United States, and discussed the implications for food retailers.
Why it matters: Many Americans extend the notion of “eating well” to wellness and ethics. Consumers remain interested in how livestock and poultry are being raised in an ethical and sustainable manner, and brands are fielding these questions against the backdrop of mounting pressures from outside groups to adopt practices that arguably don’t have science-based guidelines or might be counter to science-based programs.
Additionally, producers and retailers are increasingly facing regulatory requirements at the state level that significantly impact operations and bottom lines.
NPPC’s take: Pork producers care deeply about the health and well-being of their animals and have a moral obligation to raise them humanely and compassionately. Healthy animals ensure safe food for consumers.
Learn more about how NPPC is advocating for science-based approaches to swine health and production and opposing efforts to dictate on-farm production practices here.
U.S. Pork Exports Increased in January
What happened: U.S. pork exports were up 16% in value and 13% in volume in January from a year ago, according to data released last week by USDA. Shipments to foreign destinations totaled nearly 237,000 metric tons worth more than $643 million.
Destinations for U.S. pork: As it was for all of 2022, Mexico was the top market for U.S. pork in January, importing a record 96,800 metric tons, which is up 11% from a year ago and a 7% increase from the record amount in December 2022. The value of those exports rose to more than $191 million, a 40% increase from January last year. The Dominican Republic, which is battling ASF, also continued to take more U.S. pork in January. It is nearly 8,200 metric tons of pork and was up 28% from last January, while the value soared to 67% and almost $24 million.
After down years in 2022, Canada, China, Japan, the Philippines, and most of the Central American countries started 2023 with U.S. pork imports trending up.
Canada, which had about 11% less U.S. pork by volume and 9% less by value in 2022 over 2021, increased imports by 19% by volume and 7% by value in January from a year ago. China’s imports in January topped 46,000 metric tons, up 31% from a year ago, with a value of nearly $122 million. Exports to Japan for the month increased 8% to 28,476 metric tons, although the value was down slightly at $116 million. The Philippines had a 35% increase from a year ago in imports of U.S. pork, valued at $10.1 million. U.S. pork exports to El Salvador, Guatemala, Honduras and Nicaragua combined were up 4% by volume to more than 9,700 metric tons and 13% in value at $27.7 million.
What it means for producers: January pork exports accounted for almost $58 in value for each hog marketed in the month, an increase of 8% from a year ago, and they accounted for 22.9% of the month’s total pork production, up from 22.4% in January 2022.
APHIS Awards $15.8 million to Bolster US Response to Animal Disease Outbreaks
What happened: USDA Animal and Plant Health Inspection Service (APHIS) announced on March 16 that they are awarding $15.8 million to 60 projects led by 38 states, land-grant universities and industry organizations to enhance the ability to respond rapidly and control animal disease outbreaks.
The funding was made possible by the 2018 Farm Bill’s National Animal Disease Preparedness and Response Program (NADPRP). According to the press release, this year’s “NADPRP funding supports projects focused on enhancing prevention, preparedness, early detection and rapid response to the most damaging diseases that threaten U.S. livestock.”
NPPC’s take: NPPC actively supported the inclusion of NADPRP in the 2018 Farm Bill, protecting animal health, and urges Congress to expand support for this critical program in the 2023 Farm Bill.
Ag, Food Groups Urge Passage of TPA
What happened: Farmers for Free Trade, a group of the leading U.S. agricultural and food organizations, including NPPC, urged Congress to pass Trade Promotion Authority (TPA) legislation to help boost U.S. exports. TPA defines U.S. trade negotiating objectives and guidelines and spells out an oversight and consultation process. Under TPA, Congress must review and vote for or against proposed trade deals without amendments.
In a letter sent Thursday to lawmakers from more than 50 organizations, Farmers for Free Trade pointed out that the United States is falling behind global economic competitors, including China and the European Union. It noted that after decades of running a trade surplus in food and agricultural products, the U.S. Department of Agriculture now projects in 2023, the United States will have a $14.5 billion agricultural trade deficit.
“The U.S. has not implemented a comprehensive trade agreement that opens new markets in over a decade,” said the group, which also called on Congress to approve TPA to “provide direction to the Executive Branch about the importance of expanding new markets for America’s food and agriculture products.”
Why it matters: U.S. agricultural trade is vital to America’s farmers, ranchers and the overall U.S. economy, supporting about 1 million U.S. jobs. For U.S. pork producers, pork exports contribute significantly to their bottom line. Last year, when they shipped $7.68 billion of product to foreign destinations, those exports contributed more than $61 to the $208.47 average price producers received for each hog marketed.
NPPC Signs Letter of Support for Further Action for SHIP IT Act
What happened: Last week, over 80 national, state and regional associations signed a letter urging further action for legislation to aid truck transportation and support the Safer Highways and Increased Performance for Interstate Trucking (SHIP IT) Act. The SHIP IT Act provides incentives for truck drivers and increases shipping capacity in hopes of improving the supply chain.
As mentioned in the letter, “Trucks are the linchpin of the transportation sector with most forms of freight trucked at least once during the supply chain process. Pipelines move almost another 20 percent of freight, while the rail and water modes combine for almost 20 percent.”
Why it matters: The pandemic highlighted the importance of trucking to the nation’s well-being in transporting goods and efficiently keeping the supply chain process intact. With an aging workforce, the need to recruit drivers is needed now more than ever to ease shortages and counter rising inflation by getting pork to the ports.
Learn more: Read the letter of support in improving U.S. transportation and bolstering America’s infrastructure here.