Capital Update – For the Week Ending Feb. 3, 2023

In this week’s National Pork Producers Council (NPPC) Friday recap: Farm Bill trade and horticulture hearing, labor talks with the West Coast, and Congressional Supply Chain Caucus.. Take a deeper dive below.

Senate Ag Committee Kick Off Farm Bill Hearings

What happened: The Senate Committee on Agriculture kicked off its first of a series of Farm Bill hearings this week. The first hearing focused on trade and horticulture with officials from the United States Department of Agriculture (USDA) testifying.

Key topics discussed: From specialty crop and food aid programs, addressing trade with Mexico, and strengthening market opportunities to animal and plant health concerns and organics, members opened the floor to conversations on opportunities to renew and expand key Farm Bill programs.

Trade topics: Under Secretary of Trade and Foreign Agricultural Affairs Alexis Taylor testified the agency is “aggressively diversifying the United States global portfolio of export markets for U.S. agricultural products” to markets such as Vietnam, the Philippines, Egypt, and Kenya. She told committee members that USDA is looking at trade opportunities in the broader Asian region through the Indo-Pacific Economic Framework for Prosperity (IPEF) and in other countries in Africa.

Additionally, Taylor testified on the importance and successes of the 2018 Farm Bill’s Agricultural Trade Promotion and Facilitation Program, which includes the Market Access Program and the Foreign Market Development Program, among others. Those programs help develop and support export markets for U.S. farm goods.

NPPC response: NPPC expressed its support in a tweet and statement:

“NPPC applauded the first Farm Bill hearing of the 118th Congress. We are pleased the Senate Agriculture Committee is taking up issues important to the pork industry. In 2021, the U.S. exported $8.1 billion worth of pork to more than 100 countries – increasing the average value of each pig marketed by nearly $63. These exports also support over 100,000 American jobs. Congress must provide strong investments in the Market Access Program (MAP) and Foreign Market Development (FMD) programs. A wide swath of U.S. agricultural commodities have utilized these export promotion programs, generating a net return of $24.50 for every dollar spent and creating 225,800 full-and part-time jobs across the U.S. economy. We look forward to a Farm Bill that benefits our producers and every American.”

Why it matters: Keeping open and expanding existing markets and opening new ones to U.S. agricultural exports, including pork, are vital to the continued success of America’s farmers and ranchers. In 2021, for example, the U.S. pork industry exported $8.1 billion of product, which added nearly $63 to the price of each hog marketed.

NPPC works with USDA and the Office of the U.S. Trade Representative to gain market access for pork to countries around the world. The association also advocates for trade agreements that eliminate tariff and non-tariff barriers to U.S. pork exports.

For the 2023 Farm Bill, NPPC is urging congressional lawmakers to fully fund the Market Access Program and the Foreign Market Development Programs and to refine the five-year agricultural blueprint’s trade programs to make U.S. farm policy more efficient, effective, equitable, and sustainable.

Upcoming Farm Bill Hearing Dates:

Hearing dates can change – stay up to date by checking the Senate Agriculture Committee hearing calendar here.

Labor Talks Between West Coast Dockworkers, Port Operators Slow

What happened: Ongoing contract talks between West Coast dockworkers and port operators have stalled, potentially exacerbating ongoing supply chain issues and jeopardizing U.S. export sales.

The International Longshore & Warehouse Union (ILWU), whose 22,000 members have been working without a contract since July 1, 2022, and the Pacific Maritime Association (PMA) have been negotiating a new labor agreement since last May.

The Biden administration and U.S. exporters and importers, including American agriculture, were expecting a new deal to be reached last fall, but the two sides reportedly are stuck on issues related to wages and port automation.

Why it matters: With about 60% of its exports going to Asia, West Coast ports are vital to the U.S. pork industry, which last year shipped nearly $8 billion of product to foreign destinations. That amount included almost $4 billion of pork exports to China, Japan, and South Korea, alone.

In late 2014-early 2015, during protracted talks between the PMA and the ILWU, which represents dockworkers at 29 West Coast ports, work slowdowns caused severe disruptions in U.S. exports and cost the U.S. meat industry millions of dollars in lost export sales. (Those slowdowns and more-recent supply chain problems at West Coast ports caused by COVID-19 prompted some companies to shift their trade to ports on the East Coast and Gulf of Mexico.)

NPPC’s efforts: Last summer NPPC joined more than 150 agriculture and business groups on a letter to President Biden asking the administration to urge the PMA and ILWU to extend their – at that time – expiring contract while a new agreement was finalized. The groups also suggested the administration request that while labor talks continued, West Coast ports owners and the dockworkers union not engage in any activity, such as a strike or lockout, that would disrupt port operations.

Relaunch of Congressional Supply Chain Caucus

What happened: A bipartisan group of members of Congress announced the relaunch of the Congressional Supply Chain Caucus. The Caucus will work toward updating and improving the supply chain systems. Congressman David Rouzer (R-NC) and Congressman Dusty Johnson (R-SD) will serve as the Republican co-chairs of the Caucus alongside Colin Allred (D-TX) and Congresswoman Angie Craig (D-MN), who will serve as the Democratic co-chairs.

This move was timely as the House Transportation and Infrastructure Committee heard from leaders from trucking, railroad, and port industries on supply chain issues. At the hearing, Congressman Rouzer said. “I think you’re going to see us take a strong look at what policies need to be repealed, what rules and regulations related to every industry need to be modernized. Not necessarily deregulatory efforts, but modernization efforts so that the rules and regulations fit the day and time.”

Why is this important: The agriculture industry has faced supply chain challenges from a lack of truck drivers, rail shipment disruptions, and port shipping challenges. In a press statement announcing the relaunch of the Caucus, Congresswoman Craig said, “By strengthening and stabilizing American supply chains, we can lower costs for Minnesota families and family farmers, get products to shelves faster and address the vulnerabilities that so often lead to bottlenecks and higher prices at the grocery store.”

What is next: House Republicans aim to move a supply chain package later in the spring. While acute supply chain disruptions have alleviated, lawmakers still want to address vulnerabilities that came to light during the COVID-19 pandemic. NPPC will look to engage to ensure supply chains remain strong and uninterrupted.