Washington Insider -- Tuesday

DTN's Washington Insider

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

Stabenow Calls for USDA to Implement COVID-19 Relief Provisions

Senate Agriculture Committee Chairwoman Debbie Stabenow, D., Mich., is urging USDA to swiftly implement provisions included in the two latest coronavirus relief bills to protect food and farm workers and increase the resiliency of the U.S. agricultural supply chain.

In a May 25 letter to USDA Secretary Tom Vilsack, Stabenow highlighted the supply chain provisions of the American Rescue Plan as well as programs in the consolidated appropriations bill intended to increase food assistance and safeguard workers from COVID-19. Language in the two measures provided a combined $5.5 billion to USDA for those efforts.

"As USDA begins to implement these investments, I encourage the Department to take swift action and use creative approaches to help farmers and families recover from the pandemic," Stabenow wrote in the letter. Stabenow also highlighted the capacity of some existing programs at USDA to help make the supply chain more resilient and flexible in the face of large-scale disruptions.

"Allocating a portion of the funding toward programs like the Healthy Food Financing Initiative and the Local Agriculture Market Program Regional Partnerships will help ensure we are reaching all facets of the supply chain to improve food access and respond to COVID-19," she wrote.

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Lawmakers Probe USDA General Counsel Nominee on Several Issues

The key topic at a hearing last week for USDA General Counsel-nominee Janie Simms Hipp was concerns that meatpackers are using their market power to drive down prices paid to producers.

Several GOP senators led by the panel's ranking member John Boozman, R., Ark., were joined by Committee Chair Debbie Stabenow, D., Mich., in calling for a hearing on the matter to "look for solutions," Stabenow stated.

Hipp said that she needs an economist and a scientist "at my elbow" to inform her about the technical issues in agriculture.

Regarding biofuels, Sen. Amy Klobuchar, D., Minn., asked Hipp if she would defend the Renewable Fuel Standard (RFS) to the Environmental Protection Agency. Hipp promised she will be "a big voice at the interdepartmental table."

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Washington Insider: Overtures From Europe

Bloomberg is reporting that the European Union (EU) is now seeking to mend the fences with the U.S. and seeking to rekindle what is typically a strong relationship. The EU has sent President Joe Biden "a proposed joint statement to smooth over recent conflicts and give a boost to the trans-Atlantic alliance to confront China and Russia," the report noted. The new offering from the EU seeks to move the U.S.-EU relationship beyond trade disputes and address tariffs imposed during the Trump administration that have applied to more than $18 billion in goods. The effort is with an eye on an EU-U.S. summit in Brussels on June 15. The draft argues that shared values and interests will help both sides meet "unprecedented global challenges." The EU, according to Bloomberg, said in the document that they will "closely consult and cooperate on the full range of shared challenges and opportunities in the framework of our respective similar multi-faceted approaches to China." That, no doubt, is music to the ears of the Biden administration as they have publicly been seeking to enlist other countries and trading partners in addressing issues with China. But the EU did not stop at China, as Bloomberg said the document also addressed Russia. "We stand united in our principled approach towards Russia and we will respond decisively to its repeating pattern of negative behavior and malign activities," the document said. That has become another thorny situation for the Biden administration to deal with in the initial stages of Biden's presidency. Expectations for Biden's first foreign visit as president are that the two sides will seek to establish closer cooperation on China, Russia and no doubt the lingering impacts of the COVID-19 situation. And timing is key -- Biden meets with Russian President Vladimir Putin in Geneva the next day after his session with the EU. But this is hardly a surprise. The EU has been making conciliatory gestures for the last several months, including their agreeing to a four-month hiatus of the tariffs each have imposed over the large civilian aircraft disputes involving Airbus and Boeing. And contained in that announcement was a clear mention of the two wanting to address China's actions. The two partners need to address "the trade distortive practices of and challenges posed by new entrants to the sector from nonmarket economies, such as China." And the EU and China have seen a rise in their tensions. In March, Bloomberg noted, China retaliated against Western sanctions over human rights in the Xinjiang region by announcing measures against 10 individuals and four entities from Europe. And EU lawmakers have committed that as long as China has sanctions on those officials, the bloc will not ratify an investment agreement between the two. Of course, the document is still subject to change, Bloomberg pointed out, but currently said the two want to "join forces to prevent and peacefully resolve conflicts, uphold the rule of law and international law, and promote human rights for all." But there are also challenges in this desire by the EU to have a closer relationship with the U.S. For example, global tax issues remain a sensitive subject from both sides and a reading on that issue will come when G7 finance ministers meet at the end of the week ahead of the G7 summit next week. Plus, look for climate change to be another area where both will seek to broaden their relationship. But there is a hot political potato for President Joe Biden in that document, as Bloomberg pointed out it includes statements on "discouraging investment in fossil fuels, including coal, and calling for a phase out of unabated coal in energy production." That one will be a major test for Biden as oil-state lawmakers already view themselves as being somewhat under attack by the administration in early decisions. So, we will see. This effort by the EU to again become more closely aligned with the U.S. is a strategic move on their part as they seek to end trade tensions between the two sides. But agriculture will still need to watch this relationship closely as even if some of the most-recent tensions are addressed, there are still a laundry list of ag trade and other topics that remain unresolved, Washington Insider believes.

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