Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.
China Buys of US Ag Goods To Rise 'Rapidly' This Fall: USTR Nominee
China's purchases of U.S. ag products is expected to pick up steam this fall, according to Michael Nemelka, nominee to be a deputy U.S. Trade Representative (USTR).
“We have the Phase One agreement, which also just entered into force a few months ago,” Nemelka told the Senate Finance Committee in his nomination hearing. “In that remarkable agreement, USTR achieved many long-held goals, including a commitment from China to fully respect intellectual property rights, end forced technology transfer, and increase purchases of U.S. goods and products, among many other things.”
A key is making sure that China meets its commitments, he noted in prepared remarks, “and we have an agreement that is in writing, and is fully enforceable, to make sure they do.” On making sure that China will live up to its purchase commitments, Senate Finance Committee Chairman Chuck Grassley, R-Iowa, asked Nemelka to address how USTR is working to make sure that China meets those commitments. Officials at USTR are working “every day to make sure that China lives up to its commitments,” Nemelka said. “We have our ambassador Gregg Doud on the phone nearly every day” with his counterparts in China.
In the fall, he added, the expectation is that “with these seasonal products and soybeans in particular that are currently in the ground, we expect to see those purchases rapidly increase.”
Nemelka's view matches that of USTR Robert Lighthizer and other U.S. trade officials who have indicated their China purchases will increase and that China remains committed to meeting the terms of the deal.
House Ag Panel Hearing Reveals Democrats' Concerns On USDA Food Box Program
A House Ag subcommittee hearing Tuesday brought out what was expected – Democrats have concerns about how USDA rolled the aid program out. Rep. Marcia Fudge, D-Ohio, chair of the House Agriculture Subcommittee on Nutrition, Oversight, and Department Operations, blasted USDA's operation of the Farmers to Families Food Box program. “Because USDA has rushed this program out the door, there is very little quality control with regard to who gets these contracts and who is qualified to actually meet the need,” Fudge said. “Tens of millions of dollars have gone to inexperienced contractors that still haven't delivered anywhere near what they've promised. As one food bank executive explained, if USDA had gone through established and capable channels, this problem could have been avoided. This is a humanitarian effort, not a gravy train.”
Fudge related that her panel heard from food bank experts on the ground that “USDA's lack of planning and strategy on the program has led to inexplicable decisions and policies with regard to how funds are distributed, the regions into which the country is divided in terms of food distribution, and other problems. Despite these issues, USDA has refused, to date, to provide any insight or background on how these decisions are being made, and what quality control, if any, exists to correct them if they're wrong.”
USDA Undersecretary for Marketing and Regulatory Programs Greg Ibach noted that in April “in just a few short weeks, USDA stood up [the program] as a new and innovative multi-billion-dollar COVID response program to address three critical needs simultaneously: to provide markets for farmers faced with declining demand and the crisis of food rotting in fields and animals being euthanized; the food needs of newly unemployed Americans; and helping put suppliers and distributors back to work.”
Ibach acknowledged the program does not have the same standards as regular USDA food distribution programs, but said that was because it was supposed to be put in operation so quickly.
There are political fights over almost everything these days as the Congress and the administration work to iron out another round of subsidies to offset impacts of the coronavirus -- amid the more or less normal budget battles.
In one such fight, POLITICO is reporting that “millions of kids could lose access to free meals” if recent practices are ended -- and that efforts are underway to counter that proposed USDA shift.
During the spring and summer, as the coronavirus health crisis exploded, the government allowed most families to pick up free meals from whichever school was closest or most convenient without proving they were low-income. But that effort is on the verge of expiring as children prepare to return to school – and many school systems are pushing the federal government to continue the free meals into the future.
So far, USDA isn't on board with an extension, POLITICO says, but school leaders are asking Congress “to force the government's hand as it buckles down to work on the next coronavirus aid package.”
“It's impossible. It's insane,” said Katie Wilson, executive director of the Urban School Food Alliance, which represents the largest school districts in the country, including those in New York, Chicago and Dallas. “Our districts have been screaming about it. They're panicked.”
If USDA doesn't extend the program's flexibility through the fall, families may be able to get food for their children only from the school where they are enrolled, after being deemed eligible for help -- a change that could create logistical barriers for many families, particularly those without cars or with parents working multiple jobs.
USDA says it is working with lawmakers as they develop the next coronavirus relief package. “This is [uncharted] territory, but we remain committed to ensure all children have food to eat throughout this pandemic,” the spokesperson said.
The department has already extended several waivers that make it easier to feed kids this school year, including loosening rules on nutrition and restrictions on who can pick up the meals -- but have “drawn a line” at requests to continue waiving eligibility rules.
Federal school nutrition programs often have been political targets, with disparate interests disagreeing about everything from fruit and vegetable servings to how much salt can be in pizza. But free meals have found broad backing, at least during the recent pandemic.
“This is still an emergency and we need to treat it that way,” said Diane Pratt-Heavner, a spokesperson for the School Nutrition Association, a group representing more than 50,000 local leaders who run school meal programs across the country.
The group has activated its vast network of local school officials to send nearly 20,000 emails to lawmakers asking them to pressure USDA to approve the remaining waivers for the rest of the school year. A spending bill on the House side includes language urging USDA to act. There's also a letter circulating in the Senate pressing the issue.
Most school cafeteria programs already face much higher food, labor, transportation and packaging costs, as they have been essentially operating emergency meals programs for months. Nutrition providers had to come up with creative ways to still feed their students with schools shut down. Most districts are now operating some form of meal pickups, and some are even dropping meals off at students' homes on a regular basis.
It's unclear how many students who have been getting help under the waived eligibility rules might get cut off if traditional rules go back into effect. “We're going to be going from a situation where we were just providing meals to all kids, no questions asked … to having to track by student name and status, so that you can charge families if they don't qualify by submitting a free and reduced meal application,” said Rosie Krueger, Vermont's director of child nutrition programs.
In 2018, the National School Lunch Program, which serves a mix of free, subsidized and paid meals to nearly 30 million children, cost just under $14 billion. An estimated 51 million children are projected to enroll in public elementary and high schools this fall.
Some high-poverty school districts already serve universal free meals under what's called the Community Eligibility Provision, something that's available to schools if a certain percentage of their students already qualify for help. About 30 percent of schoolchildren were in schools with universal free meals in the 2019 school year.
Jessica Shelly, director of student dining services for Cincinnati Public Schools, said she wants to see USDA aggressively press for free meals this year.
She recalled meeting USDA Secretary Sonny Perdue at a school nutrition conference years ago. “I remember him saying to all of us, to do right and feed everyone,” she said. “I am just really hoping that USDA recognizes that the motto needs to be embraced not just by us … but also by them. If they want us to do right and feed everyone, then they need to help us do that.”
So, we will see. These nutrition programs are important to many participants, and will be badly missed if they are not continued – but, they are expensive and highly visible to opponents. Efforts to continue them likely will be highly controversial and should be watched closely by producers as they intensify, Washington Insider believes.
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