Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.
Trump Continues to Send Mixed Messages on Phase One Trade Deal
China is now “more than” living up to the purchase commitments on U.S. farm products under the Phase One trade agreement, President Donald Trump told Fox & Friends Monday. “They know I'm very angry at them” over the COVID-19 virus, Trump said.
"Last week, because they know I'm very angry at them because this should have never happened, they made the largest order of corn, the largest order of soybeans in history," Trump said. "They made the largest beef order that they've done in a long time they are going the opposite way because they know how I feel because look they can't make it without us."
However, on Tuesday Trump said that he was the one that postponed the trade talks between U.S. Trade Representative Robert Lighthizer and Chinese Vice Premier Liu He, saying he did “not want to talk to China right now.”
Asked if he would pull out of the Phase One trade deal, Trump simply said, “We'll see.”
NASS To Resurvey Corn, Soybean Harvested Acreage In Iowa
USDA's National Ag Statistics Service (NASS) will update harvested acreage information for corn and soybeans in Iowa in preparation for the September 11 Crop Production report, the agency said Monday, saying the two crops “have been particularly impacted by the recent derecho.”
NASS said the additional data “will help to better assess the full impact” of the storm that rolled across the state August 10. “If the newly collected data justifies any changes, NASS will publish updated harvested acreage estimates in the September report,” the agency said.
USDA reported in its Crop Progress report that condition ratings for Iowa corn put 59% of the crop in good/excellent condition as of August 16, down from 69% the prior week, with 17% rated in poor/very poor condition versus 8% the prior week. Soybean also fell, with 62% good/excellent and 12% poor/very poor versus ratings one week ag that were 70% good/excellent and 7% poor/very poor.
Iowa Secretary of Agriculture Mike Naig said Monday that USDA's Risk Management Agency (RMA) reported 57 counties in Iowa were in the path of the storm. In those counties, there are 14 million acres of insured crops, including 8.2 million acres of corn and 5.6 million acres of soybeans “that may have been impacted.” The Iowa Department of Agriculture and Land Stewardship MODIS satellite imagery and preliminary storm reports from the Storm Prediction Center signal 36 counties were hardest hit, the agency said, and “likely had the greatest impact on 3.57 million acres of corn and 2.5 million acres of soybeans.”
Beyond the damage to crops, Naig said the state has lost “tens of millions of bushels of grain storage” just weeks before harvest was to start.
In this season of party conventions, POLITICO is reporting that USDA is facing fresh scrutiny over its practice of inserting signed letters from President Trump into food boxes that are part of a $3 billion stimulus program aimed at diverting excess farm goods like meat, milk and produce to food banks and other nonprofits.
The practice is criticized in a letter from House Democrats. In the letter inserted into the boxes, the president says he “prioritized sending nutrition food from our farmers to families in need” and promises to “support America's recovery every step of the way,” along with other promotional language. It also includes basic health recommendations, like urging recipients to wash their hands, stay home if they feel sick and “consider wearing a face covering when in public.”
The “friction point,” POLITICO says, arises from questions from Democrats regarding the messaging, namely whether it constitutes improper political activity by USDA officials. Dozens of lawmakers led by Rep. Marcia Fudge, D-Ohio, a senior House Ag Committee member, are demanding to know who ordered the Trump letters and whether it's mandatory or voluntary for contractors and nonprofits to include them in their food boxes.
“Using a federal relief program to distribute a self-promoting letter from the president to American families just three months before the presidential election is inappropriate and a violation of federal law,” the Democratic critics wrote to the department on Friday. “We strongly urge you to end this practice immediately.”
The report notes that the concerns largely echo the backlash against the President's signature that was reproduced on millions of stimulus checks sent to Americans by the IRS after Congress passed an initial $2 trillion economic rescue package in March.
POLITICO notes that Fox News first flagged the letters and is reporting that “they were the president's daughter's idea. She has been involved in promoting the food box program since it launched in May,” POLITICO said.
The initiative was already somewhat contentious because of USDA's selection of private contractors, including several with little experience in food distribution — including a wedding planner in San Antonio that was awarded nearly $40 million to pack and deliver food boxes across the Southwest.
USDA officials faced criticism from Rep. Fudge and other Democrats at a recent House Ag hearing about the choice of vendors and oversight of the program.
Besides heightened scrutiny of the ongoing effort, the new controversy could further motivate key lawmakers who are pushing to tighten restrictions on how the department spends any future farm relief funds.
That fight, POLITICO says, has become increasingly contentious as Senate Republicans plan to introduce a scaled-back stimulus bill amid the standoff over a new virus relief plan that's dragged on for weeks.
The proposed legislation would include a $300 a week enhanced unemployment benefit, money for small business aid, additional U.S. Postal Service funding and protection for employers against lawsuits stemming from COVID-19 infections, POLITICO said. It would represent a slimmed-down version of the $1 trillion legislation GOP senators introduced at the end of July as a counter-point to the $3.5 trillion plan Democrats passed in the House in May.
POLITICO also noted that there are no immediate signs that Senate Majority Leader Mitch McConnell, R-Ky., would call senators back from their August break to vote on the proposal. Any such legislation would need to get at least some Democratic support to get through the Senate and POLITICO thinks that is unlikely — and that any new stimulus may not be acted upon until September.
House Speaker Nancy Pelosi, D-Calif., and Senate Democratic leader Chuck Schumer, D-N.Y., have offered to trim their proposal by $1 trillion but have repeatedly rejected any smaller stimulus or doing a virus relief package piecemeal.
With just 78 days until the general election, the White House and congressional Republicans have been in a deadlock with Democrats over bolstering the U.S. economy with millions of people still out of work and many businesses struggling with pandemic-induced shutdowns, POLITICO said.
That is despite warnings from Federal Reserve officials, economists, governors and mayors that, with much of the earlier stimulus exhausted, the risk to the economy grows every day that goes by without a deal. And, while McConnell said on Monday in Kentucky that he still hopes they can cut a deal with Democrats, he avoided “any guarantees.” “I can't tell you with certainty we're going to reach an agreement,” he said.
So, we will see. While there is strong pressure for an addition relief bill, there also is strong resistance — an increasingly bitter fight producers should watch closely as it proceeds, Washington Insider believes.
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