Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.
USDA Ups Forecast of China Corn Imports
USDA on Tuesday increased its China's corn import estimate, to 13 million metric tons, from 7 million metric tons previously.
The level, however, is still below other predictions out there, including the USDA ag attache office at 22 mmt.
USDA's World Board said, “For China, while the National Development and Reform Commission has not made any public statements indicating additional corn import quota has been allocated, shipment data for exporting countries through early November indicates they will exceed their tariff rate quota level of 7.2 (mmt).”
USDA's Foreign Agricultural Service (FAS) later on Tuesday noted, “China's imports of coarse grains for 2020/21 are forecast higher this month, mirroring the level seen in 2014-15 when imports spiked due to strong prices in the domestic market. The rise for 2020/21 is supported by strong recovery in the swine sector, which has been driving feed demand higher. Corn prices in the domestic market have rallied since February, and in October, the national price averaged around $362 per ton, the highest since August 2015.”
FAS also noted forecast rise in corn imports by China is “partly based on China Customs Statistics and U.S. Grain Inspections data through early November, which indicate that imports will far exceed the tariff-rate quota (TRQ) level of 7.2 mmt in calendar year 2020. There have been no public statements that would indicate that additional quota has been allocated by the National Development Reform Commission, the authority governing the TRQs.”
Biden Ag Transition Team
The Biden transition team for USDA will be led by Robert Bonnie, who was a senior adviser to USDA Secretary Tom Vilsack during President Obama's first term and was undersecretary for Natural Resources and Environment at USDA for Obama's second term.
Before joining USDA, Bonnie was vice president for land conservation at the Environmental Defense Fund, focused on incentives to reward farmers, ranchers and forest owners for stewardship activities on private lands.
The list also includes several volunteers such as Jonathan Coppess of the University of Illinois who was also Farm Service Agency administrator during the Obama administration.
Others include Nicholas Anthis, University of California; Sanah Baig, The Good Food Institute; Brooke Barron, Office of the Speaker, Maine State Legislature; Kumar Chandran, FoodCorps; Andrea Delgado, UFW Foundation; Debra Eschmeyer, Arizona State University; Meryl Harrell, Southern Appalachian Wilderness Stewards; LaQuita Honeysucker, The United Food and Commercial Workers International Union; John Padalino, Bandera Electric Cooperative; Gregory Parham, USDA (retired); Lisa Pino, State of New York, Department of Health; Amy Pitelka, Barker Pitelka PLLC; Jeffrey Prieto, Los Angeles Community College District; Audrey Rowe, self-employed; and Corey Then, Moneta Group.
Some on the transition teams can end up serving in roles in cabinet agencies under the new administration.
There is growing political tension in Washington on many fronts this week as the results of the election gradually sorted out—and new policies considered and debated.
With regard to efforts to fight impacts of the coronavirus, Bloomberg is reporting that the U.S. Senate's top Republican and Democrat are continuing to battle “over the size of fiscal stimulus needed to support the economy,” and that the dispute is dimming any hopes for an immediate package as lawmakers reconvene following the election.
Majority Leader Mitch McConnell, R-Ky., argues that Congress should pass a “limited” stimulus bill by year-end, in the wake of positive data on a slide in unemployment and after encouraging news on a COVID-19 vaccine.
Democratic leader Chuck Schumer, D-N.Y., countered that Republicans “have proposed totally inadequate solutions” on COVID-19 relief.
In addition, news from Pfizer Inc. that its experimental vaccine might be 90% effective introduced a fresh dynamic into the outlook for stimulus – and spurred a rally in U.S. equities on Monday. While hailing the development, president-elect Joe Biden warned that the U.S. still faces a “dark winter” with the coronavirus continuing to spread.
“That (virus) battle still takes time – it's an eternity to wait until February, let alone the time it will take to distribute a vaccine fully,” said Diane Swonk, chief economist for Grant Thornton LLP. Delays in passing another stimulus risk damaging the economy's capacity to grow for years to come as more people slip into long-term unemployment, small businesses collapse and families postpone or give up on education, she said.
For the moment, the American economic recovery has continued even with the expiration of fiscal support, Bloomberg said. The jobless rate fell by a percentage point, to 6.9% in October, data showed Friday.
“It turns out the news is a whole lot better” lately, McConnell said on the Senate floor. “I hope our Democratic colleagues will finally put aside their all-or-nothing obstruction and let the targeted pandemic relief – targeted relief is what we need – let it move forward.”
McConnell said that the Senate should pass a relief bill in the post-election congressional session, which began Monday and is slated to end in mid-December. “To be clear, our work is not finished. Too many Americans are still suffering economically,” he said.
Senate Republicans have supported a $500 billion virus package, without $1,200 stimulus checks for individuals or aid to states and local governments. However, Schumer called on Republicans to pursue a “bipartisan solution” rather than the stunts of recent months.
House and Senate Democrats continue to push for a $2.4 trillion measure. House Speaker Nancy Pelosi, D-Calif., said Friday that a smaller bill “doesn't appeal to me at all.” “That isn't something we should be looking at,” she said.
The U.S. Chamber of Commerce on Monday called on Congress to complete a package this year as the economy has yet to recoup losses that are “fallout” from COVID-19. The U.S. still has more than 11 million workers unemployed, it said.
“We have not yet beaten the coronavirus or achieved the economic recovery we all desire. Our leaders have wasted five months already. They can't waste another three,” chamber vice president Neil Bradley said in a statement.
One vehicle for at least some COVID-19 assistance is a spending bill needed to avoid the federal government shutting down on Dec. 11, when current funding runs out. Pelosi said Friday that rather than a short-term stopgap measure she favored an omnibus measure to complete the appropriations process for the fiscal year through next September.
Extended unemployment benefits and pandemic jobless benefits for gig workers are set to expire at the end of the year. With airlines and small businesses under mounting pressure, it will be hard for Congress to do nothing, said Alec Phillips, chief U.S. political economist for Goldman Sachs Group Inc.
Phillips argued that it's “reasonably likely” Congress will pass additional stimulus in negotiations before the Dec. 11 expiration of federal funding. Senators' views on the outlook differed, Bloomberg said. Appropriations Committee Chair Richard Shelby, R-Ala., said about wrapping COVID-19 relief into spending bills: “There's been talk about that, but we haven't seen that. It might not be a bad idea if we can agree on stimulus.” At the same time, Senator Roy Blunt, a Missouri Republican, said getting a stimulus deal in the lame duck session will be “hard.”
“Both sides are saying they want one but both sides are saying they only want the one they want,” he said.
So, we will see. Right now, the outcome of the elections is largely settled, although the timing and other details of the transfer remain in dispute and may continue to be for some time. These are important fights and should be watched closely by producers and others as they intensify, Washington Insider believes.
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