DES MOINES (DTN) – Groups tied to exporting and promoting U.S. agricultural goods lauded USDA tapping into the Commodity Credit Corp. to fund $2.3 billion in trade promotion and foreign food aid.
Agriculture Secretary Tom Vilsack announced USDA will use $1.3 billion for the Regional Agricultural Promotion Program (RAPP) and support for specialty crop industries to diversify export markets. Another $1 billion to help address global hunger.
Ted McKinney, CEO of the National Association of State Departments of Agriculture, was among those who cited that the RAPP funding will pick up as the Trump-era Agricultural Trade Promotion Program (ATP)is winding down. ATP was created when the U.S. was in a trade war with China as a way to help diversify U.S. export opportunities. That program was projected to generate $6.44 billion in farm cash receipts and nearly 14,780 jobs annually.
"Simply put, this program is a win for farmers, ranchers and the American economy because it will increase income and create more American jobs in the farm and food sector," McKinney said.
RAPP funding will supplement the MAP and FMD funds that several agricultural trade groups rely on.
"The U.S. Grains Council thanks Secretary Vilsack and the USDA for continuing to promote market development through providing a new program funding source," said Ryan LeGrand, president and CEO of the U.S. Grains Council. "The success of the Council would not be possible without its partners in both the public and private sector, and we look forward to expanding exports of corn, sorghum, barley and their co-products with this new source of funding, however, there is still a need to increase long-term funding of the MAP and FMD programs in a new farm bill."
Dan Halstrom, president and CEO of the U.S. Meat Export Federation, also thanked Vilsack and his staff for prioritizing international market development. Halstrom also listed the various trade programs that have helped agriculture overcome trade barriers in recent years.
"With ATP funding coming to the end, new investments in foreign market development are very timely and much appreciated," Halstrom said. "We also thank Congressional leaders for their support of this program and for their continued support of MAP and FMD funding."
The trade dollars are being boosted as USDA projects agricultural trade will fall this year compared to 2022. In Fiscal Year 2022, USDA reported a record $196 billion in U.S. agricultural exports. Through August, agricultural export dollars were down more than 10% from the same period a year ago.
USDA pointed out, "The FY23 agricultural trade deficit is $19 billion, and USDA has projected that it will grow to $27.5 billion in FY24. There is also increased competition in our export markets in Asia and Africa."
The funds and temporary programs created with it are in response to a request from Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., and Sen. John Boozman, R-Ark., the committee ranking member. Stabenow and Boozman asked Vilsack to release the funds as a way to ease pressure on demands for the next farm bill.
Vilsack made the announcement Tuesday as part of the World Food Prize's Borlaug Dialogue in Des Moines.
The United States Agricultural Export Council, (USAEDC) called the infusion of funds "a necessary and welcome development." The council cited that every dollar invested in trade programs generates more than $24 in net export revenue.
"I've experienced firsthand the immense positive impact on consumers, companies, and countries around the world, and on our U.S. agricultural economy from this type of sustained investment. This funding helps American producers compete in established overseas markets and expand into new ones," said Jim Sutter, chairman of USAEDC and CEO of the U.S. Soybean Export Council.
Sutter continued, "I thank USDA and Congressional leaders for their continued leadership and commitment to investing for impact. This new investment will continue our critical work started under the Agricultural Trade Promotion (ATP) program and explore new ways to advance nutrition, sustainability and economic growth through American products, services, and collaborations. At a time when global competition is increasing and conflicts remain, the work ahead is critical. We look forward to collaborating to deliver impact."
The funding comes as commodity groups have repeatedly called on Congress to increase funding in the next farm bill for USDA's two major trade-promotion programs, the Market Access Program (MAP) and the Foreign Market Development Program (FMD).
In a news release, USDA noted releasing the money is "consistent with a bipartisan request from the Senate Agriculture Committee."
Vilsack said in a news release, "The Commodity Credit Corporation continues to address the needs of American producers as significant and unpredictable challenges arise, including impacts to international commodities markets and global food insecurity in the wake of ongoing conflict and a changing climate."
Vilsack has been pushing back on congressional efforts to curb his authority to use the CCC. He noted the CCC has been in operation since the Dust Bowl.
"For 90 years, the CCC has stabilized markets, supported farm income and prices, and enhanced the ability of farmers to market their commodities," Vilsack said.
As if anticipating some criticism for using the CCC for trade and food aid purposes, USDA noted that five years ago "in reaction to the trade war with China," the Trump administration had developed the Agricultural Trade Promotion Program (ATP) to help exporters diversify their markets.
On food aid, USDA said, "Recent challenges to supply chains and ongoing conflicts have exacerbated what was already a dire situation of increased numbers of people experiencing food insecurity globally."
"An estimated 205 million people need life-saving food assistance, and some 768 million people are facing chronic hunger, according to the Global Report on Food Crises and the United Nations Food and Agriculture Organization.
The National Wheat Growers Association (NAWG) also pointed to the role wheat has taken in U.S. food assistance programs for more than 60 years as well. Between food-aid programs at USDA and the State Department's Food for Peace program, more than 1 million metrics of wheat has been donated annually each of the last three years.
"Additional funding for food assistance programs will help address the most urgent humanitarian needs in a generation. USW and NAWG look forward to working with USDA and other partners to ensure additional food donations generate the most benefit where it is needed most," Brent Cheyne, president of NAWG. "As NAWG works with Congress to reauthorize the Farm Bill, we continue to advocate for strengthening the in-kind commodity donation program and additional investments in the existing trade promotion programs."
USDA said it will purchase commodities and work with the U.S. Agency for International Development(USAID), the lead federal agency on international emergency food aid programs, "to ensure they reach those most in need around the world."
Chris Clayton can be reached at Chris.Clayton@dtn.com.
Follow him on X, formerly known as Twitter, @ChrisClaytonDTN.
Jerry Hagstrom can be reached at firstname.lastname@example.org.
Follow him on X, formerly known as Twitter, @hagstromreport.
(c) Copyright 2023 DTN, LLC. All rights reserved.