Washington Insider-- Monday

The Brief War on Pork

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

Russia Buy of US Soybeans Surprises Some

Russia showed up as a buyer of US soybeans for the week ended Oct. 8, with net purchases of 120,999 metric tons, their first new purchases of the marketing year.

The sales surprised some, given the ban on imports of certain ag products from the US, European Union, Canada, Australia and Norway, a ban that now goes through June 24, 2016. Information released by USDA when the initial ban was put in place Aug. 6, 2014, noted, “The products banned include beef, pork, poultry, fish and seafood products, fruits and nuts, vegetables, and some sausages and most prepared foods. In calendar year 2013, the United States shipped $1.3 billion of agricultural and related food products (including fish and forestry products), and of this amount approximately 55% are products now restricted.”

Of the 120,999 metric tons of soybeans purchased by Russia for the week ended Oct. 8, it reflected 68,999 metric tons of new sales and 52,000 metric tons of sales shifted from unknown destinations. Russia was the second largest buyer of US soybeans for the week. USDA also reported that 32,999 metric tons were shipped for the week. This puts US soybean export commitments to Russia (outstanding sales and accumulated exports) at 210,999 metric tons.

The US ag attaché Russia is forecasting the country will import 400,000 metric tons of US soybeans for 2015/16 with no mention of them being impacted by the food ban.

Russia started the 2015/16 marketing year with purchases of 60,000 metric tons of US soybeans, purchases that were made during the 2014/15 marketing year for delivery in the current marketing year.

Russia has remained a customer for US soybeans in recent years, importing 316,900 metric tons for the 2014/15 marketing year as the eighteenth largest buyer of the oilseed and imported 449,700 metric tons during the 2013/14 marketing year, putting them as the twelfth biggest customer. Between the 2010/11 and 2012/13 marketing years, Russian imports of US soybeans were between 30,300 and 82,000 metric tons.

USDA also shows export commitments for 120 metric tons of US rice to Russia for 2015/16, with 40 metric tons already exported. USDA data show Russia imported 500 metric tons in 2014/15, down from 3,100 metric tons in 2013/14 with imports of 2010/11 and 2012/13 marketing years of 1,500 to 2,200 metric tons.


GAO: Implementation of New School Lunch Standards Still Facing Challenges

A study on the ongoing implementation of the Healthy, Hunger-Free Kids Act of 2010 (HHFKA) found challenges still exist regarding encouraging lunch program participation, student acceptance of new menu items, and food waste, the Government Accountability Office (GAO) reported.

The participation rate of students in the National School Lunch Program (NSLP) declined 4.5% – a total of 1.4 million students – between the 2010-2011 and 2013-2014 school years. Participation among enrolled students declined as well, from 62% to 58% over the same period.

Problems achieving student acceptance of changes made to the menu – in order to meet the new nutritional requirements – were cited by seven of eight states interviewed by the GAO as a reason for the declines seen in school lunch participation.

Also, recent increases in the price of school lunches were cited as another reason for declines in school lunch participation, by four of the eight states interviewed by GAO.

Participation in the School Breakfast Program (SBP) rose nationally in the same period that declines were seen in school-lunch participation, but the increase is partially attributable to the fact that breakfast expanded to more schools during that time.

Plate waste of mandated menu items was cited as a major issue faced by five of the eight states interviewed, although three noted improvements in the same area. Another five states noted that preparing required food items in a way that appeals to students was a challenge to encouraging student participation.

Competitive foods – those not part of a school-provided meal but sold on campus – also posed problematic for some schools, both with procuring complaint items and dealing with the reduced revenues seen from lower student demand for the new complaint items.

Clarity on new and ongoing implementation of nutrition requirements from USDA and implementing upcoming meal sodium reduction requirements were cited as continuing areas of concern among school-lunch administrators.


Washington Insider: The Brief War on Pork

Amid all the saber rattling over debt ceilings and budgets and such like, there was a little “prison menu dance” last week that pretty much amazed everybody. The Washington Post said that the federal Bureau of Prisons, which is responsible for over 200,000 inmates, was outed by the Fort Worth Star Telegram for its plan to pull roast pork from its menus, the sole remaining pork item offered. The reason given was “surveys of prisoners’ food preferences [that] showed it wasn’t a very popular menu item.” Plus, they blamed the rising cost of pork.

You might think that pulling a more costly menu item in favor of a less costly one would please Congressional budget hawks but that would be wrong, of course, because the hog industry has many strong supporters across the Midwest that watch very carefully for its interests. The Federal Bureau of Prisons was criticized by the National Pork Producers Council and also by individual Congressional supporters who saw the federal decision as a threat to pork markets.

These complaints seemed surprising to the Feds who caved almost immediately with promises to return pork to their menus. Not a word, though, about the prisoner’s preferences in the response.

Senator Grassley provided an example of “Senatorial outrage” at the bureaucrats’ proposal. Not only could he not imagine that anyone would reject pork, but he also asked the Bureau to “corroborate the validity of the claim that prisoners indicated a lack of interest in pork products.” He wants copies of the prisoner surveys and responses.

He took the opportunity provided by the menu issue to lecture the feds on the economic importance of pork in America. The pork products are highly likely to be home grown, he said, while “alternative products may be more likely to be imported. The pork industry is responsible for 547,800 jobs, which creates $22.3 billion in personal incomes and contributes $39 billion to the gross domestic product,” he wrote.”

Overall, the political events radar hardly gave the prison pork issue a blip as it went by, probably because it flamed out so quickly--but also because it is hard to understand how it could have happened. Anyone who has been exposed to even a glimmer of American politics surely knows the difficulty of pushing an important commodity from an established position in a federal program, especially without an overriding reason. Saving a little money or pleasing prisoners seems so unlikely to qualify. As can be seen.

So, in any event, the fully chastened bureaucrats are likely to be much more firmly focused on reality this week than they were only a few days ago. They also may have a new appreciation for the unreliability of local advice for their menu planners, Washington Insider believes.

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