POLICY, REGULATORY AND ISSUE UPDATES
House Appropriations Committee Clears FY 2023 Agriculture Appropriations Bill, including Equitable Relief for Specialty Crop Policies Under Crop Insurance
The House Appropriations Committee advanced a $27.2 billion Fiscal Year 2023 Agriculture Appropriations bill that would provide significant new funding for conservation technical assistance, rural broadband and food safety. The Committee approved the bill on a party-line, 31-26 vote after Republicans argued the 8.3 percent increase in spending in the overall bill was excessive. The increased funding may well be scaled back during negotiations with the Senate which has yet to begin work on its version of the measure due to disagreement over total FY 2023 spending and the division of spending between defense and non-defense, amongst other things. Before the final vote on the bill, the committee adopted by voice vote an amendment offered by Rep. Dan Newhouse (R-WA) that would prohibit companies from China, Russia, North Korea, or Iran from buying U.S. farmland. The manager’s amendment to the bill also includes a provision providing equitable relief with respect to specialty crop policies under Federal Crop Insurance.
Due to a flaw in the Standard Reinsurance Agreement (SRA), or contract between crop insurance and companies, administrative and operating expense reimbursement to pay for the sales and servicing of specialty crop policies and the adjustment of loss claims on these policies is cut whenever row crop prices increase. When row crop prices rise sharply, the cuts are especially severe as they were in the 2021 reinsurance year and as they are now in the 2022 reinsurance year. Importantly, the provision which works to restore overall A&O on specialty crop policies for the 2021 reinsurance year to their 2020 levels does not open the SRA nor does it amend the Federal Crop Insurance Act. A number of specialty crop and crop insurance champions worked hard to ensure this success, including but not limited to Chairman Sanford Bishop (D-GA), Ranking Member, Rep. Andy Harris (R-MD), Rep. Jimmy Panetta (D-CA), Rep. Kat Cammack (R-FL), Rep. Darren Soto (D-FL), Rep. Dan Newhouse (R-WA), Rep. John Moolenaar (R-MI), Rep. David Valadao (R-CA), and Rep. Henry Cuellar (D-TX), and so on. Access the bill here and the amendments here.
Don't Risk Your ARC Payments with ERP Provisions
Many producers filled out FSA form 520 by assigning shares of 50 percent to themselves and 50 percent to their spouse in order to take advantage of the 15 percent increase in ERP payments for historically underserved producers. However, it is important to remember that the shares assigned on form 520 must match shares reported earlier for the ARC/PLC 2022 program which began on October 1, 2021. If not, any ARC or PLC payments for 2022 will be reduced by 50 percent. For producers whose shares at FSA already represent a 50/50 split with their spouses, this reduction would not apply as form 520 filled out to reflect such a split would match the shares reported for ARC/PLC 2022. Shares for all FSA programs can be restructured going forward to reflect a 50/50 split for spouses. It should also be noted that there will be additional implications from a restructure, including conservation compliance requirements, so discuss the change with your county FSA office and crop insurance agent before making final decisions. For more resources on ERP visit our website.
USDA Announces Additional Farm Service Agency and Rural Development State Directors
President Joe Biden announced his intent to appoint five U.S. Department of Agriculture (USDA) regional positions, including three Farm Service Agency (FSA) State Executive Directors and two Rural Development (RD) State Directors. Christy Davis will be appointed RD State Director in Kansas and Lillian Salerno will be appointed RD State Director in Texas. Read the full USDA release here.
USTR Defends Trump’s China Tariffs as Leverage
U.S. Trade Representative Katherine Tai argued against lifting tariffs imposed by former President Donald Trump on hundreds of billions of dollars’ worth of Chinese goods Wednesday, saying it would not do much to ease inflation and would remove key leverage she has in negotiations with China. Tai said, “The China tariffs are, in my view, a significant piece of leverage, and a trade negotiator never walks away from leverage.” Several farm groups sent a letter to Tai in May, urging the Biden Administration to withdraw Section 301 tariffs on China as well as Section 232 tariffs on steel and aluminum imports from China and elsewhere. Read more here.
Supreme Court Leaves Bayer to Fight Roundup Claims while Federal Preemption under FIFRA Hangs in Balance
On Tuesday the Supreme Court denied a petition to review a federal appellate court ruling that the Federal Insecticide, Fungicide, and Rodenticide Act does not preempt state tort-law claims. Monsanto will continue making the case for federal preemption in the courts through a separate petition filed in which the company seeks review of a California Court of Appeals decision in a similar case. Bayer said in a statement “The company believes that the [Supreme Court] decision undermines the ability of companies to rely on official actions taken by expert regulatory agencies, as it permits every U.S. state to require a different product label, which conflicts with the clear intent of the ‘uniformity clause’ adopted by the U.S. Congress in FIFRA and similar Statutes.” For their part, agriculture groups defended glyphosate following the Supreme Court’s decision Tuesday and warned that the ruling risks the global food supply and stricter herbicide regulations. They said now is not the time to limit chemicals that can boost food production, after Russia’s invasion of Ukraine, one of the world’s top grain-producing regions, has helped drive up global food prices. “Too much is on the line to allow the emergence of an unscientific patchwork of state pesticide labels that would threaten grower access to tools needed,” wrote farm groups. Read more here.
Eminent Agriculture CPA Expert, Paul Neiffer, Writes “Not Much Good News on ERP”
In a new blog post, farm CPA expert Paul Neiffer, principal with CliftonLarsonAllen (CLA), discusses Adjusted Gross Income (AGI) issues facing producers who seek to increase their payment limitation under the Emergency Relief Program (ERP). Negative AGIs, machinery sales, and other issues continue to be an obstacle. Read the full blog post here.
Mayra Flores Appointed to House Agriculture Committee
On Wednesday, House Agriculture Committee Ranking Republican Member, Rep. Glenn “GT” Thompson (R-PA) welcomed newly-elected Rep. Mayra Flores (R-TX) to the House Agriculture Committee. Said Flores: “As a legal immigrant from Mexico who grew up working in cotton fields to help make ends meet, I am looking forward to working alongside my colleagues on the House Agriculture Committee to advance commonsense policies that help farmers and producers in South Texas and across the country continue to feed the world and provide good-paying jobs for Americans.” Flores succeeds Rep. Filemon Vela (D-TX) who resigned his seat in order to take a job in the private sector. Read more here.
Survey Shows Rural Bankers Fear Looming Recession
Approximately 93 percent of rural bankers believe there is a high chance of a recession descending upon the nation, according to The Creighton University Rural Mainstreet Index. Of the 93 percent, 42 percent believe the recession may come within the next 12 months. Creighton University economist Ernie Goss believes that rural areas will not immediately feel the effects and will temporarily benefit from high commodity prices. Goss said that farmers will be at risk as they borrow more money.
Agriculture Groups Support Taylor Nomination
A coalition of farm groups, including National Sorghum Producers, Southwest Council of Agribusiness, USA Rice, Western Peanut Growers Association, and American Sugar Alliance, sent a letter to Senate Agriculture Committee leadership endorsing the nomination of Alexis Taylor to be USDA’s Undersecretary for Trade. The letter says the Oregon Agriculture Director "is a widely recognized leader on agriculture policy and has the domestic and international experience to shepherd U.S. agriculture through growing global changes of protecting food security, tackling inflation, and expanding markets for U.S. agricultural products.”
Commerce Department Rules Fertilizer Imports Were Subsidized, Dumped in US
The Commerce Department issued final rulings that Russia and Trinidad and Tobago unfairly subsidize exports of urea ammonium nitrate fertilizer, which is dumped in the U.S. at below-market prices. The rulings bring the U.S. another step closer to finalizing stiff duties on the fertilizer that American farmers say has become too costly and scarce to the point where they may have to ration usage. The final stage in the antidumping and countervailing investigations will be rulings from the U.S. International Trade Commission on whether or not the agency will finalize determinations that the UAN imports from companies in Russia and Trinidad and Tobago do damage to U.S. producers of the fertilizer. Read more on this story from Agri-Pulse here.
FSA Accepting Nominations from Farmers to Serve on Local Committees
The U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) announced on June 15 that they are now accepting nominations for county committee members. Nomination forms for the 2022 election will need to be postmarked or received in the local FSA office by August 1,2022. County committee members will make important on how decisions on federal farm programs are locally administrated. To learn more about USDA's FSA county committee nomination and elections, read here.
ORGANIZATION UPDATES
Keesling Highlights U.S. Food Aid on Agri-Pulse Newsmakers
National Sorghum Producers board director Doug Keesling from Chase, Kansas, was featured on Agri-Pulse's Newsmakers segment this week with a "From the Field" question highlighting the importance of U.S. food aid and how to overcome the associated costs with shipping U.S. commodities like sorghum and wheat. Watch the segment here.
New Episode! Sorghum Smart Talk: Policy Edition
Check out the newest episode of Sorghum Smart Talk: Policy Edition! Tune in for a special episode of Sorghum Smart Talk: Policy Edition about the Rural Investment to Protect Our Environment (RIPE). NSP's John Duff is joined by Martin Barbre, vice president of engagement and government affairs for RIPE, to discuss their work with farmers and on Capitol Hill. It's available at https://sorghumgrowers.com/podcast/ or on your favorite podcast platform!
Sorghum Checkoff Continues the Cultivation of Sorghum Leaders
The United Sorghum Checkoff Program is accepting applications for Leadership Sorghum Class VI, a program designed to cultivate the next generation of sorghum leaders. During the 14-month leadership program, class members will have the opportunity to experience various aspects of the sorghum industry in addition to personal development and networking opportunities. Applications are available here and are due by 5:00 pm CST on September 23. To learn more about Leadership Sorghum, visit SorghumGrowers.com.
CROP UPDATES
Export Report
Sorghum export shipments were up noticeably from the previous week and from the prior 4-week average with net sales of 3.7 million bushels for 2021/2022. China made purchases of 2.37 million bushels and Mexico at 1.3 million bushels. Exports of 5.9 million bushels were up 13 percent from the previous week but down 11 percent from the week prior 4-week average. The destination was China.
Sorghum Crop Progress Report
Eighty percent of the nation’s sorghum acreage was planted by June 19, six percentage points behind the previous year and 5 points behind the 5-year average. Texas planted 95 percent of its sorghum acreage by June 19, one percentage point behind the previous year and 2 points behind average. By June 19, fifteen percent of the nation’s sorghum acreage had reached the headed stage, 1 percentage point behind last year and 2 points behind average. Forty-six percent of the nation’s sorghum acreage was rated in good to excellent condition on June 19.
Sorghum Checkoff Releases Weekly Sorghum Basis Snapshot
The Sorghum Checkoff, with Southwest Agribusiness Consulting, released its weekly sorghum basis snapshot, available at SorghumCheckoff.com.
Sorghum in the Spotlight:
Husker team leads effort to help sorghum defend itself from aphid attacks - IANR News
Drawn-out sorghum harvest nears end - Grain Central
Chinese Farmers Bought More US Sorghum in May Amid Wheat, Corn Price Hikes - YiCai Global
USGC: US DDGS, Sorghum Showcased in Turkey - Ethanol Producer Magazine
Upcoming Events
June 27 NLS Food Evolution Summit - Scottsdale, AZ
July 4 Independence Day - Office Closed
July 18-21 Leadership Sorghum Session - Washington, DC
August 2 Mid-South Ruminant Nutrition Conference - Grapevine, TX
August 11 Sorghum U - Wichita, KS
August 15 NSP Board Meeting - Wichita, KS
August 17 USCP Board Meeting - Wichita, KS
Market News - To view this week’s Gulf export grain report, click here.
About Sorghum Notes
Sorghum Notes is a publication of the National Sorghum Producers. NSP represents U.S. sorghum producers and serves as the voice of the sorghum industry from coast to coast through education and legislative and regulatory representation.