Amidst great farm uncertainty, Congress to vote on disaster aid
Congress returns today amidst some of the greatest uncertainty for agriculture in decades, with corn and soybean planting behind schedule, commodity prices low, and trade conflicts with China and Mexico worse than before the Memorial Day congressional recess.
The House is scheduled to vote at 6:30 p.m. on a supplemental appropriations bill that includes aid to farmers and ranchers who experienced hurricanes and wildfires in 2018 and flooding this year.
The Senate passed the bill before leaving for the recess. The House attempted to pass the bill by unanimous consent, but objections from three Republican House members stopped those efforts.
The bill — technically the Senate Amendment to H.R. 2157 sponsored by House Appropriations Committee Chairwoman Nita Lowey, D-N.Y. — is listed on the suspension calendar and expected to pass easily. President Donald Trump is expected to sign it, although he left on a trip to the United Kingdom and France on Sunday evening.
Disaster aid may help farmers recover from past losses, but the American Farm Bureau Federation’s Market Intel service pointed out that last Tuesday, USDA’s latest Crop Progress report showed historic delays in corn and soybean plantings across farm country.
While high levels of precipitation were the primary factor in delayed planting, Farm Bureau also said that farmers may take into account the Trump administration’s announcement that it will distribute another round of Market Facilitation Payments due to the continuing trade conflict with China.
“While USDA has not announced the rates, many farmers who may have otherwise taken the prevented planting option may look to plant something in order to participate in the MFP program as the original announcement stated that payments would only be paid on planted acres,” Farm Bureau said.
Major publications including The Economist and the Los Angeles Times said in recent days that the conflict between the United States and China has moved from a trade war to a “clash of civilizations.”
On Sunday, China’s State Council issued a statement that the United States was responsible for the breakdown in the trade talks.
And then there’s President Donald Trump’s threat to impose a tariff on all Mexican goods by June 10 if Mexico doesn’t stop illegal immigrants coming through its country into the United States.
U.S. and Mexican officials say the conflict won’t affect approval of the U.S.-Mexico-Canada trade agreement in either country, but analysts don’t buy that viewpoint.
The San Francisco Chronicle said Friday the tariffs would jolt the state.
California exports dairy products, nuts, fruits and grains to Mexico, said Sung Sohn, an economics professor at Loyola Marymount University, who predicted that farmers will be hard hit, the Chronicle said.
“I think it’d be a disaster for agriculture in general,” said Ken Christopher, executive vice president at Gilroy’s Christopher Ranch, the nation’s largest garlic grower. “In a world where supply goes down, demand is going to stay the same, so that just means higher prices for all Americans.”
Avocados, for instance, could wind up costing an extra nickel per pound for distributors with a 5% tariff, Will Brokaw, co-owner of Brokaw Ranch, a Ventura County farm that grows avocados and other fruits, told the Chronicle.
Because Mexico provides 78% of U.S. avocados, the price of American-grown avocados might rise in the short run, but people might turn away from the fruit as prices rise, Brokaw said.
A delegation of Mexican officials is expected to meet with U.S. officials and allies of Mexico in Washington this week, Reuters reported.
On Friday, Mexico’s top farm lobby said President Andrés Manuel López Obrador should target agricultural goods from states that support Trump’s Republican Party if the American leader carries out his threat to punish Mexico for the migrants heading north, Reuters said.
As he left for London Sunday evening, Trump told reporters “We’re going to clog up the border. We’re going to stop the border. Mexico is making hundreds of billions of dollars for many, many years. And they have to do something about the border. Everyone is coming through Mexico — including drugs, including human trafficking — and we’re going to stop it or we’re not going to do business and that’s going to be it. It’s very simple.”