Perdue talks China sorghum, NAFTA at House Ag hearing
February 7, 2018
Agriculture Secretary Sonny Perdue told the House Agriculture Committee on Feb. 6 that he is hopeful that a North American Free Trade Agreement deal will be reached before the end of the year but the decline in U.S. sorghum prices after China announced it is conducting an anti-dumping investigation into U.S. sorghum exports to China shows the sensitivity of markets to trade news.
Perdue made the statements when he testified before the House Agriculture Committee on the state of the rural economy.
In his opening statement, Perdue acknowledged that farmers are facing lower prices and lower incomes, but said the Trump administration and the U.S. Department of Agriculture "are focused on creating economic conditions where they can prosper."
"With the help of farm disaster programs and crop insurance, many producers are recovering from some difficult times following a series of disastrous droughts, wildfires, and hurricanes in many parts of the country," Perdue said.
In an opening statement, House Agriculture Committee Chairman Michael Conaway, R-Texas, said, while the Trump administration has tried to reduce regulatory burdens and Congress passed a tax law to reduce taxation, "Unfortunately, on the earning side of the equation, the news has not been nearly as favorable.
"Natural disasters and high and rising foreign subsidies, tariffs and non-tariff trade barriers have resulted in lost crops and chronically depressed prices," Conaway continued. "And, uncertainty over the direction of trade has exacerbated the anxiety in rural America because the U.S. farmer and rancher depends so much on access to global markets to make ends meet."
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Crop insurance "has been an extraordinary success story, providing critical risk management to farmers and obviating the need for Congress to approve ad hoc disaster assistance over the past decade," but "the most costly hurricanes on record have shed some light on areas where we need to make improvements so crop insurance can serve the Florida orange producer as well as the Iowa corn farmer," Conaway said.
"On the trade front," he continued, "the ball is naturally more in the administration's court than it is in ours. I appreciate the administration's strong desire to strike better deals for the United States and to reduce if not eliminate our trade deficit. But, as you know, Mr. Secretary, there is also a very deep concern in the countryside that none of the gains we have made in the way of market access for farmers and ranchers should be lost in the process. In this regard, you have been a critical friend and advocate."
House Agriculture Committee ranking member Collin Peterson, D-Minn., said he is "very concerned that if prices continue to fall, and yields decrease, we could be in for some real trouble. This is one of the reasons I would like to see a new farm bill with an improved safety net – but with no new money, it's going to be hard to do."
Peterson also told Perdue, "Last year, the president's budget called for $231 billion in cuts to mandatory farm bill programs. You were not yet at USDA when the budget was released, but I hope that we'll be able to see your influence when the new budget is unveiled next week. I'm not sure anybody in the administration really understands agriculture, so we're relying on you to be a voice of reason at the table."
Peterson added, "I appreciate your efforts to give us some guidance in writing a new farm bill. I hope you will work with us to write a bill that provides an adequate safety net and other tools for our farmers and ranchers."