By RYAN MCCRIMMON (firstname.lastname@example.org; @RyanMcCrimmon)
With help from Liz Crampton
05/16/2019 10:00 AM EDT
— The Agriculture Department could offer up to $20 billion in a second trade assistance package to farmers and ranchers burned by retaliatory tariffs. The plan is likely to include more direct payments and commodity purchases.
— House Agriculture Chairman Collin Peterson threatened to sue USDA over how it’s handled sign-ups for the Conservation Reserve Program, which pays farmers to take vulnerable farmland out of production.
— The U.S., Canada and Mexico are close to a deal to remove steel and aluminum tariffs that have weighed on farmers, a move that could significantly boost the chances that Congress will ratify the new NAFTA 2.0 deal.
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Driving the Day
USDA OUTLINES UP TO $20 BILLION IN EXTRA TRADE AID: Agriculture Secretary Sonny Perdue said Wednesday that the Trump administration is considering $15 billion to $20 billion in assistance for ag producers feeling the economic pain from President Donald Trump’s escalating trade feud with China, Pro Ag’s Catherine Boudreau and your host report.
Details, details: Perdue said USDA’s trade aid 2.0 plan is still in the works, but it’s likely to include direct payments to producers and potentially another commodity purchase program, similar to last year’s trade-relief program for 2018 production. He said the aid will fully comply with WTO limits on agricultural subsidies.
We hear ya: The department is also taking into account feedback from the first round of assistance, Perdue added. Certain commodity groups (e.g. corn and wheat growers) saw the direct payment rates as inadequate to offset their losses stemming from the trade war.
“We will look at the history of what happened with that program and we’ll try to learn from it and improve from it and address some of those stakeholder comments,” he told reporters on a conference call.
Tallying up the current trade aid: A USDA spokesperson said the department so far has paid $8.5 billion in direct aid to farmers under last year’s program. Producers have until Friday to certify their 2018 production numbers to receive payments from USDA under the existing program, which included about $9.5 billion for direct payments.
PETERSON GOES OFF ON FSA ADMINISTRATOR: House Agriculture Chairman Collin Peterson kicked off the conservation subcommittee’s first hearing Wednesday by blasting Farm Service Agency Administrator Richard Fordyce for opening up Conservation Reserve Program continuous sign-ups ahead of general sign-ups, the two ways farmers can apply to participate in the program.
The continuous sign-up process operates on a rolling basis and is designed to protect the most environmentally sensitive land. The general sign-up format is competitive and is only offered during set periods.
Threatening to sue USDA, Peterson said he doesn’t believe the department has authority to open sign-ups before guidance in line with new farm bill provisions is issued. Peterson said he’s concerned farmers will be confused by the staggered sign-up process, and that it will result in more farmers participating in the continuous program. (Peterson has long been a fan of general sign-ups.)
In response, Fordyce said FSA determined “after thorough analysis” that continuous CRP sign-ups “may be opened under limited circumstances prior to publication of the regulation.” CRP continuous sign-ups will prioritize land devoted to water-quality practices, such as establishing grassed waterways, riparian buffers and filter strips, USDA said when announcing the sign-up period that will open in June.
Following the hearing, subcommittee Chairwoman Abigail Spanberger (D-Va.) said Peterson “raised a strong point.”
“If we’re changing sign-up timeframes for one aspect of the program, is that something that is not possible for both components of the larger program?” Spanberger asked. “He raised a question that I’m certainly interested in hearing the answer to.”
CLOSING IN ON A STEEL TARIFFS DEAL: Treasury Secretary Steven Mnuchin said Wednesday that the Trump administration is “close to an understanding with Mexico and Canada” to remove tariffs that have been in place for nearly a year and have weighed heavily on U.S. agriculture, report Pro Trade’s Megan Cassella and Sabrina Rodriguez.
It’s unclear what the potential agreement will include. But any resolution on tariffs would go a long way toward clearing a path to ratification in Congress for the U.S.-Mexico-Canada Agreement, Trump’s top trade achievement and his primary legislative priority this year.
On the Hill: Democratic leaders are already more optimistic about eventually supporting the NAFTA replacement following their latest meeting with U.S. Trade Representative Robert Lighthizer.
Agriculture and other industries have long called for removal of the tariffs, which many farm groups and lawmakers consider more important than the new trade pact. Trump’s tariffs prompted Mexico and Canada to retaliate with duties on $17 billion in U.S. exports, including many foods and farm goods.
For example, Mexico targeted pork products, potatoes, apples, cheeses and whiskey, while Canada slapped duties on U.S. coffee, yogurt, ketchup, orange juice, pizza and quiche, among many others.
On the table: Jesús Seade, Mexico’s undersecretary for North America, confirmed to POLITICO that instead of a quota system sought by the Trump administration, one proposal for a deal would involve a tracking system designed to prevent other countries from bypassing tariffs by shipping their steel and aluminum through Mexico.
— Trump today will roll out his latest immigration plan to boost border security and move the U.S. to a more merit-based system. There are already signs the proposal won’t gain much traction in Congress, POLITICO’s Anita Kumar and Eliana Johnson write.
— The White House will host a second infrastructure meeting with congressional Democrats next Wednesday. POLITICO Playbook has more.
— Indigo Ag, a startup providing seed treatments to boost crop yields, was named the top “disruptor” of 2019 on CNBC’s annual list of innovative companies.
— A fire this week at a major Blue Diamond processing plant in Sacramento could affect almond prices, but the company said it was too soon to assess the potential market impact, The Sacramento Bee reports. California processes about 80 percent of the world’s almonds, and Blue Diamond Growers is the largest processor.
— A top Kentucky ag official said it will be “impossible” for USDA to finalize a crop insurance program for hemp in time for the 2020 crop year, despite a push from Senate Majority Leader Mitch McConnell to include language in a disaster aid bill to direct the department to do so. Pro Ag’s Catherine Boudreau has the story.
— The Chilean government signed an agreement with Oceana on Wednesday to publish data tracking its commercial fishing vessels through the nonprofit advocacy group’s Global Fishing Watch map. The map, which tracks vessels in near-real time, is aimed at helping expose illegal fishing. Chile is the world’s eighth largest fishing nation with about $8 billion in annual seafood exports.
— The National Restaurant Association named Sean Kennedy as its executive vice president for public affairs. Kennedy will start in June, the group announced Wednesday.
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