Agriculture News
State Labor Regulations and Labor-Intensive Agriculture
Farm Doc Daily | Posted on June 19, 2017The state of U.S. agricultural production is changing. Over the next decade, increases to minimum wage and other changing labor regulations will have a dramatic impact on fruit, vegetable and other labor-intensive agricultural production in the U.S. These impacts will be on top of evolving immigration policies and trends, which have been receiving a lot of attention in mainstream media as well as farm media in recent months. Many of these changes will undoubtedly be welcome to farmworkers and their families. This has been extensively discussed elsewhere, as well as the ongoing debate over what is an "appropriate" minimum wage. Here we consider the implications for agricultural production and farm management, which we believe will be substantial. While immigration is generally a national issue, many labor laws are set at the state level. Most U.S. fruit and vegetable production takes place in states that have significantly raised minimum wages in the last decade and plan further increases into the 2020s. Several of these states are also considering or have already mandated new benefits for farmworkers, such as sick leave and overtime. Many fruit and vegetable farmers, as well as other farms that rely on non-family labor, such as dairy farms, will need to reduce their labor use, increase productivity or take other measures, such as finding new markets, to remain viable. Farmers in the top 10 fruit- and vegetable-producing states (Figure 1) in the U.S. saw the minimum wage increase from 11% to 45% between 2008 and 2017. This range reflects important differences between these states, which we divide into "low-wage" and "high-wage" groups. The five "low-wage" states use either the federal minimum wage or a state minimum adjusted for inflation. The five states in the "high-wage" group have current minimum wages at or above $9 per hour and have committed to future increases. California, by far the largest fruit and vegetable producer in the U.S., will raise its minimum wage to $15 by 2023 and has also mandated overtime for farm workers. Washington ($13.50 by 2021) Oregon ($13.50 by 2022), New York ($12.50 by 2021), and Arizona ($12 by 2020) also plan to raise the minimum wage. Combined, the high-wage group represents more than two-thirds of U.S. fruit and vegetable production; California alone is 55% of production value (Figure 2).
U.S. exports to Mexico fall as uncertainty over NAFTA lingers
The Wall Street Journal | Posted on June 19, 2017Friction between the U.S. and Mexico over trade is starting to cut into sales for U.S. farmers and agricultural companies, adding uncertainty for an industry struggling with low commodity prices and excess supply.Over the first four months of 2017, Mexican imports of U.S. soybean meal—used to feed poultry and livestock—dropped 15%, the first decrease for the period in four years, according to data from the U.S. Department of Agriculture. Shipments of U.S. chicken meat fell 11%, the biggest decline for the period since 2003. U.S. corn exports to Mexico declined 6%. Mexico is the largest U.S. export market for those commodities.The numbers reflect how Mexican companies are now increasingly buying grain on a short-term basis and purchasing more chicken from Brazil, troubling some industry officials and analysts. The trade data, which is the latest available, indicates that Mexico is starting to follow through on aspirations to buy food from a wider range of countries, and reduce reliance on the U.S.“We have to send a signal to policy makers in Washington, and emphasize that we are not sitting still,” said Raúl Urteaga Trani, head of international affairs for Mexico’s Secretariat of Agriculture, who last month shepherded officials from 17 Mexican companies on a trade mission to South America, focused on corn, soybeans and wheat.
CoBank reports rising demand and strong profitability for US pork
Meat + Poultry | Posted on June 19, 2017According to a new report from Farm Credit System member CoBank, global demand and the potential for profit are creating strong incentives for US pork producers to expand capacity. While this means favorable conditions for producers, it also means intensified competition among packers and possible short-term compression in packer margins. “US pork packing capacity will increase eight to 10 percent by mid-2019, when five processing facility construction projects are complete and fully operational,” Trevor Amen, an economist with CoBank who specializes in animal protein said in a statement. “Hog production is expected to increase two to four percent in both 2017 and 2018 to meet the demand for more supplies, with the bulk of the increased production coming from small to mid-size pork producers in the Midwest.”
Trump’s Cuba Moves May Chill Long-Sought U.S. Farm Export Push
Bloomberg | Posted on June 19, 2017A rollback of Obama administration efforts to open Cuba to U.S. tourism and trade may chill a rebound in agricultural sales to the island nation, setting back a farm-lobby push that’s weathered two decades. U.S. Secretary of State Rex Tillerson signaled Tuesday that changes would come as soon as Friday, when President Donald Trump visits Miami. The moves may include new limits on travel and investment policies. While there’s no indications of a clampdown on agricultural sales allowed on a cash-only basis since 2000, cooled relations may drive buyers elsewhere, said Bob Young, chief economist for the American Farm Bureau Federation in Washington.The agriculture sector has long advocated an end to the trade embargo with Cuba in place since Fidel Castro consolidated power in the early 1960s. Companies including agricultural equipment maker Deere & Co. and soybean processor Bunge Ltd., along with the federation, the biggest U.S. farmer group, have supported full farm trade. "If we make it tougher on Cuba, there are other folks ready to line up and say, ‘We can help you with that,’" Young said.
Brazil approves world's first commercial GM sugarcane
Reuters | Posted on June 19, 2017Brazil has approved commercial use of a genetically modified sugarcane, setting a milestone for the country's highly competitive sugar industry as this is the first time such permission has been granted anywhere in the world. Authorization was obtained by CTC Centro de Tecnologia Canavieira SA, which developed the technology and made the application seeking approval in December 2015.
Cancer agency left in the dark over glyphosate evidence
Reuters | Posted on June 19, 2017The World Health Organization's cancer agency says a common weedkiller is "probably carcinogenic." The scientist leading that review knew of fresh data showing no cancer link - but he never mentioned it and the agency did not take it into account.The epidemiologist from the U.S. National Cancer Institute had seen important unpublished scientific data relating directly to a key question the IARC specialists were about to consider: Whether research shows that the weedkiller glyphosate, a key ingredient in Monsanto’s best-selling RoundUp brand, causes cancer.Previously unreported court documents reviewed by Reuters from an ongoing U.S. legal case against Monsanto show that Blair knew the unpublished research found no evidence of a link between glyphosate and cancer. In a sworn deposition given in March this year in connection with the case, Blair also said the data would have altered IARC’s analysis. He said it would have made it less likely that glyphosate would meet the agency’s criteria for being classed as “probably carcinogenic.”But IARC, a semi-autonomous part of the World Health Organization, never got to consider the data. The agency’s rules on assessing substances for carcinogenicity say it can consider only published research – and this new data, which came from a large American study on which Blair was a senior researcher, had not been published.The lack of publication has sparked debate and contention. A leading U.S. epidemiologist and a leading UK statistician – both independent of Monsanto – told Reuters the data was strong and relevant and they could see no reason why it had not surfaced.Monsanto told Reuters that the fresh data on glyphosate could and should have been published in time to be considered by IARC, and that the failure to publish it undermined IARC’s classification of glyphosate. The legal case against Monsanto, taking place in California, involves 184 individual plaintiffs who cite the IARC assessment and claim exposure to RoundUp gave them cancer. They allege Monsanto failed to warn consumers of the risks. Monsanto denies the allegations.
China's WH Group targets beef and poultry assets in U.S. and Europe
Reuters | Posted on June 19, 2017Smithfield Foods Inc's owner, China-based WH Group Ltd (0288.HK), is scouting for U.S. and European beef and poultry assets to buy, in a move that would sharpen its rivalry with global meat packers Tyson Foods Inc and JBS SA.Smithfield Chief Executive Ken Sullivan told Reuters he is interested in the potential of diversifying into other meats to broaden the company's product portfolio, though no deals were imminent."We're a food company," he said. "No one said that we're strictly a pork company."Sullivan did not provide further detail, but parent WH Group is looking for targets in beef and poultry in the United States and Europe, according to Luis Chein, WH Group's director of investor relations. He declined to name specific targets.Chein declined to provide a timeline for expanding into the U.S. beef and poultry business or say how much money the company aims to spend.
Dow, DuPont merger wins U.S. antitrust approval with conditions
Reuters | Posted on June 16, 2017DuPont (DD.N) and Dow Chemical Co (DOW.N) have won U.S. antitrust approval to merge on condition that the companies sell certain crop protection products and other assets.The asset sales required by U.S. antitrust enforcers were similar to what the companies had agreed to give up in a deal they struck with European regulators in March. The deal is one of several big mergers by farm suppliers, and the antitrust approval was quickly denounced by the head of the National Farmers Union, saying that farmers would face higher costs.The Justice Department said the asset sales would prevent price hikes or lost innovation.Dow and DuPont announced the deal in December 2015 in what was billed as an all-stock merger valued at $130 billion.According to the filing in U.S. District Court for the District of Columbia, the assets to be sold include DuPont's Finesse herbicide for winter wheat and Rynaxypyr insecticides, which the Justice Department said had U.S. annual sales of more than $100 million.In addition, Dow will sell its U.S. acid copolymers and ionomers business. The products are used to make food packaging and other goods.
Losing one dairy farm a day is not 'normal'
Wisconsin State Farmer | Posted on June 15, 2017Headlines from the past month reveal the disappointing truth about the state of Wisconsin’s dairy industry. “Dairy industry breathes a sigh of relief,” said one headline, celebrating a “return to normal” now that most of the farmers who were axed by Grassland Dairy Products have found new milk buyers. And what does “normal” look like? “Dairy farm exits outpaced 10-year trend,” read another headline from Hoard’s Dairyman, noting Wisconsin lost 400 dairy farms in 2016.It did not go unnoticed by Wisconsin farmers that at the same time Grassland Dairy was dropping dozens of family farms, it was directly engaged in assisting the development of a 5,000-cow CAFO in Dunn County. Grassland is the largest producer of butter in the nation, with a market share of nearly 50 percent. Its effort to consolidate ownership at both the processing and farm level is a perfect example of why we need stronger anti-corporate farming laws.
As High-Tech Farms Take Hold, Can Farm Towns Hold On?
KCUR | Posted on June 15, 2017That means farms on the Great Plains and in many other parts of the country have had to grow in size and adopt new technologies to make ends meat. He can’t just farm 80 acres and make a living, he says. “I wish you could. I think life would be a lot simpler, easier,” Biesemeier says. “And there’d be a lot more people out here if that was the case.”About a hundred years ago, farming was the way a third of the country made its living. It used to be the most common occupation in America.As more farmers adopt new technology, they become more efficient, drive down prices on the crops they produce, and “that means the people who have not adopted find themselves with high costs and find it very difficult to make any money, and many of them wind up deciding to get out of the business,” MacDonald says.All that has led to the trends that have shaped all of American agriculture: The average farm is growing larger, fewer farmers are doing the job and midsize farms are disappearing. University of Missouri rural sociologist Mary Hendrickson says sometimes small towns in Middle America are written off, discarded in national discussions as “throwaway places.” But, she argues, there is a lot of value held not only in rural communities, but also in the surrounding farms and ranches. Farmers manage a huge swath of America’s land mass. If we want a healthier environment, she says, farmers who manage land and water need support to reverse some of the negative economic trends plaguing the small towns they live in and rely on.“Farmers can’t do it on their own,” Hendrickson says. “So it’s going to take some investments from rural development agencies, from potentially people outside the region as well.”