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China's WH Group targets beef and poultry assets in U.S. and Europe

Reuters | Posted on June 19, 2017

Smithfield 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.


Trump’s Cuba moves may chill long-sought U.S. farm export push

Bloomberg | Posted on June 16, 2017

A 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.U.S. agricultural exports to Cuba rose to $221 million in 2016 after three consecutive annual declines, according to U.S. Department of Agriculture data compiled by Bloomberg. Sales so far this year are outpacing last year’s by 19 percent.  Trump’s tough line on Cuba isn’t deterring legislators and lobbyists. Senators including Republicans Mike Enzi of Wyoming and Jeff Flake of Arizona, along with Democrats Amy Klobuchar of Minnesota and Patrick Leahy of Vermont, introduced anti-embargo legislation last month."Instead of eating American-grown food, Cubans and tourists will be eating food from other countries,” unless trade is opened, Klobuchar said in a statement.


The Canadian Dairy Dispute

Farm Credit East | Posted on June 15, 2017

Canada has been extremely protective of its dairy farmers for a long time. Governed by a supply management quota system, Canadian dairy producers have had higher and more stable milk prices than U.S. producers. Canada has about 11,700 dairy farms, and just under 960,000 cows.¹ Compare that to the U.S., which has about 64,000 dairy farms and 9.3 million cows. The Canadian government put a supply management system in place in the early 1970s in an effort to reduce production surpluses. A farm’s quota can be adjusted up or down on an as-required basis by the government, according to consumer demand. This system limits farm expansion and the limited supply affects consumers directly. Canadian consumers pay the equivalent of about $6.73 (USD) for a gallon of conventional whole milk, compared to about $3.20 in the U.S. Canada’s milk pricing formula and the subsequent loss of export markets has attracted national attention in the U.S., with federal and state lawmakers urging the Administration to find a way to get Canada to roll back its pricing scheme. Nonetheless, this will be a difficult fight for American trade negotiators. The U.S. still enjoys a substantial dairy products trade surplus with Canada, and there is no punitive tariff, per se, to fight against. Instead, Canada has manipulated the situation to position its domestic suppliers to undercut U.S. imports. For its part, Canada has argued this is strictly a domestic policy issue, and that it is not responsible for the oversupply situation in the United States.Meanwhile, U.S. dairy producers and cooperatives have been scrambling to come up with new markets for not only displaced exports, but production levels that continue to increase. While trade is absolutely critical to American agriculture, this situation is emblematic of the frustration that U.S. companies sometimes face – markets are developed by innovative businesses and then undercut by protective actions.


Millions of pounds of apparently fake ‘organic’ grains convince the food industry there may be a problem

The Washington Post | Posted on June 15, 2017

The organic industry is creating an anti-fraud task force in the wake of a Washington Post report that millions of pounds of “USDA Organic” soybeans and corn imported through Turkey appear to have been fraudulent. Organized by the Organic Trade Association, the task force would develop methods for companies to ensure that imports of organic products are actually organic.“There is a strong desire on the part of industry to stop the incidence of fraud in organic,” said Laura Batcha, director of the association. “The consumer expects that organic products are verified back to the farm. The industry takes that contract with the consumer very seriously.” Last month, The Post reported that three enormous shipments of “organic” corn and soybeans - large enough to constitute a meaningful proportion of the U.S. supply of those commodities - had reached the U.S. Documents and interviews indicated that the shipments were not really organic - in fact, some had been treated with pesticides en route to the U.S. All three shipments hailed from Turkey, one of the largest exporters of organic products to the United States, according to Foreign Agricultural Service statistics. With the "USDA Organic" designation, the value of the shipments rose by millions of dollars.The report confirmed the suspicions of many U.S. farmers, who have seen prices by as much as a third as the volume of imports of organic corn and soybeans have climbed rapidly in recent years.After the story appeared, one of the nation’s largest organic inspection agencies, CCOF, issued a notice to its clients indicating that it “lacks confidence in the organic status of foreign grain. ” The agency instituted rules requiring that organic grain shipments be traceable back to growers.


Heritage Foundation’s Farm Policy Proposal Would ‘Devastate’ U.S. Farmers & Prove ‘Ineffective’ in Advancing Free Trade in Agriculture

Farm Policy Facts | Posted on June 15, 2017

The new report entitled, “The Heritage Foundation’s Farm Policy Proposals: Harmful to U.S. Farmers and Ranchers and Ineffective in Advancing Free Trade,” addresses what the author believes are fundamental flaws in Heritage’s “blueprint” for agricultural policy, which calls for unilaterally eliminating U.S. farm policy.  John Gilliland, an international trade consultant at Akin Gump Straus Hauer & Feld LLP and author of the study, explains how that would not only hurt America’s farmers and ranchers, but would also be an “ineffective tool in securing global free trade in agriculture.”The Heritage Foundation argues that eliminating farm policy would give the U.S. “moral authority to demand more of its trading partners,” but Gilliland suggests this would only weaken U.S. negotiating power to reverse rising foreign protectionist behavior. He writes:“Trade negotiations proceed in a uniquely transactional environment. Member countries give defensive concessions in order to secure offensive gains. To succeed in this environment, the United States needs bargaining power – tangible, offensive leverage that will convince other countries to come to the table.”Gilliland cites cotton as an example. He notes that while the United States has significantly reduced its support for American cotton growers in the farm bill, China ramped up “massive subsidization and stock-building programs” that created a glut in the global market, depressing cotton prices “to the detriment of farmers in the United States, Africa, and elsewhere.”Gilliland believes this experience is instructive for U.S. policymakers as he writes:“[A]ny ‘moral’ high ground U.S. farmers gained from the repeal of their farm support had virtually no impact on China’s willingness to devote billions of dollars in new subsidies for its own cotton industry.”In the face of this lopsided global playing field, Gilliland observes:“Eliminating the farm safety net and already low U.S. agriculture tariffs would further expose U.S. farmers to the manifold distortions of dozens of foreign governments… The U.S. farm economy is strong, innovative, and competitive. But it is not invulnerable against foreign treasuries and high market access barriers.”


USDA Posts Final Requirements for Exporting US Beef to China

DTN | Posted on June 15, 2017

U.S. beef shipping to China will have to come from cattle that are under 30 months of age, are born in the U.S., Canada or Mexico, and are traceable back to a U.S. farm with a unique identifier. Those were some of the main ground rules laid out Monday as the U.S. Department of Agriculture spelled out the specific requirements China expects for reopening its beef market to the U.S. for the first time since 2003. The release of the technical requirements marks some of the final steps for U.S. packers to send beef to China.According to the North American Meat Institute, beef products processed after May 24 can be exported to China once a packing plant is approved by USDA as eligible to ship to China.


Secretary Perdue Names Anne Hazlett to Lead Rural Development at USDA

USDA | Posted on June 15, 2017

U.S. Secretary of Agriculture Sonny Perdue has named Anne Hazlett, Chief Counsel to the Majority on the U.S. Senate Committee on Agriculture, Nutrition, and Forestry, to lead the Rural Development agencies at the U.S. Department of Agriculture (USDA).  Hazlett, whose title will be Assistant to the Secretary for Rural Development, will oversee the Rural Utilities Service, the Rural Business Service, and the Rural Housing Service within USDA and report directly to the secretary.  The announcement is in keeping with a realignment of USDA announced by Perdue in May and represents an elevation of Rural Development, which had previously been in the portfolio of an undersecretary, who in turn reported to the deputy secretary of agriculture. “With this addition to USDA Rural Development, rural America will have a seat at the main table and have walk-in privileges with the secretary on day one,” Perdue said.  “With her background of advising the Senate committee overseeing agricultural and rural development issues, Anne Hazlett comes with a depth of knowledge and experience perfectly suited to her role in helping to restore prosperity to rural America.  We are excited to have her aboard.”“Small towns and the people who call them home have been my life’s passion,” Hazlett said.  “It is with great enthusiasm and a deep commitment to rural America that I am eager to get to work at USDA and be a partner in crafting solutions to the significant challenges these communities face from economic opportunity to infrastructure, quality housing, and addiction.”


The Trump budget threatens funds that turn farmers into foodmakers. Rural communities should care.

New Food Economy | Posted on June 14, 2017

Value Added Poducer Grantss were authorized as part of the Agriculture Risk Protection Act of 2000, which amended the Federal Crop Insurance Act to strengthen the safety net for agricultural producers by providing greater access to more affordable risk management tools and improved protection from production and income loss. It was later amended by the 2002 farm bill. Housed within USDA Rural Development’s Business and Cooperative Programs division, the new program became a key ingredient to the secret sauce of the farmer-owned enterprise development sector.VAPG funds and services were critical to supporting the growth and development of entire industries. The early days of the program, for instance, saw its largest investments flow to planning efforts for ethanol and biodiesel facilities. Multiple millions of federal dollars were granted to farmer-led groups to hire consultants for feasibility and business planning efforts. Numbers were crunched. Engineering studies were drafted. Navigation maps for obtaining other incentives and fuel price agreements were created.At the time, politicians from both parties promoted the renewable fuels sector almost unanimously. Republicans could justify program investments and subsidies through a national security lens: developing domestic energy production. Democrats could wave the patriotic flag while also supporting job growth in rural communities. And many farmers, now investor-owners of energy plants, often made more money as investors than they did raising the corn or soy that fed the plants.


Enviros and BLM reach major public lands settlement in Utah

High Country News | Posted on June 14, 2017

Thousands of miles of dusty two-tracks crisscross Utah’s remote public lands. Some are historical routes, while others were carved more recently by backcountry recreationists in trucks and four-wheelers. Which roads should still be used and which should be abandoned to protect the environment has been a topic of intense debate for years. Now, Utah is one step closer to ending its roads controversy.  Last week an eight-year lawsuit spanning 11 million acres and 20,000 miles of routes in southern and eastern Utah ended with a settlement. Ten environmental groups argued that Bureau of Land Management plans created in 2008 for Utah public lands were too heavily weighted to favor off-highway vehicle interests. U.S. District Court Judge Dale A. Kimball in Salt Lake City agreed, in part.


US Cybersecurity in Need of Rapid Repair, Senators Told

Roll Call | Posted on June 14, 2017

Cybersecurity in the United States is in a severe state of disrepair, leaving the country vulnerable to attack from hacking groups backed by its opponents, two witnesses testified in a Senate subcommittee hearing Tuesday. The witnesses told the Senate Foreign Relations Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy that they believe a massive cyberattack is imminent unless the U.S. ratchets up its efforts to protect against and deter offensives from countries such as Russia, China, and North Korea.“The starting point,” Rosenbach urged lawmakers, “is to make the NSC framework mandatory for critical infrastructure, in the energy sector particularly. … I think you need to legislate on it.”


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