Capital Update – For the Week Ending May 3, 2024

NEWS 05/03/24

Senate, House Ag Committees issue farm bill frameworks | NPPC's Zieba represents U.S. pork in Taiwan trade negotiations | USDA previews new school nutrition guidelines to include meat for breakfast | USDA to raise user fees for Quarantine and Inspection program | NPPC participates in NAFB's 'Washington Watch' | USDA to require cattle to use electronic ID ear tags

Senate, House Ag Committees Issue Farm Bill Frameworks

What happened: The Senate and House agriculture committees released their respective frameworks for the next farm bill, with the House measure including a provision to fix the problems caused by California Proposition 12.

The House Agriculture Committee is expected to consider its legislation toward the end of this month. The Senate Agriculture, Nutrition, and Forestry Committee has not yet set a date to begin work.

Provisions of the House 2024 Farm Bill plan of most interest to pork producers include ones that would:

• Clarify that state and local governments cannot impose a condition or standard on the production of covered livestock unless the livestock is physically located within their state or locality.
• Reauthorize and fund the Feral Swine Eradication Program.
• Substantially increase funding for the Market Access Program (MAP) and Foreign Market Development (FMD) export promotion programs.
• Provide guidance documents and other resources for small and very small meat and poultry processing facilities.
• Address trade barriers and infrastructure deficiencies.
• Require the Agriculture Secretary to conduct regular assessments to identify risks and security vulnerabilities in the food and agriculture critical infrastructure sectors.
• Allow livestock auction owners to invest in packing facilities, subject to head-per-day capacity limitations.

Much of the Senate plan focuses on conservation, farm loans, nutrition programs, and rural development. But it includes several sections of interest to pork producers, including provisions that would:

• Establish the U.S. Department of Agriculture's (USDA) National Detector Dog Training Center to train dogs used at U.S. ports of entry to detect agricultural contraband.
• Extend annual mandatory funding for export promotion programs through fiscal 2029, including $200 million for MAP and $34.5 million for the FMD Program.
• Increase mandatory funding to $35 million for fiscal 2025 and each fiscal year thereafter and extend authorization of the National Animal Health Laboratory Network, the National Animal Disease Preparedness and Response Program, and the National Animal Vaccine and Veterinary Countermeasures Bank.
• Establish a program to make grants to small meat processing establishments, processing establishments subject to state meat and poultry inspection programs, and custom processing operations.
• Extend through fiscal 2029 programs related to agricultural research, extension, and education.
• Requirement for producers with confined livestock feeding operations to submit a greenhouse gas emissions reduction plan to be eligible to receive payments under the EQIP program.

Both frameworks call on the Agriculture Secretary to work with the U.S. Trade Representative (USTR) to negotiate animal disease regionalization agreements with U.S. trading partners. This would allow exports from such regions to continue during a disease outbreak in other regions.

NPPC's take: NPPC President Lori Stevermer, a pork producer from Easton, Minnesota, said of the plans: "The Biden Administration and Congressional Republicans agree that Congress must correct the market chaos caused by California Proposition 12. This misguided initiative burdens American consumers with higher pork prices and jeopardizes the livelihoods of our nation's pork producers. NPPC calls on Congress to pass a robust farm bill that protects producers and consumers from this dangerous law and appreciates Chairman Thompson's work to do just that."

NPPC opposes Senate provisions to establish an Office of the Special Investigator for Competition Matters to investigate and prosecute violations of the Packers and Stockyards Act and create standards for voluntary U.S. origin labeling claims for USDA Food Safety Inspection Service products.

Why it matters: The five-year farm bill sets farm, conservation, forestry, and nutrition policy and authorizes various agricultural programs, including ones related to foreign animal disease preparation and prevention and export promotion.

NPPC's Zieba Represents U.S. Pork in Taiwan Trade Negotiations

What happened: The U.S. and Taiwan held another round of trade negotiations under the U.S.-Taiwan Initiative on 21st Century Trade. The sides focused on issues not resolved in the agreement finalized last summer, including agriculture, labor, and environment, among others.

NPPC Vice President of Government Affairs Maria C. Zieba traveled to Taipei to participate in the negotiations. Taiwan had been a growing market for U.S. pork until non-tariff barriers to trade were enacted several years ago, including border and county inspections, a country-of-origin labeling (COOL) scheme, and a partial ban on the internationally approved feed additive ractopamine.

Invited to speak at a public stakeholder session by USTR, Zieba highlighted the importance of the agreement to both parties, the need to facilitate trade and market access, and the importance of promoting science-based agricultural trade.

NPPC's take: NPPC would support agreements with Taiwan under the U.S.-Taiwan Initiative on 21st Century Trade if the country eliminates the numerous barriers to trade for U.S. pork exports. With nearly 24 million people and a cultural preference for pork, Taiwan should be a better market for the U.S. pork industry. Last year, Taiwan imported only $54.6 million of U.S. pork. By comparison, Australia, with 26 million people, imported $247 million of U.S. pork in 2023.

Why it matters: The U.S.-Taiwan Initiative on 21st Century Trade, launched June 1, 2022, is intended to develop a roadmap to deepen the economic and trade relationship between the US and Taiwan, advance trade priorities, and promote innovation and economic growth for workers and businesses. Most important, the text and outcome could set a precedent for future agreements with the U.S.

NPPC's Zieba represents U.S. pork at the U.S.-Taiwan Initiative on 21st Century Trade negotiations.

USDA Previews New School Nutrition Guidelines to Include Meat for Breakfast

What happened: USDA's Food and Nutrition Service recently previewed a final rule on new nutrition standards for school lunch and breakfast programs, requiring a reduction in added sugars and sodium and more flexibility for schools to offer meat - a huge win for pork producers. The standards, which will be gradually updated between fall 2025 and fall 2027, will be consistent with the 2020-2025 Dietary Guidelines for Americans. USDA is required to set standards for the foods and beverages served through the school meal programs that align with the goals of the dietary guidelines.

The current School Breakfast Program requires fruits, grains, and milk. Meat and meat alternates are not required meal components. However, the new standards establish a combined grains and meat-meat alternates component in the program. Schools may offer grains, meat-meat alternates, or a combination of both, to meet the requirement.

NPPC's take: NPPC has been heavily involved in maintaining and expanding pork options in school cafeterias. NPPC also weighs in on the Dietary Guidelines for Americans, which are updated every five years, to ensure meat remains a recommended source of protein and has actively fought against proposed recommendations to reduce meat intake.

Why it matters: Meat is a nutrient-dense protein source, providing vitamins and minerals not found in plant-based foods. The decision to add meat as an option in the School Breakfast Program shows the importance of protein in the diet and decreasing sugar-rich foods. This could set a precedent for the Dietary Guidelines for Americans to expand meat protein into the diet instead of reducing meat intake.

USDA to Raise User Fees for Quarantine and Inspection Program

What happened: USDA's Animal and Plant Health Inspection Service (APHIS) will raise the user fees for the Agricultural Quarantine and Inspection (AQI) program effective Oct. 1, 2024. NPPC supports the hike, which will help fund the U.S. Department of Homeland Security's Bureau of Customs and Border Protection (CBP) agricultural inspectors stationed at U.S. ports of entry and carrying out the AQI program.

Passenger and cargo transporters pay user fees for the program. Because of changes in international travel and shipping, such as larger ships and increased cargo volume, the current fees, which were last updated in 2015, no longer generate enough revenue to cover the costs of the AQI program. Click here for a list of the new fees.

NPPC's take: In comments on the proposed higher user fees submitted to APHIS last fall, NPPC said, "Increased user fees can provide the necessary funding to strengthen [AQI] programs, enhance inspections, and implement preventative measures to safeguard agricultural production."

NPPC strongly supports the AQI program and has worked to strengthen it. In 2020, it played a leading role in securing passage of the Protecting America's Food and Agriculture Act, which authorized the CBP to hire an additional 720 agricultural inspectors.

Why it matters: The $1 trillion U.S. agriculture sector is a crucial component of the American economy. CBP inspectors play a critical role in checking cargo and passenger baggage entering the country for plant pests and potential sources of animal diseases that could affect U.S. agriculture, trade, and commerce.

NPPC Participates in NAFB's 'Washington Watch'

What happened: NPPC President and Minnesota producer Lori Stevermer and several NPPC staff this week participated in the National Association of Farm Broadcasting's (NAFB) annual "Washington Watch" issues forum in Washington, DC.

Joining Stevermer were NPPC's Chase Adams, assistant vice president of domestic policy; Christina Banoub, manager of competition, labor, and tax; Dr. Trachelle Carr, senior director of international technical affairs; and Dr. Ashley Johnson, director of food policy.

Among the topics they discussed in 20 radio interviews - which will go to more than 2,500 network affiliates across more than 17 states - were:

• A legislative fix to California's Proposition 12.
• Reauthorization through the next farm bill of programs to prevent and prepare for foreign animal diseases.
• The farm labor shortage and reform of the H-2A and TN visas to make them more useful to animal agriculture.
• A request that the Biden administration negotiate comprehensive trade agreements that eliminate tariff and non-tariff barriers to U.S. pork.

Why it matters: NAFB's "Washington Watch" connects agriculture broadcasters and industry leaders to discuss key issues and topics affecting U.S. farmers. Farm broadcasters are a trusted source, provide an invaluable service, and are vital to communicating with the agricultural community, telling the story of the who, what, when, where, and how of America's food, feed, fiber, and fuel system.

NPPC's Stevermer speaks with farm broadcasters in Washington, D.C.

USDA to Require Cattle to Use Electronic ID Ear Tags

What happened: USDA's APHIS announced it will amend animal disease traceability regulations, effective 180 days after publication of the final rule in the Federal Register, to require ear tags be visually and electronically readable to be recognized for use as official ear tags for interstate movement of cattle and bison covered under the regulations. It also will clarify certain record retention and record access requirements.

APHIS issued regulations in January 2013 for animal disease traceability that included minimum requirements for identification and documentation for livestock moving between states. It sought to update those in 2020 with a proposal - through a notice-and-comment procedure rather than a formal rulemaking - that called for radio frequency identification (RFID) tags. The new rule refers to electronic identification (EID) tags.

The agency points out requiring EID ear tags will improve its ability to trace the cattle and bison that are currently required to have official identification.

NPPC's take: At its March annual business meeting, NPPC delegates approved a resolution supporting an enhanced swine traceability system that includes the use of 840 series RFID tags for categories of swine that have more complex paths from "start to finish," including cull breeding stock and exhibition swine. The resolution permitted NPPC to submit these industry recommendations to USDA for inclusion in regulations mandating pre-harvest swine traceability.

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Animal Well-being | Biosecurity | California Proposition 12 | Capital Update | Capital Update | Commerce | Farm Bill | News | Nutrition | School meals | Taiwan | Trade