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| Rural Advocate News | Thursday February 27, 2020 |


Deadline for CRP Signup is Friday The deadline to get involved in the Conservation Reserve Program is this Friday, February 28. Agricultural producers and private landowners need to make an offer of acres or schedule an appointment to do so with their local USDA service center by Friday. The signup first opened in December and is available to producers and private landowners who are either offering acres for the first time or re-offering acres for another 10-15 year term in the Farm Service Agency’s conservation program. “Call your FSA county office today to make an appointment to sign up for the Conservation Reserve Program,” says FSA Administrator Richard Fordyce. “As long as you have an appointment scheduled, your CRP offer will be able to compete in this general signup, even if the appointment is in the first week of March. This is the first opportunity for general signup since 2016 and we want to make sure interested producers and landowners take advantage of the popular conservation program.” Farmers and ranchers who enroll land in CRP receive yearly rental payments for voluntarily establishing long-term, resource-conserving plant species, such as approved grasses or trees, which are called “covers.” CRP currently has about 22 million acres enrolled, but the fiscal cap for 2020 is 24.5 million acres. ********************************************************************************************** Agriculture Still Slowing Pace of EU, U.S. Trade Talks U.S. President Donald Trump is turning up the heat on Brussels when it comes to trade discussions. He’s set on taking down some trade barriers to so-called “chlorine chicken,” GMO crops, and other U.S. products that don’t fit into the EU’s strict food safety standards. The two sides are still stuck on agriculture, which isn’t helping the talks that have struggled to get off the ground since 2018. Each side has been talking up the potential of a deal ahead in the coming weeks or months. EU Trade Commissioner Phil Hogan has said recently he’s aiming for a mini agreement as soon as March 18. U.S. officials have long been unhappy with the EU policy that tightly controls agricultural tools like pesticides. Hogan notes that U.S. rules currently block sales of European apples and pears, so there is an opening for regulatory tradeoffs on both sides of the Atlantic. Politico says the U.S., is an agricultural powerhouse that has seen its share of the EU market shrink steadily for decades. The trade deficit with Europe topped $2 billion in 1989 and evolved into a $15 billion deficit in 2019. ********************************************************************************************** Trump Leaves India without a New Trade Deal President Trump is leaving India without the trade deal in place he was hoping for. The U.S. president was looking to expand access to the massive market for U.S. dairy goods and other products like motorcycles and medical devices. India currently has tariffs on American farm goods at an average rate of 32.8 percent. As if that’s not high enough, India has 100 percent tariffs on raisins and coffee, as well as 150 percent on alcoholic beverages. For the second time since last September, when India’s prime minister visited the U.S., the two sides failed to reach even a limited “mini-trade deal,” which would increase trade on focused groups of goods, which would include dairy products. The New York Times says negotiators have worked since 2018 on a deal that would lower India’s barriers to some American products, as well as restore India’s access to a program that allows goods to enter the U.S. tariff-free. The U.S. India Business Council released a statement that says,” Both sides are tuned into their own political imperatives and not where the other side might have an area of accommodation. That makes it harder to find where the common ground is and where a deal could be struck.” ********************************************************************************************** Wisconsin Representative Asks Perdue for More Certainty Wisconsin Representative Ron Kind fired off a letter to Ag Secretary Sonny Perdue demanding more information after the Secretary and the President brought up the possibility of more trade aid for farmers. Perdue had recently told farmers “not to anticipate” more aid in 2020, but Kind points out that the purchases promised in the trade deal with China have not materialized yet. The president says the trade aid would be paid for by tariffs the Administration has slapped on imported goods. However, Kind says that’s a tax actually paid for by working families. Because the purchases outlined in the Phase One trade deal haven’t happened yet, the Wisconsin Representative is pushing for a clear plan from the Ag Department on how they will enforce China’s commitments and ensure farmers “see the proof” of these purchases as promised. “Farmers in Wisconsin have been forced to bear the burden of this Administration’s trade war for nearly two years,” Kind says in the letter. “This deal was supposed to bring them some much-needed relief but instead, the secretary and the president continue to create more uncertainty.” Kind says he’s consistently expressed concerns that the agreement wasn’t fully binding like a more traditional trade agreement. ********************************************************************************************** Commodity Experts Worried About the Coronavirus Commodity experts at the International Sweetener Colloquium say announcements on the spread of the coronavirus and the falling stock market are making them nervous about the future. The director of dairy market intelligence for High Ground Dairy says fear is gripping the entire supply chain. While dairy prices have risen recently after multiple bad years, the coronavirus could pull dairy prices lower. That means price forecasting in any agricultural sector is extremely difficult. Stephen Nicholson is a senior analyst for Rabo AgriFinance, who says, “We have to be ready for more volatility as we see trade disrupted. We’re going to see economic activity contract and there may be a little more downside than we’d thought.” He’s not in the same camp as those who are sure that the Chinese will fulfill their promises to buy $40 billion to $50 billion in agricultural products. Nicholson says commodity prices are low, which means China will have to buy a lot of products to spend that much money. The Hagstrom Report quotes Nicholson as saying the Trump Administration will have to make a “tough decision on whether to punish China if they don’t live up to their promises.” ********************************************************************************************** Wisconsin Senator Working to Slow the Tide of Dairy Bankruptcies Wisconsin is currently leading the nation in farm bankruptcies, a position that no one wants to be in. Wisconsin Senator Tammy Baldwin is working to give flexibility to local banks and credit unions to help fight the surging number of farm bankruptcies. Local financial institutions like banks and credit unions are restricted in their regulatory lending ability to farmers, even though they are uniquely positioned to help farmers get the loans they need to get by. In a letter to financial regulators, Baldwin and John Thune from South Dakota are urging the federal government to give those local banks and credit unions the flexibility they need to help farmers navigate through these tough economic conditions. Baldwin says, “We’re calling on the federal government to lift the regulatory restrictions on local financial institutions to ensure our farmers have the tools to be successful and move our state forward.” Baldwin and Thune sent their letter to financial regulators from the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the National Credit Union Administration.

| Rural Advocate News | Thursday February 27, 2020 |


Washington Insider: Coronavirus Pressure on the Fed The key issue in the media this week is the spread of the coronavirus and its impact. The question of what the central banks and other will do in response is also “a dire challenge,” The Hill says this week. Pressure is building on the Fed to cut interest rates as it struggles to both keep the economy stable and defend its independence from the President’s pressure. The Fed earlier indicated a desire to keep interest rates steady this election year after navigating both a trade war and a global downturn in 2019, The Hill says. But, even as bank officials say it is too soon to react to the outbreak, “that stance is being put to the test.” U.S. financial markets are now betting on an interest rate cut after this week’s Wall Street losses obliterated six weeks of stock gains as coronavirus fears intensified. Tuesday’s 3.2% plunge followed a Monday loss of 1,031 points, or 3.6%, its worst day since February 2018. The stretch of losses could extend further as worries about the coronavirus fester continue the Centers for Disease Control and Prevention warned Tuesday. “It’s not a question of if this will happen but when — and how many people in this country will have severe illnesses,” said Nancy Messonnier, a top CDC official. “Disruption to everyday life might be severe.” The warning from federal health officials spurred further alarm among investors as expectations of a Fed rate cut in March rose to 27.7% Tuesday from just 11.1% a week ago, according to investment firm CME Group. Fed officials have been reluctant to cut rates further after slashing borrowing costs three times last year, bringing the central bank’s baseline range to just 1.5% to 1.75%. With rates so close to an effective rate of zero percent, economists fear that a minor reduction would do little to handle a global supply shortfall and cost the Fed crucial room to cut rates in the event of a crisis. “They won’t want to cut rates too soon and then immediately see the pace of new infections quickly diminish and an inventory correction occur suddenly, wrote University of Oregon economic professor Tim Duy in a Tuesday analysis. Several members of the Federal Open Markets Committee, which sets Fed interest rates, have spoken out against cutting over the past four days. The Fed held rates steady at its January meeting and had expected to maintain that stance. Fed Vice Chairman Richard Clarida said in a Tuesday speech that “it is still too soon” to gauge the potential economic impact the outbreak could have on the U.S., adding that the Fed will “respond accordingly” to “a material reassessment of our outlook.” Clarida’s comments echoed similar remarks from several Federal Reserve Bank presidents — including Loretta Mester of Cleveland, Raphael Bostic of Atlanta and James Bullard of St. Louis — who played down the need for a March rate cut over the past few days. But the economic toll of a prolonged outbreak also would likely raise the President’s ire as he seeks reelection on the strength of the economy. He and his top officials who regularly pressure the Fed to cut rates amid stock downturns have tried to soothe the fears of a pandemic driving Wall Street’s losses. “We have very few people with it,” the President told reporters at a press conference in New Delhi on Tuesday, saying it was “well under control” in the U.S. “The people are getting better. They’re all getting better,” Other officials agreed despite warnings from CDC officials. Economists at Goldman Sachs warned last week that the coronavirus could cause a stock market correction, which is considered a 10% decline from the most recent peak, before the weekend’s sharp increase in infections. The President often ties the success of his economic agenda to the rise of the stock market while blaming the Fed for even minor downturns. The president has piled unprecedented pressure on the Fed and its chairman, Jerome Powell, to pump a steady economy with crisis-level stimulus. “When Jerome Powell started his testimony recently the Dow was up 125, & heading higher. As he spoke it drifted steadily downward, as usual. Germany & other countries get paid to borrow money. We are more prime, but the Fed Rate is too high, Dollar tough on exports,” the President tweeted earlier as Powell testified before a House committee. The Fed has largely ignored the President’s pressure and took great pains to distance its three 2019 rate cuts from any political considerations. But the President’s pressure is likely to intensify if the markets continue their weakness, The Hill said. “A Fed rate cut will bolster financial conditions but it will take months to filter through to the real economy,” said Joe Brusuelas, chief economist at U.S. tax and audit firm RSM on Tuesday. Brusuelas warned that if the coronavirus outbreak slumps the U.S. economy, it could take a special lending facility from the Fed and fiscal action from Congress to counter the damage. “The agencies that could help like the [Small Business Administration] need to be mobilized now and additional trade finance will need to be considered,” he said. So, we will see. The situation appears to be highly complex and challenging, and there is the potential for destabilization if inappropriate policies are applied. It certainly is one producers should watch closely as it continues, Washington Insider believes.

| Rural Advocate News | Thursday February 27, 2020 |


USDA Sees Continued Tame Grocery Store Food Price Inflation Ahead Food at home (grocery store) prices are seen increasing from 0.5% to 1.5% in 2020, in line with the 2019 increase of 0.9% and a forecast that would continue the trend of grocery store prices rising less than one percent that has been in place since 2016, according to USDA. 2015 was the last time that grocery prices rose more than 1% with an increase of 1.2%. Still, the result remains well below the 20-year average of 2%. USDA also recalculated the 20-year averages for food items to include the 2019 data, with nine categories seeing a decrease in their averages (beef and veal, fish and seafood, eggs, dairy products, fats and oils, fruits and vegetables, fresh fruits and vegetables, fresh fruits, and other foods) while four saw increases (food away from home, pork, fresh vegetables, and sugars and sweets). Food away from home (restaurant) prices have continued to see strong increases as they contain several other cost factors not included in grocery store prices such labor and rental prices with food making up only a small percentage of total restaurant costs.

| Rural Advocate News | Thursday February 27, 2020 |


Report says EPA to Extend Court Ruling on RFS Waivers Nationwide The Trump administration has decided to limit the small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS) based on a January court ruling that EPA overstepped its bounds in granting three SREs for the 2016 compliance year. EPA is now expected to apply the ruling by the 10th Circuit Court of Appeals nationwide, Bloomberg reported, citing sources familiar with the internal discussions. This would mean that only a few small refiners would be granted the exemptions as the court ruling indicated that EPA erred in granting the waivers as they were not extensions of waivers that had been granted in 2010. EPA data showed a sizable increase in the level of SRES granted starting with the 2016 compliance year. EPA data posted showed that the agency approved eight out of the 16 SREs sought for the 2013 compliance year, eight of 13 sought for the 2014 compliance year and seven of 14 sought for the 2015 compliance year.

| Rural Advocate News | Thursday February 27, 2020 |


Thursday Watch List Markets Thursday's schedule of events will look familiar to long-time market watchers: USDA export sales, weekly U.S. jobless claims and a new U.S. Drought Monitor at 7:30 a.m. CST. Also at 7:30 a.m., fourth quarter U.S. GDP and advanced durable goods in January will be posted. The U.S. Energy Department will provide natural gas inventory at 9:30 a.m. CST. South American weather and any trade news also remain of interest. Weather A little light snow in the Northern Plains and lighter lake-effect snow in the eastern Midwest, otherwise it will be rather quiet over the major crop areas on Thursday. Warming conditions over the next several days will help with snowmelt and soil drainage.

| Rural Advocate News | Wednesday February 26, 2020 |


Progress on Implementing the Phase One Trade Deal with China Ag Secretary Sonny Perdue and U.S. Trade Representative Robert Lighthizer announced that China has taken numerous actions to begin implementing its agriculture-related commitments in the Phase One trade deal. The countries first entered into the landmark agreement back on February 14. China’s actions toward implementing the deal include signing a protocol that allows the importation of U.S. fresh chipping potatoes. They’ve lifted the ban on imports of U.S. poultry and poultry products, including pet food containing poultry products. China has lifted restrictions on imports of U.S. pet food that contains ruminant material. They’ve also updated lists of facilities approved for exporting animal protein, pet food, dairy infant formula, and tallow for industry use to China. The Chinese government has also updated the lists of products that can be exported to China as feed additives. Additionally, China has begun announcing tariff exclusions for imports of U.S. agricultural products subject to its retaliatory tariffs, and it announced a reduction in retaliatory tariff rates on certain U.S. agricultural goods. Lighthizer says, “We’re already seeing positive results just a month after signing the agreement with China. We will continue to ensure the agreement is strictly enforced for the benefit of our workers, farmers, ranchers, and businesses.” ********************************************************************************************** Wheat Exports Set to Rise Ag Secretary Sonny Perdue had good news for U.S. wheat farmers. Effective immediately, U.S. wheat can now be shipped to Kenya regardless of the state of origin or which port of export it comes from. This important step means that Idaho, Oregon, and Washington can now join the list of states that can ship wheat to Kenya. “America’s farmers in the Pacific Northwest now have full access to the Kenyan wheat market,” says Greg Ibach (EYE-baw), USDA Undersecretary for Marketing and Regulatory Programs. “This action proves our commitment to securing fair treatment and greater access for U.S. products in the global marketplace.” The USDA’s Animal and Plant Health Inspection Service has been working closely with Kenya for 12 years to address plant health concerns that kept U.S. wheat exports from Idaho, Oregon, and Washington, out of Kenya. The export protocol signed off on by Kenya’s Plant Health Inspectorate Service and APHIS gives U.S. exporters full access to the wheat market in Kenya, valued at nearly $500 million annually. ********************************************************************************************** Doing a Deep Dive into U.S. Dairy Consumption It’s no secret that the dairy sector has been struggling with low milk prices for years. Agricultural Economic Insights took a deep dive into the U.S. dairy industry in the face of rising bankruptcies among small farmers and big milk processors like Dean Foods. Fluid milk consumption per capita in the U.S. has been falling for decades. However, consumers are actually buying more dairy goods overall, including more butter and cheese. Cheese consumption per capita has doubled since 1975, with mozzarella and cheddar each representing about 30 percent of consumption in 2018; butter consumption has grown by a third since 2001 and a Politico article says part of that surge comes because fat has lost some of its stigma among dietary health advocates. Per-capita yogurt consumption was steadily climbing up till 2014 before dropping over the past five years. Fluid milk consumption dropped more than 40 percent since 1975, or about 1.2 percent per year. In the meantime, alternatives like almond and soymilk have grown in popularity. Overall, the dairy industry is primarily driven by slow rates of changes unfolding over several decades,” says AEI farm economist David Widmar. Farm bankruptcies in the dairy industry jumped by nearly 20 percent in 2019. ********************************************************************************************** UK Farmers Union Wants High Food Standards in Trade Negotiations The United Kingdom shouldn’t allow imports of food that fall short of the country’s own standards when it draws up trade agreements. That thought comes directly from the head of the UK’s National Farmers Union. NFU President Minette Batters says domestic production standards should be used as a benchmark in trade talks. Business Times Dot Com says her comments signal that British farmers would face a setback if the government allows imports of products that are treated with certain chemicals or made using lesser animal-welfare rules. After leaving the European Union last month, the UK is working on getting trade talks going with multiple nations that cover everything from food trade to data protection. “It’s not just about chlorinated chicken,” Batters says in a statement. “This is about a wider principle. We must not tie the hands of British farmers to the highest rung of the standards ladder while waving through food imports which may not even reach the bottom rung.” As it has in America, trade uncertainty is weighing down UK farm sentiment, with one-year confidence falling to its third-lowest point since 2010. ********************************************************************************************** U.S. Facing a Sugar Shortage and Higher Prices Last year was a rough one for American sugar farmers. The Hagstrom Report says America is facing a sugar shortage after last year’s bad weather in the Midwest, a freeze in Louisiana, and drought in Mexico. The shortage is driving the prices for the industrial sweetener higher, reaching several cents above average. A national refiner of raw sugar is offering refined cane sugar at 44 cents per pound now and 41 cents for the calendar year 2021. That’s compared with the more usual prices of 37 to 38 cents. The bad weather hit particularly hard in the Red River Valley of North Dakota and Minnesota. Those areas have some of the most sophisticated delivery systems to candy makers and other food companies in Chicago and other midwestern cities. The U.S. Ag Department can make changes if needed to its sugar management system to make it easier and cheaper to bring in raw cane sugar from other countries into the United States, but also has no control over the refining process once the sugar enters the country. The U.S. sugar industry used to have 104 production plants but now has 45. ********************************************************************************************** More Farmers Converting to Organic U.S. farmers harvested almost 3.3 million acres of certified organic field crops in 2019, with that number driven by 14 percent more organic operations. Those numbers come from Mercaris, the market data service and online trading platform for organic, non-GMO, and certified agricultural commodities. The company’s final 2019 report shows that the number of growers converting land to organic production escalated significantly throughout 2019, adding to the U.S. organic harvest and offsetting the impact of a wet growing season. Producers harvested 1.1 million acres of organic hay and alfalfa in 2019, up eight percent year-over-year with 11 percent more certified organic operations. Thirteen percent more certified organic operations harvested organic corn over 2019, offsetting a significant decline in the number of harvested acres per operation. The number of certified operations harvesting organic soybeans reached 2,835, up 11 percent. The amount of harvested organic wheat acres was driven by expansion in the High Plains region, growing 16 percent in 2019. A release from Mercaris says, “Despite what can fairly be described as the most difficult growing season in more than a decade, 2019 was a remarkable year for organic production.”

| Rural Advocate News | Wednesday February 26, 2020 |


Washington Insider: Coronavirus Damage The U.S., like nearly all of the rest of the world, is quite unprepared to deal with a vicious new disease, Coronavirus (COVID-19), or even to know how it should be regarded. The New York Times said on Tuesday that while “Wall Street is (finally) waking up to the damage the virus could cause, no one really knows quite what should be done.” The Times focused on the uncertainties involved and reported “a strange divergence” among people in the trenches of global commerce—supply chain managers, travel industry experts, employers large and small who warned of substantial disruptions to businesses and the financial markets — and most economic forecasters who had been willing to downplay expectation of economic harm or loss of profits. “Something had to give and this week, it did,” NYT said, “giving way to a more pessimistic view across major world markets.” While “huge uncertainty” remains about how widely the virus will spread and how much damage it will do, at least the financial world “is realizing just how much is at stake” — and how different this may be from other recent hiccups in the global economy, notably last year’s trade war between the United States and China. “It’s one thing if Wuhan is on lockdown, another if China is on lockdown; or Asia--and yet another if the whole world is affected,” said Patrick Chovanec, an adviser for Silvercrest Asset Management and an expert on the Chinese economy. Since the end of the global financial crisis more than a decade ago, investors who have been the most alarmist about various risks have had a tendency to lose money. Global asset prices have been on a steady march upward despite the eurozone crisis, the end of the Federal Reserve’s quantitative easing, the trade war and every other problem that has occupied financial headlines. So it is somewhat understandable if investors were quick to assume that coronavirus would follow a similar pattern — a temporary blip that reduced China’s growth for a quarter or two but had little lasting impact. “The portfolio managers apparently figured this is a flash-in-the-pan virus, that will end as soon as the winter does, and that even if that assumption isn’t right, that central bankers will step in and fix this mess, the Times said. Markets accustomed to optimism may be all the more vulnerable if the virus becomes a global pandemic that causes meaningful pullback of commerce across major economies. The financial markets remain richly valued, even after Monday’s sell-off that included a 3.4% drop in the S&P, the steepest single-day retrenchment in two years. The U.S. stock market remained above its level of Feb. 7. The trade war, in which the United States and China placed tariffs on specific imported goods, caused a significant slump in manufacturing last year. But the coronavirus is hurting service industries as well. If the authorities in major world economies start shutting down any facility where large numbers of people congregate — a list that includes factories, shopping malls and airports — the damage could prove broad and lasting. When a hotel or airplane sits empty for weeks because people are afraid to travel, that is a loss that cannot be recovered once business returns. That’s particularly relevant for the United States, where service industries account for the majority of economic activity. This means that even companies that made it through the trade wars unscathed might be exposed to lost revenue or business shutdowns because of the virus outbreak. Moreover, while tariffs might put sand in the gears of global commerce, implications are different when gears stop entirely. Companies had many options for dealing with the trade war, whether sourcing goods from elsewhere or simply paying more for them. The longer the shutdowns of Chinese production and the more widely other countries are forced to take similar measures the more the spread of the virus could affect the ability of global companies to do business. Moreover, while the Fed and other central banks may well take action to try to insulate the world economy from the disease shocks, their tools are ill-suited to the task in many ways. The economic effects of coronavirus on the productive potential of affected nations from factors unrelated to those that more traditionally shape economic results like monetary policy or fiscal policy. In addition, lower interest rates won’t make a sick person well or give public health authorities confidence that businesses can reopen. All they can do is lower borrowing costs and help encourage businesses and consumers to spend and push financial market prices higher. “We would rather have a vaccine than a rate cut and fully recognize that monetary policy is not optimized for addressing this type of shock,” said Krishna Guha with Evercore ISI, in a research note. “But it does not follow from this that the appropriate path of policy under the shock is unchanged.” Neither economists nor portfolio managers make particularly good epidemiologists. But what has become clearer in the last few days is that it is the science of epidemics — and the policy choices that nations make to try to address them — that will shape the economy for the near future, and maybe quite some time to come. So, we will see. Amid growing concerns regarding economic impacts, there is new talk of additional technologies and perhaps potential to build a vaccine fairly quickly. However, the new disease threat is at least being taken seriously and its implications should continue to be watched closely as they develop, Washington Insider believes.

| Rural Advocate News | Wednesday February 26, 2020 |


US-UK Trade Officials To Meet This Week U.S. Trade Representative Robert Lighthizer will meet his British counterpart in London on Thursday as the two work toward reaching a trade deal yet this year. Lighthizer’s meeting with International Trade Secretary Liz Truss comes on the same day London releases its position on separate talks with the EU toward a post-Brexit trade arrangement. This comes as U.S. and UK meat industry groups have signed a memorandum of understanding to further their contacts as the two parties work on a trade deal. Meanwhile, reports indicate European Union (EU) Trade Commissioner Phil Hogan will be in Washington next month just a few days before March 18, his target date for striking a separate trade agreement with the Trump administration.

| Rural Advocate News | Wednesday February 26, 2020 |


USDA Touts China Actions in Phase One Deal USDA released an update which outlines the changes that China has made as part of the phase-one trade deal, including shifts the country undertook on several fronts. China’s lifting of its ban on imports of U.S. poultry, noting it also includes pet food containing poultry products. China also listed its restriction on pet food containing ruminant material. USDA also noted China’s action on a new protocol to allow in fresh shipping potatoes as another action the country took under terms of the deal. China has also updated its list of U.S. facilities that can export animal proteins, pet food, dairy, infant formula and tallow for industrial use, and also broadened its list of U.S. seafood products. The announcement also touted China’s action to half retaliatory tariffs on a host of U.S. products and allow Chinese importers to apply for exemptions on tariffs for nearly 700 U.S. products.

| Rural Advocate News | Wednesday February 26, 2020 |


Wednesday Watch List Markets It looks likely that the spread of coronavirus will remain a concern for markets, at least into spring. South American weather also gets attention as Brazil advances through its soybean harvest. At 9 a.m. CST, U.S. new home sales will be released, followed by the Energy Department's weekly report of energy inventories, including ethanol. Weather Wednesday features rain and snow in the eastern Midwest and mid-South, keeping soils saturated ahead of spring. Other crop areas will be dry, allowing for some excess moisture drainage. Northern Midwest conditions will continue to have snowpack-induced cold.

| Rural Advocate News | Tuesday February 25, 2020 |


Trump says More Trade Aid an Option; Conflicting Messages on the Need for it. A Twitter announcement from President Donald Trump last week made it seem like more trade aid for farmers hurt by trade disputes is a legitimate possibility. Evidently, he hadn’t yet made it known to USDA that this was on the table. “The president’s tweet was a surprise to us,” says Ted McKinney, Undersecretary for Trade and Foreign Ag Affairs. “That’s the decision we’ll go with.” Politico says the administration’s agricultural forecasts offer some conflicting messages about whether additional trade is actually needed this year. USDA’s Chief Economist, Robert Johansson, predicts a return to what he called “normal trade” in 2020, along with mentioning more hopeful signs for the farm economy ahead this year after a recent economic downturn. Farm income is projected to increase this year despite a large drop in federal farm payments as the 2019 trade aid program wraps up. Ag Secretary Sonny Perdue has already predicted a “record year for agricultural exports with China.” But, market analysts say isn’t entirely possible because of Beijing’s insistence on following market demand and complying with World Trade Organization limitations. USDA has already paid out $23 billion directly to U.S. producers since 2018. ********************************************************************************************** Brazilian Beef is Back in the U.S. Late last week, the USDA reopened the door into the U.S. market for imports of raw beef from Brazil. The agency says the world’s largest beef exporter has taken the right steps to improve its food-safety inspection system, bringing it up to U.S. standards. Some farmers, ranchers, and food safety groups are already pushing back against the decision. The National Cattlemen’s Beef Association is one of those groups that has serious concerns about the decision. “NCBA strongly supports science-based trade and the administration’s efforts to enforce it,” says Kent Baucus, the Senior Director of International Trade and Market Access for NCBA. “But, NCBA has serious concerns about Brazil returning to the U.S. beef market.” He says the NCGA has frequently questioned the lack of scientific evidence that was used to justify Brazil’s initial entry into the U.S. market in 2016. “Unfortunately, we weren’t surprised that Brazil forfeited its beef access to the U.S. in 2017 due to a large number of food safety violations,” Baucus says. “Given Brazil’s history with foot-and-mouth disease and its track record of repeated food safety violations at ports-of-entry, you can rest assured that we will keep a sharp eye out on all future developments with Brazil.” ********************************************************************************************** Deere says Farms, Ag Economy Beginning to Stabilize Deere and Company had a surprisingly strong first quarter after an extended period in which the tractor and construction equipment maker was hit hard by the trade dispute between China and the U.S. “Farmer confidence, though still subdued, has improved due in part to hopes for a relaxation of trade tensions and higher agricultural exports,” says CEO John May. An Associated Press report says China has suspended more punitive tariffs on imports of U.S industrial goods in response to a truce in its trade war with Washington. It’s been well-documented how hard Chinese tariffs hit U.S. agricultural commodities like soybeans, which hurt farmers, and in turn, hurt farm equipment manufacturers as well. Illinois-based Deere and Company had posted three consecutive quarters of falling profits and slowing sales growth as trade tensions between China and the U.S. continued. It also stuck to a conservative outlook during 2020. Deere expects sales in its agriculture-and-turf business to fall between five and ten percent, and those in the construction and forestry segments to fall between 10 and 15 percent. ********************************************************************************************** NFU says Goodbye to Roger Johnson; Election Coming for New President The National Farmers Union officially saw Roger Johnson off into retirement late last week during a party that took place in the Farmers and Distillers Restaurant in northwest Washington, D.C. Johnson, the NFU President for 11 years, announced back in December that he would be retiring. “Farmers Union has been a fundamental part of who I am for all my life,” Johnson says. “It’s been the biggest honor of my life to serve this organization and the farmers and ranchers that make up the membership ranks. It’s a bittersweet feeling to step away from the role of a lifetime but I need to spend more time with my wife and four grandkids.” The Hagstrom Report says the election to replace Johnson at the top spot of the NFU is coming up March 1-3. There are three candidates to replace Johnson, including Rob Larew, NFU’s Senior VP of Public Policy; Donn Teske, president of the Kansas Farmers Union and a former NFU National Vice President; and Mike Eby, spokesperson and chair for the National Dairy Producers Organization. The Farmers and Distillers Restaurant where the retirement celebration took place is part of a restaurant group owned by the North Dakota Farmers Union. ********************************************************************************************** U.S. Launches Pilot Program for Prairie Pothole Region to Plant Cover Crops The USDA’s Farm Service Agency announced a new pilot program to enable farmers in the Prairie Pothole region to receive payments for planting cover crops on their land for three to five years. The new Conservation Reserve Program’s Soil Health and Income Protection Program, or SHIPP, is available for producers in Iowa, Minnesota, Montana, North Dakota, and South Dakota. The signup for the pilot program starts on March 30 and ends August 21. “We’re excited to provide a short-term Conservation Reserve Program option tailored to the unique soil health needs of producers in the Prairie Pothole Region,” says FSA Administrator Richard Fordyce. “The number of people that can be enrolled in the program is limited, and participation will be on a first-come, first-served basis.” Fordyce says interested landowners need to contact their FSA county office for an appointment to apply. Through the SHIPP program, producers have the option of taking a three, four, or five-year CRP contract to establish cover crops on less productive cropland in exchange for payments. Cover crops, used either in a single crop rotation or over multiple years, can improve the productivity and health of soils on a farm for generations and increase the bottom line for the farmer. ********************************************************************************************** Cargill Moving into the Fake-Meat Business Cargill is making a jump into the plant-based protein business. The global giant announced plans to sell its private-label plant-based patties and ground products to retailers and restaurants beginning in early April. Cargill says the offerings are part of its “new approach” to the future of the protein market, and they predict protein demand will jump by 70 percent over the next three decades. The plant-based products were developed and will be manufactured in Cargill facilities. The company’s managing director of the alternative protein team says they’ve created some of the “best-tasting products available in the plant-based category.” However, it doesn’t mean that Cargill is going to a 100 percent plant-based protein production plant. Brian Sikes, the leader of Cargill’s global protein and salt business says, “We need to keep all protein options on the table. Whether people are eating alternative or animal protein, Cargill intends to be right there at the center of the plate.”

| Rural Advocate News | Tuesday February 25, 2020 |


Washington Insider: Limited Trade Negotiation Progress in India Politico says this week that President Donald Trump has been anticipating a warm welcome in India, but that the nation has been reluctant to give the administration “even a small trade victory.” Over the last few weeks, U.S. officials have “struggled to clinch a miniature agreement” that could result in some modest additional access for U.S. medical devices, motorcycles and milk products in a market of more than 1.3 billion people. As a result, the president moved quickly to tamp down expectations, including that a “big deal” may only be possible “after he wins a second term.” U.S. Trade Representative Robert Lighthizer did not plan to travel to India with the president, further diminishing any chance for substantial results, nor did he go to India ahead of the president’s visit, also dampening expectations for a deal. “We may make a tremendous deal there -- or maybe we’ll slow it down. We’ll do it after the election. I think that could happen too,” the president said late last week. A senior administration official said a "wide scope" of issues is complicating progress toward a mini trade deal. "We want to address a lot of concerns and we’re not quite there yet.” He noted that discussions with the prime minister about these concerns are expected, Politico said. India is expected to announce some significant purchases of U.S. energy and defense products but the administration’s fixation with imbalanced trading relationships is likely impeding any willingness to offer New Delhi concessions, Politico said. India is the United States’ ninth-largest trading partner and bought about $34 billion worth of goods in 2019 -- just a fraction of the $256 billion exported to Mexico, the top destination for U.S. goods last year. The U.S.-Indian trade deficit was $24 billion last year while India's exports to the U.S. grew much faster than U.S. exports to India. Politico thinks these statistics could be driving the president’s reluctance to give India what it really wants -- access again to the U.S. Generalized System of Preferences, a tariff-cutting program for developing countries that discounts duties on roughly $6 billion worth of imports. Policies that have fiercely guarded India's markets have been the bane of multiple previous U.S. administrations. Even now, as India’s economy slumps further and pressure from neighboring China grows, New Delhi has continued to make protective moves including a multiyear "Make in India" initiative aimed at bolstering the country's manufacturing sector through local sourcing and production requirements, Politico said. India also released a national budget in late January that raised tariffs on a number of products that were under consideration to be cut or eliminated under a mini-agreement with the U.S. U.S.-India Business Council President Nisha Biswal said India’s tariff increases on walnuts, medical devices and other goods that were to be part of a trade deal further “complicated” the talks. The negotiations also got hung up on details related to increasing access for U.S. dairy products and credit card companies. Modi’s latest actions may reflect efforts to stem a tide of cheap, Chinese imports where a significant portion of the population still lives in poverty. India was also likely emboldened by the U.S. and other countries to stand firm or ramp up its tariffs. For months, administration officials have weighed the launch of a so-called Section 301 trade investigation, a law that gives the president broad leeway to impose trade restrictions to address unfair trade actions. Trump used the same authority on China, which resulted in tariffs on hundreds of billions worth of imports — but no final decision has been made on whether to apply it to India. At least this week, the President may be content to maintain the warm relationship with a leader he views as a kindred spirit who can mobilize the masses of supporters the president relishes. Modi’s visit to Houston in September where he held a joint rally with Trump brought the president one of his largest crowds. U.S. businesses were hoping a limited trade package would be a confidence-building move for a more comprehensive negotiation. "We are fundamentally looking at an Indian approach to trade that is still emerging and evolving from a more protectionist or closed trading system to a more open one," an administration official told Politico. So, we will see. India’s trade policies have long been difficult and highly political — and the growing global tensions and intensifying fears of a destructive coronavirus outbreak appear to be among several key economic and social threats lurking ahead, Washington Insider believes.

| Rural Advocate News | Tuesday February 25, 2020 |


EPA Receives Additional Small Refiner Exemptions EPA data shows the agency now has 23 small refinery exemption (SREs) requests for the 2019 compliance year, an increase from two compared with month-ago data. Attention continues on the issue with reports indicating EPA will respond to a court decision sometime in early March on this topic. Indications are the court ruling has the potential to impact many previously granted SREs in that the court determined that for three of those granted for the 2016 compliance year, the agency did not act appropriately as the court said the SREs were to be extensions of ones granted prior to 2010.

| Rural Advocate News | Tuesday February 25, 2020 |


China Lifts Ag Restrictions on US Beef China has conditionally lifted its ban on imports of U.S. beef/products from animals more than 30 months of age, according to a notice from the Chinese General Administration of Customs Office. The notice said that inspection and quarantine requirements would be released separately. The action is one of the moves that China agreed to make as part of the phase-one agreement with the U.S. The other one on beef is that China is to set maximum residue levels (MRLs) for three growth hormones used in U.S. beef production. That is an action that China agreed to take within 30 days of the agreement taking force – March 14. The age limit action announced by China was also on the same timeline as the MRL issue, so China is ahead of their deadline on that front.

| Rural Advocate News | Tuesday February 25, 2020 |


Tuesday Watch List Markets Traders are keeping an eye on the spread of coronavirus with questions as to whether it can be contained. Tuesday's lone report is for U.S. consumer confidence at 9 a.m. CST. South American weather and any trade news will also get attention. Weather Tuesday features snow, cold and strong winds in the Northern and central Plains, and rain in the eastern Midwest and Southeast. Areas with snow will have transportation and safety issues along with livestock stress. Rain in the Midwest continues to keep soils saturated ahead of spring. A drier trend is in store during the last half of the week.

| Rural Advocate News | Monday February 24, 2020 |


Pork Pessimistic on EU; Cattle Optimistic on China U.S. pork producers don’t seem optimistic about a potential trade deal with the European Union coming together anytime soon. Nick Giordano is the Vice President of Global Government Affairs for the National Pork Producers Council. Giordano tells Politico that he’s “very skeptical” that the two sides will even reach a mini agreement in the weeks ahead. He feels the real goal should be a comprehensive trade pact covering all sectors of agriculture. “It’s outrageous that a market of that size, with that level of income, is so closed to us,” Giordano says. “They’re stealing jobs from us because of their protectionism and that’s unacceptable.” The VP says there will be widespread support in the U.S. agriculture community for the Trump Administration to take tough action against the EU if there are no concessions regarding a more open EU market. Meantime, U.S. cattlemen might annually sell $4 billion worth of beef to China within the next five years. Kent Baucus, Senior Director of International Affairs with the National Cattlemen’s Beef Association, says the Phase One trade deal and the meat shortage in China cause by African Swine Fever should drive U.S. beef exports higher. “We haven’t even scratched the surface on the Chinese market,” he says. “There is a tremendous amount of unmet protein demand in China. ********************************************************************************************** USDA Ag Outlook Forum Calls for a Return to “Normal” Trade in 2020 The USDA’s top economist predicted agricultural trade will return to normal this year. USDA Chief Economist Robert Johansson says farm exports to China will rise from $10 billion last year to $14 billion in 2020. That “slight” $4 billion jump doesn’t quite add up to the $40 billion in U.S. ag products that China committed to import from the U.S. under the Phase One trade deal. Johansson says the forecast “reflects public information that’s available right now on phase one.” Later, he added that the calendar year predictions don’t completely include the phase one commitments. However, Ag Secretary Sonny Perdue says that China’s import commitments were not included in Johansson’s estimates. “We expect to exceed that, certainly,” Perdue told reporters. An Agri-Pulse report says Johansson noted that improved exports this year should help farmers’ bottom lines in 2020, while lower interest rates would reduce borrowing costs and strengthen land values. USDA is projecting a corn price at $3.60 a bushel this year, down four percent from last year. The price of soybeans is expected to be $8.80 a bushel, one percent higher last year. Wheat prices are predicted to average $4.90 a bushel, up eight percent from 2019. ********************************************************************************************** Trump Promises Farmers More Trade Aid if Needed President Donald Trump took to Twitter again to talk trade. There have been questions on the possibility of more trade aid distribution this year, with the president seemingly saying it’s a possibility. “If our formally targeted farmers need additional aid until such time as the trade deals with China, Mexico, Canada, and others fully kick in, that aid will be provided by the federal government, paid for out of the massive tariff money coming into the USA,” he said in a Friday Tweet. However, The Hagstrom Report says Trump isn’t technically accurate when he says the aid will come out of tariff income. The money comes from the Commodity Credit Corporation, which was set up back in the 1930s as a way to distribute aid to farmers. The CCC is a division of the U.S. Department of Agriculture. It has a line of credit set up at the Treasury Department that Congress replenishes. Ag Secretary Sonny Perdue has told farmers recently to not expect more trade aid in 2020. The Trump Administration has already paid out a total of $28 billion in trade aid by way of payments to farmers, trade promotion, and purchases from food items for distribution to food shelves across the country. ********************************************************************************************** ASF Virus Infections Last Longer Than Originally Thought A group of researchers and veterinarians put together a fact sheet dealing with the African Swine Fever that’s called “Holding Time Calculations for Feed Ingredients to Mitigate Virus Transmission.” However, they’ve revised the necessary holding time upward when it comes to determining if the African Swine Fever virus is sufficiently degraded in feedstuffs to potentially prevent transmission. The new recommendation is to hold conventional soybean meal an average of 125 days from when it’s placed in a package, which is up from only 52 days found in previous research. The new research was funded by the Swine Health Information Center with Pork Checkoff Funds. The study was conducted at Kansas State University using the ASF virus inside the National Bio and Agro-Defense Facility. Experts recommend that producers talk with their feed suppliers and ask for the “born-on” date for all imported feed products. Vigilance is the best protection against a potential ASF outbreak in the U.S. To further ensure the U.S. swine herd remains free of African Swine Fever, the National Pork Producers Council is asking Ag Secretary Sonny Perdue to take further measures to keep potentially infected animal feed out of the country. ********************************************************************************************** Hopes Fading for a U.S.-India Trade Deal Before Trump Visits It’s looking like the U.S. and India won’t be able to reach a trade deal before President Donald Trump visits the country. A Reuters report says India has proposed new tariffs that have complicated the negotiations. The U.S.-India Business Council tells reporters that hopes were fading for the two sides to be able to quickly bridge the gap in their efforts to restore some U.S. trade preferences for India, as well as improve market access for selected U.S. farm products. “We’re still hopeful that some kind of agreement could be reached,” the council says in a statement. “We do recognize and acknowledge that both governments have been indicating that an agreement is not likely to happen at the stage of the talks.” Trump himself is sending mixed messages on the possibility of a trade agreement with India. “We’re going to India and we may make a tremendous deal there,” he says. “Maybe we’ll slow it down and do it after the election. We’ll see what happens, but we will only make deals if they are good deals that put America first.” A spokesman for India’s Foreign Ministry says they won’t rush into a trade deal with the U.S. unless there’s a balanced outcome that’s good for both countries. ********************************************************************************************** Farm Bureau Readying for Ag Safety Awareness Program Week The American Farm Bureau says its groups across the nation are getting ready for Agricultural Safety Awareness Week, which is coming up on May 1-7. U.S. Agricultural Safety and Health Centers will join the Farm Bureau in promotion of the week with the theme as “20:20 Vision on Ag Safety.” Ag Safety Awareness Program Week has a different focus each day. Topics Monday through Friday include Mental Health on Monday, followed by Transportation Safety, Weather Disasters, Confined Spaces, and Farmer Wellness on Friday. Both organizations encourage farmers across the country to make safety a priority on the farm during the week and throughout the entire year. The Agricultural Safety Awareness Program is part of the Farm Bureau Health and Safety Network of professionals who share an interest in identifying and decreasing safety and health risks. They invite farmers to visit their YouTube channel for new content and fresh ideas on how to stay safe while working in agriculture, forestry, and fishing. There’s a lot more information on the Agricultural Safety Awareness Week webpage as well.

| Rural Advocate News | Monday February 24, 2020 |


Washington Insider: Considering a New Farm Bailout It appears that the administration is seriously considering another farm bailout, in spite of its own recent negative comments regarding such an effort. The Washington Post is reporting that President Trump “for the first time Friday” vowed to continue his multibillion-dollar bailout of the farm industry “if necessary.” The White House comments appeared to surprise a number of administration officials, the Post said. However, the report noted that the comments came amid growing signs that last month’s partial trade deal with China is “falling far short of the levels initially promised.” As recently as Thursday, a senior U.S. Department of Agriculture official said China might end up buying just $14 billion in U.S. farm products through the end of September and that total purchases for the year could be much less than the $40 billion the president had promised. The Post said the President’s political support among farmers appears to continue to be strong “but White House officials have long been worried about a backlash if prices remain low and bankruptcies continue.” USDA reported at its recent outlook conference that total farm debt was at an all-time high and that there had been no “bump” in commodity prices following either the new China trade deal or the separate pact with Canada and Mexico — in spite of the president’s promise of a farming renaissance and his exhortation to farmers “to buy a bigger tractor and more land.” “We are frustrated with the situation. We understand the broader trade implications but feel we have been targeted in a bigger political battle we did not sign up for,” said Jamie Beyer, a soybean farmer in Wheaton, Minn. and president of the Minnesota Soybean Growers Association. “We are all very excited about the USMCA (U.S.-Mexico-Canada Agreement) and the trade deal with China. But we are all waiting for that to be reflected in commodity prices and orders… it’s disheartening." A third multibillion-dollar bailout could cast a shadow over administration claims about the “big, beautiful” trade deal reached with China last month, an agreement expected to form a key part of his 2020 reelection message on the economy. The outbreak of the coronavirus has wreaked havoc on the Chinese economy, making it more difficult to forecast how large farm purchases by China will ultimately be this year, the Post said. The farm bailout program began in 2018 as a way to address fury from farmers who said Chinese tariffs on their exports had pushed many to the brink of collapse. The program continued in 2019, but White House officials had suggested it would not be renewed in 2020 — until the President reversed course Friday. “Farmers are no dummies. They’ve seen this get rolled out the past two years, programs invented out of whole cloth,” said Roger Johnson, president of the National Farmers Union. “The president is going to do whatever he can to appease the farmers because it’s an election year." The need for what would amount to a third round of bailout funding highlights the immense challenges the administration has faced in its international trade war conflicts. It imposed tariffs on a range of Chinese imports, including steel, as a way to ramp up pressure on the Chinese government to boost U.S. imports. But China retaliated by targeting agricultural producers in politically critical Midwestern states. The administration “has said from the beginning that the trade war is nothing but rainbows and unicorns. The reality is that it’s not just us being tough on China; China and other countries are being tough on us,” said Rory Cooper, a former Republican aide who now works at Purple Strategies, a political consulting firm. Zippy Duvall, president of the American Farm Bureau Federation said that he was optimistic that China would purchase more than $14 billion in agricultural products, based on conversations with China’s minister of agriculture but that the final outcome was uncertain. “The difficult times farmers are having today are not getting any better because of slow implementation,” Duvall said. The President’s talk of additional bailout money may be meant as a signal to China that the White House will not wait patiently for Beijing to comply with the new trade deal, Sen. Kevin Cramer, R-N.D., a farm-state ally of the President, said. GOP lawmakers worry that the President’s trade war “weakened the impact of their 2017 tax law, slowing U.S. economic growth.” The bailout’s price tag is now more than twice the cost of the Obama administration’s auto bailout, which was criticized by conservative lawmakers, the Post said. Unlike with many other government bailout programs, farmers are not required to pay any of the money back. Still, Democrats may be in a difficult position to exploit the intra-GOP rift on the issue, the Post said. Congressional Democrats passed up an opportunity last year to force the White House to scale back the program amid pressure from lawmakers in their own caucus representing farm states. And party leaders such as Senate Minority Leader Charles Schumer, D-N.Y., have argued that the administration has “not been tough enough on China.” Senior administration officials previously expressed alarm about the administration’s legal justification for the bailout, which they have based on a New Deal-era program. It was modified from its initial form to include additional crops, among other changes. So, we will see. The administration’s heavy reliance on tariffs appears to be attracting growing criticism — at least in some quarters — especially as the coronavirus appears to continue to spread, a trend producers should watch closely as the season progresses, Washington Insider believes.

| Rural Advocate News | Monday February 24, 2020 |


Boost in Guest Workers Coming From Trump Administration The Trump administration plans to allow 45,000 additional seasonal (H-2B visa program) guest workers to return to the U.S. this summer, the highest number since the president took office, according to administration officials. The Department of Homeland Security plans to announce the additional seasonal-worker visas next week. They will become available in two waves: the first 20,000 will be immediately available, while employers can apply for the remainder for jobs beginning June 1. The additional visas are being made available ahead of the summer, when demand for short-term work is typically highest.

| Rural Advocate News | Monday February 24, 2020 |


India Now Downplaying Expectations For US-India Trade Deal Soon Expectations for a U.S.-India trade deal to be inked when President Donald Trump visits the country next week continue to fade, with the U.S.-India Business Council the latest to lower those expectations. “As new issues have continued to emerge, including the introduction of new tariffs in the most recent budget,” the group’s president, Nisha Biswal, told reporters in a teleconference, “the conversations may have gotten a little bit more complicated.” However, Biswal said there is still a chance for an agreement, but “both governments have been indicating that is unlikely at this juncture.” Indications are that the situation is linked to India not making the kind of concessions on some issues that the U.S. sought as they were wanting to put some kind of trade deal together that Trump could announce while in the country.

| Rural Advocate News | Monday February 24, 2020 |


Monday Watch List Markets Coronavirus remains a concern to markets with infections spreading beyond China. With the Ag Outlook Forum concluded on Friday, traders will be back to checking South American weather forecasts and watching for any trade news to emerge. USDA's weekly report of export inspections is due out at 10:00 a.m. CST, followed by a monthly cold storage report at 2 p.m. Weather Moderate to locally heavy rain is in store for the southern Midwest and Delta Monday, keeping soils saturated and threatening flooding. Meanwhile, snow will develop in the northern and western Plains, adding to meltwater supply for spring flood potential.

| Rural Advocate News | Friday February 21, 2020 |


EU Sets a Target Date for U.S. Trade Deal Phil Hogan, European Union Trade Chief, says he’s looking to have a trade deal in place with the Trump Administration and the U.S. by March 18. Politico says he’s working on a package of agreements for EU leaders to present to Trump in the coming weeks. Among the potential concessions the EU may be willing to make are speeding up the approval process for certain Genetically Modified Organisms, as well as allowing U.S. imports of tallow, which is a form of beef or sheep fat. Why March 18th? That’s when higher U.S. retaliatory tariffs on Airbus planes are set to take effect. The Trump Administration last week raised duties from 10 percent to 15 percent but suspended implementing the increase. Hogan says the move by Washington, as well as the decision to not raise tariffs on EU farm goods, was seen as a positive sign that the U.S. is ready to make a deal. The U.S. also didn’t do anything to increase the 25 percent duties in place on European food and alcohol products. ********************************************************************************************** Hormel Eliminating Ractopamine from Hog Supplies Hormel Foods is getting rid of ractopamine (rack-TOH-pah-meen), a growth drug banned by China, from its hog supply. Hormel is joining rival companies like Tyson Foods and JBS in looking to make more meat sales to China, which is in the middle of wrestling with a large shortage of pork. Hormel isn’t going to accept hogs that have been fed or otherwise exposed to ractopamine after April first. Tyson Foods and JBS USA took that step last year. The companies’ moves ramped up the competition for the increased pork demand from China, where the outbreak of African Swine Fever has decimated their herds. In a statement announcing the move, Hormel says, “We have been actively monitoring the changing global market dynamics for several years and believe this decision will further position us to meet growing international demand.” Ractopamine is used in some countries to raise leaner pigs, but China doesn’t allow its use or tolerate residues in its imported meats. The European Union also bans ractopamine. ********************************************************************************************** Perdue Announces New Innovation Initiative for USDA Ag Secretary Sonny Perdue announced the Agriculture Innovation Agenda, which is a department-wide initiative to help better position U.S. ag to meet future global demands. The initiative will align resources, programs, and research to help stimulate innovation so that American agriculture can achieve the goal of increasing production by 40 percent while cutting the environmental footprint of U.S. agriculture in half by 2050. “We know we have a challenge facing us: to meet future food, fiber, fuel, and feed demands with finite resources,” Perdue says. “USDA’s Agriculture Innovation Agenda is our opportunity to define American agriculture’s role to feed everyone and do right as a key player in the solution to this challenge.” He calls the new agenda a strategic, department-wide effort to better align USDA’s resources, programs, and research to provide farmers with the tools they need to be successful. “We’re also continually mindful of the need for America’s agriculture industry to be environmentally, socially, and economically sustainable to maintain our position as a leader in the global effort to meet demand,” he adds. The first component of the Ag Innovation Agenda is to develop a U.S. ag innovation strategy that aligns and synchronizes public and private sector research. ********************************************************************************************** U.S. Pork Industry Wants Additional ASF Prevention Measures in Place Continued vigilance by the USDA, Customs and Border Protection, and the U.S. pork industry, means that the U.S. has so far prevented an outbreak of the African Swine Fever Virus. The disease affects pigs and poses no threat to human safety. The National Pork Producers Council and 30 state associations are asking Ag Secretary Sonny Perdue to take additional measures, including restricting imports of organic soy products for animal feed from all countries that have ASF outbreaks. The U.S. pork and feed industries have adopted holding times to allow for the natural degradation of any viruses, to ensure that most imported feed ingredients are safe to use. Research shows that organic soy products can maintain the virus for longer periods, making holding times impractical. Most soy imports into the U.S. are organic. NPPC says it’s confident in the safety of domestic soy products. NPPC and the associations are also asking USDA to further explore the merit of restricting all soy products from ASF-positive countries, to enhance its online system used to permit animal movements in the event of an outbreak, and to expand state animal health laboratory testing capacity. ********************************************************************************************** Groups to Study 100 Percent Biodiesel Engine Technology A wide range of groups announced a partnership to conduct a year-long validation project of revolutionary biodiesel technology. Five trucks owned by ADM will be outfitted with Optimus Technologies Vector Fuel System, which enables diesel engines to run almost entirely on sustainable biodiesel. In a real-world environment, the trucks will be used in everyday fleet operations for a year, with each vehicle likely to travel between 160,000 and 180,000 miles, while reducing up to 500,000 pounds of carbon dioxide. Five other trucks in the ADM fleet will be a control group in the study and operate on conventional biodiesel. While nearly all diesel engine manufacturers support at least 20 percent biodiesel, the Optimus Vector System is designed to allow conventional diesel engines to run on 100 percent biodiesel in a wide range of climates. The system is already in use in short mileage, local fleet applications. The new project will test the viability for longer-haul, over-the-road fleets, which could potentially open a pathway to significantly higher volumes of biodiesel in the U.S. truck fleet. Other organizations involved in the project include the National Biodiesel Board, the Illinois Soybean Association, and the Missouri Soybean Merchandising Council. ********************************************************************************************** Farmers Union Recommends Improvements to EQIP The USDA continues to implement the 2018 Farm Bill and released the Environmental Quality Incentives Program Interim Rule. The National Farmers Union is urging the agency to strengthen the conservation program to better support farmers as they work to ensure the longevity of their land and natural resources. Farmers Union President Roger Johnson says his group values the program and wants to make improvements to ensure its efficiency. “We’d like to encourage the agency to include climate resilience and soil health in its list of EQIP priorities,” Johnson says. “These are two of the most critical issues facing agriculture today and farmers need all available tools and resources to address them.” They also recommend NRCS give each state the ability to set their high-priority practices for increased payment rates. Local and regional offices are the most knowledgeable about the resource concerns in their areas and should determine, when possible, how to address those concerns. “We also urge NRCS to prioritize farmers and ranchers when allocating EQIP funding,” Johnson adds. “We’d like funding to be available to water management entities that serve mostly farmers and ranchers.”

| Rural Advocate News | Friday February 21, 2020 |


Washington Insider: Complex Economic Trends It seems likely that much of the coming political campaign debate will center on the economy, and that there may well be a series of political fights brewing there as the administration seeks to claim a “blue collar boom” across the U.S. At the same time, others tend to see the recent trends as more complicated. For example, Bloomberg is reporting this week that “in the 11th year of a record expansion the rising tide of the U.S. economy hasn’t been lifting all boats equally — at least when it comes to pay.” It is true that unemployment is the lowest for half a century and that wages have been picking up steam across the board, the report says — but it also notes that “the biggest rewards from a strong economy are still skewed toward white people, men and high earners.” The report relies on details from an annual study by the Economic Policy Institute. Administration officials frequently argue that previously left-behind groups are “benefiting from a blue-collar boom.” However, Bloomberg says that while there have been gradual improvements for many “some disparities have actually worsened over time.” It points to the wage gap between blacks and whites, which is wider now than in 2000. And, it points out that along with tight labor markets, minimum wage legislation at the local level has helped deliver some of the gains for low earners. In the past two decades — encompassing two expansions and a recession — wage growth has been fastest for the highest-paid workers, Bloomberg says. However, it notes that it wasn’t until last year that workers with only “some college education” got back to their pre-2008 wage level. It also notes that men with a standard college degree are still paid more than women with an advanced one--and black workers with some college education still get paid less than in 2000. Still, most black workers experienced stronger wage growth between 2018 and 2019 than any year since 2000, the report said. And it notes that Hispanic workers were the only ethnic group to see their wages rise across all education levels from 2018 to 2019--although at almost every level, Hispanic and black workers were paid less than white peers. Bloomberg also reports wage disparity “even near the top.” For example, men in the 95th percentile saw a 37% wage gain in the last 20 years, about twice that for those just next door in the 90th percentile. As for the median, that indicator ticked up only 3.4%. And among the top 0.1%, earnings grew at more than double the pace of the mere 1%. Wage rates paid to the lowest-paid men saw faster growth than those in the middle, with the 10th percentile rising 12% and the 20th up 10%. However, the gains among the lowest-paid workers have been concentrated during economic expansions with wages accelerating a few years into boom cycles and then tapering off. Minimum wage legislation also affected the trends, Bloomberg said. Pay rose 18% for the lowest-paid 10% of workers in states where minimum wage legislation was enacted in the last seven years. It rose just 9% in regions without those laws. The trend in wage growth is more important than usual just now, since it is one reason Federal Reserve policy makers are comfortable leaving interest rates at historically low levels at this time; Chairman Jerome Powell has cited growth beginning to reach those on the sidelines. So, we will see. The strong domestic economic trends have been widely welcomed even while there are reports of economic pitfalls ahead, including those facing trade policies as well as the coronavirus outbreak. USDA is emphasizing its belief that China will honor its phase one requirements in spite of the economic pressures it faces — although tensions appear to be growing between the U.S. and Europe. Clearly, the trends and issues producers face now are increasingly complex and difficult to evaluate. They should be watched closely as the season advances, Washington Insider believes.

| Rural Advocate News | Friday February 21, 2020 |


EU Trade Chief Lays Out US-EU Trade Pact Expectations European Union (EU) trade chief Phil Hogan is working to get a deal with the U.S. by March 18, he told reporters Wednesday night. Hogan said he is preparing a package of several agreements for European Commission President Ursula von der Leyen to present to President Donald Trump in the next few weeks. The Trump administration’s decision last week not to increase retaliatory tariffs on agricultural products in the long-running Boeing-Airbus dispute was a positive sign that the U.S. is willing to negotiate a deal, Hogan said. The U.S. Trade Representative instead boosted retaliatory tariffs on Airbus aircraft to 15%, from 10%, and left unchanged a 25% tariff on EU food, alcohol and other products. As for the significance of March 18, Hogan noted USTR Robert Lighthizer suspended the tariff increase on Airbus planes until March 18. “Between now and then, we are trying our best to have a mini deal based on the terms of reference that was given to us ... by President von der Leyen and Trump in Davos,” Hogan said.

| Rural Advocate News | Friday February 21, 2020 |


USDA Announces Program to Reduce Environmental Impact of Farming USDA Secretary Sonny Perdue announced an initiative to reduce the environmental impact of American farming. He stressed voluntary conservation incentives and efficiency improvements rather than regulation as he joins major farm groups in seeking to shape the public debate on agriculture and climate change. Some 21 farm groups announced a coalition Wednesday on environmental sustainability. Perdue set a goal of increasing farm production by 40% while cutting the “environmental footprint” in half by 2050. The initiative includes goals such as a 50% reduction in food waste by 2030, a 30% cut in fertilizer run-off by 2050 and an overall “net reduction” in carbon emissions by 2050 “without regulatory overreach.” Perdue also set a goal for biofuels such as ethanol to reach “market-driven blend rates” of 15% of U.S. transportation fuels by 2030 and 30% of transportation fuels by 2050.

| Rural Advocate News | Thursday February 20, 2020 |


Farm Groups Come Together for Sustainability Discussion Twenty-one farm and ranch groups that represent millions of U.S. farmers and ranchers are launching Farmers for a Sustainable Future. It’s a new coalition committed to environmental and economic sustainability. The coalition will serve as a primary resource for lawmakers and policymakers as they consider climate policies. One important task for the new coalition is to share with elected officials, media, and the public, U.S. agriculture’s commitment to sustainability and the incredible strides they’ve already made to reduce agriculture’s environmental footprint. As policy proposals are developed and considered, the goal is for the coalition and its guiding principles to serve as a foundation to ensure the adoption of meaningful and constructive policies and programs affecting agriculture. Those guiding principles include calling for policies that support science-based research, voluntary incentive-based conservation programs, investment in infrastructure, and solutions that ensure vibrant rural communities and a healthy planet. The coalition says farmers and ranchers are committed stewards of the land, leading the way to climate-smart farming by promoting soil health, conserving water, enhancing wildlife, using nutrients efficiently, and caring for their animals. ********************************************************************************************** Ag Groups Excited about New Sustainable Farming Coalition Farm groups that represent millions of farmers and ranchers across the country have come together to form a new coalition called Farmers for a Sustainable Future. It’s a coalition committed to environmental and economic sustainability. One of the ag groups is the American Soybean Association. Their CEO, Ryan Findlay, says, “Soybean farmers have an awesome story to tell, including their sustainability initiatives, so it’s great to be able to collaborate with like-minded organizations to facilitate sound policy and program decisions and have a platform to share our efforts.” The National Council of Farmer Cooperatives also joined the coalition. Chuck Conner, President and CEO of the NCFC, says, “This effort is important as policymakers at both the state and federal levels, and our partners in the value chain develop programs to reduce greenhouse gas emissions and address climate change.” National Cattlemen’s Beef Association Vice President of Government Affairs Ethan Lane says, “Twenty-one agricultural groups are now standing side-by-side in unity to correct a false narrative that’s haunted us for as long as I can remember.” The National Pork Producers Council says farmers and ranchers are “committed stewards of the land” and leading the way in climate-smart farming. ********************************************************************************************** Meat Import Containers Piling Up in Chinese Ports There are thousands of containers of frozen pork, chicken, and beef, all sitting in major Chinese ports because of the impact of the coronavirus outbreak. Bloomberg says transportation disruptions and labor shortages are slowing operations down drastically. People familiar with the situation tell Bloomberg that there aren’t enough truck drivers to pick up and move the containers due to travel restrictions imposed on the country to control the coronavirus. Ports are running out of electricity to help freeze the containers, while some ships have been told to move on to other destinations in mainland China or Hong Kong. China imports massive amounts of meat products from South America, Europe, and the United States. It’s been boosting purchases to help ease some of the shortages caused by the African Swine Fever outbreak that decimated its hog herds. Customs data shows that China boosted its imports of meat and offal by almost 50 percent last year to a record 6.2 million tons. It’s not known if or when port operations will be able to return to normal as truck drivers returning from other cities are quarantined for 14 days. Other transport restrictions on trucks also remain in place. ********************************************************************************************** China Offers More Tariff-Relief on U.S. Imports The University of Illinois’ Farm Policy News website says reports are surfacing that China is looking at purchasing some U.S. farm products by early March. The gesture would be intended to show the U.S. that it will meet its commitments outlined in the Phase One trade deal. The Chinese government is in discussions over what commodities it could potentially buy at the end of February or in early March. The purchases would show the U.S. that China intends to stick to the trade deal despite the impact of the coronavirus outbreak. Additional reports from Reuters show that China intends to “grant exemptions on retaliatory duties imposed on almost 700 U.S. products,” which would be the most substantial tariff relief to be offered so far. That would be the third round of tariff relief offered by China and comes after the Phase One trade deal officially went into effect on February 14. China has already been issuing tariff waivers on more of an ad hoc basis for U.S. farm products, including soybeans. The exemption announcement that came this week includes energy products like crude oil. ********************************************************************************************** Don’t Forget to Complete Census of Agriculture Special Studies The USDA’s National Ag Statistics Service continues to collect responses to the 2019 Organic Survey and the 2019 Census of Horticultural Specialties, both of which are special studies that take place every five years. The response window runs through March of this year. NASS is asking producers who received the questionnaires to respond online, by mail, or by telephone. “We are extending the deadlines for responses since we still have a steady stream of completed questionnaires coming in,” says NASS Administrator Hubert Hamer. “NASS produces the most comprehensive data about U.S. agriculture. Our record of accuracy is why NASS data continues to be used throughout the industry.” Hamer says the better response they get from the questionnaires means the better data they have to offer. “Responding to NASS surveys and censuses means contributing to the future,” Hamer adds. The resulting data will be used by commodity associations, agribusinesses, policymakers, researchers, Extension, and more. Producers who didn’t respond to the original deadline will receive a second questionnaire this month. ********************************************************************************************** CRP Signup Deadline Rapidly Approaching The USDA is reminding producers interested in the Conservation Reserve Program that the signup deadline is on February 28. The signup is available to farmers and private landowners who are either enrolling for the first time or re-enrolling for another 10-to-15-year term. Farmers and ranchers who enroll in the program get yearly rental payments for voluntarily establishing long-term, resource-conserving plant species, such as approved grasses or trees, which can control soil erosion, improve water quality, and develop wildlife habitat on marginally productive agricultural lands. The CRP has 22 million acres currently enrolled, but the 2018 Farm Bill lifted that cap to 27 million. The program is marking its 35th anniversary in 2020 with many milestones. It’s prevented more than nine billion tons of soil from eroding, which is enough soil to fill 600 million dump trucks. The program has also sequestered an average of 49 million tons of greenhouse gases, equal to taking nine million cars off the road.

| Rural Advocate News | Thursday February 20, 2020 |


Washington Insider: Growing Obesity Threat The New York Times science section recently featured a report that argued that climate change “is not the only source of dire projections for the coming decade.” The article was responding to “a predicted continued rise in obesity among American adults.” It featured projections from a prestigious team of medical scientists who conclude that “by 2030, nearly one in two U.S. adults will be obese, and nearly one in four will be severely obese.” The estimates are thought to be particularly reliable, NYT says because the team corrected for current underestimates of weight given by individuals in national surveys. In as many as 29 states, the prevalence of obesity will exceed 50%, with no state having less than 35% of residents who are obese, the team said. Likewise, it expects that in 25 states the prevalence of severe obesity will be higher than one adult in four and could become the most common weight category among women, non-Hispanic black adults and low-income adults nationally. Given the role obesity plays in fostering of many chronic, disabling and often fatal diseases, these are dire predictions indeed, the Times said. Yet it notes that “the powers that be” in the U.S. are doing very little to head off these potentially disastrous results. Well-intentioned efforts like limiting access to huge portions of sugar-sweetened soda, the scientists note, have been “effectively thwarted” by well-heeled industries able to dwarf the impact of efforts by health departments that have minuscule budgets by comparison. Claims that such taxes are regressive “and unfairly target low-income people” are shortsighted, according to Zachary Ward, public health specialist at Harvard and the lead author of the new report published in The New England Journal of Medicine in December. “What people would save in health care costs would dwarf the extra money paid as taxes on sugar-sweetened beverages,” he said told the press. Still, in “a city like Philadelphia,” where a soda tax of 1.5 cents an ounce took effect three years ago, total purchases declined by 38% even after accounting for beverages people bought outside the city, the report’s authors said. However, the report downplayed piecemeal policy changes like this as too small to make a significant difference in the obesity forecast for the country. Rather, nationwide changes are needed as the “food environment” has fostered a steady climb toward a weight-and-health “disaster”. NYT says that this health threat is relatively new and that since 1990, the prevalence of obesity in this country has doubled. This change is not from genetics, which have “not changed in the last decade,” Dr. Sara Bleich said. Rather, what has changed is the environment in which our genes now function. Food is super easy to access, said Bleich, a professor of public health at the Harvard T.H. Chan School of Public Health. “We eat out more, consuming more foods that are high in fat, sugar and salt, and our portion sizes are bigger.” “It doesn’t take that many extra calories to result in weight gain,” Dr. Bleich said. “Through marketing, we’re constantly being sold on foods we didn’t even know we wanted.” Unless something is done to reverse current trends, Ward said, “Obesity will be the new normal.” In addition, the study authors think that there is “no one thing to throw at the problem.” However, they point out that policies that reduce added sugars have reduced weight gains and health problems and that “when people drink their calories, they don’t feel as full as when they consume solid food, so they end up eating more.” With a third of meals now being eaten out, Dr. Bleich suggested that prompting restaurants to gradually reduce the amount of fat, sugar and calories in the meals they serve could help dampen societal weight gain. “Menus could make healthier, lower-calorie meals the default option,” she said. Controlling portion sizes is another critically important step. “Big portions are especially motivating for low-income people who reasonably want to get more calories for their dollar,” she said. Low-income groups already have the highest rates of obesity and, the new projections show, they are the groups most likely to experience a rising prevalence of obesity and severe obesity. “From a policy perspective,” Ward said, “prevention is the way to go. Children aren’t born obese, but we can already see excessive weight gain as early as age 2. Changes in the food environment are needed at every level, local, state and federal. It’s hard for individuals to voluntarily change their behavior.” So, we will see. Taxes are unpopular and face an uphill fight for acceptance, so education likely is the most acceptable policy choice. Whether or not warnings and nutrition education can effectively derail this trend remains to be seen, but it is a growing industry wide threat with potential implications for the food industry that should be watched closely by producers, Washington Insider believes.

| Rural Advocate News | Thursday February 20, 2020 |


Hormel to Stop Using Hogs That Are Fed With Ractopamine Hormel Foods announced it will no longer accept hogs that have been fed or exposed to ractopamine after April 1 as the company seeks to expand its ability to sell products to China. "We have been actively monitoring the changing global market dynamics for several years and believe this decision will further position us to meet growing international demand," Hormel said. Hormel uses third-party suppliers for its pork and does not have slaughter operations. Tyson Foods and JBS USA announced last year they would eliminate ractopamine from their supply chains for the same reason – they sought to boost exports to China which prevents the use of ractopamine for livestock. The move comes even as the phase-one trade agreement between the U.S. and China calls for China to undergo a risk assessment of ractopamine in cattle and hogs “as soon as possible without undue delay.” The risk assessment is to be done in consultation with the U.S. and “verifiable data and the approved conditions of ractopamine use in the United States.”

| Rural Advocate News | Thursday February 20, 2020 |


Caution: USDA Forecasts Ahead USDA’s Annual Outlook Forum will take place the next two days near Washington, D.C., and a lot of attention will be placed on a series of USDA forecasts that will come out today. The updates include the 2020 acreage expectations and price forecasts that will be delivered this morning by USDA Chief Economist Rob Johansson. Those will frame the supply picture for the 2020/21 marketing year, with those outlooks due Friday morning. The other important update will be the Outlook for U.S. Agriculture Exports which will provide USDA’s latest look for the dollar value of U.S. ag exports and imports for Fiscal Year (FY) 2020. The attention point will be on the how much USDA chalks up to the Phase One trade deal between the U.S. and China. USDA will have to acknowledge the deal in their forecast, particularly now that the deal is in effect. Then, USDA analysts on Friday morning will release their first run at the 2020/21 marketing year U.S. balance sheets. But the key to keep in mind on these forecasts relative to the Phase One deal is that the agreement is on a calendar-year basis, while the forecasts due over the next two days will be a mix. The trade forecast is on a FY basis – an October-September year – while the U.S. commodity balance sheets are on a mix of marketing years. Still, the data will provide some additional perspective on what USDA analysts expect to be a result of the Phase One deal with China.

| Rural Advocate News | Wednesday February 19, 2020 |


India Offers Concession on U.S. Farm Goods to Help Reach a Deal India is attempting to reach a trade deal with the U.S. before President Donald Trump makes his first official visit to the country on February 24-25. People close to the negotiations say the Indian government is open to greater market access for American farm and dairy products. India is willing to allow market access for U.S. products like cranberries, blueberries, pecan nuts, and avocados at lower duty rates. They’re also open to allowing imports of DDGs, the by-product of ethanol production used in animal feed and alfalfa hay. Even as the two nations attempt to have a deal in place before Trump’s visit, there aren’t a lot of details available as to when a new agreement might be ready. Negotiators are still working on the final details in an attempt to resolve some long-standing issues between the two countries. Bloomberg says even a partial trade deal with India that allows greater market access for U.S. farm goods is likely to help the president as he runs for reelection this year. He’s fresh off success with the “Phase One” deal with China, as well as the USMCA agreement, and the trade deal with Japan. ********************************************************************************************** GAO will Investigate Trade Aid Funds Distribution The Government Accountability Office is looking into President Trump’s $28 billion aid program for farmers that were hurt by trade disputes with other countries. The office is investigating allegations that the money was mismanaged and distributed unfairly. The New York Times says the investigation came about because of a request by Michigan Democrat Debbie Stabenow, who says she thinks the aid program was biased. She argues that the program provided more funds to southern states that voted for the president and that it favored large and foreign agriculture companies over small farmers. The administration says the aid program that began in 2018 will end this year. The program started as a $12 billion effort to help mitigate losses for farmers who faced lost sales because of retaliatory tariffs from China, the European Union, Canada, and Mexico, as a result of the trade war. The program grew to $28 billion last year as the trade war disruptions with China lingered. Critics have said the formula that was used to determine payments for certain crops were faulty, which meant funds went to multiple big corporations or large farms, instead of the smaller family operations. ********************************************************************************************** Hemp Farmers on Edge Because of Law Enforcement Requirements Hemp producers around the country feel they’re being treated like criminals. That’s because laboratories that test the crop must be certified by the Drug Enforcement Administration, something that has the country’s producers uneasy. USDA’s new hemp regulations say farmers have to ship some of their crops off to labs so that they can verify the crop doesn’t contain illegal amounts of THC, the mind-altering chemical in marijuana. If a hemp crop is found non-compliant, which would mean the THC levels are above .3 percent, it has to be completely destroyed under the supervision of a law enforcement officer. Eric Steenstra, President of Vote Hemp, tells Politico that law enforcement shouldn’t be involved unless there’s evidence of illegal activity, such as a farmer with a hemp license growing marijuana. Other critics worry that DEA lab certification will create a major bottleneck to testing, which must take place during a 15-day window before harvest. 44 labs in America can process hemp samples, but some states such as Alabama don’t have a single lab to take care of that kind of testing. ********************************************************************************************** Justice Department Looking Into Dairy Merger Dairy Farmers of America has reached an agreement with Dean Foods to purchase the bulk of Dean’s operations for $425 million. An Agri-Pulse report says that agreement will be contingent on approval from the Justice Department and a federal bankruptcy court. Dean filed for bankruptcy back in November. The company currently operates 57 facilities in 29 states, and under the agreement, Dairy Farmers of America would acquire 44 of those facilities. However, not everyone is happy with the agreement. “It would be awful,” says Peter Carstensen, a Law Professor at the University of Wisconsin. “This has the potential to hurt consumers because it would eliminate a lot of competition within the industry. At the same time, it will hurt dairy farmers.” Carstensen specializes in antitrust in agriculture, and he says Dean and DFA are some of the only milk processors in the Upper Midwest and New England. Bobbi Wilson, a government relations associate for the Wisconsin Farmers Union, says, “We don’t want to see a situation where DFA is the only buyer around.” The Justice Department will need to review the merger and has been in contact with Dean Foods about potential transactions, including a tie-up with DFA. Dean Foods says it believes the transaction would be “competitive and beneficial” for both farmers and consumers. ********************************************************************************************** Grain Glitch Could Cost Farmers, Cooperatives Money It’s been two years since the discovery of the “grain glitch” in the Tax Cuts and Jobs Act of 2017. A DTN report says farmer cooperatives are still asking Treasury Department officials to change provisions of Section 199A back to the way the tax deduction worked before the 2017 tax law was passed. The tax quirk that looked like a windfall for farmers who did business with cooperatives might now increase the taxes for at least some of those farmers who are patrons of more diverse cooperatives. Accountants and grain industry leaders discovered in early 2018 that the new tax law inadvertently gave farmers a potentially large tax break for selling their crops to farmer cooperatives instead of private elevators. Major private grain companies were faced with a possible large purchasing disadvantage. The grain glitch generated enough attention that Congress passed legislation to rework the tax deduction in a federal spending bill within a few months. Last summer, the Treasury Department began proposing that Section 199 deductions only apply to “patronage income.” That would eliminate cooperatives’ ability to combine “non-patronage income” as part of the deduction calculation. That exclusion of non-patronage income was never part of the original Section 199 regulations. ********************************************************************************************** Coronavirus a “Wildcard” in the Cotton Market too? The coronavirus in China represents a significant wildcard in the world’s cotton market. That comes from the 2020 economic outlook released at the National Cotton Council’s annual meeting in New Orleans. The coronavirus outbreak in China may mean delays in the Asian country’s ability to increase purchases in the near-term. The NCC says that it makes it hard to predict what 2020 buying may look like in the cotton market during the year ahead. The NCC is projecting planted acreage to be 13 million acres, 5.5 percent less than in 2019. The Hagstrom Report says the expected drop in cotton acres is a result of slightly weaker cotton prices relative to corn and soybeans. Export markets for cotton, like many other commodities, continues to be the primary outlet for the raw fiber shipments from the U.S. World trade is estimated to be higher in the 2019 marketing year. However, retaliatory tariffs and increased competition from other major exporting countries have led to a sharp drop in the U.S. share of the cotton market in China. However, despite the continued U.S. and China trade disruptions, the NCC says U.S. export sales to other markets have been very strong for the current crop year.

| Rural Advocate News | Wednesday February 19, 2020 |


Washington Insider: GAO to Investigate Farm Bailout Program The New York Times and others are reporting this week that the Government Accountability Office (GAO) is opening a review of the administration’s $28 billion bailout for farmers. The Times said that the review would look into allegations that the money was “mismanaged and allocated unfairly.” The investigation was requested by Senator Debbie Stabenow, D-Mich., who has frequently charged that the aid program was biased, providing more funds per-acre to farmers in southern states that voted for President Trump and favored “large and foreign agriculture companies over small farms.” The administration, which signed an initial trade deal with China last month, said the farm subsidies already were planned to end this year. The program began in 2018 as a $12 billion effort to mitigate losses for farmers who lost sales or faced retaliatory tariffs from China, the European Union, Canada and Mexico as a result of the trade war – and was expanded to $28 billion last year as the conflict with China festered. Critics have faulted the program for the formulas it used to determine payments for certain crops and for providing funds to big corporate farms, the Times said. The program used a “Depression-era fund that allowed farmers earning less than $900,000 a year to receive money if they produced one of the agricultural products that faced retaliation.” The government also purchased certain products to buoy key markets for products like apples, oranges and pork. “It’s clear that the administration’s trade assistance payments pick winners and losers rather than help the farmers who have been hit the hardest by this president’s trade policies,” Stabenow said in a statement late last week. She requested that the GAO study why payments disproportionately went to large farm operations, if the Agriculture Department was effectively preventing fraud, waste and abuse in the program and whether the model the USDA used to distribute payments accurately reflected trade damage that farmers experienced. Democrats have complained that the program paid subsidies to some farmers that did not need them while leaving those that were suffering from others damaged by the administration’s tariff policies without benefits. The GAO is a nonpartisan congressional watchdog that audits government programs. It notified Sen. Stabenow’s office in a letter transmitted on Thursday that it would take up the investigation. Democrats are not the only ones that have expressed concerns with the farm bailout program, the Times said. Senator Marco Rubio, R-Fla., joined with Senator Bob Menendez, D-N.J., and Representative Rosa DeLauro, D-Conn., in asking Sonny Perdue, the agriculture secretary, to investigate JBS, a Brazilian-owned meat-processor that received $67 million in bailout funds. Lawmakers also raised concerns about the payments given the company’s past legal problems, noting that in 2017 two of JBS’s former top executives, brothers Wesley Batista and Joesley Batista, pleaded guilty to corruption charges in Brazil. The brothers remain majority shareholders with control over the company. Rubio and Menendez also asked the Treasury Department to investigate possible ties that JBS has with the government of Nicolas Maduro in Venezuela, whom the United States does not recognize as the legitimate president. In a letter to DeLauro last month, Secretary Perdue said that he did not intend to ask his inspector general to open an investigation into JBS, noting that the Department of Justice and the Securities and Exchange Commission were already looking into the company’s practices. So, we will see. Farmers who saw export markets weaken as a result of the administration’s trade policies have long argued that they much prefer their accustomed access to growing developing country markets over government subsidies—which they charged fell substantially short of making up for the lost sales, although many producers reported that the program’s benefits were very much appreciated. Producers have long invested in overseas market development and have punished administrations for interventions that weakened those markets – in spite of efforts to offset impacts of the interventions. So, producers can be expected to add their criticisms to those turned up by the GAO—especially if the coronavirus weakens Chinese demand and undercuts its promises to purchase US farm products. These trade policy efforts are important and producers should watch them closely the “trade fight” proceeds, Washington Insider believes.

| Rural Advocate News | Wednesday February 19, 2020 |


EPA Discussing Court Case Impact on RFS with White House EPA is currently consulting with the White House and Department of Justice on the potential impact of the recent court ruling that three small refinery exemptions (SREs) granted by EPA in the 2016 compliance did not meet requirements under the Renewable Fuel Standard (RFS), according to a report from Reuters. The report said the decision would be made by March 9. The court ruled that the three in question did not meet the RFS law which they said requires that any SREs granted after 2010 have to be an extension. The agency aims to have an announcement by March 9, according to the report. "EPA and (the Department of Justice) are reviewing the decision and carefully considering its potential impact on the program," EPA spokeswoman Molly Block said in a statement. The number of SREs requested and granted by EPA has risen sharply in recent years and some of those SREs are potentially impacted by the court decision, with EPA Administrator Andrew Wheeler telling reporters recently that the action has the potential to impact the SRE process.

| Rural Advocate News | Wednesday February 19, 2020 |


China to Exempt 696 US Goods From Tariffs China will allow companies to apply for tariff exemptions on 696 US products as of March 2, with several ag products on the list, including pork, beef, soybeans, denatured ethanol, wheat, corn, sorghum some medical devices, cooper ore and concentrates, copper scrap, aluminum scrap and some pharmaceutical products and antibiotics. Crude oil, liquefied natural gas and several seafood products are also on the list of goods where importers can apply for the tariff exemptions. The announcement from the Ministry of Finance indicated the imports are still to be based on market conditions and companies can apply to have other products added to the list of goods that are eligible for tariff exemptions. The ministry will approve application within three working days. Buyers must get approval before their cargoes clear customs.

| Rural Advocate News | Wednesday February 19, 2020 |


Wednesday Watch List Markets Wednesday's reports start early with U.S. producer prices and housing starts due out at 7:30 a.m. CST. Weekly energy inventories are pushed to Thursday, due to this week's holiday schedule, leaving traders to notice the South American weather forecast and any trade news. Minutes of the latest Federal Reserve meeting will be released at 1 p.m. CST. Weather Wednesday will feature light snow in the western Plains, light rain along the Gulf Coast, and dry conditions elsewhere in primary crop areas. A strong arctic cold wave will spread across north-central areas, hindering transportation and bringing stressful conditions to livestock.

| Rural Advocate News | Tuesday February 18, 2020 |


Washington Insider: China and Future Trade Policies There is a lot of concern among global policy makers just now regarding what will happen next on trade, Bloomberg is reporting this week. The “broad policy direction for many of the world’s central banks and governments now hinges on one question: how will the Chinese government respond to the economic shocks caused by the coronavirus?” The report notes that the Communist Party’s elite Politburo has urged the nation to meet its economic targets this year, an imperative that could change the government’s recent reluctance to “fire up large-scale stimulus.” If this attitude translates into an all-out loosening of monetary policy and a ramp up in government spending, key trading partners that have been slammed by the hit to exports, supply chains, commodities and tourism may see that short-term pain followed by a rapid snap back. Such a potential economic shock is expected to dominate discussions at this week’s meeting of finance ministers and central bankers at a Group of 20 summit in Riyadh, Saudi Arabia. International Monetary Fund Managing Director Kristalina Georgieva on Friday suggested there may be a need for “synchronized or, even better, coordinated measures to protect the world economy.” Much depends on which levers China pulls, Bloomberg says. Near-term options include further cuts to central bank funding rates and more tax relief to hard-hit sectors as well as flush liquidity for the financial system. The emphasis for now remains on not over doing it, though there are signs the resolve is softening. The People’s Bank of China could further cut the proportion of deposits banks must hold as reserves. Local governments are being allowed to speed up bond sales to fund infrastructure like highways and health facilities. Real gross domestic product is now forecast to grow 5.8% this year, according to the median result in a Bloomberg survey, down from 5.9% last month. That would be the weakest in three decades. The main unknown is whether officials will really relax their rigid clampdown on borrowing in an economy where total debt is heading toward 300% of national output, making financial stability a political priority. “The key for China’s trading partners is not so much the composition of China’s stimulus but, rather, that the stimulus is tailored to reflect the features of the shock.” said Nathan Sheets, a former Fed official who is now chief economist for PGIM Fixed Income. However, Bloomberg also notes that China’s factories are vital links in the supply chains for multinational companies and that Hubei province, an industrial powerhouse with an economy the size of Sweden’s, remains in lock-down while a mix of curbs on factory production and travel remain in place elsewhere too, complicating the task of getting the economy back up to speed. HSBC Bank Plc economists led by Janet Henry estimate the hit to tourism revenue will be the biggest drag on Asia. They also highlight China’s role at the center of the global supply chain for electronics will delay a nascent recovery after a prolonged slump. The Asia-focused lender has cut its 2020 global GDP forecast to 2.3% from 2.5% on the back of the China effect. President Xi Jinping has stressed the hit to growth will be short term and has used opportunities like a half hour phone call with Malaysia’s Prime Minister Mahathir Mohamad to assure the fallout will be contained. Still, there is concern that because China is experiencing a supply side shock that’s upended production and distribution, a conventional stimulus such as lower interest rates or higher public spending may not be enough to turn things around, according to former IMF chief economist Olivier Blanchard. “The effects on the rest of the world are likely to be mostly through the disruption of supply chains and the effect on firms outside of China,” he said. “Much more so than the effect through lower exports to China, because of lower growth in China.” Governments across Asia are already gearing up to respond, observers say. For example, Koichi Hamada, an adviser to Japanese Prime Minister Shinzo Abe, said more fiscal stimulus will be needed if the fall out worsens. Singapore is seen as poised to roll out extra spending and Malaysia will announce stimulus next month while Indonesia plans faster spending, Bloomberg said. Globally, policy makers including those at the International Monetary Fund and the U.S. Federal Reserve say they are closely watching the virus fallout. Among emerging markets, Thailand, Malaysia and the Philippines have already cut their benchmarks and others may follow. That is why there’s so much focus on how China responds, Bloomberg thinks. “I would guess the global policy response will be 3/4 on Beijing and 1/4 by the rest of the world,” said Gene Ma, head of China research at the Institute of International Finance said this week. So, we will see. There remains a basic current of trade tensions among major competitors concerning the U.S. reliance on tariffs and potential impacts on U.S. competitiveness in global markets including those for manufactured products – as well as the concern that the fundamental impacts of the coronavirus outbreaks may be harder to shake than some expect. As a result, trade policy proposals and decisions will continue to be vitally important to producers and should be watched closely over the coming months, Washington Insider believes.

| Rural Advocate News | Tuesday February 18, 2020 |


Visit to India By USTR Lighthizer Now Not In The Cards Ahead Of Trump Trip President Donald Trump is to visit India this week, February 24-25, with some expectations that he could sign a trade deal during the trip. The expectation had been that U.S. Trade Representative Robert Lighthizer was to visit India ahead of Trump’s arrival to hold trade discussions. The two sides have held discussions over the last several weeks via teleconference. But it now appears Lighthizer’s visit may not take place. The Press Trust of India reported that an unnamed official said, "Lighthizer was supposed to hold discussions with [a] commerce ministry team but as of now, he is not coming." The official said there was no indication yet that a trade deal will be signed by Trump during his visit.

| Rural Advocate News | Tuesday February 18, 2020 |


White House Sends Nominations to Senate For EPA, Energy Posts The White House Thursday sent forward the nomination of Mark Menezes to Deputy Secretary of Energy. Menezes is currently Undersecretary of Energy and is the principal advisor on energy policy and emerging energy technologies. Prior to taking that role at DOE, Menezes was an executive with Berkshire Hathaway Energy in its Washington, D.C., office and while a staffer on the Hill was involved in the Energy Policy Act of 2005. The nomination of Douglas Benevento as EPA Deputy Administrator was also sent forward. Benevento currently serves as EPA Associate Deputy Administrator. Previously, he served as Senior Counselor for Regional Management and State Affairs, and as Region 8 Administrator for EPA. In the private sector, he worked on energy and environmental issues at Xcel Energy and practiced law at Greenberg Traurig, LLP. Benevento also served as executive director for the Colorado Department of Public Health and Environment, where he managed the State’s environmental and public health programs. Both agencies play a role in US ethanol policy and Menezes has experience on the Hill in terms of the initial law that set up the Renewable Fuel Standard (RFS).

| Rural Advocate News | Tuesday February 18, 2020 |


Tuesday Watch List Markets There is a scarcity of economic reports on Tuesday after the President's Day holiday. DTN will be watching for updated South American weather and harvest activity, along with any news on coronavirus (COVID-19), and especially news on China granting duty-free import licenses for U.S. soybeans and ag products. Weather Tuesday features additional rain in the Delta, Ohio Valley, and the Southeast, with continued flooding. The central U.S. will have several rounds of light mixed freezing precipitation and snow, causing some travel and safety issues. Conditions will be cold north and seasonal to above normal central and south. No polar vortex-related cold outbreak is indicated in the upper-level pattern.

| Rural Advocate News | Monday February 17, 2020 |


India Offers Dairy, Chicken Access in Trade Negotiations with the U.S. In a bid to land a limited trade pact with the U.S., Reuters says India has offered to partially open up its poultry and dairy markets. The offer comes as India readies for President Donald Trump’s first official visit to the country at the end of this month. No country produces more milk than India, which has traditionally restricted dairy imports to protect the livelihoods of the 80 million households involved in the industry. Last year, Trump suspended India’s special trade designation that dated back to the 1970s. That move came after India put price caps on medical devices, such as cardiac stents and knee implants, as well as introduced new data localization requirements and e-commerce restrictions. The U.S. is India’s second-largest trading partner, trailing only China. India has offered to allow imports of U.S. chicken legs, turkey, and produce like blueberries and cherries, while also cutting tariffs on chicken legs from 100 percent to 25. U.S. negotiators would like that cut to ten percent. The Indian government is also offering to allow some access to its dairy market, but with a five percent tariff and quotas. However, dairy imports would need a certificate saying they aren’t derived from animals that have consumed feeds containing internal organs, blood meal, or tissues of ruminants. ********************************************************************************************** Phase One Trade Deal Officially Takes Effect Not only was Friday Valentine’s Day, but it was also the first official day that the Phase One Trade Deal was in effect. Tariffs on both sides of the agreement officially began coming down. The coronavirus outbreak is causing concern about China meeting its obligations under the agreement. An Agri-Pulse report says U.S. experts are worried about whether ports, interior transportation, and soybean crushers are all operating at normal levels. However, industry sources and USDA data show that 1.6 million metric tons of U.S. soybeans were making their way across the Pacific Ocean and heading to China. The latest numbers show that 69,000 tons of soybeans left the U.S. and headed to China during the week of January 31st. During that same time frame, USDA reports showed net sales of 132,000 tons of soybeans to China for the 2019-2020 marketing year. The numbers show that soybeans are still going to China, even though information coming from out of China is almost non-existent. Officials point out that we still don’t know any specifics about how many purchases China will make under the Phase One agreement. Farm groups are looking for more specific information but don’t have any yet. ********************************************************************************************** Phase One Trade Deal Does Include Deadlines for China While much of the attention on the deal between the U.S. and China centers around concerns on China meeting its purchasing requirements under the agreement, there are some deadlines it has to meet. There are some deadlines for the U.S. to meet as well. Politico said on Friday that, within the next seven working days, the USDA’s Animal and Plant Health Inspection Service and China’s Customs Agency are required to sign a protocol to allow for the importation of U.S. potatoes. China is also required by February 24 to formally recognize the U.S. dairy safety system is as safe as its own, as well as allow imports of American pork that’s been inspected by the USDA Food Safety and Inspection Service. China is also required by March 14 to lift its ban on U.S. pet foods containing ruminant ingredients and to eliminate cattle age requirements for imports of U.S. beef and beef products. The two sides are also required by that same date to begin technical discussions intended to pave the way for China to import U.S breeding cattle. ********************************************************************************************** Stronger Farmland Values are Supporting the Farm Economy Strength in farm real estate markets provided support to the agricultural sector amid ongoing financial challenges. The Tenth District Survey of Agricultural Credit Condition from the Federal Reserve of Kansas City says non-irrigated cropland values and cash rents increased slightly in the fourth quarter of last year. Cash rents had been dropping since 2017 but rose slightly at the end of last year. Credit conditions in the District remained weak but deteriorated at the slowest pace in more than four years. Despite some signs of stabilization, geographic disparities persisted across the region. Land values were stronger on the eastern side of the District, while farm income and credit conditions were weaker on the west side of the district. Lower interest rates and reduced borrowing costs may have contributed to recent strength in the District’s farmland values. Demand for farmland remained strong in the fourth quarter of 2019, which could also have supported farmland values. Bankers who responded to the survey said that trade relief payments provided notable support to farm finances in 2019, but many also indicated that underlying weaknesses in the sector continued to be driven by low agricultural commodity prices. ********************************************************************************************** Midwest Bracing for More Flooding This Spring States that border the Missouri River are forecast to experience an elevated flood risk this spring. The National Weather Service says those conditions will only be made worse by already saturated soils and a lot of snow to melt. The NWS issued its first Spring Flood Outlook last week, saying Nebraska, Iowa, Kansas, Missouri, and eastern North and South Dakota all face an above-average flooding risk. It’s not good news as many of those areas are still trying to recover from devastating flooding last year that damaged levees and cost farmers millions in crop losses. The U.S. Army Corps of Engineers says they are “very concerned at this point.” An Associated Press report says even in places where the Corps was able to patch holes in some levees, the normal level of protection won’t be there because initial repairs haven’t been done yet to the full height of the levees. Officials say levee repairs will likely take up to two years to complete. Part of the challenge is the water remained so high in some areas that officials couldn’t even assess the full scope of damage until just recently. Many levees in Iowa and Nebraska have been patched but work hasn’t begun yet in Kansas and Missouri. ********************************************************************************************** Hemp Industry Executive Blames FDA for industry Challenges The Food and Drug Administration’s uncertainty over how to regulate the hemp industry is causing challenges that some companies can’t overcome. Warning letters to companies for selling products illegally has diminished big companies’ interest in hemp food products and made it difficult for processors to obtain working capital. Steven Bevan, president of GenCanna, says his Kentucky hemp processing company had to file for bankruptcy last week. “The FDA doesn’t have a pathway for accepting something that was an illegal product,” Bevan told attendees at the Crop Insurance and Reinsurance Bureau seminar on hemp. Crop insurers and companies that issue reinsurance are interested in hemp because the 2018 Farm Bill made it legal to grow the non-psychotropic relative of marijuana. There are three main hemp products, including fiber, seed, and flowers used to make CBD oil, which is used without FDA approval to treat a range of medical problems. In November, FDA warned consumers that it could not conclude CBD is safe for use in human or animal food, and it sent warning letters to 15 companies. Bevan called the FDA’s safety concerns “hogwash.” He says the FDA hasn’t ever removed a single CBD product from any store shelves. The result of the warning letters is that big companies are following their lawyer’s advice to say away from hemp.

| Rural Advocate News | Friday February 14, 2020 |


Tougher Trade “Firewall” Needed for Smaller Ag Sectors Senators Gary Peters of Michigan and Richard Burr of North Carolina are working on bipartisan legislation to give the U.S Commerce Department a greater ability to defend smaller segments of agriculture. Politico says the bill would give the department greater authority to “self-Initiate investigations” to help those less influential sectors combat potential trade manipulation. Peters says, “If you’re a big industry, such as the steel industry, you can hire an army of lawyers and economists to push back against unfairly subsidized trade by foreign governments. If you’re a smaller industry like cherries or blueberries or other agricultural products, it’s a lot more difficult.” Peters sent a letter to Customs and Border Protection this week, calling for an investigation into tart cherry exports from Turkey. He says shortly after the U.S. slapped duties on cherries from Turkey back in 2018, cherry exports from Brazil surged as much as 1,200 percent. He points out in the letter that “Brazil doesn’t appear to have a discernible tart cherry industry.” ********************************************************************************************** Past Mad Cow Scare Keeping EU Cautious During U.S. Negotiations A Reuters report says the Mad Cow Disease outbreak in the 1990s will likely keep the European Union from easing its strict rules on food safety. That caution will likely continue even though U.S President Trump is threatening to slap tariffs on car imports from the EU if the countries don’t start importing more U.S. farm products. European food and farming exports to the United States are worth $12 billion more than the imports the bloc brings in from the U.S. Ag Secretary Sonny Perdue told EU officials last month they should adapt food regulations to reflect “sound science.” However, Reuters says there is very little optimism that the EU will agree. Europeans remember the BSE outbreak and will not accept any lowering of its food standards. A trade specialist with the European Policy Center says no politician will support a trade deal that’s perceived as dropping those stringent standards. Trump has long complained the EU position on trade is “worse than China.” Earlier this week, the president said he’s setting sights on Europe, which raises the prospect of another trade war. ********************************************************************************************** January Ag Equipment Sales Mixed The first month of 2020 saw mixed results in the total number of U.S. tractor and self-propelled combine sales. Total farm tractor sales grew compared to January of last year while combines fell by 25 percent. That’s according to data out this week from the Association of Equipment Manufacturers. Total U.S. farm tractor sales increased 4.7 percent in January compared to last year while January self-propelled combine sales dropped 24.4 percent. Total sales of two-wheel-drive tractors grew in all segments during January by a total of 4.9 percent more than January of 2019. Sales of tractors with more than 100 horsepower led the way in sales growth, up 19.6 percent to 1,361 units. The total number of four-wheel-drive tractor sales fell 6.6 percent to 169 units sold. “The sales numbers we’re seeing for January are in line with our expectations,” says Curt Blades, Senior Vice President of Ag Services at AEM. “With the approval of the USMCA and the Phase One trade agreement with China, we believe we’re seeing some positive trends on the horizon for ag equipment sales.” ********************************************************************************************** Study Highlights Urban-Rural Divide Over the Environment Duke University’s Nicholas Institute for Environmental Policy Solutions issued a new study on the rural and urban divide over environmental issues. The study says rural voters have a deep distrust of the federal government, which explains their split with urban folks on environmental policy. The study says rural Americans matter a whole lot when it comes to the fate of U.S. environmental policy. After all, farmers, ranchers, and forest owners manage a huge part of America’s lands and watersheds. The study finds that 70 percent of rural folks express their support for conserving natural resources, while the same percentage of urban folks feel the same way. However, a stark contrast comes to light when each side is asked about the preferred level of government oversight on the environment. Forty percent of rural voters support less government oversight of the environment and conservation, while 47 percent of urban voters support more government oversight. “My hope is that this will help us understand how to engage with rural constituencies,” says Robert Bonnie, who led the study. “This data shows there is an approach to national climate legislation that empowers states and local government because folks seem more comfortable with that.” ********************************************************************************************** USDA Selects 30 Future Agricultural Leaders The USDA announced its selection of 30 college students who will attend the USDA’s 2020 Ag Outlook Forum as participants in the USDA Future Leaders of Agriculture Program. These undergrad and graduate-level students will take part in a weeklong trip to Washington, D.C., capped off with their attendance at the Forum on February 20-21. The USDA has hosted students in this program since 2007. The trip to the Forum, which is USDA’s largest annual meeting, gives students real-world learning opportunities in contemporary agribusiness, scientific research, and agricultural policy. The program selects 20 undergrads and 10 graduate students based on their written essays on agricultural careers and challenges. During their visit to D.C., students will take part in a USDA briefing and discussion of career opportunities with agriculture leaders in academics, government, and industry. They will also tour the nation’s capital, attend the Forum, and will meet with Ag Secretary Sonny Perdue. The Future Leaders in Agriculture Program is supported by academic institutions, corporations, and government institutions dedicated to promoting the education of the next generation of agriculture. ********************************************************************************************** NASS Making Changes to its Crop Reporting The USDA’s National Agricultural Statistics Service will be making changes to its county-level reporting. More specifically, there will no longer be county-level estimates for dry edible beans, flaxseed, hay (alfalfa and others), as well as potatoes, sugar beets, sugarcane, sunflowers (non-oil and oil varieties), and tobacco. Additionally, NASS will discontinue county estimates based on irrigated or non-irrigated practices for all crops. These changes are effective beginning with the 2019 crop year. The reason for the changes is the lack of funds. The data collection cost for the surveys that the agency uses to gather the data for county-level numbers had been partially funded through a cooperative agreement, which was not renewed. As a result, NASS says it has to adjust its county estimates program to reflect the lower level of funding available. NASS took public comments and reviewed the feedback before deciding to discontinue these estimates. Future NASS reports will still be available at www.nass.usda.gov/Publications.

| Rural Advocate News | Friday February 14, 2020 |


Washington Insider: Administration Proposes to Slash Chesapeake Bay Funding Again The president’s Fiscal Year (FY) 2021 budget proposal went to Congress this week and, as expected, it would largely wipe out federal funding for the Environmental Protection Agency’s Chesapeake Bay Program, the Washington Post said this week. The partnership effort includes six states and the District and aims to clean up and restore the Bay. It has been underway since 1983. The popular program, which received $85 million this year, would be reduced to $7.3 million next year—the fourth year in a row the administration has proposed to cut it sharply. While the proposed cuts shouldn’t have been a surprise since they have been an annual feature of recent administration proposals, but Will Baker, president of the Chesapeake Bay Foundation, said the number still came as a shock. “This is a program that for years has truly enjoyed broad bipartisan support,” he said. “So it makes you ask yourself, what statement is the President trying to make?” Such a dramatic decrease of support would threaten the ecosystem’s steady yet fragile recovery, Baker argues. However, he doubts that the final budget will look the way the administration has envisioned. Last year, the proposed cut also was 90%, as it was the year before – and the year before that, the proposal was to eliminate the federal contribution altogether. Members of Congress who support the bay recovery effort have regularly rejected the president’s proposals and restored funding. Environmentalists and lawmakers have said they expect a similar response this year. But, as always, “there are no guarantees,” the Post said. Scientists say the Chesapeake Bay is the healthiest it has been in generations. The ecosystem is showing signs of resilience and recovery unseen for decades, and even after record-setting 2018 rainfall resulted in a D-plus grade on last year’s annual report card, most metrics now indicate the estuary is continually improving. Fishermen and environmentalists have logged sightings of species, including bottlenose dolphins, that had vanished. Signs of natural resilience and recovery — like thriving underwater grass beds and growing oyster reefs — have returned. Many who work along the estuary use the same metaphors to demonstrate its growth: The Chesapeake Bay, they say, is like a sick patient in the early stages of remission. Why would you stop the patient’s supply of lifesaving medicine when it seems the treatments are working? The program’s six states and the District have committed to meeting environmental goals, such as improving fisheries, increasing public access and limiting pollution in the bay to target levels by 2025. The restoration plan is outlined in the Chesapeake Bay Watershed Agreement. Maryland Gov. Larry Hogan issued a public call for the president to reverse course and support the restoration effort--for which he has committed more than $350 million in his budget proposal. “Maryland is leading the charge to safeguard the Bay — we are simply asking our federal partners to keep up their share,” Hogan said. “At his confirmation hearing, the EPA administrator said: ‘I am very much committed to the Chesapeake Bay and the Chesapeake Bay Program.’ Instead, the administration recklessly and repeatedly proposes gutting Chesapeake Bay funding.” Hogan, who chairs the Chesapeake Executive Council — a regional commission that consists of governors of the six states along the Chesapeake watershed, the District mayor, the EPA administrator and chair of the Chesapeake Bay Commission — added that the effort to protect the bay has long been bipartisan. However, not every state has been so diligent. For example, Pennsylvania, which does not border the Chesapeake but contributes a significant amount of agricultural pollution via the Susquehanna River, recently released a bay cleanup plan that underfunds by $300 million a program to help farmers adopt anti-pollution practices. The Chesapeake Bay Foundation last month announced it intends to sue the EPA over its refusal to cooperate with mandatory Obama-era environmental programs – including those that decrease runoff and aid restoration efforts. Maryland and Virginia also are considering suing the EPA in an effort to compel it to change course. “With this continued lack of support from the White House, it is all the more important that state practices and programs and funding all come through to help this restoration effort,” Baker said. “It’s very disturbing to see such a broad-based attack on the very fundamental and environmental principles of our nation.” So, we will see. Clearly, support is strong for this program but so is the opposition in some cases. It is an effort that affects many producers directly and which should be watched closely as the funding fight continues, Washington Insider believes.

| Rural Advocate News | Friday February 14, 2020 |


Farm Credit Administration Official: Too Early To Make Call On More Farmer Aid The CEO of the Farm Credit Administration is “cautiously optimistic” the financial picture for agriculture could improve this year as trade agreements enter into force and interest rates are expected to remain low. “It may take patience, but at least the groundwork has been laid for trade normalization and improved farm prices,” Glen Smith told the House Agriculture Appropriations Subcommittee. He said that means it is “too early” to know if there should be 2020 Market Facilitation Program (MFP) effort. Smith and Jeffery Hall, a Farm Credit Administration board member, appeared before the subcommittee regarding the independent agency’s Fiscal Year (FY) 2021 budget request of $81 million. In the third quarter of 2019, Smith said the share of adverse loan quality was 7.4% compared with data from the Farm Credit System putting that at 6.6% at the end of 2018. Nonperforming loans for the third quarter remained below one percent while delinquent loans were at 0.3%.

| Rural Advocate News | Friday February 14, 2020 |


US Officials Comment on China Phase One Status The U.S. has not yet received anything from China that the country expects to delay its purchases of U.S. ag goods under the phase-one trade agreement due to the coronavirus situation, according to USDA Undersecretary for Trade and Foreign Agricultural Services Ted McKinney. “We have not received any formal notification of a delay, which pleases me,” McKinney said in Houston, Texas, at an ethanol event. “We hope it does not come.” The length of the coronavirus situation will be important, McKinney said, particularly if it impacts shipping and other economic activities. “I suspect it will be determined by how long the issue goes on,” he noted. He also expressed a hope China would deploy additional tariff reductions to help meet the purchase commitments. “They made the commitment and it will be difficult to meet that commitment with the current tariff schedule and conditions in place,” he said. Meanwhile, Treasury Secretary Steve Mnuchin told lawmakers during a Senate Finance Committee hearing on the Fiscal Year 2021 budget that with the coronavirus situation in China, implementation of the phase one deal “to a certain extent slowed down.” Despite the statement by McKinney, there is the full expectation that China will request consultations, likely in March, on the issue of delaying their purchase commitments of U.S. ag goods.

| Rural Advocate News | Friday February 14, 2020 |


Friday Watch List Markets Economic reports out early on Friday morning are retail sales, industrial production and consumer sentiment index, which could all give a glimpse into the health of the economy. We will also be watching for any news regarding coronavirus, Chinese soybean buying and any weather changes in South America. Weather Dry conditions will cover all primary U.S. crop areas Friday. Precipitation will be confined to light snow in the Canadian Prairies. Bitter cold will be noted in the northern and eastern Midwest. Snow and rain return to the northern crop areas Sunday and Monday.

| Rural Advocate News | Thursday February 13, 2020 |


Beijing Asks World for Trade Calm Amid Coronavirus Outbreak The U.S. and several of the world’s major trading powers are dealing with uncertainty surrounding China. Politico says the spread of the coronavirus has killed hundreds of people and sickened tens of thousands in mainland China. However, at the World Trade Organization gathering in Geneva (Juh-NEE-vah), Chinese officials were quick to “flex their economic muscles” and remind other officials from countries around the world about China’s contributions to worldwide growth. Federal Reserve Chair Jerome Powell told a House panel this week that the coronavirus will “very likely” affect the U.S. economic growth, but it’s far too early to predict what kind of impact it will have. He also says the central bank doesn’t see any need to adjust interest rates right now as U.S. manufacturing has weakened over the past year. The outbreak is putting a damper on speculation that China will be able to meet the obligations it agreed to in the Phase One Trade Deal with the U.S. China’s Ministry of Agriculture says the country may have to delay its purchases of $40 billion due to the outbreak, but also says it will fulfill its commitments within a year. ********************************************************************************************** U.S./EU Bracing for Potentially Rough Trade Negotiations Fresh off a phase one trade deal with China, U.S. President Donald Trump has his sights on a new deal with the European Union. The president wants to restructure the over $1 trillion U.S. trade relationship with the European Union. Reuters says that’s already raising the specter of another major trade war as the global economy is slowing. Trump has long complained that the EU position on trade “is worse than China’s.” Trump says, “Europe has been treating us very badly. Over the last 10 to 12 years, there’s been a tremendous deficit with Europe. That have incredible trade barriers, so we’re going to be starting with that.” Meantime, EU officials say they are willing to work with the U.S. president to address some of the challenges in the relationship. A German conservative lawmaker tells Reuters that Trump needs to remember the EU and the U.S. are “evenly matched” in the economic realm, and that they will defend themselves if the need arises. EU officials say, “We will respond to U.S. tariffs, and we know how to structure them to be effective.” Reuters says there may be a “mini-deal” like the Phase One agreement signed with China. However, that likely won’t solve the main issues that would allow both sides to declare a truce. ********************************************************************************************** EU Strikes Trade Deal with Vietnam European Union lawmakers overwhelmingly approved free trade and investment deals with Vietnam that will eliminate almost all tariffs over the next decade. The website U.S. News Dot Com says the deal is expected to give the EU a competitive foothold in an important overseas market for the United States. European legislators voted 401 to 192 in favor of striking the deal. The EU hopes the deal will bring in 15 billion euros, or $16.5 billion, in additional exports from Vietnam to the continent by 2035. They also expect EU exports to Vietnam will jump by more than eight billion euros to an annual level of 22 billion euros. Vietnam sends a lot of telecommunications equipment, food, and clothing to Europe, while the EU sends machinery, transport equipment, chemicals, as well as agricultural products to the Asian nation. EU officials say the deal is all about strengthening economic ties to Vietnam amid fierce competition from the U.S. and China within that marketplace. Once adopted by lawmakers, the deal needs to be approved by the EU council and ratified by all 27 member nations to go into effect. ********************************************************************************************** Study says FCC Underestimates Number of Americans without Internet A report issued by BroadbandNow Research says the number of Americans that are without internet service is 43 million. The Hagstrom Report says that’s double the estimate of 21.3 million from the Federal Communications Commission. The report also says the problem is worse than the FCC says it is in rural America. They say the discrepancy occurs because the FCC relies on semi-annual self-reporting by Internet service providers using the FCC-mandated Form 477. If an ISP offers service to at least one household in a census block, then the FCC counts the entire census block as covered by that provider, even if the rest of the block doesn’t have service. BroadbandNow Research says it examined the magnitude of this flaw by manually checking internet availability using FCC data as the source of truth for randomly selected addresses. BroadbandNow Research says it believes that “provider reporting on address-level availability is the best and most transparent way to understand and quantify the digital divide.” They also believe that FCC reporting should be timelier. FCC Form 477 data typically comes out to the public about 12-18 months after the ISPs file their required reports. ********************************************************************************************** December U.S. Pork Exports Set a Record to End 2019 U.S. pork exports finished up 2019 on a good note, setting records for both the dollar value and total volume. The U.S. Meat Export Federation compiled USDA data and found that 5.89 billion pounds of U.S. pork and pork variety meats were exported to countries around the world. The volume was a 10 percent jump over the previous year, while the value came in at $6.95 billion, up nine percent over 2018. Pork exports accounted for almost 27 percent of total U.S. pork production in 2019. Export value per head averaged $53.51, up four percent of 2018. “China was the main driver for the record-breaking pace of U.S. pork exports during the last year,” says David Newman, president of the National Pork Board. “We are poised to help China fill its protein gap caused by the recent African Swine Fever outbreak.” He also says that the U.S. pork industry is focusing on recapturing lost market share with key customers and investing in research to develop emerging markets. While exports to China were higher last year, key customers like Japan and Mexico, the number one export markets in terms of value and volume, respectively, saw significant drops as the U.S. negotiated new trade deals with each country. ********************************************************************************************** NACD Elects Next President The National Association of Conservation Districts’ Board of Directors has elected Michael Crowder of Washington as the association’s president-elect. “Michael epitomizes conservation, both in his leadership at the national level and on the ground on his operations in Illinois, Indiana, and Washington state,” says current NACD President Tim Palmer. “Having worked with Michael closely for several years on the NACD officer team and board of directors, I’m confident he’s well-suited to champion locally-led conservation in the years ahead.” Crowder will serve a one-year term as president-elect alongside Palmer. Crowder was first elected to the NACD Officer Team in 2017 as the second vice president and previously served on the organization’s Board of Directors as the Washington state delegate. “Locally-led conservation is the backbone of conservation delivery,” Crowder says. “It’s an honor to be selected by my fellow district officials to represent and advance conservation work at the national level for farmers, ranchers, and fellow conservationists.” Crowder will be sworn in as the next president in February of 2021.

| Rural Advocate News | Thursday February 13, 2020 |


Washington Insider: Coronavirus Impacts and the EU The media is focused heavily on the potential impacts of the coronavirus this week, especially on the European Union – in spite of the fact that only scattered cases of the virus have appeared in Europe, the New York Times says. One key reason for concern is the fact that the disease is proving very difficult to quarantine. As a result, the European impact “may be severe enough to push the vulnerable German economy, and perhaps the entire eurozone, into recession,” the Times says. The report notes “the concerns of a growing number of economists” as it becomes clear that it will take weeks, at best, before the Chinese economy resumes its role as a prolific exporter of essential factory goods. In Germany, the chief executive of Daimler, one of Germany’s most prominent companies with several plants in China, said the crisis is one of uncertainty. “I’m calling China every day,” Ola Kallenius said at a news conference on Tuesday. “It’s too early to say if and how other factories could be affected. We are talking about global networks.” The rest of the world also could suffer economically, Fed chair Jerome Powell, warned U.S. lawmakers on Tuesday. We are closely monitoring the disease “which could lead to disruptions in China that spill over to the rest of the global economy,” Powell told House Financial Services Committee members. A dismal profit report by Daimler on Tuesday underlined why it would not take much to shove the 19 European countries that use the euro into a downturn that could exacerbate a slump in global trade that was apparent long before the coronavirus claimed its first victims. Daimler said that it slipped into the red at the end of 2019, battered by the cost of adjusting to new technologies and by its penalties from diesel emissions cheating. Vehicles are Germany’s biggest export, and economists are predicting that official data to be published Friday will show that the German economy shrank in the fourth quarter of 2019 because of a slump in manufacturing. The problems of German automakers “reverberate around the continent” because so many small and midsize parts suppliers depend on them for sales. Italy’s economy shrank in the fourth quarter in part because its industrial north is closely linked to Germany. “For most countries, Germany is the most important trading partner,” said Carsten Brzeski, chief economist at ING Germany. “If it starts to slow down, other countries will feel it.” Daimler reported a quarterly loss of 11 million euros compared with a profit of 1.6 billion euro in the fourth quarter of 2018. The evaporating earnings put Daimler, the maker of Mercedes-Benz cars and trucks in a weak position as it confronts the economic consequences of the coronavirus outbreak. Auto factories and others are being shuttered longer than planned after the Lunar New Year holiday and people also are being kept out of showrooms. On Monday, Daimler said it had begun gradually ramping up production at its Chinese factories, but that the situation remains tense and unpredictable. There is widespread concern that assembly lines around the world could be forced to shut down for lack of components made in China. China also has become a critical market for all German carmakers--it sold nearly 700,000 Mercedes-Benz cars in China last year, more than twice as many as it sold in the United States. For the full year, net profit at Daimler plummeted 64% to 2.7 billion euro. Sales in 2019 rose 3%, to 173 billion euro. “The coronavirus provides a substantial risk for the expected global recovery, as hopes were pinned on an improvement of the Chinese economy,” Stefan Schneider, an economist at Deutsche Bank, said in a note to clients on Tuesday. A recession in Germany early this year is “quite probable,” he added. Ziehl-Abegg, a German maker of industrial fans, has a factory in Shanghai with 450 workers. Even after the factory was allowed to reopen this week fewer than half of the employees reported to work. Many were ordered to stay home because they had visited affected areas of China during the Lunar New Year. German machinery makers like Ziehl-Abegg are coming off a “terrible” year. New orders for products like machine tools or construction machinery slumped 9% in 2019 because of the trade fight with the U.S., Brexit and auto industry woes, the Times said. “The political turmoil created uncertainty and uncertainty is poison for investment,” said Olaf Wortmann, economist for the Mechanical Engineering Industry Association in Frankfurt. Now, the coronavirus outbreak is another blow. In addition, Daimler, like Volkswagen, faces significant accusations that it programmed diesel vehicles to cheat on emissions tests. It said this week that it had set aside 4 billion euro for the year to cover the cost of legal proceedings and penalties in Europe, the United States and elsewhere. Daimler’s legal problems are amplified by the industry’s biggest shift in technology in a century. Like other carmakers, Daimler must invest billions in electric cars and autonomous driving, or risk becoming irrelevant, the Times said. So, we will see. Clearly, the virus is shocking the industrial world in unexpected ways and creating trends that should be watched closely by producers as they emerge, Washington Insider believes.

| Rural Advocate News | Thursday February 13, 2020 |


Trump Administration Issues Report On Countries’ Trade Status The Trump administration issued a notice Tuesday that denies developing country status to nations the administration deems “wealthy” and says has “abused” special and differential trade treatment under World Trade Organization (WTO) rules. Among the countries excluded under the administration action are China, Brazil, India, Indonesia, Malaysia, Thailand and Vietnam. The criteria included gross national income per capita exceeding $12,375 or the country's share of world trade. WTO rules on subsidies permit developing or least developed countries a higher threshold before rules against subsidies would apply to their exports. The notice included a list of least-developed and developing countries that still enjoy special status under U.S. law, including Bangladesh, Kenya, Cambodia, Honduras, Pakistan, Zimbabwe, Ecuador, Egypt and El Salvador.

| Rural Advocate News | Thursday February 13, 2020 |


USDA IG to Assess MFP Process USDA Inspector General Phyllis Fong told lawmakers Tuesday her office is reviewing USDA’s authority to provide more than $20 billion in direct payments to producers without an appropriation from Congress via the Market Facilitation Program (MFP). She also said they will look at questions on whether the aid is unfairly tilted to certain states and commodity groups. “We are going to start out with the basic issue of authority for the programs, and then we are going to get into the design and implementation, eligibility and look at the producer questions,” Fong said at a House Appropriations subcommittee hearing. “The first piece of our work should be coming out in the next several months.” Senate Ag Committee Ranking Member Debbie Stabenow, D-Mich., has complained repeatedly the aid is tilted to southern states based on the per-acre payments via the 2019 MFP effort (MFP 2) while USDA continues to point to the totals received by states in the Midwest, with Iowa, Illinois, Texas, Minnesota and Kansas receiving the most. As of February 10, USDA said that $14.23 billion has been paid out under MFP 2.

| Rural Advocate News | Thursday February 13, 2020 |


Thursday Watch List Markets At 7:30 a.m. central, the weekly jobless claims, consumer price index and Core CPI readings will be out. We will also be watching export sales at the same time, and any new flash sales reported by USDA at 8 a.m. We will also look for any news on China and South American weather. Weather Snow will end in the Midwest during Thursday, and this week's heavy rain in the Delta and Southeast will let up ahead of the weekend. A new storm system forming in the Northwest for the weekend will begin spreading rain and snow into the northern U.S. by Tuesday. Conditions will continue very cold in northern areas ahead of moderation at the end of the week.

| Rural Advocate News | Wednesday February 12, 2020 |


Border Ag Inspector Bill Headed to President Trump The House of Representatives passed a bill that authorizes funding for more agriculture inspectors to work with U.S. Customs. The Hagstrom Report says the House passed the legislation, known as the Protecting America’s Food and Agriculture Act of 2019 after it had already passed the Senate. “I’ve long raised the issue of inadequate staffing levels at the border,” says House Ag Committee Chair Collin Peterson. “It’s critical that we have enough CBP agriculture inspectors, specialists, and canine teams to protect our rural communities and our economy from foreign animal and plant pests and diseases.” A joint press conference featuring several representatives from agricultural states expressed happiness that the bill made it through both chambers of Congress. The legislation authorizes the hiring of 240 new agriculture specialists and 200 agriculture technicians until staffing shortages are resolved. It also assigns 20 agriculture canine teams to prevent harmful pests and foreign animal diseases from getting into the United States. During the press conference, the lawmakers pointed out that the country faces a shortage of agricultural inspectors that could leave the U.S. ag industry vulnerable to diseases, pests, and other threats that could potentially devastate the American economy and affect the health and safety of millions of American people. ********************************************************************************************** Agriculture will be Involved in U.S.-UK Trade Negotiations Agricultural tariffs, as well as non-trade barriers, will be a part of pending trade discussions between the United States and the United Kingdom. An Agri-Pulse report says that comes from two government officials in the United Kingdom who didn’t want to be named because the negotiations haven’t started yet. Over the next year, topics of conversation between the two nations will include everything from tariffs on U.S. grains to how GMO’s will be handled going forward. The U.K. officially broke away from the European Union on January 31, but Britain is still technically in the European customs union until the last day of 2020. Between now and then, the British government plans to work on trade agreements with the U.S. and the EU at the same time. British officials spoke to reporters this week and say they know just how important U.S. agriculture is in Washington, D.C., these days and any free trade agreement that doesn’t include U.S. agriculture will likely not get through Congress. The U.S. is working on separate trade talks with the EU, which has held firm for over a year that agriculture will not be a part of the negotiations. ********************************************************************************************** Tariffs Take a Big Two Year Toll Consumers took a big financial hit from two years of trade wars with U.S. trading partners. The tariffs cost consumers $50 billion since February of 2018. That data comes from the Tariffs Hurt the Heartland campaign. For example, in December of last year, Americans paid an extra $6.3 billion in duties, compared to $2.6 billion in December of 2017, just weeks before the trade disputes began to ramp up. While President Trump has had recent success in partial trade deals with Japan and China, among others, Tariffs Hurt the Heartland says work still remains to get things where they should be on the trade front. “Make no mistake, this trade war is as active as it was in December,” says Brian Kuehl (Keel), co-executive director of Farmers for Free Trade. Tariffs Hurt the Heartland also released specific impact data for states like Florida, Michigan Ohio, Pennsylvania, and Wisconsin, all of which are critical states that Trump will need to win in the November election to get a second term in the Oval Office. Those five states have paid an additional $7.6 billion in tariffs because of the trade disputes. Speaking of trade, the U.K. departure from the European Union is two weeks old, but there’s no start date for trade talks between Washington and London. ********************************************************************************************** USDA Releases February WASDE Report The February World Ag Supply and Demand Estimates call for minimal changes in corn projections and increased soybean exports. The 2019/2020 U.S. soybean outlook is for increased exports and lower ending stocks. Soybean exports are projected at 1.825 billion bushels, up 50 million from last month, partly reflecting more imports from China. Soybean crush is unchanged, which means ending stocks drop 50 million bushels. The season-average soybean price is forecast at $8.75 per bushel. This month’s corn outlook isn’t much different than last month, with offsetting changes to exports and corn used for ethanol. Exports are lowered by 50 million bushels this month, reflecting a slow shipment pace through January. The offset is a 50 million bushel increase in corn used for ethanol. The season-average corn price projection is unchanged at $3.85 per bushel. The wheat outlook for 2019/2020 is calling for stable supplies, increased exports, and decreased ending stocks. The only change in supply or use this month was a 25 million bushel increase in exports, reflecting growing competitiveness in the international marketplace. Ending stock were forecast at a five-year low of 940 million bushels. ********************************************************************************************** NPPC: FDA Stalling Hurts Agriculture The U.S. Food and Drug Administration is misrepresenting a gene-edited livestock research project and the National Pork Producers Council says that’s a stalling tactic. The pork producers say the stalling is designed to rationalize a regulatory grasp on an emerging technology that must be regulated by the USDA if the United States is to maintain its global leadership spot in agriculture. “While countries like China, Canada, Brazil, and Argentina, are moving quickly on this advancement to gain competitive advantage, the United States is falling far behind because of the FDA’s precautionary regulatory approach,” says David Herring, NPPC President. “Under FDA regulation, gene editing faces an impractical, lengthy, and expensive approval process. If we don’t move oversight to the USDA, we’re ceding a technology that promises significant benefits to animals, including immunity to disease and a reduction in antibiotic use.” They also say the process jeopardizes thousands of American jobs. To date, NPPC says the FDA hasn’t responded in a meaningful way to the comments they received concerning the ramifications of their proposed regulatory process. ********************************************************************************************** World Pork Expo Returning in 2020 The 2020 World Pork Expo is set for June 3-5, its 32nd year at the Iowa State Fair Grounds. The expo provides pork professionals with three full days of education, innovation, and networking. “We’re excited to welcome all members of the pork industry back to Des Moines after a brief hiatus last year,” says NPPC President David Herring. “The 2020 Expo allows us to reconnect across the industry and share knowledge, as well as discuss the state of the industry together.” As a precaution, the 2019 World Pork Expo was canceled due to the outbreak of African Swine Fever in China and other countries. Pork industry professionals worked together across the globe to get a handle on the situation and evaluate risks associated with ASF. Since the outbreak began last year, the U.S. has stepped up biosecurity measures to prevent an outbreak in the United States. The 2020 Expo will have increased biosecurity on-site during the show. Additional changes to the 2020 show include relocating the live swine show to reduce an already negligible risk. “Continuing to host the show for our more than 20,000 producers and pork professionals visiting from across the country is extremely important to us,” Herring adds. Registration to attend the World Pork Expo will soon be available online.

| Rural Advocate News | Wednesday February 12, 2020 |


Washington Insider: New Federal Reserve Fight The Hill is reporting this week that the President’s latest effort to reshape the Federal Reserve faces a new test as senators grill a controversial pick for the bank’s board of governors. The nominee this time is Judy Shelton, a former Trump campaign adviser. The Hill calls her views “unconventional” and wonders whether they will disqualify her for Board membership. The nomination is considered the President’s most viable chance to place an ally within the Fed after Senate Republicans rejected his past two picks, economist Stephen Moore and Herman Cain--who were both seen as sharp critics of the bank. Now, The Hill says that Shelton “can expect similarly tough scrutiny.” Like the President, she blasted the Fed during the Obama administration for keeping low interest rates but reversed course soon after the 2016 election. Recently, she has echoed Trump’s calls for near-zero interest rates and questioned the bank’s independence as the president continues to push for lower interest rates. Shelton has defended her changed stance since the administration first floated her nomination in July. She argues that she has always been critical of the Fed. However, her reversal on monetary policy has raised questions about her ideological integrity and whether she’ll prioritize the Fed’s legal mandate over the President’s political prospects. “What her actual ideological beliefs are does matter,” said Brandon Barford, a former Republican Senate Banking Committee aide from 2006 to 2009. “Is she being an opportunist, or has she truly changed her policy beliefs?” And a position on the Fed board would make her the front-runner to take over the Fed if Trump attempts to oust its current chairman, Jerome Powell, The Hill says. “That’s why it’s a lot more serious to vote for her than most Republican senators are giving credit to,” Barford said. Shelton will appear before the Banking panel with Christopher Waller, executive vice president of the Federal Reserve Bank of St. Louis, who was nominated in tandem with her. While Waller is expected to easily pass muster with the Committee, Thursday’s hearing will give the first indication of whether Shelton’s candidacy could be derailed by her controversial record. Democrats are expected to unanimously oppose her nomination, which means the opposition of just four Republicans could quash her nomination. Shelton has already been confirmed by the Senate as the U.S. director of the European Bank for Reconstruction and Development—a fact that suggests that strong opposition to her nomination likely would have surfaced already if that was in the cards. Republicans have also expressed concern over Shelton’s decades of support for tying the U.S. dollar to gold, creating a global currency union and rejecting deposit insurance at American banks. For example, “There are a lot of questions about her,” Sen. Richard Shelby, R-Ala., a former Banking Committee chairman, told the press. “I have a few, but I’m not the only one.” Her views about a gold-linked currency and fixed exchange rates are well beyond the current economic mainstream in either party, Barford a former Shelby aide, said. He recalled receiving letters from Shelton’s Sound Money Project that fell flat among the GOP staff. No one was sending us anything like that and the idea of even calling her as a witness for something was beyond the pale,” he said. Trump’s previous efforts to put Fed critics on the bank board faltered but some Republicans now appear reluctant to reject yet another pick. For example, Sen. Kevin Cramer, R-N.D., who sank Cain’s potential Fed nomination, announced his support for Shelton and Waller after meeting with both last week, calling the two “well qualified.” And even some of Trump’s biggest critics from the right have voiced support for Shelton’s confirmation despite differences of opinion on core aspects of monetary policy. “She would be a good addition to the group that’s there,” said J.W. Verret, a George Mason University banking law professor and former Trump transition aide who backed the president’s impeachment. “I disagree with her views on interest rate policy and Fed independence but she’ll be one vote of 12, and I think a variety of views should be presented.” “Confirming her as a governor would open the door to that possibility, and to her efforts to fundamentally transform how we do monetary policy in a way that I think is anathema to most Republican senators, let alone most Americans,” said Sam Bell, policy director at Employ America, which advocates for Fed policy intended to maximize employment Bell warned of the high stakes involved in Shelton’s nomination. “Once you’ve confirmed someone as a governor, it’s hard to then go back and say, ‘I don’t want you as chair,’” he added. So, we will see. The President’s fights with the Fed have been both bitter and prolonged. This effort to impose even more basic changes could have important implications and should be watched closely as it proceeds, Washington Insider believes.

| Rural Advocate News | Wednesday February 12, 2020 |


House Clears Senate-Passed Bill to Add Ag Inspectors At Border The House unanimously passed a bill that would increase the number of pest and disease inspectors at the border, the Protecting America’s Food & Agriculture Act of 2019, which passed the Senate in October. The package would authorize the U.S. Customs and Border Protection (CBP) to hire and train 240 new agricultural specialists each year until a work shortage is filled. CBP estimates a shortage of nearly 700 inspectors across the country. The legislation now moves to President Donald Trump who is expected to sign it.

| Rural Advocate News | Wednesday February 12, 2020 |


Lighthizer Spells Out Why He Thinks China Will Meet Purchase Commitments U.S. Trade Representative Robert Lighthizer fully expects that China will live up to the terms of the phase-one trade deal negotiated between the two sides. In comments to USDA Secretary Sonny Perdue in the ag chief’s Sonny Side of the Farm podcast, Lighthizer said the enforcement provisions in the deal are very strong and solid. But he also offered an interesting observation when it comes to the texts of the agreements. In most cases with agreements, there are differences in meanings when it comes to texts in different languages, he noted. “So I said, ‘bring me these other agreements, all these agreements with China – they agreed they would do this or that.’” He pointed to several agreements negotiated with China over the past 10 years, stating, “I found out none of them were in writing. They were just a press release from the United States. Well I thought, ‘Well no wonder China did not think they have to…’ it is breath taking to hear about these agreements, you read the press release and then you say, ‘Let me see the actual agreement,’ and there is no actual agreement … literally nothing there – not in Chinese not in English.” The phase-one agreement is “in both languages. It has been authenticated, it has dispute settlement, and enforceability. And it is signed at the highest levels of government,” Lighthizer said. “I think the Chinese want to do this. I think the ag purchases, in particular, are in their interests for sure. I think they are going to do it, but if they do not, we have an enforcement mechanism to insist on it.”

| Rural Advocate News | Wednesday February 12, 2020 |


Wednesday Watch List Markets Following Tuesday's WASDE report, Wednesday's grain markets may be on the quiet side. The U.S. Energy Department's weekly inventory report is due out at 9:30 a.m. CST and includes ethanol. The U.S. Treasury updates the federal budget at 1 p.m. Traders will check South American weather forecasts and keep watch for trade news. Weather Wednesday features a wide variety of weather across the primary crop areas. Arctic cold, light snow and strong winds will bring blizzard conditions and cold-air stress to livestock and transportation in the Northern Plains and the northern and western Midwest. The far Southern Plains, Delta, southeastern Midwest and Southeast will have moderate to heavy rain with a high risk of flooding. In the middle, a swath of mixed precipitation and snow from the southwestern Plains to the northeastern Midwest will produce safety and transportation issues, while providing moisture for winter wheat. A brief round of drier conditions is indicated during late week.

| Rural Advocate News | Tuesday February 11, 2020 |


China says it Will Meet Purchase Agreement Goals A Bloomberg article last week reported that Chinese President Xi (Zhee) Jinping made a phone call to U.S. President Trump to reassure him China will meet its goals in the Phase One trade agreement. White House Economic Adviser Larry Kudrow told Bloomberg that the Chinese government intends to live up to the agreement in spite of the impact of the Coronavirus on the country’s economy and people. “XI apparently said it may be a little slower to purchase American exports, but it will get done by the end of this year and next year,” Kudlow told Bloomberg Television last Friday. “Xi admitted there may be some delays in purchases of American imports but reiterated that they would hit the goal of $200 billion over the next couple of years.” The virus outbreak has claimed hundreds of lives and impacted the Chinese economy, where reports of rapidly rising food prices continue to make headlines. Meanwhile, the reaction to the U.S.-China trade deal has been hard to gauge, mostly because of the lack of specific numbers in the deal regarding how many soybeans China intends to source from the U.S. Plus, China will struggle with its demand for soybeans because of the impact of the African Swine Fever outbreak that killed a large number of hogs. ********************************************************************************************** Trump Budget Proposal Cuts Ag Spending The president rolled out the final budget request for his first term in office. Like all of the previous budget ideas, Politico says the bulk of Trump’s fiscal 2021 spending plans are heading straight for the congressional paper shredder. Among the many ideas lawmakers are likely to say no to are the White House calls for SNAP cuts, as well as cuts to Medicaid and other safety-net programs. That’s a big piece of the Trump effort to lower federal spending by $4.4 trillion over the next ten years. And yes, the cuts do include the Ag Department. Trump would trim the USDA discretionary budget by more than eight percent from its current levels. That would take it from $23.8 billion this year down to $21.8 billion next year. The Trump budget would propose $57.7 billion in mandatory cuts to agricultural spending by 2030, including lowering crop insurance subsidies, tightening eligibility for farm payments, and by slashing spending on conservation programs. Politico points out that like virtually all other budget proposals from previous presidents, this one has no chance of ever going into effect. ********************************************************************************************** Army Corps Proposes a Flooding Study on the Missouri River The U.S. Army Corps of Engineers is proposing to conduct a long-term study of flood risk in the lower Missouri River basin. The idea comes after the Corps received many formal letters of intent from officials in states along the river who intend to help partially fund what would be about a $400,000 project. A DTN story says landowners across the basin watched helplessly as their livelihoods were washed away in last spring’s intense weather. People living in the lower Missouri River basin continued to see high water levels long after the floodwaters had receded. The lower basin consists of a 735-mile expanse, where flooding has been a significant problem for years. The Corps says it has submitted a budget request for the flood risk management study for the fiscal year 2020 and is now awaiting funding approval. The study would be a place to start in developing plans along the lower Missouri River corridor to improve flood protection and include recommendations for actions at specific problem areas. The governors of Nebraska, Iowa, Missouri, and Kansas all signed a memorandum of agreement to pool state resources to help address continuing flood concerns. In total, the flooding disaster in 2019 caused billions of dollars in damages across the lower Missouri River basin. ********************************************************************************************** Vision 2020 Focuses on Growting Ethanol Demand at Home and Overseas The Growth Energy Executive Leadership Conference set forth its Vision 2020 goals last week. Vision 2020 includes growing demand for the ethanol industry domestically with E15 or higher ethanol blends, as well as expanding markets internationally. National Corn Growers Association President Kevin Ross took part in a stage discussion at the event. Ross told the crowd, “The farmers’ voice is so important in Washington, D.C. We are a grassroots organization and our partnerships with industry groups that have similar goals, such as Growth Energy, will help us continue to grow the E15 market and add higher blends of ethanol.” Growth Energy CEO Emily Skor says E15 ethanol will pave the way forward for even higher blends. But she also points out that the industry will only get to higher ethanol blends by “showing that E15 isn’t a niche fuel, but instead is the preferred, regular fuel that consumers use every time they go to the pumps.” The ethanol industry currently has more than 2,000 locations up and running in 30 states. During the first summer without RVP limits, ethanol sales jumped 46 percent compared to the previous year on a per-store basis. Skor adds, “With year-round E15 secured, we’re moving into an exciting new phase of expansion.” ********************************************************************************************** Illegal Pesticide Trade Growing Overseas A Washington Post report says the trafficking of illegal pesticides has grown significantly in overseas countries like Brazil. While the product doesn’t sound extravagant, it’s quickly growing into one of the more lucrative criminal enterprises in the world. The World Health Organization says these illegal pesticides will hurt countries in the developing world. Excessive use of these products can and will poison soils, contaminate water supplies, and devastate ecosystems. World population growth may be one of the factors behind the trade. Javier Fernandez, a senior official with CropLife, says, “it’s unknown, and it’s very common. The increasing demand for food is accelerating the need for pesticides, so the illegal trade is getting bigger and more violent.” Multinational corporations that sell Brazilian food into the United States say their products are safe, despite the presence of illegal pesticides in the country. For example, Bunge (BUN-gee) is a U.S. producer that sources crop from Brazil and says its contract with farmers includes clauses that “require the responsible use of pesticides.” It also conducts chemical analysis on its products to ensure their safety. Similar companies provide training for their Brazilian producers and monitor the products entering the U.S. market. ********************************************************************************************** NCBA Elects New President at the Cattle Industry Convention Marty Smith is a fifth-generation cattle rancher who was elected as the new president of the National Cattlemen’s Beef Association over the weekend at the annual Cattle Industry Convention. Smith runs a cow-calf operation in Central Florida that’s been in continuous operation since 1852. Smith graduated from the University of Georgia with a degree in Agricultural Economics and Animal Science. Smith also graduated from the University of Florida College of Law and was admitted to the Florida Bar in 1984. “It’s a tremendous honor to lead the oldest and largest national organization representing American cattle producers,” Smith says. “We have a great product and a great story, and I’m looking forward to helping tell that story without apology during the year ahead as President of the NCBA.” Smith was formally elected at a meeting of the NCBA’s Board of Directors. Jerry Bohn of Kansas was named President-Elect and Don Schiefelbein (SHEH-fel-byne) of Minnesota was elected Vice President. More than 8,000 people attended the annual Cattle Industry Convention and NCBA Trade Show over the weekend in San Antonio, Texas.

| Rural Advocate News | Tuesday February 11, 2020 |


Washington Insider: Infrastructure Investment Discussed Again The Trump administration budget proposalreceived a cool reception, as usual, although Bloomberg says there is talk now that the House Ways and Means Chairman Richard Neal, D-Mass., is “cautiously optimistic about a possible compromise with the administration.” Neal said he is looking for a broader infrastructure deal--in spite of the far-reaching, major political differences involved. Neal spoke with Treasury Secretary Steven Mnuchin on Friday to discuss the possibility of moving an infrastructure package that would be broader than the highway bill reauthorization President Donald Trump endorsed during his State of the Union address. “I think we can go well beyond that,” Neal said, adding that he liked the option of reintroducing Build America Bonds to help pay for new projects. Still, he cautioned that the President would need to address Democrats’ concerns over climate change and noted that “any bill that includes infrastructure is going to have to include climate consideration.” He also said that specific agreements had not been reached yet. “The good news is everybody wants to do infrastructure,” Rep. Tom Reed, R-N.Y., told Bloomberg. “Communications are occurring. But it’s been very difficult to get it to crystallize.” Reed suggested that a more likely outcome was something along the lines of Trump’s campaign pledge to leverage private investment onto $1 trillion in new total infrastructure spending and cited an appetite among investors for government-issued bonds. However, Democrats have already dismissed that figure as unrealistic and insist that new direct federal spending “should drive infrastructure building.” Mnuchin and the administration are claiming “new interest” in 50- or 100-year Treasury bonds, an idea floated on the 2016 campaign trail. The “Build America Bonds” were taxable municipal bonds created as part of the Obama administration’s 2009 economic-stimulus package, which included infrastructure repairs, Bloomberg said. Speaker Nancy Pelosi, D-Calif., told a group of governors over the weekend that Neal is scheduled to meet again with Mnuchin this morning. The overall budget proposal the administration is expected to release this week is expected to include an enormous $4.8 trillion package for the upcoming fiscal year including $1 trillion for infrastructure spending, modeled on combining legislation proposed by Sen. John Barrasso, R-Wyo., with a $200 billion fund for “nationally significant projects.” The remainder of the funding would be made up of public-private partnerships and state and local spending, the administration has said. The White House would replenish the depleted Highway Trust Fund through cost savings in other areas of the budget. One element of the expected proposal is a somewhat pared-back request for Mexican border wall construction. The request would be for $2 billion, down from $8.6 billion requested a year ago. Senior administration officials are telling the press that that with funding for 1,000 miles of wall already secured, less spending will be needed. Bloomberg also noted that fiscal 2021 appropriations bills will not include earmarks, despite earlier support in the House Democratic caucus. House Democrats had discussed the possibility despite Senate Republican support for an indefinite ban on earmarks last year. “In the end you have to have bicameral, bipartisan support for this,” Rep. David Price, D-N.C., said last week ahead of the decision to abandon an earmark revival for the rest of the 116th Congress. “You don’t want one side exploiting it politically.” Bloomberg also reported that the United States has abandoned its antitrust probe of four automakers that sided with California over the administration’s fight over the future of fuel economy and emissions requirements. The inquiry had targeted Ford, Honda, BMW and Volkswagen over their agreement last year with California regulators to voluntarily meet the state’s targets for fuel economy and tailpipe emissions. The decision was seen as undercutting the administration’s plan to relax the national requirements and was decried by the administration at the time as a “PR stunt.” California Gov. Gavin Newsom cheered the decision, calling it “a loss for the weaponization of federal agencies.” He argued that the effort was a “blatant attempt by the administration to prevent more automakers from joining California and agreeing to stronger emissions standards,” Newsom said. So, we will see. Clearly, the coming budget fight will be highly contentious and possibly prolonged—although there seems to be no appetite now for shutting down the government. Still, many high-stakes proposals are on the table, to one degree or another, and should be watched closely by producers as they appear, Washington Insider believes.

| Rural Advocate News | Tuesday February 11, 2020 |


EPA Chief Comments on Court Case Impact on RFS EPA Administrator Andrew Wheeler on Saturday said the recent federal court decision to vacate three biofuel small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS) “has the potential of completely changing the small refinery program.” The court struck down waivers for three refineries in Oklahoma, Utah and Wyoming, ruling that the EPA could only extend exemptions for plants that had continuously received waivers from their RFS obligations. The three plants in question had not been previously granted exemptions. The agency is now “taking a close look at the 10th Circuit decision and the ramifications to the program,” Wheeler told AgWired in an interview, saying the agency would have something on that “shortly.” This is the first acknowledgement from EPA that the decision could have a significant impact on the SREs ahead..

| Rural Advocate News | Tuesday February 11, 2020 |


Trump Budget Plan Again Proposes Pay Cap, Crop Insurance Changes The Fiscal Year (FY) 2021 budget plan had a familiar feel to it Monday, including provisions that have been floated before by this and other administrations. The administration included legislative proposals that would lower the adjusted gross income (AGI) limit to be eligible to obtain farm program payments to a maximum of $500,000. And the limit would apply to more benefits than just those under the farm program. Plus, the administration said the separate pay cap for peanuts of $125,000 needs to go and there needs to be a limit of $125,000 per person on Marketing Assistance Loan (MAL) benefits. On crop insurance, the administration proposes cutting the crop insurance subsidy on harvest price option (HPO) policies by 15 percentage points and by 10 percentage points on policies without the HPO. That item would save $21 billion over 10 years. But the legislative proposals floated by the administration will not be picked up and ran with by lawmakers. However, the proposals indicate that the administration will keep this as a focus should Trump win another term in November. So even though these proposed cuts are not expected to materialize, ag interests are on notice that this will be a recurring theme ahead. The budget documents also make no mention that a 2020 Market Facilitation Program (MFP) is in the cards, with their projections showing that more than $9 billion under the MFP 2 effort for 2019 will still go out to producers in FY 2020. As of late Monday, USDA had not updated their figures for funds paid out to farmers via the final installment of the MFP 2 payments.

| Rural Advocate News | Tuesday February 11, 2020 |


Tuesday Watch List Markets USDA's WASDE report is set to be released at 11 a.m. CST Tuesday and the focus will likely be on U.S. export estimates and South American crop estimates. This will be USDA's first WASDE since the phase-one agreement was signed and that adds a little more drama to what is usually a quiet February ritual. Weather and any trade news that develops will round out trader interests. Weather Continued wet weather for the Southern Plains through the Delta and into the Mid-Atlantic Tuesday. Another round of heavy rainfall with a developing system through the same areas Wednesday and Thursday. Some moderate snow will accompany this round for the southwestern Plains Tuesday, spreading into the Midwest on Wednesday and Thursday. Colder air returns, albeit briefly, Wednesday through Friday across the Northern Plains and upper Midwest with some of the coldest air of the season and potential for a ground blizzard in the Red River Valley of the North.

| Rural Advocate News | Monday February 10, 2020 |


Corteva Dropping Chlorpyrifos Chlorpyrifos (Klor-PEER-uh-fos) is a pesticide that’s been sprayed on crops like strawberries, corn, and citrus, for many years to kill pests. Corteva (Kor-TEV-ah), the largest manufacturer of chlorpyrifos, says it will stop manufacturing the product by the end of the year. The insecticide has been linked in certain studies to neurological problems in children and has been called a threat to wildlife. However, the Environmental Protection Agency has resisted banning the product from the market, while saying that additional safety tests are needed. Some states haven’t waited for the EPA to make a decision and acted on their own. California is a state that says farmers can’t use the insecticide after December 31st of this year. Hawaii was the first state to ban chlorpyrifos, with that ban to take effect in 2022. The European Union has also banned using the insecticide. Corteva spokesperson Gregg Schmidt says demand for the product has “declined significantly” over the last twenty years. That’s what drove the decision to stop manufacturing the product, not safety concerns. Corteva tells Reuters that the company will continue to back chlorpyrifos during the EPA’s review. Environmental groups are happy with the move, but they caution that other companies are still manufacturing the product, which is allowed on imported food. ********************************************************************************************** Commerce Department Continues Argentina Biodiesel Anti-Dumping Duties The U.S. Commerce Department responded to a U.S. Court of International Trade ruling requiring it to explain how it found cause for anti-dumping duties on biodiesel from Argentina. In a recent filing with the court, the Commerce Department made “certain changes” to its calculations. However, the anti-dumping duty rates would remain the same for the two Argentine producers and exporters involved in the case. However, things could eventually be changed when it comes to imported biodiesel from Argentina. The Commerce Department is conducting a “changed circumstances review” that was requested by the Argentine government. Depending on what the review determines, it could potentially lead to lower countervailing duties on biodiesel imports from Argentina. The U.S. imported about $1.2 billion worth of biodiesel from Argentina in 2016, before duties were imposed in a case brought by the National Biodiesel Board and 15 domestic biodiesel producers. ********************************************************************************************** China to Cut Tariffs on U.S. Imports The Chinese Finance Ministry says it will cut tariffs on $75 billion worth of U.S. products. The cuts begin on February 14th and will include ag commodities like soybeans, asparagus, pork, and more. However, a Wall Street Journal article says there likely won’t be a big impact. An Agri-Pulse report says the move will cut tariff rate increases in half, somewhere between five and 10 percent, that China put into effect late last year in response to U.S. tariffs. The 30 percent punitive tariff on soybeans will drop to 27.5 percent on February 14, which will be seen largely as a goodwill gesture by China that won’t have a big effect on trade between the two countries. The “Phase One” trade deal between China and the U.S. calls for increased Chinese purchases of American agricultural commodities but neither side did away with the tariffs that have been a staple of the trade war since it began. China points out that the next step in tariff reduction depends on how much progress the two countries make in their relationship. U.S. and government officials say they expect China to boost purchases by granting targeted exemptions to the tariffs currently in place. All recent Chinese soybean buys took place in spite of the punitive tariffs in place and were due to the Chinese government giving targeted exemptions to importers. ********************************************************************************************** Pork Board Committs Half-Million Dollars to Fellowships The National Pork Board has opened up applications for a new series of swine research fellowships to help provide a pipeline of highly-skilled employees for the pork industry. The checkoff is investing a hefty sum of $500,000 for the fellowships. The money will fund education and training in critical areas of impact, such as animal science, feed science and management, engineering and human resources, along with many others. “Labor supply is critical to the entire pork industry,” says David Newman, President of the National Pork Board. “This fellowship program will develop highly-trained professionals who possess the skills and abilities with direct application to pork production both now and in the future.” Fellowships will be awarded for a maximum of two years and can be used for multiple advanced-degree programs. Fellowship funding will be capped at $30,000 over two years. Second-year funding will be contingent on the submission and approval of a progress report at the end of the first year. Go to www.pork.org/rfp for more information. Application materials must be submitted by February 25th. ********************************************************************************************** NCBA Researches Confusion about Plant-Based Fake Meat The National Cattlemen’s Beef Association released survey results that show widespread consumer confusion about plant-based fake meat products and the ingredients they contain. Less than half of the 1,800 respondents understood the labeling term “plant-based beef” was intended to describe an entirely vegetarian or vegan food product. One major source of confusion for one-third of consumers is the mistaken belief that plant-based meat products contained at least some real beef. “The fact that so many consumers look at these labels and think that the products include meat or any other animal by-product is a clear sign that the misleading labeling and deceptive marketing practices surrounding plant-based fake meat has caused real consumer confusion,” says NCBA President Jennifer Houston. Among other mistaken beliefs is 44 percent of consumers thought plant-based products were lower in sodium. In reality, leading plant-based fake beef is between 220 to 620 percent higher in sodium than the same-sized serving of real beef. “We need to do a better job of educating consumers on the differences,” Houston says. ********************************************************************************************** Broin Named American Biofuels Visionary by Growth Energy Growth Energy CEO Emily Skor recently named POET Founder and CEO Jeff Broin as the American Biofuels Visionary award winner. Tom Buis (BUY-us), previously the CEO of Growth Energy, joined Skor onstage during the 11th Annual Executive Leadership Conference. Growth Energy presents the award in tribute for a lifetime of leadership that has fueled the growth of America’s entire biofuels sector. “Jeff Broin’s unwavering leadership and transformative vision for U.S. biofuels have touched the lives of every American, from farm families in South Dakota to drivers in New York,” Skor says. “As founding chair of Growth Energy, he followed in the footsteps of other great American founding fathers, building an enduring legacy that will shape the future of homegrown energy for generations to come.” Broin says he’s honored and humbled to be recognized by Growth Energy. “Helping to found and grow this organization has been a true labor of love for me, going back to my roots on the family farm. While we have won many battles, the war over biofuels is far from over.” Broin says he will continue to work with the biofuels industry and agriculture to drive biofuels to new heights in the years to come. POET Biofuels is the world’s largest ethanol producer.

| Rural Advocate News | Monday February 10, 2020 |


Washington Insider: The Impacts of the Coronavirus Scrutinized The urban press is laser-focused on the rapidly spreading impacts of the coronavirus just now. Fed chair Jerome Powell is scheduled to appear before a couple of congressional committees this week and certainly will face strong scrutiny regarding developments and plans for key economic policies. As might be expected, Powell is confessing that he finds it “very hard” to understand China’s economy--and that the disease outbreak “has made that exponentially more difficult.” Certainly, these issues are seen as “too important to ignore,” Bloomberg thinks because of the sheer size of the economy—so that “any hit to its growth from the epidemic will have a knock-on impact for the rest of the world and the US,” and much of the world is worried. The effects of the coronavirus in China are generating a “prominent new risk to the outlook,” the U.S. central bank wrote in its semi-annual report to Congress released on Friday. Just how big that risk is--and the expected Fed response—certainly will key topics as Chairman Powell kicks off two days of Congressional testimony before the House Financial Services Committee, and then to the Senate Banking panel. Lawmakers also will likely press Powell for the rationale behind the big run-up in the Fed’s balance sheet that’s occurred since September’s turmoil in the money markets. Bloomberg also notes that the testimony comes on the heels of the impeachment fight and ahead of November elections so the hearings—like almost everything else—almost certainly will be “politically contentious” as lawmakers from both parties pepper Powell with questions. “He is going to have his Kevlar on,” said Ward McCarthy, chief financial economist at Jefferies LLC. “All of the questions will have some political connotations.” Ahead of the hearings, traders in the federal funds futures market are betting that Powell and his colleagues will respond to the virus with a cut in interest rates later this year. Still, given all the unknowns involved, Fed watchers say Powell is unlikely to be that clear about the Fed’s intentions. But he’s just as unlikely to dismiss the threat and rule out any response. “There’s little upside to trying to sound too confident,” said former Fed researcher Michael Feroli, who is now chief U.S. economist at JPMorgan Chase & Co. “At least when I was there, there weren’t any virologists on the board.” Bloomberg also notes that its own economists think that “the underlying hiring trend is robust, providing a sturdy foundation for domestic growth,” although this is due to be challenged in the relatively near term by weak global growth in general and coronavirus supply-chain disruptions in particular. In the meantime, private sector economists have started to shave their estimates of U.S. growth due to the coronavirus. Feroli cut his first-quarter forecast to 1%, though he expects activity to bounce back in the second quarter. Oxford Economics is more pessimistic. It reduced its first-quarter growth prediction to 0.6% from 1% with some spillover into the second quarter. At the same time, the virus outbreak occurs against a backdrop of what is mostly a healthy U.S. economy. U.S. employers boosted payrolls by a higher-than-expected 225,000 in January as wage gains also rebounded. The global outlook also appears a bit brighter now thanks in part to the US-China phase one trade deal and fading of fears of a disruptive, no-deal Brexit. What’s more, the turbulence in the money markets has also subsided, thanks to hundreds of billions of dollars the Fed pumped into the financial system. So, Powell will have a lot to discuss. In a Feb. 6 letter Democrat senators pressed him for an explanation of what lay behind last year’s agitation in the money markets and the Fed’s response. The lawmakers, including presidential candidate Elizabeth Warren, raised questions about whether the banks had gamed the market in hopes of winning some regulatory relief. Powell, for his part, has depicted the money market interventions as a success. He also sounded satisfied with the stance of monetary policy, after three interest rate cuts last year. And he’s suggested that he’s likely to stay that way unless there’s a material change to the outlook for the U.S. economy. So, we will see. Whether the coronavirus will eventually force such a reassessment is unclear at this point even as it broadened “the set of possible outcomes,” said Nathan Sheets, a former Fed official who is now chief economist for PGIM Fixed Income. And, it means that producers should watch the upcoming monetary debates especially closely as they emerge, Washington Insider believes.

| Rural Advocate News | Monday February 10, 2020 |


Stabenow Again Hits USDA Over MFP ‘Inequities’ Senate Agriculture ranking member Debbie Stabenow, D-Mich., released an updated report alleging inequities in payments from USDA's Market Facilitation Program (MFP). She said the data show a bias in payments towards large and Southern farms on a per-acre basis. “As farmers continue to face tough times, the Trump administration has failed to correct the serious inequities within their flawed trade assistance program,” Stabenow said in a statement. Stabenow argued MFP’s “relaxed payment and eligibility limits” have benefitted large farms and foreign companies at the expense of small and beginning farmers. A USDA spokesperson disputed the findings, telling Politico “farms with less than 100 acres received an average of $55.90 per acre, while farms with more than 2,500 acres received an average $47.51 per acre.” The spokesperson also emphasized that MFP payments are made based on trade damage, not other factors.

| Rural Advocate News | Monday February 10, 2020 |


USDA Report Details China Trade Deal Impact on US Trade Forecasts The Office of the Chief Economist released a report, “Agricultural Provisions of The U.S.-China Economic and Trade Agreement and USDA Trade Forecasts,” outlining how the Phase One trade agreement will – and will not – affect USDA trade forecasts for the monthly WASDE and other monthly, quarterly and annual reports. While some have focused on the statement referenced more than once in the document that “commodity-specific commitments are not publicly available and are therefore not considered in the published forecasts,” it is important to note that the report also states, “Beginning in February 2020, USDA trade projections for 2019/20 (and Fiscal Year 2020) will fully consider all publicly available information on the Agreement, as well as any new market or policy developments that would affect those forecasts.” As for the forecasts released at USDA’s Outlook Forum near Washington, DC, Feb. 20-21, and the first official 2020/21 forecasts in the May WASDE, the report states, “Both the initial forecasts released in February and the official May WASDE 2020/21 forecasts will incorporate the Agreement into the underlying analysis, along with all other relevant market and policy variables.” Importantly, the report also notes, “As more information and data become available regarding the timing, volume and content of China’s commodity purchases, USDA commodity forecasts will be updated to reflect that new information.” This indicates that USDA analysts are being given no additional information beyond what has already been made public. But it also means they will be incorporating the information is available in their forecasts starting with the February WASDE report due on February 11.

| Rural Advocate News | Monday February 10, 2020 |


Monday Watch List Markets Unless something unexpected happens over the weekend, Monday's trading in grains is apt to be restrained ahead of Tuesday's WASDE report. Traders will check South American weather forecasts and any trade news. USDA will release weekly export inspections at 10:00 a.m. CST. Weather Heavy rain and flood threat is in store for the Delta and southeastern Midwest Monday. Another round of heavy rain is indicated for these areas during midweek. We'll also see snow begin in the far southwestern Plains, where heavy snow is likely over the next couple days. Other crop areas will be drier, allowing for flood recovery in the Northwest and improved transportation in the northern Midwest after heavy weekend snow.

| Rural Advocate News | Friday February 7, 2020 |


2020 Farm Income Forecast Looks “Average” U.S. net cash farm income, the total income after expenses, is forecast to decrease $13.1 billion to $109.6 billion in 2020. When adjusted for inflation, the drop is almost 11 percent compared to the previous year. U.S. net farm income is a broader measure of profitability. It incorporates noncash items like economic depreciation and gross imputed rental income, and it forecast to increase by $1.4 billion to $96.7 billion in 2020. That’s a 1.4 percent jump over 2019. The USDA says if the forecast changes are accurate, net cash farm income in 2020 would be 0.6 percent below the inflation-adjusted average calculated throughout 2000-2018. Net farm income would be 5.4 percent above the average during 2000-2018. The two income measures will diverge this year because of how net sales from inventories are treated. Net cash farm income records the income in the year a sale took place, while net farm income counts it in the year production occurred. For example, high net sales at $14.9 billion from crop inventories forecast in 2019 are expected to boost net cash farm income significantly that year. Very low net sales from inventories ($0.5 billion) in 2020 are expected to contribute to a decrease in net cash farm income between the two years. ********************************************************************************************** U.S. Pork Exports Set Record in 2019 2019 was a banner year for U.S. pork exports in terms of volume and value, reaching almost $7 billion. That comes from USDA data compiled by the U.S. Meat Export Federation. Exports of U.S. beef were below 2019’s record levels, while lamb export volume was the second-largest on record. Pork exports rose to just over 282,000 metric tons in December, up 34 percent year-over-year and surpassing the previous high set in November of 2019 by nine percent. Export value was $760 million, up 44 percent from the previous year, breaking the previous record also set in November of 2019. These results pushed 2019 pork exports 10 percent above the previous year in volume and nine percent higher in value. December beef exports were a little over 111,000 metric tons, down one percent from last year, and valued at $682 million, a three percent drop. Exports in 2019 were down 2.5 percent from the previous year’s record volume, finishing at 1.32 million metric tons. The surge in pork demand was due in part to Chinese and Hong Kong demand for U.S. pork, which climbed to almost 110,900 metric tons in December. That’s more than quadruple the previous year’s volume. The value was six times higher than last year at the same time, totaling almost $275 million. ********************************************************************************************** Perdue: U.S. Must be Understanding if Coronavirus Affects Chinese Purchases Ag Secretary Sony Perdue says the U.S. will have to be “tolerant” if the fast-spreading Coronavirus inhibits China’s ability to increase purchases of American farm goods. China pledged in the “Phase One” agreement to buy at least an additional $12.5 billion worth of farm goods in 2020 and at least $19.5 billion in 2021 over the 2017 level of $24 billion. Commodity traders and economists have questioned China’s ability to follow through on those commitments since the deal was signed. Now that the Coronavirus is continuing to spread, it poses a threat to China’s economic growth. “If they’re trying and the disease blows the economy out of the water, then we’ll need to be understanding,” Perdue told reporters during a cattle industry convention in Texas. Reuters says Perdue isn’t part of the government team that’s responsible for enforcing the terms of the agreement. He also didn’t say how the U.S. would need to adjust its expectations of China. The text of the agreement does contain a disaster clause, which Beijing has yet to formally invoke, which would allow for delays. China has reported that over 500 people have died in the Coronavirus outbreak. ********************************************************************************************** Trump Wants Trade Deal with Kenya President Donald Trump and the president of Kenya are going to kick off bilateral trade negotiations this week as they meet at the White House. V.O.A. News Dot Com says this is an unusual effort for the president, who’s largely focused his trade efforts on major economic powers like China, Japan, and the European Union. Kenya ranks 98th among the U.S. trading partners with about $1 billion in two-way trade of goods in 2018. However, a trade deal with Kenya could create a template for future negotiations with other African nations. It would also help to thwart some of China’s rising influence in the continent. China took the top spot from the U.S. as Africa’s number one trading partner several years ago. Scott Eisner is president of the U.S.-Africa Business Center at the U.S. Chamber of Commerce. He says the agreement is likely to take several years to complete, especially if Trump follows the trade promotion authority law. That requires congressional input for comprehensive trade deals. If the two sides eventually agree, it would be the first trade deal between the U.S. and an African nation. The U.S. currently has 20 free-trade deals in place with other countries, but none are on the African continent. ********************************************************************************************** Cattle Outlook Positive in 2020 With a plateau in U.S. cattle numbers and strong beef demand ahead, CattleFax says prices are likely to be stronger in the year ahead as consumers at home and abroad support industry profitability. That’s one of the big takeaways from the CattleFax outlook session in San Antonio, Texas. Kevin Good, CattleFax Vice President of Industry Relations and Analysis, says trade will play a significant role in beef and cattle markets. He expects higher total animal protein production will be offset by strong demand and increasing exports. “With strong demand for U.S. beef at home and rising demand overseas, the modest increases in supply will be more than offset by growing consumer appetite for our product,” Good says. CattleFax is projecting composite cutout prices will rise $3 during the upcoming year to reach $222 per hundredweight. Good also says CattleFax is projecting fed steer prices to average $120 per hundredweight during 2020, an increase of $3 from the previous year. Calf prices are also expected to move higher in the year ahead. CattleFax CEO Randy Blach (Block) predicts a lot less volatility in the market during 2020 than compared to last year. ********************************************************************************************** USDA Announces Details of RMA Hemp Protection Programs The USDA announced the details of two programs that protect hemp producers’ crops from natural disasters. A pilot hemp insurance program through Multi-Peril Crop Insurance provides coverage against yield loss because of insurable causes of loss for hemp grown for fiber, grain, or CBD Oil. The Noninsured Crop Disaster Assistance Program coverage protects against losses associated with lower yields, destroyed crops, or prevented planting where no permanent federal crop insurance program is available. Producers can apply now, with the deadline to sign up for both programs set for March 16, 2020. “We are pleased to offer these coverages to hemp producers,” says USDA Undersecretary for Crop Production and Conservation Bill Northey. “Hemp offers a new economic opportunity for our farmers, who are anxious for a way to protect their product in the event of a natural disaster.” The pilot insurance program option for hemp producers is available in select counties in 21 states during the 2020 crop year. The Noninsured option provides protection against loss for hemp grown for fiber, grain, seed, or CBD for the 2020 crop year where no permanent federal crop insurance program is available.

| Rural Advocate News | Friday February 7, 2020 |


Washington Insider: The Consumer Economy Continues to Shrug Off Industry Woes Well, the economic outlook continues to show signs of both strength and weakness and to defy easy interpretation, Bloomberg is reporting this week. It highlights the warning from Caterpillar Inc. that “sales of its heavy machinery are expected to slump for a second straight year in 2020 amid continued global economic uncertainty.” Still, Bloomberg emphasizes that Amazon.com Inc., added $72 billion in market value — about the size of Caterpillar — after reporting robust holiday season sales. The report says that shows “how much the U.S. industrial and consumer economies have diverged.” The report explains that the manufacturing sector went through a mild recession last year as the administration’s trade war with China “added costs to supply chains and curtailed business investment.” And it says that “new data from the Institute for Supply Management show U.S. factory activity barely expanded in January after contracting in the last five months of 2019. However, it notes that “this industrial downturn was at most a blip for the still-roaring consumer spending spree.” CSX, 3M, and other industrials joined Caterpillar in reporting sluggish sales predictions but McDonald’s and Starbucks reported healthy gains for the final three months of the year. Even Target Corp., which warned last month of weaker-than-expected demand for toys and electronics, over the holiday season, managed to project sales at stores open at least a year to be up more than 3% in 2019. U.S. consumer sentiment reached an eight-month high in January, according to University of Michigan data. One reason there hasn’t been a broader recession is that manufacturing’s share of the economy continues to shrink, Bloomberg thinks. Factory output accounted for 11% of U.S. gross domestic product in the third quarter, which is tied with the second quarter for the lowest level since 1947, the report says. Another is that this wasn’t a typical slump. What happened in 2019 was a “policy-driven slowdown,” says Gina Martin Adams, chief equity strategist at Bloomberg Intelligence—that is, the trade war. While U.S. whiskey, motorcycles, and myriad other products are subject to European Union tariffs, the consumer sector emerged largely unscathed from the spat with China. The administration’s threat on Aug. 1 to apply a 10% tariff on $300 billion of Chinese products, including toys and iPhones, was watered down and then partially rescinded, the report notes. The industrial sector, by contrast, bore the brunt of the back-and-forth in 2018 and 2019 as it dealt with broad U.S. taxes on aluminum and steel imports and tariffs on $250 billion of mostly manufacturing-related products. Those Chinese imports remain subject to 25% tariffs. The tariffs appear to have stalled an industrial recovery that was gaining traction following a mini-recession in 2015-16 amid plunging oil prices, the report concludes. Already, companies were dealing with rising labor, raw material, and logistics expenses. But the will-he-or-won’t-he debate around the U.S. tariff push created an “impossible environment in which to make major purchases of expensive machinery.” Industrial companies’ sales suffered. A belief that things would recover quickly if the U.S. and China reached a trade deal changed how companies responded to the slowdown, Bloomberg suggests. Executives didn’t want to be caught flat-footed by a swift recovery or left without workers in a tight labor market. Thus far, people have largely stayed employed and been active consumers. Even with all the volatility in 2019 – which also included a six-week General Motors Co. strike and the global grounding of Boeing Co.’s 737 Max jet – the manufacturing industry ended 2019 with a net gain of 46,000 jobs, the Commerce Department is reporting. Asked on a Jan. 28 earnings call if aerospace supplier United Technologies Corp. would lay off employees to help it cope with the Boeing production halt, Chief Executive Officer Greg Hayes said “that would be the easiest thing to do, but quite frankly, given the scarcity of talented aerospace workers out there, we’re not going to.” Most industrial CEOs say they expect a challenging economic environment to linger at least through the first half of the year. Emerson Electric Co. and 3M Co. announced fresh restructuring plans in their earnings releases that will almost certainly include job cuts. But a continued slow bleed in manufacturing combined with moderate cost-cutting probably won’t be enough to tip the overall employment picture negative, Adams says. With the Federal Reserve signaling that it’s unlikely to raise interest rates soon, things would have to change materially for that manufacturing weakness to leak into the consumer sector, she adds. One wild card is the coronavirus and the impact it could have on consumer sentiment, particularly in China. Unlike the trade war, the outbreak threatens to hit consumer-facing companies equally as hard if not harder than industrial ones, with Apple, McDonald’s, and Starbucks shuttering locations in China and U.S. airlines halting travel to the country. So, we will see. This will be a campaign year and there likely will be political interventions at the slightest sign of economic weakness – developments that should be watched closely as the elections approach, Washington Insider believes.

| Rural Advocate News | Friday February 7, 2020 |


USDA Sees 2020 Net Farm Income Rising Despite Government Payment Downturn USDA forecasts U.S. net farm income to increase $3.1 billion (3.3%) from 2019 to reach $96.7 billion in 2020. Net cash farm income, however, is forecast to decrease $10.9 billion (9%) from 2019 to $109.6 billion in 2020, according to USDA. The difference between net farm income and net cash farm income is based on what is included in each forecast. Net cash farm income encompasses cash receipts from farming as well as farm-related income, including government payments, minus cash expenses, according to USDA, but it does not include noncash items—such as changes in inventories, economic depreciation, and gross imputed rental income of operator dwellings — reflected in the net farm income. Some are playing up that USDA is “forecasting” a downturn in government payments. But that was well known or should have been ahead of the USDA update as no 2020 Market Facilitation Program (MFP) effort has been announced. Total direct government farm program payments are seen at $14.98 billion in 2020, down $8.7 billion from $23.65 billion in 2019. But farmers will still receive some MFP money in 2020 as USDA projects eligible producers will still get nearly $3.7 billion in MFP dollars.

| Rural Advocate News | Friday February 7, 2020 |


US December Ag Exports Hold Near $12 billion The value of U.S. ag exports in December moved down to $11.85 billion, down from $12.66 billion in November, putting total exports for the first three months of Fiscal Year (FY) 2020 at $36.59 billion. Ag imports rose to $10.75 billion in December, up from $10.31 billion in November, putting the FY 2020 total at $31.98 billion. The monthly trade surplus was $1.1 billion pushing the quarterly surplus to $4.62 billion. So far in FY 2020, exports have totaled more than $1 billion above the year-ago period, while imports have risen nearly $100 million. The rise in exports compared with year ago is an encouraging sign but even more surprising is that imports have not risen more. The overall U.S. December trade results showed that imports rose significantly in December, a trend not matched in the agricultural data. Now the focus will shift to how USDA alters their outlook for U.S. ag exports later this month, in particular how they account for the Phase One agreement with China and the ag purchase commitments in that pact.

| Rural Advocate News | Friday February 7, 2020 |


Friday Watch List Markets At 7:30 a.m. CST Friday, the U.S. Labor Department will release nonfarm payrolls and unemployment rate for January. Markets will largely be on their own the rest of the day, noticing the South American weather forecast and any further trade news that might emerge. Weather Friday will feature this week's heavy rain ending in the southeastern U.S. We'll also see periods of light snow in the Midwest, heavy snow in the Northeast, snow in the Rockies, and rain and snow in the Northwest. Dry conditions will be in place elsewhere.

| Rural Advocate News | Thursday February 6, 2020 |


China Says Trade Deal Good for both China and the U.S. China calls the Phase One agreement a "win" for both sides, following comments made during the State of the Union address this week by President Donald Trump. During the Tuesday evening speech, President Trump called the trade deal with China a "Win" for the United States, worth billions in new U.S. ag exports. Wednesday, a spokesperson for China’s Foreign Ministry responded to the comment, stating, “Sound and steady development of bilateral relations serves the fundamental interests of the two countries and meets the aspiration of the international community.” Trump signed the Phase One agreement in January. However, the benefits of the deal may now be delayed. The Coronavirus outbreak is thought to limit demand and could cause delays at Chinese ports. China offered a different tune, though, Wednesday, saying, “China and the U.S. are in close communication on the situation through diplomatic and health channels.” Earlier in the week, China claimed the U.S. “hasn't provided any substantive assistance.” China is also seeking flexibility on trade deal rules due to the coronavirus outbreak. *************************************************************************************​ NCBA Unveils Top Policy Priorities For 2020 Kicking off the National Cattlemen’s Beef Association annual convention, leaders of the organization approved top 2020 policy priorities. At the annual Cattle Industry Convention in San Antonio, Texas, NCBA leadership included issues related to international trade, proper regulation of fake meat, and regulatory reform. Although after a series of significant policy victories in 2019, this year’s priority list is focused on implementing and protecting those gains. NCBA President Jennifer Houston says, “Now it’s time to implement and defend those gains and to keep pushing for policies that will help improve conditions for cattle producers.” This year’s priorities include an issue that was a late addition to last year’s list after Congressional introduction of the so-called Green New Deal: climate policy. NCBA plans to “Continue to push back against misguided climate policies while advancing the U.S. cattle industry’s tremendous environmental record.” NCBA also plans to prioritize the importance of cattle markets, and aggressively pursue final regulatory rules, including the Waters of the U.S. Rule, among others. ************************************************************************************* Beef Quality Assurance Online Modules Updated Building on its updated National Manual launched in Summer 2019, the Beef Quality Assurance program, or BQA, has updated its online training modules to make them more realistic and useful. The new modules are now available to those who are first becoming BQA certified online and those who are getting recertified as required after three years. First launched in 2017, the online training modules have been embraced by more than 100,000 in the cattle industry. BQA certifications are also available at in-person training events offered through state beef councils, and other local efforts throughout the country. Funded by the Beef Checkoff, the BQA program touches more than 85 percent of beef produced in the United States today. Bob Smith, chair of the BQA Advisory Board, says, "The new online modules maintain the program's integrity and make its lessons more real-life and user-friendly." After registering, participants are taken through an interactive training module that can be completed online, anytime. Learn more at www.bqa.org ************************************************************************************* E15 Sales Reach Record in 2019 A new Renewable Fuels Association analysis found approximately 500 million gallons of E15 were sold nationwide in 2019, setting a new record. RFA says the record proves that the Trump administration’s elimination last summer of an obsolete regulatory barrier is working. However, sales would have been even stronger if not for the RFS compliance exemptions granted by EPA to dozens of refineries. E15 sales in Minnesota—the only state that tracks monthly purchases of higher ethanol blends—increased by nearly a third in 2019, compared to 2018. The review by RFA Chief Economist Scott Richman extrapolated the Minnesota data nationally, finding that 499 million gallons of E15—containing 75 million gallons of ethanol—were sold across the country in 2019. Before 2019, sales of E15 had been prohibited each year during the summer months in areas where conventional gasoline is sold. In May 2019, the EPA allowed E15 to be sold year-round by extending to it the vapor-pressure waiver that was already available for E10 blends. ************************************************************************************* CoBank Examines Impact of Wal Mart entering Beef Business Walmart officially entered the beef business in January when it opened a case-ready beef plant in Georgia after establishing its own Angus supply chain. The facility is the latest step by Walmart in its vertical integration strategy for food, according to a new report from CoBank's Knowledge Exchange division. If Walmart's new beef plant and Angus supply chain succeed, it could lead the retail giant to take another step up the supply chain towards the producer. That could be in the form of harvesting fed cattle or through a joint venture with a current packer. Will Sawyer, animal protein economist with CoBank, says, “We believe their current beef strategy is something of a test, not only for Walmart and its suppliers, but also its customers." The new plant will cut and prepare steaks and roasts produced by Walmart's Angus beef supply chain for 500 stores. CoBank doesn’t see the move shifting the price and leverage dynamics of U.S. beef production, adding the move will account for less than .5 percent of U.S. beef production. ************************************************************************************ AFBF, INTL FCStone Partner on Risk Management Tools for Farm Bureau Members The American Farm Bureau Federation is partnering with INTL FCStone to offer Farm Bureau members exclusive discounts on FCStone’s catalog of agricultural risk management tools. Announced Wednesday, the partnership includes access to a range of customized commodity marketing plans to data management solutions and educational seminars and covers an extensive range of agricultural commodities, from grains and oilseeds to dairy and livestock. AFBF President Zippy Duvall says the partnership "will give Farm Bureau members access to invaluable education and resources to help them succeed." Through the partnership Farm Bureau members are eligible for ten free trades each year when opening a new account, discounts on subscriptions and fees to attend conferences, along with access to INTL FCStone’s Market Intelligence expertise at reduced rates. AFBF President Duvall says, "It’s important to take control where we can, and this new member benefit can help us do that.” Farm Bureau members can learn more online, at FB.org/FCStone, or by contacting the state Far. Bureau office.

| Rural Advocate News | Thursday February 6, 2020 |


Washington Insider: US Annual Trade Gap Shrinks Bloomberg is reporting this week that the U.S. trade gap narrowed last year. Lower shipments from China and declining oil imports are driving the trend, the report said. However, it also noted that the “overall gap” remains wider than it was before President Trump took office, although the trend is seen as giving the president evidence he has delivered on his pledges to reduce the gap. The annual deficit in goods and services decreased for the first time in six years, narrowing 1.7% to $616.8 billion according to Commerce Department data reported on Wednesday. However, the December gap rose from the prior month to $48.9 billion, wider than the median estimate of economists as oil imports from Canada jumped. President Donald Trump frequently cites the trade deficit as evidence of the failure of earlier trade policies — even though most economists don’t dwell on the indicator since it reflects numerous broader economic trends beyond overseas purchases and sales. However, Bloomberg notes that the gap remains more than 20% wider than before the president took office. That reflects steady gains in American consumer spending, which drives imports, Bloomberg said. The annual merchandise-trade deficit with China — the principal target of the administration’s trade war — narrowed 17.6% to $345.6 billion after hitting a record in 2018. Imports from the country slumped 16.2%, exceeding the drop in 2009 during the global financial crisis, while shipments to China declined 11.3%, the biggest drop since at least 2003. That pushed China down to third place among America’s top trading partners for goods in 2019, as Mexico claimed the top spot, slightly ahead of Canada. The merchandise deficits with Mexico and the European Union hit records, while the U.S. surplus in services declined by 4% to $249.2 billion as imports gained. Bloomberg also said it expected that the phase-one trade deal with China is likely to have an impact on the composition of trade flows, “but not the overall net position.” The boost to exports growth, however, appears likely to be delayed by the coronavirus outbreak. Overall, Bloomberg estimates exports will add only slightly to GDP in 2020 and for net trade to continue to subtract from full-year growth. Even with the trade tensions in recent months, oil was a chief force behind the full-year deficit narrowing. Petroleum imports dropped $31.4 billion to $193.9 billion while exports increased, narrowing the full-year gap in such products to a record-low $13.7 billion. On a monthly basis, the U.S. has been a net exporter since September. However, the non-petroleum goods deficit was $839.2 billion, a record high. In addition, the U.S. and China last month signed the first phase of a trade agreement that is expected to boost Chinese purchases by $200 billion over the next 24 months, the culmination of almost three years of acrimonious talks that have roiled markets. However, the coronavirus “threatens to affect that target that many observers thought was lofty before the outbreak.” Officials in Beijing are said to be hoping Washington will agree to some flexibility on pledges in their deal. At the end of January, President Trump signed a new trade pact with Canada and Mexico into law extending the life and updating the trading bloc created by NAFTA in the 1990s. The White House is now turning its attention to scrutinizing trade links with other nations and regions including the UK, Africa and the European Union, with whom relations started to sour in 2018 when the administration invoked national-security considerations to impose tariffs on steel and aluminum from Europe. President Trump argued on Tuesday in his State of the Union address that the administration’s tariff strategy with China has worked and will protect U.S. workers and intellectual property, open markets and “bring billions and billions of dollars into our Treasury.” Bloomberg also noted that while the remaining Chinese tariffs mean significant payment flows to the U.S. Treasury, they raise costs for importing firms who must decide whether to take this “hit” to profits, shift supply chains or pass along price increases to customers. As a share of the economy, the overall trade gap narrowed to 2.9% of gross domestic product from 3% in 2018 — still significantly smaller than in the decade before the last recession, when it approached 6%. For the full year, U.S. exports fell 0.1% to $2.5 trillion as shipments of civilian aircraft declined amid the grounding of Boeing Co.’s 737 Max plane, while sales of autos, consumer goods and petroleum gained. Imports fell 0.4% to $3.12 trillion on lower purchases of crude oil, computer accessories and telecommunications equipment. So, we will see. There continues to be significant global trade tensions that likely will continue to dampen global growth, although the phase one deal with China is being welcomed as providing significant relief in the months ahead. At the same time, there are growing uncertainties regarding the impacts of Brexit and the continuing possibility of U.S. tariffs on European autos — as well as continued fights over European tax policies on U.S. firms — debates that should be watched closely as they proceed, Washington Insider believes.

| Rural Advocate News | Thursday February 6, 2020 |


WTO’s Azevedo Calls For Real Action On WTO Reforms A realization is building that real reforms to the WTO are needed, according to Director General Roberto Azevedo. “The reality is we need very significant changes,” Azevedo said. “A few coats of paint will not be enough.” In remarks to the Washington International Trade Association (WITA), Azevedo touched on the dispute settlement process at the WTO and the appellate body, the source of U.S. complaints about the WTO process. “In my mind, I can see a much better functioning dispute settlement system, but my mind is not enough,” Azevedo said. While he did not meet with either U.S. Trade Representative Robert Lighthizer nor President Donald Trump in his visit this week, Azevedo noted he has been engaging with U.S. officials on a consistent basis. But he emphasized, “What we need to do is transform those ideas into concrete action.” As for not meeting with Lighthizer or Trump, the WTO chief said, “It does not mean that I cannot come back. I need somebody to tell me – ‘This is the time.’”

| Rural Advocate News | Thursday February 6, 2020 |


NEC’s Kudlow Expects Delay in US Exports to China National Economic Council (NEC) chief Larry Kudlow told CNBC that the China coronavirus situation is expected to have an impact on U.S. exports to China, likely delaying the increase outlined in the phase-one trade deal. “The export boom from that trade deal will take longer because of the Chinese virus,” Kudlow said of the pledge by China to boost its purchases of U.S. ag, energy, services and manufactured goods. Meanwhile, former White House aide Clete Willems said the U.S. would need to show some understanding with China on the trade front as the country confronts the coronavirus situation. "We simply do not know the scope of this and what the economic impact is going to be. It does mean that in the short term it is going to make it difficult to make progress on phase two, and there will be a conversation with respect to implementation,” Willems told Reuters in Washington. As for the impact to the U.S. economy, Kudlow said it would be “minimal,” and the U.S. was ready to help China. “We would like to make them as healthy as we can,” he said. Expectations are the situation could trim U.S. GDP by 0.2 percentage points in the first quarter and another 0.2 percentage points later in the year. “It is not a catastrophe. It is not a disaster. I think people should be very calm about this,” Kudlow said. “This is not going to be that big a deal for us.”

| Rural Advocate News | Thursday February 6, 2020 |


Thursday Watch List Markets Thursday morning's schedule should sound familiar with weekly export sales and U.S. jobless claims due out at 7:30 a.m. CST. U.S. natural gas inventories follow at 9:30 a.m. South American weather and any ag trade news will also get traders' attention. Weather Thursday features moderate to heavy rain with a threat of flooding in the Southeast, mixed precipitation and snow in the eastern Midwest, light snow in the Northern Plains, and a rain-snow mix in the Northwest. Dry conditions will be in place elsewhere. Temperatures will be colder in all areas except for the Southeast.

| Rural Advocate News | Wednesday February 5, 2020 |


Rural Mainstreet Index Starts 2020 on Solid Ground January’s Rural Mainstreet Index from Creighton University climbed to its highest level since June of 2018. It’s the fifth-straight month the reading has been above growth neutral in the survey of bank CEOs in a ten-state region that relies primarily on agriculture and/or energy. The overall index in January came in at 55.9, up from 50.2 in December. It’s the 11th time in the past 12 months that number has been above 50, which is growth neutral. “Only 17 percent of bank CEOs reported their local economy was in an economic downturn,” says Index chief Dr. Ernie Goss. “This is better than a year ago, when almost 23 percent of bank CEOs said their local economy was in a recession, or economic downturn.” Don Reynolds is chair of the Regional Missouri Bank, who says, “Farm incomes for 2019 and projections for 2020 aren’t as bleak as we expected.” The farmland and ranchland price index came in below growth- neutral for the 73rd time in the past 74 months. While December’s index was 52.8, January’s number fell to 45.6. “Two out of three Nebraska bankers say property taxes on farmland are a significant factor in reducing farm profitability,” Goss says. ********************************************************************************************** Farmland Sales Pace Picking Up in 2020 The pace of farmland sales is picking up as the calendar heads further into 2020. Sam Kain, area sales manager for Farmers National Company, says the first six months of last year were as slow as he’s seen the land market in recent memory. “The fall months and winter season saw an increase in the pace of land auctions,” Kain says. “The on-going lower supply of land for sale has helped to support land prices. Good quality cropland remains steady to strong.” Farmers National recently sold a tract of land in Iowa for $13,000 an acre, which was way above expectations. “Lower quality land takes more time and effort to get it sold,” Kain says. “That’s more typical of Wisconsin farms, due to the financial stress of the past few years in dairy. Good quality cropland still sells well in the state, while lower quality land or properties with dairy facilities struggle to sell.” Looking ahead to this year, Farmers National says attention turns to what’s going to have the biggest impact on the farm economy and land market. Producers are optimistic about improvements with China but are now concerned about how soon grain prices might improve given disease outbreaks and world grain trade fluctuations. ********************************************************************************************** New Study says Red/Processed Meat Consumption Carries Risks A new study in the Journal of the American Medical Association says red meat lovers may want to put down that slice of bacon. A CNN report says a new analysis of long-term data on nearly 30,000 people shows a small but significant risk of death from any cause tied to eating two servings of processed meat or unprocessed red meat each week. People eating two servings a week of processed meat, unprocessed red meat or poultry were all found to have similar risks of cardiovascular disease. Researchers say including poultry in that category may have more to do with frying or consuming the skin. The study says there were no associated risks for eating fish. One serving of processed meat equaled two slices of bacon, two small sausages, or one hot dog. One serving of unprocessed red meat equaled about four ounces of red meat or poultry or three ounces of fish. The new findings come out just months after a separate study that says there is no need for people to reduce their red meat and processed meat consumption for good health. Senior Study Author Norrina Allen says, “Everyone interpreted that it was OK to eat red meat, but I don’t think that’s what the science supports.” ********************************************************************************************** Crop Insurance Flooding Bill Totals $6.4 Billion Politico says flooding added a lot of money to federal crop insurance payouts last year during the growing season. The bill is $6.4 billion so far, the costliest payout on record. Most of the money is tied directly to spring and summer flooding in states like North and South Dakota, Minnesota, and Illinois. Meteorologist Steve Bowen, who works for a national insurance company, analyzed USDA data. “Given the record rainfall that occurred and the multiple waves of flooding that affected areas across the Mississippi, Missouri, and Arkansas River basins, the heightened impacts are not terribly surprising,” Bowen says. “Last year was a very tough season for farmers, and there are concerns that already saturated soils across the Plains and Midwest may set the stage for more possible flooding in 2020.” Last year wasn’t the worst in terms of overall economic costs. Taking in the amount of damage to agriculture, infrastructure, and other property, the 1993 floods along the Mississippi and Missouri rivers remain the costliest disaster in modern history, coming in at $38 billion in today’s dollars. Last year’s disaster cost about $20 billion. Last year, USDA economists found that more frequent and intense storms will ratchet up the price of crop insurance between four and 22 percent, depending on the future rates of greenhouse gas emissions. ********************************************************************************************** United Fresh Produce Industry Leadership Program Signup Period Open The signup period for the 26th edition of the United Fresh Produce Industry Leadership Program is now open. The program first began in 1995 and more than 250 produce industry professionals have graduated from the program. “As we celebrate the program’s 25th anniversary, I invite our alumni and all those who have supported their journey to pay it forward,” says Tom Stenzel, President and CEO of the United Fresh Produce Association. “Please encourage the next generation of industry leaders to apply to take part in the class and become the first fellows of the next 25 years.” The United Fresh Produce Industry Leadership Program is the only ongoing, fully paid leadership program for the produce industry. Each year, people are selected to participate in the program which is developed around four fundamental goals: leadership development; business relationships; government and public affairs; and media and public communications. Participants take part in a series of four trips during the year-long program. The trips focus on face-to-face meetings, hands-on training with top industry experts and educators, interactive experiences with leaders in Washington, D.C., and more. The participants will be named at the United Fresh 2020 Convention and Ag Expo, June 16-19, in San Diego. ********************************************************************************************** Peterson, Conaway Skeptical about Conservation Program Implementation House Ag Committee Chair Collin Peterson and Ranking Member Michael Conaway were skeptical about the Trump Administration’s implementation of conservation programs during a subcommittee hearing last week. The Ag Committee’s Conservation and Forestry Subcommittee hearing on the implementation of the 2018 Farm Bill conservation provisions got a little testy. Natural Resources Conservation Chief Matthew Lohr says his agency launched the Conservation Assistance Ranking Tool (CART) to help farmers figure out which conservation programs work best for them. “Overall, the improvements through the CART program will enhance customer experience and save 200,000 hours of staff time every year,” Lohr said during testimony. Peterson wasn’t happy, saying that Lohr hadn’t told him about it in a meeting they had, and he believes CART amounts to “more damn crazy regulations as a ‘top-down’ deal.” Conaway told Farm Service Agency Administrator Richard Fordyce that his farmers were “back home scratching their heads” over differences in rental rates for the land-idling Conservation Reserve Program in neighboring counties. “There shouldn’t be marked differences in neighboring counties,” Conaway said to Fordyce.

| Rural Advocate News | Wednesday February 5, 2020 |


Washington Insider: Punitive Tariffs for Monetary Policy Lest you think that the phase-one deal with China might mean more tranquil international markets this year, Bloomberg is reporting that the administration is going ahead with controversial new rules that would clear the way for the U.S. to apply punitive tariffs on goods from countries accused of having undervalued currencies. The move would give new muscle to U.S. complaints about currency manipulation that have in the past targeted economies like China and Japan. In the process, it could “turn the more than $6 trillion-a-day global currency market into a new battlefield in the administration’s trade wars,” Bloomberg says. The rule would allow the U.S. to impose countervailing duties on goods from countries accused of manipulating their currencies--even in cases where they were not officially found to be guilty of that by the U.S. Treasury. Past administrations have resisted calls to take such action from Congress and some industries for fear it would lead to more tit-for-tat currency wars. In the wake of the global financial crisis a decade ago, policy makers in countries such as Brazil accused the U.S. and the Federal Reserve of using monetary policy to weaken the dollar to help spur a quicker recovery in the U.S. President Donald Trump has long accused China and other countries of doing the same. Commerce Department officials on Monday presented the recent decision as simply follow-through on a 2016 campaign promise to tackle currency manipulation around the world. “This currency rule is an important step in ensuring that unfair trade practices are properly remedied,” Secretary of Commerce Wilbur Ross said. “While successive administrations have balked at countervailing foreign currency subsidies, this administration is taking action to level the playing field for American businesses and workers.” The new rule, which the Treasury Department opposed when it was first proposed in 2019, would allow U.S. companies to file complaints with the Commerce Department over specific imported products by treating undervalued currencies as a form of unfair subsidy. It would also give the administration the power to self-initiate cases should it so choose, however, potentially making the U.S. government plaintiff, judge, jury and executioner in currency fights. The Commerce Department put some caveats on its powers, saying it would “not normally include monetary and related credit policy of an independent central bank or monetary authority” in determining whether foreign governments had acted inappropriately to weaken currencies. “Commerce will seek and generally defer to Treasury’s expertise in currency matters,” it said. Still, its statement left room for unilateral action by Commerce--even if Treasury, which issues a twice-yearly report identifying currencies that are artificially weak or the subject of government manipulation, determines that a currency is not undervalued. “This appears intended as a broad signal to U.S. trading partner countries that any significant weakening of their currencies relative to the dollar could invite retaliatory actions,” said Eswar Prasad, a Cornell University economist and the author of books on the rise of the dollar and Chinese renminbi. The new rule appeared to go against guidance from a Treasury official, who said last June that the framework of any currency assessments by Commerce would be consistent with its semi-annual foreign-exchange report to Congress. The Commerce Department also indicated that said it would preserve the final power to make any determination about whether a currency’s value presented an unfair subsidy for that country’s exporters — and that the new rule would allow it to “specifically impose currency-related tariffs against China even if Treasury did not label it a currency manipulator.” The Treasury last month lifted a designation of China as a manipulator just days before President Trump signed a “Phase One” trade deal with China that includes language on currencies, though the new rule appears to give the U.S. powers to act that go beyond that included in last month’s deal. Bloomberg noted that the final rule announced Monday drew “concern from some former U.S. officials.” “This is a unilateral policy which will alienate countries around the world,” said Mark Sobel, a former Treasury official. It may also violate U.S. World Trade Organization commitments, Sobel said, although the Commerce Department insisted in its statement that “there is no WTO rule that bars the imposition of countervailing duties on subsidies conferred through currency practices.” It also prompted warnings that the rule marked another administration effort to weaponize the dollar after the president previously set out to talk down its value while blaming the Federal Reserve for causing it to strengthen to the detriment of U.S. manufacturers and other exporters. So, we will see. In general, currencies tend to be volatile and “mechanical” regulatory efforts are frequently accused of amplifying that volatility and uncertainty — a reason sometimes given by Treasury for not intervening more often. In general, it appears that the administration has ideas of additional market interventions that could threaten Fed independence, and which should be watched closely by producers as these fights continue, Washington Insider believes.

| Rural Advocate News | Wednesday February 5, 2020 |


Commerce Announces Tomato Inspection Program The Department of Commerce has announced a new inspection program for imports of certain fresh tomatoes from Mexico, according to a notice in the Federal Register, an inspection program called for under the provisions of a new tomato suspension agreement the U.S. and Mexico agreed to last year. All fresh tomato imports from Mexico will be subject to inspection except tomatoes on the vine, specialty tomatoes and grape tomatoes in retail packages of two pounds or less. USDA will conduct the inspections and the effort will start 60 days from now. As part of the agreement, the U.S. will not put antidumping and countervailing duties on imports of fresh tomatoes from Mexico as long as the suspension agreement remains in effect.

| Rural Advocate News | Wednesday February 5, 2020 |


USTR Says No Request from China For Negotiations On Ag Purchases Bloomberg reported early Monday that China was requesting flexibility from the U.S. on its purchases of ag products under the Phase One trade deal between the two countries. However, the Office of the U.S. Trade Representative (USTR) said it has received no request from China on the matter. "USTR has not received any requests from China’s government to discuss changes in China’s purchase commitments due to the coronavirus outbreak," a USTR spokesperson said in a statement. The Global Times said that purchases of goods by Chinese firms was likely to be delayed in the first quarter but that purchases could increase later this year given that the purchase comments are on an annual basis, citing Gao Lingyun, researcher at the Chinese Academy of Social Sciences. Meanwhile, some suggest that USDA may release some additional information on the USDA forecasts regarding Chinese purchases of U.S. ag goods under the phase-one agreement ahead of the February 11 WASDE report.

| Rural Advocate News | Wednesday February 5, 2020 |


Wednesday Watch List Markets Wednesday's reports start at 7:15 a.m. CST with the release of ADP's estimate of private U.S. job gains, a possible hint to Friday's unemployment report. The December trade deficit is due out at 7:30 a.m. and will provide USDA with important ag trade data that will be revealed later Wednesday morning. The U.S. Energy Department's weekly inventory reports follow at 9:30 a.m. CST. Weather Freezing precipitation and snow will extend from the Texas Big Bend to the southern and eastern Midwest Wednesday. We'll also see mixed precipitation and snow in the Northwest and rain in the Southeast. Wintry precipitation areas will have transportation and safety issues, while rain in the Southeast brings extensive flood threats. Temperatures will be seasonally cold in most northern and central areas.

| Rural Advocate News | Tuesday February 4, 2020 |


Washington Insider: The US, London and the Huawei Fight Global trade issues are increasingly complicated these days, especially when it comes to tech policies. For example, the New York Times report on technology policy this week concludes that “one of the biggest recent stories began with an announcement in London.” The background is that for weeks, observers in Washington had been waiting to see whether Prime Minister Boris Johnson would ban Huawei equipment as the U.S. has done or allow it to be used in the nation’s 5G wireless network. The United States has said for years that the company’s networking gear could give the Chinese government access to key infrastructure. Last week Prime Minister Johnson revealed his decision, that Huawei is in. The company’s equipment can be used in a portion of the 5G, or fifth-generation, network. NYT thinks this is a big setback for the administration’s global anti-Huawei push. The White House had sent top officials to London to try to sway Johnson, who is seen as a close ally to President Trump. Also, after the British announcement, the European Union told members to limit but not totally eliminate Huawei’s role in their networks. The Times raised the question of why Prime Minister Johnson decided to allow Huawei to stay involved in building Britain’s 5G network, despite all the pressure he was under from the U.S. administration? NYT believes there are a few key reasons. The practical one is that Huawei has been part of the British telecom network for years, and that 5G will be built on top of that existing system. To implement a ban now would be “extraordinarily costly” and delay the rollout of the faster network because a lot of that old kit would have to be ripped out. The second reason, NYT says, is that British intelligence and cybersecurity officials believe the risks of Huawei can be mitigated. As part of allowing Huawei to be part of its network, British officials years ago required the company to subject its products and code to tests and a lab near Cambridge does that work. For British officials, this gives them a level of confidence that the problem can be managed. Of course, American officials argue that “this is wishful thinking.” With 5G, software plays a much bigger role, meaning it will be harder to keep harmful code from slipping through. Finally, as Britain exits the European Union, many of its officials believe that it can’t afford to alienate China, which is a big investor in the country and a growing buyer of British exports. From an economic standpoint, it would be a big risk. Britain also sees 5G as a key to the country’s economic future and that any delays could put it at a disadvantage to other countries. In Washington, the Johnson decision set off a paroxysm of concerned statements from the administration and hawkish members of Congress—but perhaps not as strong as some expected. That included the statement from the White House, as well as the fact that Secretary of State Mike Pompeo traveled to Britain during the week—where U.S. criticisms were seen as muted and delivered behind “closed doors.” In addition, NYT thinks the Huawei decision is just one example of a split between how tech is regulated in the United States and in Britain but also raises the question of what the future of the “special relationship” between the U.S. and Britain will be in the future with regard to tech? The Times thinks the answer to that question, like many others these days, is complicated. For example, the report says that Britain, like many countries in Europe, is very frustrated with Big Tech and doesn’t think the companies pay their fair share in taxes. Also with Facebook and Google/YouTube, “not enough is done to limit the spread of harmful content.” Attempts to address taxes and harmful content will gain momentum this year, potentially setting up more tension with the United States. Finally, the Times notes that tech issues “cover all of Europe, not just Britain,” and the U.S. must decide where it will campaign to keep Huawei out of 5G networks. It sees Germany as another country where the United States has been applying a lot of pressure but where the politics are intense and complicated. For example, China has threatened Germany with retaliation if Huawei is banned and that threat is resonating there. Chancellor Angela Merkel has signaled she doesn’t want a ban but she is facing pressure from others in government who want to take a more aggressive approach. So, we will see. The tech issues are particularly fascinating, touching on tech, trade, politics, foreign policy and national security. They pose an increasingly severe challenge to the administration to develop a unified approach that it previously has found difficult to sustain, and which producers should watch closely as these efforts continue, Washington Insider believes.

| Rural Advocate News | Tuesday February 4, 2020 |


USDA Finally Announces Third Round of 2019 Trade Aid Payments USDA has announced that farmers will be soon receiving the third installment of 2019 Market Facilitation Program (MFP 2) payments. The payouts have been expected since early January, but officials had signaled there were still details being worked out. Through January 28, USDA issued $10.89 billion in payments under MFP 2, meaning the payment announced by USDA Monday should total around $3.6 billion. USDA Secretary Sonny Perdue has cautioned that a 2020 MFP effort is not expected to be in the cards given the phase-one trade deal signed between the U.S. and China. But the situation could change depending on how the market response plays out to the phase-one deal and amid already rising political pressure for the administration to issue another round of the aid for 2020.

| Rural Advocate News | Tuesday February 4, 2020 |


Expectations for US-China Consultations on Phase One Purchase Commitments The China coronavirus situation is expected to result in the U.S. and China undergoing consultations under the phase-one trade deal relative to purchase commitments of U.S. ag and other products under the deal. Recall consultations are called for if either party faces a delay in their purchase commitments for reasons outside of their control. Most observers expect consultations will be held between the two countries, if they have not yet been via phone/video conference. Some expect delays in purchases/shipments of one to two quarters, with the seasonality of China’s buys of U.S. ag goods potentially impacted if the purchase timeline goes beyond that in terms of any delay. It is possible that with enough supply chain disruption China will not be able to meet the schedule for phase-one purchasing commitments.

| Rural Advocate News | Tuesday February 4, 2020 |


Tuesday Watch List Markets As far as official reports go, Tuesday should be quiet with just U.S. factory orders due out at 9 a.m. CST. Traders will also continue to have an interest in South American weather forecasts and the latest reports on coronavirus. Weather Tuesday features mixed precipitation and snow in the Southern Plains and moderate to heavy rain in the southern Midwest, Delta and mid-South. Precipitation areas will have transportation and safety issues. In addition, flood threats are noted in rain locales due to already-saturated soils. Dry and seasonally cold conditions are indicated for northern areas.

| Rural Advocate News | Monday February 3, 2020 |


EPA Once Again Affirms Safety of Glyphosate Late last week, the Environmental Protection Agency once again found that the weed killer glyphosate does not cause cancer. Glyphosate is the most widely used weed killer in the U.S. The Daily Mail reports that the agency’s regulatory review again reaffirms its stance on glyphosate, the key ingredient in Bayer’s Roundup. The EPA findings come in spite of recent decisions by U.S. juries that found using the weed killer was to blame for causing plaintiffs’ cancer in some trials. In a statement, the EPA says, “There are no risks of concern to human health when glyphosate is used according to the label and that it is not a carcinogen.” Bayer, which bought Monsanto, the original maker of Roundup, was pleased with the agency’s findings. The company has long said that glyphosate and Roundup are safe and do not cause cancer. Liam Condon, Bayer’s global president for crop science, says, “Glyphosate-based herbicides are one of the most thoroughly studied products of their kind, which is a major reason why farmers around the world continue to rely on these products.” Back in 2015, the World Health Organization classified glyphosate as “probably carcinogenic to humans.” ********************************************************************************************** China Asks Food Producers to Step Up Production Despite Coronavirus The Chinese Agriculture Ministry is asking the country’s feed producers and slaughterhouses to resume their production as quickly as possible. Reuters says the goal is to add to supplies during the outbreak of the Coronavirus. China’s factories typically shut down during the Lunar New Year holidays. Those holidays have been extended to at least February 2nd to curb the spread of the virus that’s killed 170 people in China and infected close to 8,000 more people. The virus outbreak has led to a quick jump in food prices, as well as low food supplies in some cities due to panic buying and transportation disruptions. In spite of the Coronavirus outbreak, China’s transportation authority is also asking their local authorities not to cut off highways and main roads to try and limit the spread of the disease. Coronaviruses manifest differently in different hosts. The virus often causes severe respiratory disease in humans, such as pneumonia. It likely jumped from animals to humans and is transmissible between human beings. The virus first emerged in the Chinese city of Wuhan, a large city with connections both inside and outside of China. ********************************************************************************************** NBB Supports Biodiesel in USDA Infrastructure Program The National Biodiesel Board released comments in response to the USDA’s request for information on the Higher Blends Infrastructure Incentive Program. The NBB says it’s grateful that biodiesel is included in the program. The infrastructure needs for biodiesel, renewable diesel, Bioheat, and sustainable aviation fuel are different from those of other biofuels. In its comments, the group asked USDA to focus the program on investments in strategic terminals, pipeline storage, and rail expansion to create a broader downstream capacity to sell more gallons. “Investments would be best served on opportunities that would afford the greatest additional volumes of biodiesel to enter the marketplace,” the group says in its comments. “The greatest barriers to biodiesel distribution are at the terminal and pipeline terminal level, as well as railways to reach distribution centers.” Kurt Kovarik, NBB Vice President of Federal Affairs, says they’re grateful to the USDA for following through on a pledge to support infrastructure projects that facilitate higher biofuel blends. “American consumers are increasingly demanding access to clean, low-carbon, advanced biofuels, like biodiesel,” Kovarik says. “We look forward to working with the USDA to strengthen the market for higher blends of biodiesel.” ********************************************************************************************** Farm Bankruptcies Rose in 2019 Farm bankruptcies jumped by almost 20 percent last year. That is the big takeaway from court data put together by the American Farm Bureau Federation. Overall, there were almost 600 Chapter 12 family farm bankruptcies in 2019, up from almost 100 filings the previous year. Wisconsin was hit the hardest, with 57 family farms filing for bankruptcy in 2019, while Georgia was second with 41. Almost half of the nation’s filings took place in the Midwest, which totaled 46 percent of the bankruptcies. 22 percent of the filings took place in the Southeast U.S. In spite of the numbers, last year’s filings didn’t come close to the all-time high of a 33-percent increase back in 2010, the year after the Great Recession. Over the past ten years, there have been more than 5,000 farm bankruptcies. That number represents a quarter of one percent of all farm operations. Given that there are just over two million farms in the U.S., the 2019 bankruptcy rate is about 2.95 bankruptcies per 10,000 farms. On a year-over-year basis, Chapter 12 filings have increased for five consecutive quarters. ********************************************************************************************** Seasonal Farm Trade Tensions Brewing Between the U.S. and Mexico In spite of the goodwill generated after the U.S. and Mexico approved the U.S.-Mexico-Canada Agreement, there could be more tensions between the two countries surrounding produce. The Financial Post says Mexico responded to a letter from the top U.S. trade negotiator, Robert Lighthizer, pledging protectionist measures on seasonal farm trade for producers in the politically important states of Florida and Georgia. Mexico says if the U.S. takes action in any way against Mexican agricultural imports, it will respond in kind. The Deputy Trade Minister of Mexico says, “If the U.S. government takes any steps of this kind against Mexican agricultural exports, the Mexican government will apply similar measures to U.S. products.” The head of the Mexican National Farm Council says he thinks the U.S. measures would likely target the more “successful” Mexican exports like tomatoes, berries, and mangos. Those exports are worth $12 billion every year and support about 1.4 million jobs in Mexico. The council president says this potential move is about U.S. politics and Mexico’s private sector is extremely concerned. In the January 9th letter, Lighthizer pledged to explore new protections for farmers in Florida and Georgia. ********************************************************************************************** RFA, NCGA Co-Sponsor the 2020 Crappie Masters Fishing Tournament Events The 2020 season of the Crappie Masters Tournament Trail begins later this week, with the Renewable Fuels Association and the National Corn Growers Association signed on as co-title sponsors. It’s the fourth consecutive year that the two major farm groups are sponsoring the events. “We’re thrilled to be representing the Renewable Fuels Association and American Ethanol by sharing the truth about ethanol and educating our anglers, listeners, viewers, and followers,” says Crappie Masters President Mike Valentine. “For five straight seasons, all winning teams with Crappie Masters have been running E10 fuel in their boats with no problems.” This year’s competition will include stops in states like Oklahoma, Kentucky, Missouri, Kansas, Iowa, and several more. NCGA Ethanol Action Team Chair Mark Recker says, “Nearly one-third of America’s corn crop goes into the production of ethanol, an environmentally friendly fuel additive that reduces greenhouse gas emissions by 40 percent, keeping the waterways clean for fishing.” RFA President of Industry Relations Robert White says, “We’re looking forward to another great year on the water with an expanded schedule of tournaments.”

| Rural Advocate News | Monday February 3, 2020 |


Washington Insider: Climate Change and Central Banks Bloomberg is reporting this week that the world’s largest central banks are getting louder about climate change risks and “some of them are even starting to do something about it.” This new focus has raised questions over whether the banks are muddying their mission--and whether their tools will even work in this field. Critics say they can and should go a lot further. Bloomberg says that a growing body of research suggests that climate change poses the greatest long-run threat to the global economy – including inflation and financial stability, which central banks oversee. Even if the ambitious goal set in the 2015 Paris Agreement of limiting global temperature gains to 2 degrees Celsius above pre-industrial levels is met, the world’s economies are likely to be affected in important ways, from lower productivity on farms and construction sites to increased mortality and migration. That’s in addition to damage from more extreme weather events and coastal flooding. Then there are risks to the financial system. In 2015, outgoing Bank of England governor Mark Carney raised an alarm about the “tragedy” of climate change and warned specifically about “re-pricing” events. That includes physical damage that destroys the value of assets (such as waterfront hotels), imposes new liabilities on companies such as California’s now bankrupt PG&E – or sharply raises insurance prices. Another risk could be a sudden slump in the value of certain assets because of drastic government action to combat change, like the introduction of a steep carbon tax or regulations that keeps fossil fuels in the ground. Two years later, Carney and several peers created the Network for Greening the Financial System, a group that’s grown to about 50 central banks and related groups that swap research and potential policy solutions. In 2019, the group created a set of guidelines that urge peers to price in climate change risk when regulating financial companies and to invest with sustainability goals in mind for their own portfolios. To many, the mere fact that central banks are talking about the challenge is of huge significance. Each of the major banks has its own approach, depending on their legal mandate and their government’s priorities, Bloomberg notes. It describes a few examples, including the People’s Bank of China that provides direct investment in sustainable projects, encourages issuance of green bonds – and even curbs loans to polluters. Also, the Bank of Canada announced a research program on climate change at the end of 2019 and the Bank of England is in the midst of stress testing insurers and banks for how well they’d handle climate events and potential new regulation. The U.S. Federal Reserve hosted a climate change conference in November and is conducting research on the subject and the European Central Bank is set to consider climate change in its monetary policy review and Christine Lagarde, president of the EU bank, has pledged to make climate change a “mission critical” issue. Her remarks spurred discussion in financial circles of the potential for “Green QE,” or the purchase of bonds to nudge down long-term interest rates in an effort to funnel some of a central bank’s bond-buying toward green projects and companies, lowering borrowing costs for that industry. Central banks also can play a role through regulation and research, and can use their regulatory powers to do things like force banks to calculate and disclose their climate-related risks and can include climate-repricing scenarios in the stress tests they require to make sure banks are prepared for losses. That could have the effect of damping banks’ appetite for fossil-fuel investments or lending, and spur alternative energies. Still, Bloomberg notes that central banks also have very limited lawmaking capability and are generally “supposed to be independent,” and so typically avoid throwing their weight behind political agendas – especially when they contradict the priorities of the elected government. It also says that two of the world’s 10 largest economies are missing from the Network for Greening the Financial System: Brazil and the U.S., although Fed Chairman Jerome Powell said that it’s been sending representatives to meetings and will “probably” join at some point. However, Bloomberg says that critics argue that the issue “isn’t one for central banks,” which can only impact economies indirectly and should be left to politicians who can spend and invest directly. There’s also a risk that, because some see climate change as controversial, a central bank’s entry into the area will open the door for more political influence. Finally, there’s an argument that because the time horizon for monetary policy is about 2-3 years, and climate change timelines are much longer, it makes central banks ill-equipped to have a meaningful impact. So, we will see. Central banks with their large economic presence likely will be forced to take at least some steps to help their clients deal with climate uncertainty, and these likely will be highly controversial since most of their efforts are already in the cross hairs of skeptics. These issues are highly important for producers and should be watched closely as they emerge, Washington Insider believes.

| Rural Advocate News | Monday February 3, 2020 |


EPA Issues Interim Decision On Glyphosate That It Is Safe To Use EPA Thursday released its interim decision on glyphosate, the active ingredient in Roundup, saying it safe use and there “are no risks of concern to human health when glyphosate is used according to the label and that it is not a carcinogen.” The proposed interim decision issued by EPA in April 2019 also reached that conclusion. There were some 280,000 comments filed on that proposed interim decision. EPA included some updates to mitigation measures, including spray drift management requirements relating to droplet size on glyphosate labels. EPA said there will be a nontarget organism advisory to alert users to the fact that the weedkiller is toxic to plants and “may adversely impact the forage and habitat of non-target organisms, including pollinators.” EPA said it would also require those wanting approval to sell glyphosate to provide information and recommendations to slow the spread of herbicide-resistant weeds to users of the product. EPA said it would likely have a draft biological evaluation of the herbicide out for public comment this fall. The interim decision would open the way for a final registration on glyphosate that could be in effect for 15 years.

| Rural Advocate News | Monday February 3, 2020 |


Pompeo Says Food Portion Will Be Most Contentious In UK Trade Talks Trade talks with the UK are likely to be contentious, especially on food and agriculture, according to U.S. Secretary of State Mike Pompeo. He expressed a hope during remarks in London that food safety will not be used as a cover for protectionist actions. "There will be real contentious issues around agriculture," Pompeo told LBC Radio during his visit to London. “Our ask will be as it has been in the other negotiations. We need to be open and honest about competitiveness. We need to make sure we do not use food safety as a ruse to try and protect a particular industry." Pompeo outlined a timeline of hoping that by late this summer, the two sides will have made substantial progress in trade talks before moving on to address the most difficult matters.

| Rural Advocate News | Monday February 3, 2020 |


Monday Watch List Markets It is highly likely Monday will start with attention on higher counts of coronavirus infections and a surprise is possible. ISM's index of U.S. manufacturing comes out at 9 a.m. CST, followed by USDA's weekly report of export inspections at 10 a.m. At 2 p.m. CST, NASS's Fats and Oils report will show soybean crush totals for December. Weather A strong storm system in the Colorado Rockies will bring heavy snow to the western Plains and a freezing precipitation and snow mix to the central Plains Monday. Other crop areas will be dry. The Rockies storm is on track to produce areas of heavy snow in the Southern Plains and heavy rain in the southern Midwest and Delta Tuesday.

| Rural Advocate News | Friday January 31, 2020 |


FCC Launches $20 Billion Rural Broadband Fund The Federal Communications Commission Thursday approved a rural broadband funding initiative. The new Rural Digital Opportunity Fund will help finance the deployment of high-speed broadband networks in rural America. Through a two-phase reverse auction mechanism, the FCC will direct up to $20.4 billion over ten years to finance up to gigabit speed broadband networks in unserved rural areas. The FCC says the effort will connect millions more American homes and businesses to broadband. The first phase of the effort will begin later this year and target census blocks that are wholly unserved with fixed broadband at speeds of at least 25/3 megabits per second. This phase would make available up to $16 billion to census blocks where existing data shows there is no such service available. Phase two of the program will make available at least $4.4 billion to target partially served areas, census blocks where some locations lack access to 25/3 megabits per second broadband. ************************************************************************************* Magistrate Favors USDA, Beef Councils, in R-CALF Lawsuit A decision in lawsuit against the Department of Agriculture and multiple state beef checkoff’s favor the federal programs. The lawsuit, filed by R-CALF, claims there is a lack of oversight in state beef councils. However, a magistrate decision sided with USDA and the state organizations earlier this week. National Cattlemen’s Beef Association CEO Collin Woodall says the decision “was a crucial step toward ensuring state beef councils retain the important ability to direct their investments at the grassroots level.” The decision of the magistrate judge will now be forwarded to the federal district court for a final ruling. It could continue to be appealed by either party after the district court judge issues an opinion, a process that will continue over the next several months or longer, and appeals are expected. NCBA credits a recent memorandum of understanding between the state groups and USDA that reaffirms a commitment to transparent oversight for the court decision. ************************************************************************************* World Ag Expo Guarding Against Coronavirus World Ag Expo is set to host attendees and exhibitors from across the country and around the world in just two weeks. Now they will also prepare to guard against the newest coronavirus emerging in China. Show officials are working with local, state and federal officials to monitor the situation and develop a plan on the show grounds. A spokesperson for the show says, "The health and safety of everyone at our show is our top priority.” World Ag Expo is advising precautions for attendees that closely match recommendations for flu season. Those recommendations include hand washing, covering coughs, staying home if ill, and contacting a physician if symptoms arise. Travelers attending World Ag Expo who become ill should contact the local health department where they are staying, and report their illness, as well. World Ag Expo boasts an international farm show atmosphere, with more than 100,000 attendees each year in California. ************************************************************************************* AEM: USMCA A Victory for Equipment Makers This week’s signing of the U.S.-Mexico-Canada Agreement offers certainty beyond the farm for agriculture. The Association of Equipment Manufacturers says the agreement will help equipment makers grow in the United States, compete globally, and support millions of jobs across the country. Case IH North American Vice President Scott Harris serves on the AEM board of directors. Harris says that, "With commodity price stagnation and global market uncertainty, solidifying and expanding the North American market is absolutely critical for the broader agricultural community,” including AEM member dealers and customers. AEM is the North American-based international trade group representing off-road equipment manufacturers and suppliers, with more than 1,000 companies in the agriculture and construction-related industry sectors worldwide. Since the creation of NAFTA two decades ago, AEM says equipment manufacturers have benefited greatly from duty-free market access to Canada and Mexico, adding USMCA builds upon that success, supporting 1.3 million jobs in the U.S., and 149,000 more in Canada. ************************************************************************************* Report: Sustainability Improving Ag Retailers Profitability, Reputation New research shows how sustainability and conservation-focused products and services are changing the ag retail business. Research by Farm Journal's Trust In Food initiative, in partnership with the Environmental Defense Fund, suggests the focus on sustainability is leading to improvements in ag retailers' profitability and reputation. The report documents key insights gathered through in-depth interviews with nine sustainability leaders in the ag retail sector, as well as through broader feedback from a national survey of more than 70 ag retail professionals. Collectively, these professionals service each of the nine Department of Agriculture Farm Resource Regions and represent more than $1.7 billion in annual revenue. The study reveals how ag retail companies are successfully integrating products and services related to conservation agriculture and the sustainability of agriculture into their business portfolios. Organizers say the report presents a clear business case for ag retailers to dramatically transform their businesses to meet the needs of farmers, the food value chain, local communities and the world's natural resources. Find the report at trustinfood.com. ************************************************************************************ Organic Chicken Feed Subscription Launches An eCommerce store is launching organic chicken feed subscriptions. The online store, called Mile Four, offers subscription and one-time sales, targeting the backyard chicken market. Customers who subscribe to their chosen feed receive ten percent off every order and can set their delivery schedule exactly how they want, depending on the size of their flock. Founder Luke Huebner says the subscription “makes things so much easier for the buyer and the flock when feed, supplements and treats are delivered directly to their door." He says the goal of the eCommerce store is to “make raising backyard chickens as simple as possible.” Huebner grew up on a fifth-generation family farm four miles outside of a small town in western Minnesota and is self-described as an eCommerce veteran with 15 plus years of experience. The online store offers Starter, Grower and Layer Feed as well as several different supplements and treats.

| Rural Advocate News | Friday January 31, 2020 |


Washington Insider: Fed Rate Unchanged The media reported on Thursday that the Federal Reserve left interest rates unchanged at this week's first meeting of 2020. For example, the New York Times reported that the Fed upheld its "patient stance" after an active and often tumultuous 2019. Jerome Powell, the Fed chair, walked a careful line in his post-meeting news conference, painting a picture of a solid economy that is fueled by strong job gains and a confident consumer willing to spend. But he noted global risks that remain, including the outbreak of a deadly new coronavirus. He also said that price gains remain "surprisingly soft." Fed officials, whose job is to maintain both full employment and stable inflation, think the current economic situation merits a wait-and-see approach. The federal funds rate is currently set in a 1.5% to 1.75% range and the decision to keep it steady was unanimous. Powell is seen as signaling that the central bank does not plan to move policy in either direction unless something shifts "fundamentally" -- and that it does not expect to cut interest rates as long as the economy shapes up as expected, the Times said. The Fed's decision is unlikely to sit well with President Donald Trump who has been pushing it to slash rates further. In a tweet on Tuesday, the president said "the Fed should get smart & lower the Rate," arguing that comparatively high rates in the United States are putting the country at a disadvantage. The report noted that the central bank has been emphasizing recently that it does not answer to the White House and that its policy goals come from the Congress. Still, it faces a "complicated backdrop" when it comes to achieving those targets, NYT said. Expectations of a global growth turnaround have been climbing, helped along by an initial trade deal between the United States and China that forestalls additional tariffs between the two large economies. But those positive signs could be dampened by the new coronavirus, which is forcing quarantines in China where it is shuttering multinational operations and causing nervousness around the world. Powell pointed to that potential economic threat at his news conference, though he said it was too early to know what its macroeconomic effect would be. "There is likely to be some disruption to activity in China and perhaps globally," he said, adding that the Fed was "very carefully monitoring the situation." The chair also noted other persistent weak spots, including soft business investment and exports, which he attributed to "sluggish growth abroad and trade developments." Manufacturing is also continuing to see a fall off, though Powell suggested that weakness might be bottoming out. "We need to be a little bit patient about the effect on the economy." Still, Powell struck an optimistic tone about the U.S. economy overall, pointing out that employers are still hiring and unemployment continues to hover near a half-century low. He also cautioned about inflation, which continues to fall short of the Fed's 2% target. It has not hit that rate of change sustainably since the central bank formally adopted the goal in 2012. The annual price increase, as measured by the Fed, came in at just 1.5% in November. While sluggish price gains might sound positive, the Fed sees steady, gradual increases as better for the economy. Weak inflation leaves officials with less room to cut rates in a downturn. And if consumers begin to expect slower increases, that outlook could become self-fulfilling, dragging inflation down further. Fed policymakers do not expect it to eclipse 2% this year, based on their most recent set of economic projections. "In theory, inflation should be moving up," Powell added, given that the United States economy is in its 11th year of an expansion and unemployment is very low, at 3.5%. Some analysts interpreted Powell's wary tone as a sign that the Fed was still oriented more toward cutting rates than raising them. In a purely technical tweak, the central bank did nudge up the interest rates it pays on excess reserves -- bank deposits stashed at the Fed. The move was meant to keep the Fed funds rate trading within its target range. It also affirmed that it will continue purchasing Treasury bills "at least into" the second quarter of 2020, and said it would continue to conduct operations in the repo market "through April 2020 to ensure that the supply of reserves remains ample" even in stressful periods. The Fed has repeatedly said these interventions are not the type of mass bond-buying programs the central bank used to prop up the economy during and after the Great Recession. While those programs, known as quantitative easing, were meant to bolster the economy, the new interventions have been structured differently and are simply meant to fix a market-plumbing problem. Investors have turned a skeptical eye on that claim, and equity analysts regularly argue that the purchases are pushing up stock prices, as markets take a cue from the Fed to buy. So, we will see. It appears that the Fed will continue to tout its independence and that the president likely will continue his criticism. The Fed also seems prepared to take stronger action if "fundamentals" change, policies that producers should watch closely if they emerge, Washington Insider believes.

| Rural Advocate News | Friday January 31, 2020 |


USMCA Signed By Trump With Attention Shifting to Canada President Donald Trump signed the implementing legislation for the U.S.-Mexico-Canada Agreement (USMCA) Wednesday at a White House ceremony. The remaining step in the ratification process is now with Canada's parliament, which is expected to approve the deal though timing remains uncertain. Once ratification is complete, then the three countries have to embark on the process of making sure that regulations/laws reflect provisions of the updated agreement. After that process is completed, the countries are to notify each other via letters, which will start the implementation process.

| Rural Advocate News | Friday January 31, 2020 |


Concern Rising Within USDA on Slow Farmer Safety Net Signup for 2019 Crops USDA's Farm Service Agency is about to deploy a mailing campaign to remind farmers they need to enroll for 2019-crop safety net programs -- Ag Risk Coverage (ARC) and Price Loss Coverage (PLC). There are 2.3 million farms with base acres, according to FSA, and typically around 1.7 million farms enroll the programs on an annual basis. As of Jan. 27, only 327,408 farms have enrolled, FSA detailed in a notice to state and county offices outlining steps to be taken to make sure that producers meet the March 16 deadline to enroll for 2019. While county FSA offices have used a "register" when it is not possible for a producer to meet a deadline for enrollment in a program, FSA said the register must not be used "unless a producer is scheduled for an appointment or requests an appointment and the County Office does not have capability to service the producer by March 16, 2020." FSA said that appointments placed on a register "must be completed as soon as possible after the March 16, 2020, deadline." Use of the register is not considered an extension of the enrollment deadline. If a valid 2019 election and enrollment on a farm is not filed by March 16, (including enrollment registers), FSA stated, "the farm will remain with default program elections and no payments will be issued for the 2019 crop year." It is clear that farmers are waiting to gather as much information price-wise or market-wise before they make their choice on whether to go with ARC or PLC for the 2019 crop year.

| Rural Advocate News | Friday January 31, 2020 |


Friday Watch List Markets Friday marks the final day of a week dominated by concerns over the spread of coronavirus and infection counts will continue to be watched. Minor economic reports of U.S. personal income and the employment cost index are due out at 7:30 a.m. CST, followed by an index of consumer sentiment at 9 a.m. USDA releases its semi-annual cattle inventory report for January 1, set for 2 p.m. CST. Weather January ends with snow crossing the Midwest, rain in the Delta and Southeast, and mixed precipitation in the Northwest Friday. Dry conditions will be in place elsewhere. Temperatures will again be well above normal in northern and central areas. This is much different than a year ago, when the polar vortex outbreak gripped the U.S. east of the Rockies.

| Rural Advocate News | Thursday January 30, 2020 |


President Trump Signs USMCA During White House Ceremony President Donald Trump Wednesday signed the U.S.-Mexico-Canada Agreement. During a White House ceremony, Trump stated USCMA is, “the largest, most significant, modern and balanced trade agreement in history.” USMCA replaces the North American Free Trade Agreement, a trade deal Trump considered “outdated” and “terrible.” Mexico approved and signed the agreement last year. Legislation to approve the agreement in Canada was announced this week. Canada seems likely to approve the agreement within the next month, following its legislative process. Canada and Mexico are top trading partners for United States agriculture. President Trump says USMCA is “a monumental win for American farmers and ranchers, improving access to Canadian and Mexican markets.” The agreement protects current market conditions between the U.S., Mexico and Canada, and includes an estimated $2.2 billion increase in U.S. agricultural exports. The agreement is expected to grow annual dairy exports by nearly $315 million. Trump promised dairy farmers improved trade with Canada when announcing his intention to upgrade NAFTA. ************************************************************************************* Secretary Perdue: USMCA Critical for U.S. Agriculture Agriculture Secretary Sonny Perdue Wednesday proclaimed, “Today is a good day for American agriculture,” referring to President Donald Trump’s signing of the U.S.-Mexico-Canada Agreement. Perdue says USMCA"shows the rest of the world the United States is open for business," adding the agreement is critical for U.S. farmers and ranchers. Canada and Mexico are the first and second-largest export markets for United States food and agricultural products, totaling more than $39.7 billion in farm exports in 2018. Those exports, according to the Department of Agriculture, support more than 325,000 American jobs. All food and agricultural products that have zero tariffs under the North American Free Trade Agreement will remain at zero tariffs. Key provisions, Perdue says, include increasing dairy market access, along with updates to biotechnology rules, geographical indications, sanitary and phytosanitary measures, and increased market access for poultry, eggs and wheat, along with agreements to avoid technical trade barriers for wine and spirits. ************************************************************************************* Agriculture Groups Respond to USMCA Signing Agriculture groups applaud President Donald Trump for signing the U.S.-Mexico-Canada Agreement. American Farm Bureau Federation President Zippy Duvall says, “There is definitely increased optimism on farms and ranches across America and we’re grateful for the advances, but we’re also realists eager to see results.” American Soybean Association President Bill Gordon attended the signing ceremony Wednesday. Gordon states, “We reiterate our hearty thanks to both houses of Congress, the President, and their staff who worked together to make this important deal happen.” National Cattlemen’s Beef Association President Jennifer Houston also attended, and points out USMCA follows the new WOTUS rule, a Phase One trade agreement with China, and changes to the National Environmental Policy Act. Houston says, “it’s easy to see that 2020 is off to a truly historic start for U.S. beef producers.” Finally, National Farmers Union President Roger Johnson stated that while USMCA is a big step forward, “it should be a floor for future trade deals, not a ceiling.” ************************************************************************************* Trump Administration Trade Agenda Turning to EU, India The Trump administration's focus on trade continues, as officials work towards more trade agreements. Agriculture Secretary Sonny Perdue traveled to the European Union to discuss a potential trade deal this week, and talks are ongoing to reach a tentative agreement with India. Perdue maintains that "Agriculture needs to be included in a trade deal" with the European Union. Specifically, Perdue told reporters Wednesday from Rome he wants the EU to recognize the U.S. method of sanitizing chicken products, along with addressing geographic indicators and EU objections to biotechnology. Meanwhile, Politico reports U.S. Trade Representative Robert Lighthizer is expected to travel to New Delhi, India, early next month, for potential trade talks with India's Commerce Minister. President Donald Trump revoked trade benefits for India last year that cuts duties on products from developing nations. India is seeking to regain those benefits, while the U.S. wants equivalent access for U.S. agricultural products in any tentative trade deal. ************************************************************************************* NASDA Submits Hemp Program Comments to USDA This week, the National Association of State Departments of Agriculture submitted final comments on federal hemp production guidelines. The comments submitted to the Department of Agriculture highlight potential changes to the Domestic Hemp Production Program interim final rule. NASDA CEO Barb Glenn says, “We know at least 30 states will have to revise their own laws in order to comply with the requirements of the rule,” adding that without some flexibility, the rule could create competitive differences between states. NASDA recommends USDA extends the number of days in the testing window to within 15 to 30 days of harvest, along with dropping the requirement for states to use a Drug Enforcement Administration registered laboratory. Additionally, the organization suggests USDA create a tier-based approach for sampling and testing that would allow for greater flexibility for state regulators, set the negligence threshold for THC at one percent, and allow for states to develop mitigation plans, among other recommendations. The comment period closed Wednesday. ************************************************************************************ NMPF: Congress Needs to Pass DAIRY PRIDE Act for Consumers The National Milk Producers Federation says Congress needs to pass the DAIRY PRIDE Act soon to ensure the Food and Drug Administration does its job. The DAIRY PRIDE Act would designate foods that make an inaccurate claim about milk contents as "misbranded" and subject to enforcement of labeling rules. It would require FDA to issue guidance for federal enforcement of mislabeled imitation dairy products within 90 days of its passage, and require FDA to report to Congress two years after enactment. NMPF Executive Vice President Tom Balmer told the House Energy and Commerce Committee's Health Subcommittee Wednesday, "By calling these products "milk," they are clearly seeking to trade on the health halo of real milk.” Balmer says the imitators aren't nutritionally the same as milk, or the same simply by definition. The legislation would force FDA to act against plant-based imitators of milk, cheese, butter and other products that defy current FDA rules.

| Rural Advocate News | Thursday January 30, 2020 |


Washington Insider: CBO says Deficit to Top $1 Trillion U.S. officials now see the budget deficit exceeding $1 trillion annually for much of the next decade, the Congressional Budget Office (CBO) said this week. The estimates were reported by the New York Times and other media outlets. The red ink is expected to ultimately top $1.7 trillion in 2030, CBO says. The ballooning deficit is being fueled by increased borrowing by the federal government, which continues to spend more money than it takes in. By 2030, the CBO projected, federal debt held by the public will surpass $31 trillion — about 98 percent of the forecast size of the nation’s economy. The federal budget deficit already hit $1 trillion last year — the first calendar year since 2012 that the gap between revenue and spending topped the $1 trillion mark. CBO sees that as a “permanent pattern” over the next 10 years. The somber news was tempered somewhat by the budget office’s expectation that interest rates for the next decade would be substantially lower than what its August forecast indicated, saving the United States hundreds of billions of dollars in interest payments on the federal debt. The decline in interest rate projections reflects a shift in strategy by the Federal Reserve which cut rates last year amid slowing growth and little sign of sustained price increases that could spiral into rapid inflation. The budget office now expects the interest paid by 10-year Treasury bills to remain below 3 percent through 2027. President Donald Trump has pushed Fed officials to reduce rates even further, toward zero or even into negative territory. On Tuesday, hours before the new forecast was issued, he suggested lower rates would allow the United States to “refinance” its debt and begin to pay it off. The administration had promised to pay off the national debt during the 2016 campaign but in three years in office it has added to it with big tax cuts and increased federal spending. The president and Republican lawmakers have claimed the tax cuts will pay for themselves through increased economic growth, which would ostensibly produce higher tax revenues. Treasury Secretary Steven Mnuchin repeated that assertion last week in Davos, Switzerland. But while the 2017 tax cuts produced an uptick in growth in 2018, federal revenues declined. The latest CBO forecast shows no indication that officials there expect rapid growth will return any time soon, as the administration has projected. The budget office estimates the economy grew more slowly last year than it predicted in August, and sees annual growth declining from 2.2% in 2020 to 1.5% by the middle of the decade. The new forecast anticipates a sharper decline in overall tax receipts through 2029 than did the August projections. Democrats, Republicans and independent fiscal hawks all found cause for concern after the recent report. The forecast “confirms that the president’s economic policies did not create a sustained boost for the economy like he has claimed,” said Rep. John Yarmuth, D-Ky., chairman of the House Budget Committee. The committee’s top Republican, Steve Womack of Arkansas, said the forecast “once again confirms what we already know: our nation’s debt and deficits continue to grow, and we are on an unsustainable trajectory.” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said the latest numbers should serve as a wake-up call for policymakers. “We’re running trillion-dollar deficits while the economy is expanding — when are lawmakers going to wake up?” she said. “Every year we set a new postwar record for debt as a share of the economy, every year the Congressional Budget Office warns that debt is rising unsustainably, and every year our largest trust funds get closer to depleting their reserves. Ignoring what is staring us right in the face is fiscal malfeasance.” Clearly, the trillion dollar estimates are attention-catchers—and can be expected to add emphasis to questions regarding how remaining urgent needs, such as the need for renewing the nation’s infrastructure, can be met without de-stabilizing the economy. These continue to be critical issues and should be

| Rural Advocate News | Thursday January 30, 2020 |


Washington Insider: CBO says Deficit to Top $1 Trillion U.S. officials now see the budget deficit exceeding $1 trillion annually for much of the next decade, the Congressional Budget Office (CBO) said this week. The estimates were reported by the New York Times and other media outlets. The red ink is expected to ultimately top $1.7 trillion in 2030, CBO says. The ballooning deficit is being fueled by increased borrowing by the federal government, which continues to spend more money than it takes in. By 2030, the CBO projected, federal debt held by the public will surpass $31 trillion — about 98 percent of the forecast size of the nation’s economy. The federal budget deficit already hit $1 trillion last year — the first calendar year since 2012 that the gap between revenue and spending topped the $1 trillion mark. CBO sees that as a “permanent pattern” over the next 10 years. The somber news was tempered somewhat by the budget office’s expectation that interest rates for the next decade would be substantially lower than what its August forecast indicated, saving the United States hundreds of billions of dollars in interest payments on the federal debt. The decline in interest rate projections reflects a shift in strategy by the Federal Reserve which cut rates last year amid slowing growth and little sign of sustained price increases that could spiral into rapid inflation. The budget office now expects the interest paid by 10-year Treasury bills to remain below 3 percent through 2027. President Donald Trump has pushed Fed officials to reduce rates even further, toward zero or even into negative territory. On Tuesday, hours before the new forecast was issued, he suggested lower rates would allow the United States to “refinance” its debt and begin to pay it off. The administration had promised to pay off the national debt during the 2016 campaign but in three years in office it has added to it with big tax cuts and increased federal spending. The president and Republican lawmakers have claimed the tax cuts will pay for themselves through increased economic growth, which would ostensibly produce higher tax revenues. Treasury Secretary Steven Mnuchin repeated that assertion last week in Davos, Switzerland. But while the 2017 tax cuts produced an uptick in growth in 2018, federal revenues declined. The latest CBO forecast shows no indication that officials there expect rapid growth will return any time soon, as the administration has projected. The budget office estimates the economy grew more slowly last year than it predicted in August, and sees annual growth declining from 2.2% in 2020 to 1.5% by the middle of the decade. The new forecast anticipates a sharper decline in overall tax receipts through 2029 than did the August projections. Democrats, Republicans and independent fiscal hawks all found cause for concern after the recent report. The forecast “confirms that the president’s economic policies did not create a sustained boost for the economy like he has claimed,” said Rep. John Yarmuth, D-Ky., chairman of the House Budget Committee. The committee’s top Republican, Steve Womack of Arkansas, said the forecast “once again confirms what we already know: our nation’s debt and deficits continue to grow, and we are on an unsustainable trajectory.” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said the latest numbers should serve as a wake-up call for policymakers. “We’re running trillion-dollar deficits while the economy is expanding — when are lawmakers going to wake up?” she said. “Every year we set a new postwar record for debt as a share of the economy, every year the Congressional Budget Office warns that debt is rising unsustainably, and every year our largest trust funds get closer to depleting their reserves. Ignoring what is staring us right in the face is fiscal malfeasance.” Clearly, the trillion dollar estimates are attention-catchers—and can be expected to add emphasis to questions regarding how remaining urgent needs, such as the need for renewing the nation’s infrastructure, can be met without de-stabilizing the economy. These continue to be critical issues and should be watched closely as they proceeds, Washington Insider believes.

| Rural Advocate News | Thursday January 30, 2020 |


CBO Ag Baseline Updates Signal PLC To Be Safety Net Program Of Choice Ahead U.S. government outlays for farmer safety net programs are expected to be heavily weighed on the Price Loss Coverage (PLC) program in Fiscal Year (FY) 2021 and beyond, according to the Congressional Budget Office (CBO). CBO expects PLC outlays at $2.03 billion in FY 2019 and $2.23 billion in FY 2020. For FY 2021, those outlays are expected to move up to $5.24 billion and top $7 billion in FY 2022 and 2023, moving below that mark for through FY 2030, but not being any smaller than $5.08 billion in FY 2030. The FY 2020-2030 total is pegged at $62.98 billion. Outlays under the Ag Risk Coverage (ARC) program are put at $1.06 billion in FY 2019, falling to $750 million in FY 2020 and remaining in a range of $351 million (FY 2024) and $494 million (FY 2030) for a total of $5.2 billion over FY 2020-2030. As expected, the CBO update does not forecast another Market Facilitation Program (MFP) effort ahead. They estimate the 2018 MFP payments were $8.57 billion in FY 2019 with another $5.11 billion for the 2019 MFP effort. For FY 2020, CBO forecasts $10 million in outlays from the 2018 MFP with $10 billion under the 2019 MFP program.

| Rural Advocate News | Thursday January 30, 2020 |


USDA’s Perdue Says Not Clear if Coronavirus Will Impact China Buys of US Ag Goods The outbreak of the Wuhan coronavirus in China has spawned talk of whether China can meet its purchases of U.S. ag goods under the Phase One agreement signed January 15. As for how high the focus is, the issue came up while USDA Secretary Sonny Perdue held a telephone briefing with reporters from Italy to provide an update on his discussions this week with European Union (EU) officials. Asked of the China coronavirus situation could impact the commodity purchase commitments, Perdue said, “We don’t really know that yet. We would love and pray for a very quick resolution and conclusion to the coronavirus outbreak.” Coronavirus is “obviously going to have some ramifications economy wide, which we hope will not inhibit the purchase goal that we have for this year,” he concluded. The focus on this issue is coming via the following provision in the language of the Phase One trade agreement signed Jan. 15: “In the event that a natural disaster or other unforeseeable event outside the control of the Parties delays a Party from timely complying with its obligations under this Agreement, the Parties shall consult with each other.” Perdue did not say whether any such consultations have been requested on the part of China.

| Rural Advocate News | Thursday January 30, 2020 |


Thursday Watch List Markets Thursday morning is busy with weekly U.S. export sales, U.S. jobless claims and fourth-quarter GDP all due out at 7:30 a.m. CST. Weekly natural gas inventories follow at 9:30 a.m. and we can't overlook the latest news updates regarding coronavirus and South American weather. Weather Light snow will cross the Northern Plains Thursday. Other crop areas will be dry. However, fog and areas of freezing on roadways will cause transportation and safety hazards.

| Rural Advocate News | Wednesday January 29, 2020 |


Canada’s Freeland Urges Quick USMCA Approval The U.S. signing of the U.S.-Mexico-Canada Agreement Wednesday clears another hurdle towards implementation of the agreement. Following the signing ceremony, the U.S. and Mexico await approval by Canada, whose government is beginning the process this week. Canadian Deputy Prime Minister Chrystia Freeland introduced a motion in the nation’s House of Commons to consider the agreement. USMCA replaces the North American Free Trade Agreement. Freeland and Canada call the trade pact either the CUSMA, putting Canada first, or “the new NAFTA.” Freeland asked Canadian lawmakers to “work together to put Canada and Canadians first, and get this important work done without undue delay.” Freeland noted during a press conference the trade agreement received bipartisan support in the U.S. in a "highly polarized" political climate. USMCA, welcomed by U.S. agriculture, protects critical markets for U.S. farmers, and provides an additional $2 billion in agricultural exports to Canada and Mexico, the top trading partners of the United States. ************************************************************************************* House Dems Support Lawsuit Against SNAP Cuts House Democrats are seeking to block the Trump administration’s cuts to the Supplemental Nutrition Assistance Program. Changes to the SNAP Requirements for Able-Bodied Adults Without Dependents are set to take effect in April. The Department of Agriculture says the rule revises the conditions under which USDA would waive, when requested by states, the able-bodied adult without dependents time limit in areas that have an unemployment rate of over ten percent or a lack of sufficient jobs. Representative Marcia Fudge, an Ohio Democrat and chair of the House Ag Subcommittee on Nutrition, announced House support of the lawsuit, filed by 15 states, including the District of Columbia. The lawsuit says the rule strips SNAP benefits from 700,000 recipients in a move rejected by the 2018 farm bill. Representative Fudge says the rule "does real harm to SNAP’s ability to accomplish its mission,” adding the House will “fight this hypocritical and political cruelty.” ************************************************************************************* Justice Department Investigating Possible Dean Foods Deal The U.S. Justice Department is investigating a potential deal for Dairy Farmers of America to acquire the bankrupted Dean Foods. A Justice Department representative confirmed to the Wall Street Journal this week the investigation is probing the potential loss of competition in U.S. milk sales, as Dean Foods and DFA are among the largest milk processors in the country. Dairy Farmers of America represents roughly 22 percent of all U.S. milk processing, while Dean Foods is self-described as “the largest processor and direct-to-store distributor of fresh fluid milk and other dairy and dairy case products in the United States.” Dean Foods announced its bankruptcy in November of last year, while pledging to use the process to “protect and support its ongoing business operations.” Dean Foods also announced at the time that it was engaged in advanced discussions with Dairy Farmers of America regarding a potential sale of all assets of the company. ************************************************************************************* USDA: One Month Left for CRP General Signup The Department of Agriculture reminds farmers interested in the Conservation Reserve Program 2020 general signup to enroll by February 28, 2020. The signup is available to farmers and private landowners who are either enrolling for the first time or re-enrolling for another ten to 15-year term. FSA Administrator Richard Fordyce notes, "This is the first opportunity for general sign up since 2016, and we want producers and private landowners to know that we have just one month remaining." CRP has 22 million acres enrolled, but the 2018 farm bill lifted the cap to 27 million acres. Signed into law in 1985, CRP is one of the largest private-lands conservation programs in the United States. It was originally intended to primarily control soil erosion and potentially stabilize commodity prices by taking marginal lands out of production. Farmers and ranchers who enroll in CRP receive yearly rental payments for voluntarily establishing long-term, resource-conserving plant species which can control soil erosion, improve water quality and develop wildlife habitat. ************************************************************************************* Chesapeake Bay Foundation Preparing to Sue EPA The Chesapeake Bay Foundation is preparing to file a lawsuit against the Environmental Protection Agency. The planned lawsuit alleges the EPA is failing to enforce the Clean Water Act. Following a 2009 lawsuit, a plan was implemented to establish a watershed-wide Total Maximum Daily Load, a limit on the pollution the Bay can withstand and remain healthy. CBF has been concerned about the lack of progress in reducing nitrogen pollution in Pennsylvania. That concern was heightened when Pennsylvania released its plan for reducing pollution between now and the 2025 deadline. The plan has a funding shortfall of more than $300 million annually, and falls 25 percent short of the nitrogen goal. CBF President William C. Baker claims, “agriculture is the largest source of pollution from Pennsylvania,” adding that while stakeholders have pledged to comply, the lawmakers have failed by not fulling funding the efforts. Without EPA holding Pennsylvania accountable, Baker says the state’s local waters and the Bay downstream “will never be saved.” ************************************************************************************ Michelob Launches Campaign to Convert Farmland to Organic An initiative by Anheuser-Busch InBev seeks to help farmers convert farmland to organic production. Michelob ULTRA Pure Gold, and AB InBev product, is launching their 60 second Super Bowl commercial featuring 6 For 6-Pack, a new program that allows consumers to join the brand in helping farmers transition six square feet of farmland into organic production. Michelob ULTRA Pure Gold is the first national beer brand to be USDA-certified organic. A portion of sales from each Pure Gold 6-pack will go directly to farmers looking to transition to organic, “allowing consumers to help drive change.” The commercial advertises that consumers can help farmers by “simply having a beer.” By the math, for every acre assisted in the program, consumers will need to drink 43,560 beers. Last year, AB InBev caught opposition from the corn industry, and sparked an advertising war with MillerCoors, by depicting corn syrup negatively, sparking lawsuits. The 2020 Michelob commercial is now available on YouTube.

| Rural Advocate News | Wednesday January 29, 2020 |


Washington Insider: Extended Steel and Aluminum Tariffs In spite of signs of some pull backs in trade policy battles, the Trump administration announced plans to broaden tariffs on foreign steel and aluminum late last week. It argued that “existing tariffs had not proved as effective as hoped in reviving American production the New York Times said Tuesday. The administration accused foreign companies of trying to “circumvent” the 25% tariff placed on foreign steel and the 10% tariff on foreign aluminum in 2018. Imports of steel and aluminum into the United States have declined since the tariffs went into place but imports of products made with those metals had “significantly increased,” the administration said. The net effect “has been to erode the customer base for U.S. producers of aluminum and steel and undermine” the effect of original tariffs, the announcement said. That led the United States to expand its tariffs to cover products made of steel and aluminum—like nails, tacks, staples, cables, certain types of wire, and bumpers and other parts for cars and tractors — as of Feb. 8. For American companies making such products, the move provided some relief. For example, Southwire, a Georgia company that makes power cable and one of the largest manufacturers calling for the new tariffs, said the measures were necessary to ensure fair competition in the market for aluminum wire. “We continue to believe that when there is a level playing field, the strength of our manufacturing comes forth,” Burt Fealing, Southwire’s general counsel, said. However, the Times said that for economists and trade experts the development was an “I told you so” moment. Economists have long argued that by raising the price of steel and aluminum, the administration’s tariffs would make it more expensive to produce things like nails or cars in the United States—and would encourage companies to import more of those items. Chad Bown, a senior fellow at the Peterson Institute for International Economics, called this an example of “cascading protectionism” that he said was “entirely predictable.” “Trump’s steel and aluminum tariffs have raised the cost of key inputs, making American companies that rely on those metals less competitive worldwide,” Bown said. “Now President Trump is expanding his tariffs to shield their products from competition as well. Where will it end?” Richard E. Baldwin, a professor of international economics at the Graduate Institute of International and Development Studies in Geneva said that the administration is “learning this particular lesson in economics one failure at a time.” In his order expanding the tariffs, President Trump pointed to large increases in imports of certain products made of steel and aluminum. For example, from June 2018 to May, imports of items including steel nails and staples rose 33% from a year earlier. Imports of aluminum wire and cable were up 152% over the same period, the administration said. President Trump continues to argue that his trade policies are delivering on his promises to revive the manufacturing sector by sheltering American businesses from unfair competition and encouraging companies to move factories back to the United States. But a study released by two economists at the Federal Reserve in December showed that the costs of the administration’s trade approach to China had outweighed its benefits for manufacturers. Tariffs offered American companies some protection from Chinese imports, the study showed. But those positive effects were more than offset by the negative effects of the trade war, including the higher prices companies must pay to import components from China and the retaliatory tariffs China had placed on the United States. Still, American producers of steel and aluminum have supported the tariffs and U.S. steel producers operated their plants at a modestly higher share of capacity this year compared to last. But in its order, the administration said capacity utilization had not stabilized above 80%, its goal. Large steel companies have ramped up their investment since the tariffs came into effect, however. However they also have faced steel prices well below recent highs, leading to decisions to idle some facilities. For example, a plant near Detroit is sending layoff notices to roughly 1,500 employees. Some analysts continue to point at China for market pressure, since it produced steel at a record level in 2019. At the same time, trade experts have questioned the legal basis for Trump’s continuing to make revisions to his metal tariffs. The administration has said Section 232 of a 1962 trade law gives the president broad powers to impose tariffs to protect American industry for matters of national security — and that domestic capacity to make iron and steel is essential for national defense. It issued broad tariffs globally, before later carving out some exemptions for Argentina, Australia, Canada, Mexico, Brazil and South Korea. But in a preliminary decision last year, the United States Court of International Trade gave a narrower interpretation of that statute, arguing that the president must act within certain periods that have already expired. So, we will see. Certainly tariffs on basic production inputs like steel and aluminum do have impacts across a broad range of products and may well become a continuing source of skepticism for the administration’s tariff-oriented trade policies. This also is likely to lead to a continuing debate that producers should watch closely in the coming months, Washington Insider believes.

| Rural Advocate News | Wednesday January 29, 2020 |


China Says It Is Bringing Its Domestic Ag Supports Into Compliance With WTO While much attention in a meeting of the WTO Dispute Settlement Body (DSB) Monday focused on the stalled appeals process as the U.S. continues to block appointment of new judges to hear appeals to WTO rulings, China offered a status report on their efforts to comply with a WTO ruling against their use of subsidies for domestic wheat, corn and rice producers. “Chinese government agencies [have] conducted intensive consultations aiming to implement the recommendations and rulings of the DSB in this dispute,” China said. Internal processes “with respect to amending relevant measures” are ongoing, officials told the WTO, noting the “complexity of measures at issue.” China said it would “accelerate the internal process and fulfil our implementation obligation in due course.” China is facing a March 31 deadline to bring its domestic ag supports for wheat, corn and rice into compliance with the ruling in the case brought by the U.S. The U.S. said it would “engage bilaterally with China on specific amendments it will make to bring its measures into compliance.”

| Rural Advocate News | Wednesday January 29, 2020 |


USDA’s Perdue Pushes EU To Follow ‘Science’ On Food, Ag Products USDA Secretary Sonny Perdue continues to press the European Union (EU) on trade issues relative to agriculture, pushing the bloc to follow “sound science” when it comes to matters on food safety, genetically modified organisms (GMOs) and other matters. Perdue is currently in Europe and met with ag ministers from EU countries. The issue of poultry trade figures to be a key as Europe said it will not accept so-called “chlorine-washed” poultry, referring to the U.S. practice of using a chemical wash to remove pathogens from chicken. Perdue said the U.S. does not use chlorine but peracetic acid. “Peracetic acid … is a great pathogen reduction treatment,” he told reporters in Brussels. “You know what it is? It is vinegar, essentially. To say that is unsafe or not to be used… we do not think there is a basis for that in sound science.” On biotechnology, Perdue also chided Europe for its views on GMO crops. “I use the example of table salt that can be hazardous if you consume it in too much quantity, but we use it regularly,” Perdue explained. “And that is why we have the MRL (maximum residue level) for pesticides.” Perdue said the stance by Europe is going to put European farmers behind since they are not able to adopt technology used by growers in other areas of the world. Perdue also heard complaints from EU farm ministers on U.S. trade policies, including the use of tariffs on a host of goods. His stance on including agriculture in any U.S.-EU trade deal was also emphasized, with him criticizing offers to remove barriers to U.S. apples, pears and shellfish as not enough. "We are not going to get there with apples and pears and shellfish. There are other things have to happen," he said.

| Rural Advocate News | Wednesday January 29, 2020 |


Wednesday Watch List Markets Wednesday's reports start with U.S. pending home sales at 9 a.m. CST. The Energy Department's weekly inventory reports follow at 9:30 a.m. and include ethanol. At 1 p.m. CST, the Federal Reserve will make a post-meeting announcement and is expected to keep interest rates steady. Weather Wednesday features light snow in the western and southern Midwest and light rain in the Delta and Deep South. Other primary crop areas will be dry. Temperatures will again be well above normal for north and central areas for this time of year.

| Rural Advocate News | Tuesday January 28, 2020 |


Court Rules Against EPA Small Refinery Waivers The Environmental Protection Agency must reconsider its small refinery exemptions, following a recent court decision. A document dated January 24 from the U.S. Court of Appeals for the 10th Circuit says the EPA overstepped its authority to grant three specific waivers in question. The decision is expected to broadly impact the EPA approach to granting waivers, according to the Renewable Fuels Association, which claims the waivers are unlawful. The court ruling stems from a May 2018 challenge brought against EPA by the Renewable Fuels Association, the National Corn Growers Association, the American Coalition for Ethanol and National Farmers Union. NFU President Roger Johnson says, “We believe this ruling will help restore the ability of the RFS to drive demand.” Among other findings, the court says EPA cannot “extend” exemptions to any small refineries whose earlier, temporary exemptions had lapsed. The court also found EPA abused its discretion in failing to explain how the agency could conclude that a small refinery might suffer a disproportionate economic hardship. ************************************************************************************* USDA to Accept Applications for the Second Round of ReConnect Funding Department of Agriculture Secretary Sonny Perdue says USDA will again accept rural broadband funding request this week. USDA will accept applications for the second round of $550 million in ReConnect Program loan and grant funding starting January 31. The funds will expand public-private partnerships in rural communities to build modern broadband infrastructure in areas with insufficient internet service. Insufficient service is defined as connection speeds of less than ten megabits per second download and one megabit per second upload. Secretary Perdue says, “we at USDA are very excited to begin accepting applications for the second round of funds.” Telecommunications companies, rural electric cooperatives and utilities, internet service providers and municipalities may apply for funding through USDA’s ReConnect Program to connect rural areas that currently have insufficient broadband service. Through the program, USDA is making available approximately $200 million for grants, as well as up to $200 million for loan and grant combinations, and up to $200 million for low-interest loans. More information is available online at www.usda.gov/reconnect. ************************************************************************************* Corps of Engineers Monitoring High Water on Upper Mississippi River The U.S. Army Corps of Engineers, St. Paul District, is monitoring high water conditions affecting parts of the Upper Mississippi River in Minnesota, Wisconsin and Iowa as a result of historic flows this winter. Cities from Winona, Minnesota, to Guttenberg, Iowa, have an increased chance of localized flooding due to ice dams. The high water conditions were created by a combination of ice dams and historic high flows. The current river flows are at levels normally observed in late spring. Irregular temperatures have also prevented ice from forming in a stable way, which compounds the ice dam problem. The ice has blocked the river’s normal flow and forced water out of its banks. It has also reduced the ability to actively manage the river water elevations. Depending on temperatures and the rate of ice melt, there could be more high water in the weeks and months ahead. the Corps is working with the National Weather Service and the U.S. Geological Survey to monitor the river and provide communication with the public. ************************************************************************************ Wisconsin Special Legislative Session Focusing on Dairy Crisis A special session of the Wisconsin legislature opening this week seeks to help the state’s struggling dairy industry. Wisconsin Governor Tony Evers signed an executive order last week to authorize the special session to consider eight agriculture-focused bills. They include farmer assistance, stress and mental health support, promoting value-added agriculture, farm grants and a focus on exports. Evers announced the plan during his State of the State Address last week, and says, “It's about investing in and supporting our rural families and communities.” The governor hopes to increase Wisconsin dairy exports to 20 percent of the nation’s milk supply by 2024. The Milwaukee Journal Sentinel reported earlier this month that last year, Wisconsin lost nearly 700 dairy farms. The Wisconsin Cheese Makers Association says the industry is challenged by trade instability, poor weather conditions, a severe labor shortage, and a decline in milk consumption. Association executive director John Umhoefer (um-hay-fer) says, “Urgent action is needed to stabilize and strengthen Wisconsin’s backbone industry.“ ************************************************************************************ United Nations Declares 2020 as the International Year of Plant Health The United Nations has declared 2020 as the International Year of Plant Health to bring worldwide attention to invasive pests. The pests destroy up to 40 percent of the world's food crops and cause $220 billion in trade losses each year, according to the United Nations. They are calling on stakeholders to work together to protect plants against the introduction and spread of invasive pests. The U.S. National Plant Protection Organization—the Department of Agriculture's Plant Protection and Quarantine—is leading the effort in the United States. Undersecretary for Marketing and Regulatory Programs, Greg Ibach (eye-bah), says “we’re urging everyone to take this issue seriously and to do their part.” According to USDA, everyone can help avoid the devastating impact of pests and diseases on agriculture, livelihoods, and food security. Tips to do so include reporting unusual signs of pests, refrain from moving firewood, and declaring food or ag items at U.S. Customs and Border Protection checkpoints when returning from international travel. ************************************************************************************ Public Lands Council Names Executive Director The Public Lands Council Monday announced that Kaitlynn Glover joined the organization as its executive director. The Public Lands Council, known as PLC, is a national trade association representing 22,000 ranchers who raise cattle and sheep on federal land. Glover will serve as the chief lobbyist for the organization, representing cattle and sheep producers in western states on resource issues affecting their operations. The legislative and regulatory portfolio focuses on protecting grazing on federal land, and includes the Clean Water Act, tax policy, the Endangered Species Act, property rights, and other matters. Glover says her top priority will focus on policies that “ensure a strong future for agriculture and healthy public lands.” Glover comes to PLC from Wyoming Republican Senator John Barrasso’s office. Originally from Wyoming, Glover has strong ties to grazers, recreationalists, and many other users of public land resources. Glover will also lead the National Cattlemen's Beef Association's natural resources policy portfolio in the organization's Washington, D.C. office.

| Rural Advocate News | Tuesday January 28, 2020 |


Washington Insider: Focus on Infrastructure, Again There is considerable media attention this week on the nation’s infrastructure needs and Bloomberg is reporting that as House lawmakers return to Washington after a recess week there are new plans “to roll out a draft infrastructure package.” The House Ways and Means Committee will be tasked with the responsibility of finding ways to fund new legislation. It plans to meet Wednesday to discuss funding and financing proposed projects. Any effort to pass a comprehensive infrastructure package in an election year would face some roadblocks, Bloomberg thinks, including the need for the president to find common ground with House Democratic lawmakers. The administration itself has called for a big infrastructure package, but it may have problems persuading congressional Republicans to support that type of legislation. The 2017 tax law, which received no Democratic votes in either chamber, imposed new limits on advanced refund bonds, which cities and counties use as a way to finance infrastructure projects. “To do something really big on infrastructure is going to take a significant hand-holding exercise, obviously, it’s going to have to be a bipartisan effort,” said Andrew Grossman, chief tax counsel for Ways and Means Chairman Richard Neal, D-Mass. “Whether or not we can get there in an election year remains to be seen but we’re still optimistic.” The New York Times also focused on infrastructure last week, noting that state voters approved $7.7 billion in transportation spending last year, but the federal government needs to do much more to fix the nation’s ragged roadways. Drivers in America topped 3.2 trillion miles in 2018, much of that on the countless roads and bridges in dire need of repair and improvement. The Times cited the American Society of Civil Engineers’ bleak picture of the country’s byways in its Infrastructure Report Card in the spring of 2017, the most recent of its every-four-years editions. The organization’s assessment resulted in an overall D-plus grade. Road conditions earned an underwhelming D, while bridges slid by with a C-plus. In all, 45% of the nation’s roads were deemed in poor condition. Since then, the group estimates that vehicle travel has increased 17% alongside an unequal 5% increase in new roadways. The result has been 6.9 billion hours a year of traffic delays, which cost motorists roughly $616 each in 2017 — the last year tracked. Federal spending on road infrastructure is struggling to keep up, the Times says. It notes that federal lawmakers staved off a cut to the national Highway Trust Fund last year that would have pulled $7.6 billion away from state highway budgets. This has left the states to fill in some of the gaps and voters around the country last year approved major transportation investments via ballot measures. “The ballot results are a great reminder infrastructure investment remains one of the few areas where red states, blue states, Republicans and Democrats can all come together,” Dave Bauer, president of the American Road & Transportation Builders Association, said. “It should also demonstrate to lawmakers on Capitol Hill that the public will be on board for the passage of a long-term bill that significantly boosts highway and transit investment at the federal level.” Jim Tymon, executive director of the American Association of State Highway and Transportation Officials, said that “States and localities are doing their part and this is a great opportunity for the federal government to do its part.” The American Society of Civil Engineers says there is a huge backlog of federal highway projects that need funding, to the tune of $836 billion. The Transportation Investment Advocacy Center at the road builders group said that most of the ballot measures involved property tax increases to pay for road repairs. The road builders group reported that 57 ballot initiatives across 12 states had the potential to raise $20 million in revenue each. All told, voters approved $7.7 billion worth of investment into transportation projects and $1.9 billion in continued funding over the next quarter-century. Washington State and Colorado were among the few to vote for tax cuts that are likely to squeeze highway budgets. The issue is important at the local level, too. The United States Conference of Mayors published a campaign agenda wish list in December that called on 2020 presidential candidates to say what they would do to stabilize the Highway Trust Fund, regulate new transportation technology and strengthen public transportation. President Trump’s initial infrastructure plan — coming in widely mocked “infrastructure week” presentations stalled several times before resurfacing again last spring. A $2 trillion infrastructure package seemed politically plausible but appears sidelined by the impeachment issue. So, we will see. State and local governments are working hard to get things done, but we need the federal government to step up with a bill, the Times said. Whether a bi-partisan effort, even for a widely supported investment, can be defined in the current toxic political environment remains to be seen and should be watched closely by producers as options are considered, Washington Insider believes.

| Rural Advocate News | Tuesday January 28, 2020 |


Extension Of Comment Period On NEPA Reforms Urged A 180-day extension of the 60-day comment period on the Trump administration’s notice of proposed rulemaking (NPRM) on the National Environmental Policy Act (NEPA) reforms has been requested by the Council on Environmental Quality. Given that the proposed rule would impact how “every single agency in the federal government considers the health and environmental impacts federal decisions,” the group said the 60-day comment period and two public meetings scheduled by EPA are “woefully inadequate” for the plan the group says would impact more than 50,000 decisions made each year by the federal government. They called for additional public meetings to be held in both rural and urban areas versus the two proposed by EPA to be held in Denver, Colorado, and Washington, D.C.

| Rural Advocate News | Tuesday January 28, 2020 |


Court Sends Some Small Refinery Exemptions Back To EPA EPA has to reconsider small refinery exemptions (SREs) issued for the 2016 compliance under the Renewable Fuel Standard (RFS), according to a decision from the U.S. Court of Appeals for the 10th Circuit. The court ruled that exemptions granted to Holly Frontier’s Woods Cross and Cheyenne refineries and CVR Energy’s Wynewood refinery were improper, stating the agency overstepped its authority as the refiners had not previously been granted SREs. The court said the statute states that any SRE granted to a refinery has to be in the form of an “extension” after 2010, yet the three refineries were given exemptions for the first time in the 2016 compliance year. "Because an 'extension' requires a small refinery exemption in prior years to prolong, enlarge or add to, the three refinery petitions in this case were improvidently granted," the court said. "We remand these matters to the EPA for further proceedings consistent with this opinion." EPA approved 19 of the 20 SRE requests received for the 2016 compliance year and it rejected only one of the requests. There are currently 21 SRE requests pending at EPA for the 2019 compliance year, already at half the level that were requested for the 2018 compliance year.

| Rural Advocate News | Tuesday January 28, 2020 |


Tuesday Watch List Markets Early Tuesday, traders will note a report of U.S. durable goods orders at 7:30 a.m. CST, followed by an index of U.S. consumer confidence at 9 a.m. South American weather forecasts and coronavirus infection counts will also get attention. The Federal Reserve begins a two-day meeting on Tuesday and is expected to keep interest rates unchanged on Wednesday afternoon. Weather Rain, freezing precipitation and snow will cross the central and southern Plains Tuesday, and the western and northern Midwest will have freezing precipitation and snow. Transportation and travel delays are in store along with safety hazards. We'll also see rain and snow in the Northwest. Temperatures will be well above normal in much of the northern and central areas for this time of year.

| Rural Advocate News | Monday January 27, 2020 |


President Trump Expected to Sign USMCA on Wednesday White House and administration officials confirmed to CNN that the president will sign the U.S.-Mexico-Canada Trade Agreement on Wednesday. The new agreement was one of the president’s biggest priorities during his term and was passed out of Congress just days before the impeachment trial began. Trump is expected to tout this agreement as an important highlight during the 2020 presidential campaign, especially in the swing states that will see a lot of benefits from the pact. For example, the agreement opens the Canadian dairy market to U.S. farmers, something Trump is likely to point out in dairy-heavy states like Wisconsin. During a speech at the American Farm Bureau’s National Convention, Trump told attendees that the agreement will “massively boost exports for farmers, ranchers, growers, and agricultural producers.” The deal was originally signed by leaders of all three countries back in November of 2018. However, the text was later changed after months of closed-door negotiations between House Democrats and the Trump Administration. The updates added additional labor protections and got rid of controversial patent protections for certain drugs. ********************************************************************************************** New WOTUS Rule Appears Headed to the Courts Environmental groups and Democratic states are already promising to sue over the new Waters of the U.S. Rule, which the Trump administration calls the “Navigable Waters Protection Rule.” The conservative-leaning Pacific Legal Foundation made a similar promise, calling the new rule not narrow enough. If the challenges happen to make it to the Supreme Court, the administration is banking on being able to win the backing of five of the justices who have a novel interpretation of the limits of federal power laid out under the Clean Water Act. Legal experts tell Politico that it’s a gamble that could result in a lasting win for the administration and its allies or a “spectacular loss.” Janette Brimmer, an attorney for the northwest office of Earthjustice, joined other environmentalists in calling the new rule “the dirty water rule.” She says, “President Trump’s administration wants our waters to burn again.” The Chesapeake Bay Foundation says, “The administration’s new definition of ‘Waters of the United States’ unravels safeguards in place since the landmark Clean Water Act first went into effect in 1972.” ********************************************************************************************** USDA Recruiting for a Trade Mission to the Philippines The U.S. Department of Agriculture will lead a trade mission to the Philippines, designed to explore new business opportunities with the island nation. The trade mission will travel to Manila on April 20-23. They’re looking for agribusiness people who want to take part in the trip. Anyone interested should apply to the USDA’s Foreign Agricultural Service by February 6. Morgan Haas is the FAS counselor for agricultural affairs in Manila. She says, “U.S. agricultural exports to the Philippines have more than doubled over the last decade, reaching a record $3 billion in 2018. Positive consumer attitudes and a healthy business climate point to continued growth potential going forward.” Haas also says local consumers in the country have an affinity for American brands, while the country’s rapidly expanding retail, food service, and food processing sectors offer robust opportunities for U.S. exporters looking to sell agricultural raw materials, high-value ingredients, and consumer-oriented food and beverage products. FAS office staff in the Philippines will arrange business meetings between trade mission delegates and local companies seeking to import American farm and food products. The trip to the Philippines is one of seven trade missions USDA has scheduled in 2020. ********************************************************************************************** Queen Approves Brexit, Potential New Ag Markets for U.S. Britain’s effort to leave the European Union was finally approved by Queen Elizabeth last week, clearing the way for the United Kingdom to make the move to independence. Royal approval was the last obstacle toward Brexit. Now it’s up to the European Union leaders to formally ratify the law in a vote scheduled for Wednesday. The EU Parliament’s constitutional affairs committee voted by a large margin last week to approve the Brexit withdrawal deal, paving the way for the final vote this week. The UK is expected to then begin trade negotiations with the EU as well as the United States soon after the move is official. The Brexit move could be very good news for American farmers, but that’s only if the UK doesn’t keep the restrictive EU-based ag policy in place that limits trade. Gregg Doud, the chief agricultural negotiator for the Office of the U.S. Trade Representative, says a new trade pact with Britain is of utmost importance to him. “In my mind, that’s a legitimate top ten market for U.S. agriculture,” Doudd says. “When that move is official, we’ll be right there ready to begin negotiations with the U.K.” Last week at the World Economic Forum in Switzerland, U.S. Commerce Secretary Wilbur Ross sounded optimistic that a deal would get done once Brexit is completed. ********************************************************************************************** Legislators Send Letter to FDA on Dairy Labeling Senator Tammy Baldwin, a Wisconsin Democrat, and Jim Risch, an Idaho Republican, have led a bipartisan coalition that sent a letter to Stephen Hahn, the new Commissioner of the Food and Drug Administration. They’re asking Hahn to stop the use of dairy terms on the labels of non-dairy products. The Hagstrom Report says under the former commissioner, the FDA began to review how to enforce regulations on what may or may not be labeled a dairy product, and the public comment period on the topic has concluded. “Dairy farmers are now waiting for action from the FDA,” the senators say in the letter. “We encourage you to move swiftly to address this unfairness and ensure that dairy terms may only be used to describe products that include dairy.” The senators say imposter products should no longer be able to get away with violating the law and taking advantage of dairy’s “good name.” Baldwin and Risch are also the cosponsors of the Dairy Pride Act of 2019. The act requires non-dairy products made from nuts, seeds, plants, and algae to no longer be labeled with dairy terms like milk, cheese, and yogurt.” ********************************************************************************************** Beef, Pork Production Hit Record Highs in December Pork and red meat production hit a monthly record in December. The USDA says pork production totaled 2.44 billion pounds, a nine percent jump over December of the previous year. Slaughter was also higher, up nine percent to 11.4 million head. The average live weight gaining was up two pounds to 288 pounds. Beef production totaled 4.72 billion pounds, a jump of eight percent over 2018. Slaughter increased to 2.75 million head, up seven percent from December of 2018. The five-pound gain for the average live weight was 1,373 pounds. December red meat production totaled 4.72 billion pounds; eight percent higher than the previous year. Unofficially, red meat production for 2019 was 54.5 billion pounds, three percent higher than in 2018. The USDA’s official red meat production numbers for 2019 come out in April. December’s dairy cow slaughter totaled 265,400 head, a jump of 9.3 million head from November and 4.2 million more than the previous December. The unofficial total for 2019 was 3.22 million head, a 71,000 head increase above the 2018 total.

| Rural Advocate News | Monday January 27, 2020 |


Washington Insider: Future Trade With China There has been something of a surge in skepticism regarding parts of the recent phase one deal with Beijing, especially China’s pledge to buy billions of dollars of U.S. foodstuffs. “The farmers are really happy with the new China Trade Deal,” the president tweeted the day after a signing ceremony in the White House. However, that “euphoria” may be fading fast, Bloomberg reported this week. The dispute exposed Beijing’s vulnerability when it comes to food imports and the Communist Party leadership is expected to do all it can to wean itself off the U.S. David MacLennan, chief executive of Cargill Inc., the world’s largest agricultural commodity trader said, “I think they don’t want to be in the same position again of being overly dependent on one supplier.” Food security has long been a Chinese policy priority and officials there remember the political impact of price rises in the late 1980s that stoked dissent in the run-up to the Tiananmen Square protests. A generation later, China is many times richer but still depends on food and other imports. For U.S. farmers, the trade deal means a potentially short-lived benefit — but possible long-term challenges as “America’s biggest customer looks elsewhere.” The extent of this response will affect the fortunes of global ag companies from traders like Cargill and Louis Dreyfus Co. to farming equipment manufactures and beyond, Bloomberg said. China has long been striving for self-sufficiency, paying huge subsidies to farmers to grow corn and rice and more than 95% of its cereal needs can now be satisfied locally. But declining arable land, water shortages and an aging farm labor force mean that domestic production alone isn’t enough in the rapidly urbanizing country, Bloomberg says. President Xi Jinping launched the Belt and Road initiative in 2013 to expand its trading routes, after also embarking on a multi-billion-dollar spree in global agriculture firms and infrastructure over the last decade. Before trade hostilities escalated in 2017, the U.S. was China’s top agricultural supplier for 18 years running, providing almost 20% of its farm goods imports amounting to $24 billion a year. In the China-U.S. trade war, imports from the U.S. tumbled 45% in 2018. Beijing slapped retaliatory levies ranging from 5% to 60% on almost all American farm goods including soybeans, pork and corn. As a result, the administration announced a $28 billion bailout for farmers. The fight also forced China to search for supplies elsewhere — and to double down on efforts to diversify, with rivals Brazil and Argentina the most obvious beneficiaries. Brazilian President Jair Bolsonaro and China’s Xi promised to continue increasing bilateral trade that surged to record levels during the trade war. China also bolstered its alliance with Argentina, opening the door to the South American nation’s soybean meal shipments for the first time. “Food security is always critical to China’s leadership, and this trade war just affirms the importance of having strong domestic production and diversified import sources,” said Li Qiang, chief analyst with Shanghai JC Intelligence Co., an influential Chinese agricultural consultant. But China is seen as unlikely to attempt to rely on South America alone. Brazil typically exports soybeans during March to September, before new-crop U.S. supplies are available. Despite record imports from Brazil, China briefly experienced a recent soybean deficit due to lack of American supply. So, it also has been looking for other sources, for example by investing in Russia and the Black Sea regions. The reality is that it will be hard for China to wean itself entirely from the U.S. China’s annual soy demand is about 110 million tons, of which domestic output satisfies just 15%, according to China’s ministry of agriculture. Thus, many Chinese officials regard the U.S. as “just too influential.” America will remain an important trading partner for soybeans, China’s minister of agriculture and rural affairs said last year. It may also prove politically expedient for Beijing to maintain some trade with Washington to keep its truce in place. There’s historical precedent for how trade disputes can permanently reshape global trade, and the lessons from a battle more than 40 years ago suggest American farmers may suffer over the longer term, Bloomberg asserts. In 1973, Washington imposed an embargo on soybean exports to Japan. The conflict lasted only five days, and Japan returned to purchase U.S. soybeans — but “has never again seen America again as a reliable supplier,” Bloomberg said. Instead it diversified purchases and invested heavily in the then-nascent Brazilian soybean industry. In addition, the Nixon administration embargoed trade with China over two decades through 1971, policies that may also have stained the U.S.’s reputation as a reliable partner in the minds of Chinese leadership. “Given those experiences, it’s not surprising they put a lot of emphasis on food security,” Friedrichs said. “They don’t want to be overly dependent on a single supplier.” So, we will see. Questions have frequently been raised across the ag industry regarding the future impacts of the recent trade fight, and these likely will resurface as the two-year duration of the current truce approaches its end—and the phase two considerations take shape. These are debates that will be crucial to ag producers and which should be watched closely as they emerge, Washington Insider believes.

| Rural Advocate News | Monday January 27, 2020 |


US Eyes Trade Deal With UK Before Year End The Trump administration is looking to complete a trade deal with the United Kingdom before the end of 2020, Treasury Secretary Steven Mnuchin said Thursday. Talks could start as soon as February. “The president is very focused ... on Europe,” Mnuchin said in an interview with CNBC. “The good news is we have seen a lot of investments in the U.S. from the European car companies. But the president wants to make sure that we have free and fair and reciprocal trade in Europe. And by the way, we are very focused on a UK Free Trade Agreement, which we hope to get done this year as well.” British Prime Minister Boris Johnson is expected in Washington next month to begin talks with President Donald Trump though the exact dates have not yet been set. Key in the U.S.-UK trade deal will be in large part dictated by the way the UK aligns itself with the EU upon Brexit. The closer it hones its rules to those of the EU, it could make it much more difficult for negotiations in areas like agriculture.

| Rural Advocate News | Monday January 27, 2020 |


EPA Finally Unveils WOTUS Replacement The final rule to replace the Obama-era Waters of the U.S. (WOTUS) rule was released by EPA Thursday, with the Navigable Waters Protection Rule representing “step two” of the plan from EPA and the U.S. Army Corps of Engineers to repeal and replace the Obama-era regulation. The rule scales back the categories of waters that fall under Clean Water Act (CWA) jurisdiction. Under the new rule, four categories would be federally regulated: The territorial seas and traditional navigable waters; perennial and intermittent tributaries to those waters; certain lakes, ponds and impoundments; and wetlands adjacent to jurisdictional waters. The rule also spells out 12 categories that would be excluded, including those that only contain water in direct response to rainfall, groundwater, ditches that are not traditional navigable waters and tributaries that are not next to wetlands. EPA also noted that states may still choose to regulate waters that do not fall under the scope of the federal CWA. The rule would become effective 60 days after being published in the Federal Register. Ag interests welcomed the rule while many environmental groups criticized the plan as expected. The rule is expected to end up being challenged in the courts.

| Rural Advocate News | Monday January 27, 2020 |


Monday Watch List Markets There are few economic reports on Monday morning other than new home sales. DTN will be watching for South American weather updates, any news about the coronavirus, and will be watching for new sales announcements, especially regarding China. We will also be looking at grain inspections. Weather Light freezing precipitation is in store for much of the western and northern Midwest Monday, causing transportation and safety hazards and delays. Hazardous fog is also indicated in the Midwest and southeastern Plains. Other crop areas will be drier. However, moderate to heavy snow is slated to form in the southwestern Plains Monday night through Tuesday.

| Rural Advocate News | Friday January 24, 2020 |


EPA Announces WOTUS Change The Environmental Protection Agency Thursday, along with the Army Corps of Engineers, announced a new “clear definition for Waters of the United States.” EPA Administrator Andrew Wheeler says the new Navigable Waters Protection Rule provides “much needed regulatory certainty and predictability for American farmers.” The rule recognizes the difference between federally protected wetlands and state protected wetlands, and adheres to the statutory limits of the agencies’ authority. The revised definition identifies four clear categories of waters that are federally regulated under the Clean Water Act: the territorial seas and traditional navigable waters, perennial and intermittent tributaries, certain lakes, ponds and impoundments, and wetlands that are adjacent to jurisdictional waters. The final action also details what waters are not subject to federal control, including features that only contain water in direct response to rainfall, groundwater, many ditches, including most farm and roadside ditches, prior converted cropland, farm and stock watering ponds, and waste treatment systems. ************************************************************************************* Ag, Environmental Groups, React to EPA WOTUS Announcement The Waters Advocacy Coalition applauds the new Clean Water rule that brings clarity and certainty to enforcement of the Clean Water Act. The coalition is a broad cross-section of small businesses, farmers, ranchers and builders, including the American Farm Bureau Federation. The Environmental Protection Agency and U.S. Army Corps of Engineers announced the WOTUS replacement Thursday. Farm Bureau President Zippy Duvall says AFBF supports the new rule, as it allows “farmers to understand water regulations without having to hire teams of consultants and lawyers.” National Pork Producers Council President David Herring says the previous WOTUS rule was “a dramatic government overreach and an unprecedented expansion of federal authority over private lands.” Now, Agriculture Secretary Sonny Perdue says the new rule removes “undue burdens and strangling regulations” from farmers. The response from agriculture was expected, as was the response from Environmental groups. The Natural Resources Defense Council says the Trump administration is “stripping protections” from streams and wetlands, adding “It's a blatant disregard for science, and for public health.” ************************************************************************************* Farmers Optimistic Despite Challenging 2019 A new poll finds farmers are optimistic for 2020, despite a challenging 2019. The DTN/Progressive Farmer Agriculture Confidence Index rose to 164.1 in December 2019, significantly higher than the Index of 110.2 in March and the December 2018 level of 109.2. The long, drawn-out, challenging crop year, along with trade battles, didn’t dampen their mood for the future, or their feelings about the Trump administration. About 75 percent of farmers said that if the 2020 presidential election was held at that time, they would vote to reelect the current administration. About a quarter said they would likely not vote for the current administration. Farmers were surveyed in mid-to-late December, when President Donald Trump announced a phase one trade agreement with China, and the House of Representatives approved the U.S.-Mexico-Canada Agreement, sending the trade deal to the Senate. The DTN/Progressive Farmer Agriculture Confidence Index is conducted three times a year, before planting, before harvest, and before the end of the year. ************************************************************************************* Export Exchange 2020 Scheduled For October The U.S. Grains Council announced Export Exchange 2020 this week, scheduled for October 7-9. The event, sponsored by the U.S. Grains Council, Growth Energy and the Renewable Fuels Association, uniquely focuses on connecting international grain buyers with U.S. suppliers. Export Exchange 2020 will take place at the Loews Kansas City hotel in Kansas City, Missouri. More than 200 international purchasers and end-users of U.S. coarse grains and related products are expected to join an estimated 300 U.S. producers, agribusinesses and representatives at the event. In addition to business-to-business meetings and an exhibit hall, the conference will address critical issues facing U.S. exports to build awareness of the benefits of U.S. corn, sorghum, distiller’s dried grains with solubles (DDGS) and other products. The grain buyers from 35 countries who attended Export Exchange 2018 in Minneapolis reported purchasing approximately 2.1 million metric tons of coarse grains and co-products traded either at the conference or immediately before or after, valued at an estimated $403 million. ************************************************************************************ Climate Change and Other Issues Move Doomsday Clock: 100 Seconds to Midnight The metaphorical Doomsday Clock set by the Bulletin of the Atomic Scientists was set at 100 seconds until midnight this week, as the organization says, “Humanity continues to face two simultaneous existential dangers—nuclear war and climate change.” Rachel Bronson, president and CEO of Bulletin of the Atomic Scientists, says, “We now face a true emergency – an absolutely unacceptable state of world affairs that has eliminated any margin for error or further delay.” Regarding climate change, the organization says governmental action still falls far short of meeting the challenge at hand. The Doomsday Clock has now moved closer to midnight in three of the last four years. While the Doomsday Clock did not move in 2019, its minute hand was set forward in 2018 by 30 seconds, to two minutes to midnight. The clock was adjusted in 2017 to two and a half minutes to midnight from its previous setting of three minutes to midnight. ************************************************************************************ Americans to Eat Record 1.4 Billion Chicken Wings for Super Bowl The National Chicken Council Thursday released its annual Chicken Wing Report, projecting Americans to consume a record-breaking 1.4 billion wings during the upcoming Super Bowl weekend. Americans’ love for wings continues to grow. This year’s wing consumption estimate is a two percent increase over 2019, meaning Americans will eat 27 million more wings during this year’s big game weekend versus last year’s. To put that in perspective, if Kansas City Chiefs’ coach Andy Reid ate three wings per minute, it would take him about 900 years to eat 1.4 billion wings. Council spokesperson Tom Super says when it comes to Super Bowl menus, wings rule the roost.” The Council asked wing-eaters about their habits, and roughly two thirds of Americans, 65 percent, who eat chicken wings, claim they like to do so while watching a major sporting event like the Super Bowl. Half, 51 percent, claim that they believe chicken wings should be the official food of the Super Bowl.

| Rural Advocate News | Friday January 24, 2020 |


Washington Insider: Did the Fed Hold the Economy Back? The fight over U.S. monetary policy continues on display. On Wednesday, President Donald Trump renewed that criticism from the sidelines of an elite gathering in Davos, Switzerland. When asked why his economic growth goal was not reached, he said, “No. 1, the Fed was not good,” Data for the full year aren’t isn’t in yet, but probably was 2.2% or 2.3% relative to the fourth quarter of 2018, economists estimate. The president also pointed to the grounding of Boeing’s 737 Max plane and severe storms as factors that held back the economy, but added that “with all of that, had we not done the big raise on interest, I think we would have been close to 4%.” Economists said that claim was not realistic. The central bank’s nine interest rate increases between 2015 and late 2018 — three of which it reversed last year — probably reined in business investment and the housing market, economists say. But that impact did not shave nearly 2 percentage points from growth. It discussed “a few ways to think through how the economy might have shaped up had the Fed acted differently.” In the “real world,” the Fed lifted rates between December 2015 and the end of 2018 in an effort to achieve a soft landing in which growth continued at a moderate pace and inflation settled around its 2% target. When growth showed signs of wavering in 2019 and inflation remained soft, Fed officials reversed course, cutting rates three times. In what it called the “most extreme counterfactual,” one in which the Fed never raised its policy interest rate at all, growth might have been 1 percentage point higher in 2019, said Ernie Tedeschi, policy economist at Evercore ISI. That estimate, based on the central bank’s main economic model, would have gotten America to around 3.2% growth in 2019 — but at a hefty cost. For example, “Inflation would’ve been well above their mandate, 2.5% and rising, at this point,” Tedeschi said, and “would have necessitated a sharp increase in rates.” Such an abrupt change could have weakened the economy and certainly “would have been painful,” he said. But even in that version of the world, one in which the Fed was willing to leave its policy totally untouched at near-zero for more than a decade, the economy could have achieved that 4% growth figure only absent a trade war — and even that is a stretch, the Times said. While it’s hard to gauge precisely how much the administration’s tariffs reduced growth, estimates suggest they could have shaved between 0.5% and 1 percentage point away in 2019, Mr. Tedeschi said. All of these projections are highly uncertain and even if the basic figures are right, “this scenario is unrealistic,” the Times said. In another version of the world, the Fed could have raised interest rates between 2015 and 2018, but then lowered them much more quickly in 2019. Had the federal funds rate dropped to zero at the very start of the year, Tedeschi said, it might have added about 0.35 percentage point to growth, getting the economy up to the 2.5% range. However, that is seen as far-fetched since the Fed has never slashed rates to zero outside of a recession. Doing so at a time when the economy was growing and the president pushing for more stimulus would have looked overtly political and could have raised the risk of higher inflation. Relative to the economy’s structural growth path — the one driven by labor force expansion and productivity — the Fed’s rate-setting may have shaved about 0.1 percentage point from growth in 2019, according to an estimate from Julia Coronado, a founder of MacroPolicy Perspectives. Slower capital expenditures and trade probably shaved another 0.1 percentage point from growth. But those effects were offset by the aftereffect of ramped-up government spending and tax cuts, which she estimates probably lifted growth by about 0.4 percentage point. But even here, there are uncertainties. While it is clear that business investment fell sharply last year and manufacturing sagged, weighing down growth, it is hard to tell how much of that was a lagged response to higher interest rates and how much was a response to the trade war. “The slowdown in capital expenditures came along when the trade war escalated,” Torsten Slok, an economist at Deutsche Bank, said in an interview. “One cautious estimate is that the trade war played a bigger role,” he said. Tax cuts and higher government spending have helped to nudge growth temporarily above its potential — it came in at 2.8 percent in 2017 and 2.5 percent in 2018, decently above the roughly 2 percent sustainable growth rate. Yet those gains probably will not hold. The working-age population is growing more slowly, and productivity, which popped temporarily, has since fallen back to earth. The Congressional Budget Office estimates that over the next decade, growth will average 1.9% a year, up slightly from the preceding decade but down substantially from the 3 percent and higher growth that prevailed before 2000. So, we will see. “We haven’t seen 4% growth for many, many years,” Slok said. Certainly, this continuing fight over monetary policy should be watched closely by producers as it intensifies during the coming campaign, Washington Insider believes.

| Rural Advocate News | Friday January 24, 2020 |


Farm Bureau policy plans call for more farmer aid The American Farm Bureau Federation has set their policy goals for 2020, including another round of trade aid for farmers. “Our members are basically saying, ‘Show us results,’” said Scott VanderWal, the group’s national vice president. He noted that “no products have moved, implementation has not happened yet, and it is kind of a ‘prove it to me’ thing.” They also are calling for a review of USDA's National Agricultural Statistics Service (NASS) and its crop reporting program, including its methodology and track record. “The June 2019 Acreage report was a debacle, and it seems like each NASS report this year has contained surprises and unexpected market impacts, etc.,” Farm Bureau said. The group also wants USDA to amend its hemp production framework to allow for plants with up to one percent tetrahydrocannabinol (THC, the chemical in cannabis), compared with the current limit of 0.3%. USDA's interim hemp rule requires “hot” crops to be destroyed at 0.5% THC levels.

| Rural Advocate News | Friday January 24, 2020 |


Grassley signs USMCA legislation Sen. Chuck Grassley, R-Iowa, took to social media Wednesday to announce he has signed the US-Mexico-Canada Agreement (USMCA) in his role in the Senate. “As President pro tem I had the honor of signing United States Mexico Canada Agreement Implementation Act w my colleagues. This trade agreement will greatly benefit Iowa. Now to Pres Trump for signature,” Grassley tweeted. Canada has yet to clear the trade deal but is expected to once their parliament returns January 27. The exact date President Donald Trump will sign the pact remains unclear, with some indications he wants to do it in farm country and with Canadian and Mexican officials present.

| Rural Advocate News | Friday January 24, 2020 |


Friday Watch List Markets Early on Friday we will see reports on personal income, consumer spending, and the core price index. Also, we will see export sales released. We will also watch for any daily export sales that might be announced, South American weather, and any hint that China may be buying ahead of their Lunar New Year. We will also be keeping an eye on coronavirus, and any new information regarding that. Weather Light to moderate snow and moderate to locally heavy rain are in store for the central and eastern Midwest, Mid South, and Southeast Friday. We'll also see rain and snow throughout the Northwest. The precipitation keeps soils saturated and will delay transportation. Other crop areas will be dry. A new storm system is slated for the central U.S. early next week.

| Rural Advocate News | Thursday January 23, 2020 |


Senate Sends USCMA to President Trump The U.S. Senate Wednesday put its finishing touches on the U.S.-Mexico-Canada Agreement. Senator Chuck Grassley, chair of the Finance Committee and Senate President Pro Tempore, signed the agreement, the final step before the agreement heads to the White House. President Donald Trump was previously expected to sign the agreement sometime this week. The ceremony Wednesday signals the end is close after the nearly three-year process of renegotiating the agreement, then further negotiations to gain U.S. congressional approval. President Trump, in January 2017, announced his intention to renegotiate the North American Free Trade Agreement. The trade talks started in May of that year. A deal was reached in September of 2018 between the U.S., Mexico and Canada. Senator Deb Fischer, a Republican from Nebraska who attended the ceremony Wednesday, says she is "proud that this critical trade agreement has finally come across the finish line.” President Donald Trump told the American Farm Bureau Federation on Sunday, that USMCA, and the agreement with China, “are just the beginning,” as his administration seeks more trade agreements. ************************************************************************************* Canada to Consider USMCA Next Week Canada will consider the passage of the U.S.-Mexico-Canada Agreement next week. Prime Minister Justin Trudeau (true-doh) told reporters this week, ”On Monday, we will introduce a Ways and Means motion, and on Wednesday we will table legislation to ratify the deal.” The comments were part of a press conference detailing plans for Canada’s Parliament, which returns to work next week. Trudeau says, “We are going to make sure that we are going to move forward in the right way, and that means ratifying this new NAFTA as quickly as possible, but responsibly in the House of Commons.” Canada is the last of three nations to take action on the agreement. Mexico has already ratified the agreement, and the U.S. has one final step to ratify the agreement, being President Donald Trump's signature. The USMCA, or CUSMA, as it’s known in Canada, is estimated to be worth an extra $2 billion annually in exports for U.S. farmers. ************************************************************************************* Farm Bureau Establishes 2020 Priorities Farmer and rancher delegates to the American Farm Bureau Federation’s 101st Annual Convention this week adopted policies to guide the organization’s work in 2020. After a year-long process to review ways to modernize Federal Milk Marketing Orders, AFBF’s delegates voted to support creation of a flexible, farmer- and industry-led milk management system. This includes giving individual dairy farmers a voice by allowing them to vote independently and confidentially on rules governing milk prices. The new dairy policies, when combined, “will form a strong foundation” to guide the organization during future reform efforts to better coordinate milk supply and demand. Delegates also updated labor and immigration policies, emphasizing the need to see significant changes to the H-2A program. And delegates also voted to support allowing a higher THC level in hemp. Delegates also re-elected American Farm Bureau President Zippy Duvall and Vice President Scott VanderWal for their third terms. VanderWal served as chair of the meeting on behalf of Duvall, who is grieving the loss of his wife, Bonnie. ************************************************************************************* Cattle Disease Traceability Continues Advancing Multiple state cattlemen’s organizations from major beef producing regions have partnered together to form U.S. CattleTrace, a disease traceability initiative. The goal is to develop a national infrastructure for disease traceability and encourage private industry’s use of the infrastructure for individualized management practices. The new U.S. CattleTrace initiative combines the efforts of CattleTrace, which includes the Kansas Livestock Association and others in Kansas, Missouri, Oklahoma, Kentucky, Oregon and Washington, as well as traceability pilot projects underway in Florida and Texas. Brandon Depenbusch, CattleTrace board of directors chairman, says the partnership “will be a catalyst to build upon the CattleTrace foundation we established the past few years.” In late August 2018, CattleTrace Inc. was formally established as a private, not-for-profit corporation to securely maintain and manage the data collected as part of the disease traceability pilot project. Volunteer leaders from each of the partner organizations have agreed to a set of guiding principles for U.S. CattleTrace. *************************************************************************************​ NBB Welcomes New Biodiesel Quality Reports The National Biodiesel Board Wednesday welcomed new reports on Biodiesel fuel quality published by the National Renewable Energy Laboratory. Through funding and support from the National Biodiesel Board, NREL's statistical analysis is based on thousands of data points that were previously unavailable. The reports are comprised of data gathered from U.S. and Canadian BQ-9000 producer members. The analysis from both the 2017 and 2018 reports show that the vast majority of biodiesel readily exceeded the specification limits in ASTM D6751, the standard for biodiesel. As part of the data gathering process, biodiesel producers test their own B100 fuel at the point of production monthly, then provide NBB's National Biodiesel Accreditation Commission with the resulting data. NBAC randomizes and anonymizes the results and provide the final version to NREL for statistical analysis. NBB Technical Director Scott Fenwick says, “We now have a simpler, more efficient way to collect, analyze, and determine the quality of biodiesel.” The data was presented during a breakout session at the 2020 National Biodiesel Conference and Expo. ************************************************************************************* ASA Celebrates Its ‘First Soy Century’ The American Soybean Association is celebrating its “First Soy Century” as it recognizes its 100th anniversary throughout 2020. The roots of ASA were formed during the first Corn Belt Soybean Field Day in Camden, Indiana, in September 1920. The event drew nearly 1,000 farmers from six states, who were interested in discovering more about this emerging new commodity called soybeans. The National Soybean Growers’ Association—later renamed the American Soybean Association—was formed that year. In the century since those beginnings, ASA has continually focused on sustaining and improving the prospects and opportunities for profitability for U.S. soybean farmers. ASA plans a robust year of activities to celebrate the association’s centennial including, high profile activities at Commodity Classic, and a policy event in July at the National Museum of American History in Washington, D.C. ASA will also host a forward-looking symposium entitled “The Next Soy Century” to be held on the campus of Purdue University in August. Learn more at ASA100Years.com.

| Rural Advocate News | Thursday January 23, 2020 |


Washington Insider: Emerging GOP Climate Plans Although President Trump is widely seen as a climate-change skeptic, he announced on Tuesday that the United States will join the One Trillion Trees Initiative launched at the World Economic Forum in a global effort to combat climate change, The Hill reported this week. The president made the announcement during an address to global business leaders gathered in Davos, Switzerland. "We're committed to conserving the majesty of God's creation and the natural beauty of our world," he said, adding that the U.S. "will continue to show strong leadership in restoring, growing and better managing our trees and our forests. The Hill reported that the announcement drew “some of the most sustained applause of any portion of the president’s 30-minute speech which focused mostly on his administration's accomplishments and the strength of the U.S. economy. That economic message contrasted with other world leaders who used the forum to highlight issues like climate change and global collaboration. President Trump has been asked repeatedly at gatherings with foreign leaders about his views on climate change and the environment. He declared Tuesday that he's "a very big believer in the environment" and earlier this month told reporters he does not believe climate change is a hoax, as he once claimed. But environmentalists have been alarmed by his administration's policies, including rolling back regulations meant to curb air and water pollution and withdrawing the U.S. from the Paris climate agreement. Also speaking at Davos on Tuesday was 17-year old Swedish climate activist Greta Thunberg. Trump, in an interview with The Wall Street Journal, said he didn't "really know anything" about Thunberg and dismissed her as "very angry." The Hill also noted that House Minority Leader Kevin McCarthy, R-Calif., “teased” new details about Republicans' forthcoming climate plan Tuesday, highlighting the legislation's focus on trees as a method for capturing carbon pollution. The Republican effort focuses on traditional areas of interest for the party, including spurring green technology innovation and carbon capture. Rep. Bruce Westerman, R-Ark., who is developing the legislation that would commit the U.S. to the goal, said the plan would "go back to something old for something new and trees are the ultimate carbon sequestration." Republicans had previously hinted the plan would rely heavily on trees but it's still unclear just how many Westerman's legislation would require planting. The plan would not, however, set any targets for reducing carbon pollution, The Hill said. An ambitious plan from the Democrats outlined earlier this month would require the U.S. to rely on 100 percent clean energy by 2050. Even though Democrats have likewise expressed interest in boosting tree planting as well as green technology, the Republican plan would face an uphill battle in the House as Democrats push forward their own plan with hard targets for carbon reductions. In addition, environmental groups have already criticized the Republican bill, arguing they were pushing policies they've already thwarted. "Congressional Republicans and Donald Trump just blocked a package of clean energy tax credits from being included in the year-end tax and budget deal," Sierra Club global climate policy director John Coequyt said in a statement. "That was a serious and limited solution they failed to support, but they are suddenly serious a few weeks later after decades of climate denial." The Hill also reported that presidential candidates Michael Bloomberg and Tom Steyer are leaning into climate change as a campaign issue to stand out in a crowded Democratic field. The former New York City mayor and owner of the Bloomberg financial empire has donated millions of dollars to the Sierra Club's Beyond Coal campaign, which has worked to shutter numerous coal plants, and he has pledged to donate $500 million to close the country's remaining coal plants by 2030 Meanwhile, Steyer founded the organization NextGen America, which aims to support candidates who advocate for climate action. Both have highlighted their commitment to the issue on the campaign trail. Steyer has said that he would declare climate change a national emergency on his first day in office and Bloomberg has also said that fighting climate change would be a focus for him. "They have been super active and insistent at not only raising the profile of the issue in front of voters, making it a litmus test with elected officials, but also, especially if you look at Mike Bloomberg, using his resources ... to give big cities and major carbon users real incentives to plan for the future and a lower-carbon or carbon free future," Democratic strategist Jon Reinish said of the two candidates. The Hill also points out that both candidates have faced a certain degree of skepticism on climate issues and are contending with candidates who are polling higher than they are and who have also put heavy emphasis on climate policy. So, we will see. Clearly the public is worried about the climate and there seems to be growing pressure on candidates to weigh in on those issues which continue to be extremely contentious—and which should be watched closely by producers as these debates continue to intensify, Washington Insider believes.

| Rural Advocate News | Thursday January 23, 2020 |


Still Waiting On WOTUS The Trump administration’s new definition of Waters of the U.S. (WOTUS) is still awaited, but is now expected to be announced as early as today. Now, Sen. Chuck Grassley, R-Iowa, told reporters Tuesday he expects EPA to release the new WOTUS rule before the end of the week. “The Trump administration will set common sense limits on state versus federal jurisdiction over the waterways and make it easier for state local governments and farmers to comply,” Grassley said.

| Rural Advocate News | Thursday January 23, 2020 |


China Tries to Temper Trade Concerns Chinese Vice Premier Han Zheng told the World Economic Forum the country’s trade deal with the U.S. will not hurt rival exporting nations as complaints mount from governments that were left out of the agreement. In the most high-profile remarks on Beijing’s economic policies since the accord was signed last week, Han said that a commitment to purchase more from the U.S. is in line with its World Trade Organization obligations and will not squeeze out other imports. Han also pledged to lower barriers for foreign investors as he set out the case for China’s engagement with the global market. Meanwhile, Treasury Secretary Steve Mnuchin said in Davos that a phase-two accord with China will not necessarily be a "big bang" that removed all tariffs. "We dealt with a lot of important issues in Phase One," said Mnuchin. "If we get [Phase Two] done before the election, good. If not, fine. There is no deadline."

| Rural Advocate News | Thursday January 23, 2020 |


Thursday Watch List Markets Early Thursday morning weekly jobless claims will be out along with leading economic indicators. DTN will also be watching for any 8 a.m. flash sales announced by USDA, any sign of Chinese buying, updated weather for South America, and ethanol production and stocks. Weather Thursday features snow in the central Plains through the western, northern and central Midwest, and rain in the Delta and Deep South. This precipitation will cause transportation and safety concerns along with livestock stress. The moisture also keeps soils saturated and adds to prospects of flooding and fieldwork delays in spring. We'll also see mixed precipitation in the interior Northwest. Conditions will be chilly but not bitter-cold.

| Rural Advocate News | Wednesday January 22, 2020 |


Perdue Confirms Third Round of Trade Assistance for Farmers Ag Secretary Sonny Perdue confirmed that U.S. farmers will receive a third round of trade assistance this year to help producers with their 2019 losses. President Trump had hinted at additional aid during his address on Sunday at the American Farm Bureau national convention. However, Perdue says, “No maybe about it.” Looking ahead to 2020, the secretary doesn’t see a similar program new year because of the Phase One Trade Agreement with China, as well as other trade deals in place. “Now, let’s grow stuff, let’s produce things, and let’s sell stuff,” he told the farmers in attendance. While speaking, Perdue did acknowledge the various challenges 2019 had on U.S. agriculture but thinks there are brighter days ahead this year. “We’re talking about doubling the number of ag imports to China, way more than they’ve ever purchased from us before,” Perdue says. “And, those purchases are going to come throughout the whole United States’ ag sector.” The president said farmers told him they don’t want anything but a level playing field. Because of the trade deals he’s signed, Trump says farmers “now have what they want,” and better days are ahead. ********************************************************************************************** Perdue Open to Changing Crop Data Collection Ag Secretary Sonny Perdue talked over the weekend about his willingness to make changes in National Ag Statistics Service methods of crop data collection. A Farm Journal article says during 2019 and it’s many challenges, many farmers were openly questioning the crop projections that were coming from NASS throughout the year. Perdue admits that he had some concerns about their crop reports and the survey methods NASS uses. “In fact, it was kind of paranoia in light of all the prevented planting and other kinds of things that were falling on us,” he recalled. “We got a little conspiratorial too, thinking NASS was also out to get us.” He thinks the NASS numbers that took the market by surprise last June might have been more correct than the market ultimately was in its reaction. However, that doesn’t mean Perdue thinks the methodology for estimating crop size couldn’t be improved. “We’re going to get better,” Perdue says. “If you’ve got an idea about how we can better use electronics, or maybe an app for better surveys, we’d love to hear about it. We’re open to the kind of ideas of using modern technology to get you the best data that you can use to make plans for your farm.” ********************************************************************************************** Poll Shows Farmers still in Trump’s Corner A new poll shows farmers are still supporting President Trump. A Market Watch Dot Com article shows survey results that say 83 percent of people in the agriculture business approve of his job performance. That’s the highest level of support Trump has received from the respondents in that poll from Farm Journal. The survey of almost 1,300 people took place before President Trump spoke over the weekend at the American Farm Bureau convention. 64 percent of the respondents strongly approve of his job performance. Another 19 percent said they somewhat approve of the job the president has done. Just 13 percent of the survey respondents strongly disapprove of his job performance. The affirmation came after the U.S. and China signed a phase one trade deal and the U.S.-Mexico-Canada Trade Agreement made it through both chambers of Congress and to the president’s desk. The agreement with China calls for the Asian nation to purchase $36 billion in U.S. agricultural products in 2020 and more than $43 billion in 2021. The Dow Jones, Nasdaq, and the S &P 500 all jumped to record highs on the news, but the grain markets were a little slower to react last week. ********************************************************************************************** Minnesota Loses Over 800 Dairy Farms in Three Years The number of licensed dairy farms in Minnesota continues to drop at a steady pace. New data out from the Minnesota Department of Agriculture says 315 dairy farms left the business between January first of 2019 and New Year’s Day of 2020. That’s the second year in a row the state has lost more than 300 dairies. Further back on January first of 2017, Minnesota had 3,258 licensed dairy farms. As of January first of 2020, that number is down to 2,448 licensed dairy farms. That’s a three-year total of 810 dairy operations that are out of business. Margaret Hart, communications director for the MDA, says, “The number of farms going out of business over the last five years has been higher than normal, due in large part to a drop in prices.” It’s worth mentioning that at least some of those businesses have ceased their operations temporarily, which is referred to as “dried off.” For example, 47 dairies that stopped operation between December first, 2019, and January of 2020, are dried off. That means they intend to resume milking within 60 days. ********************************************************************************************** National Biodiesel Board CEO Shares Future Vision Statement for the Industry The National Biodiesel Conference and Expo started off Tuesday with a state-of-the-industry address from National Biodiesel Board CEO Donnell (Duh-NELL) Rehagen (REE-hagen). The CEO outlined a new public vision statement during his address to industry stakeholders. The new industry statement says, “Biodiesel, renewable diesel, and renewable jet fuel will be recognized as mainstream low-carbon fuel options with superior performance and emission characteristics. In on-road, off-road, air transportation, electricity generation, and home heating applications, use will exceed six billion gallons by 2030, eliminating over 35 million metric tons of CO2 equivalent greenhouse gas emissions annually. With advancements in our feedstock, use will reach 15 billion gallons by 2050.” Rehagen says without a clear vision for the future of the industry, including where they want to be and how they’ll get there, the industry won’t have a chance to be more than it is today. “As carbon policies around the country really begin to take hold, we see low-carbon fuels like biodiesel, renewable diesel, and renewable jet fuel with tremendous opportunities for growth,” Rehagen says. ********************************************************************************************** USDA Continues to Invest in Rural Broadband Expansion Counties in Arkansas and West Virginia are the latest to benefit from USDA funds invested to improve their access to rural broadband. USDA West Virginia State Director Kris Werner announced the agency invested $18.7 million in a high-speed broadband infrastructure project that will create or improve rural e-Connectivity for more than 6,300 rural households and almost 400 farms in several West Virginia counties. Werner says, “This will have a positive economic impact for the farms, small businesses, and families that live in these communities.” In Arkansas, USDA Rural Development State Director David Branscum announced that USDA invested another $7.1 million in two high-speed broadband infrastructure projects that will help create or improve connectivity for 1,250 rural households in north-central Arkansas. “Through the USDA’s ReConnect Program, more than 1,250 people will get access to the latest broadband technology, which will help connect them to opportunities in education, health care, and economic development,” says Branscum. “USDA has made deploying critical infrastructure across rural America a top priority because when rural America thrives, all of America thrives.”

| Rural Advocate News | Wednesday January 22, 2020 |


Washington Insider: US and France May Have Tariff Truce Bloomberg is reporting this week that Presidents Emmanuel Macron and Donald Trump agreed to a truce in their dispute over digital taxes and that “neither France nor the U.S. will impose punitive tariffs this year.” The group reported that Macron told the press on Monday he had a “great discussion” with Trump on the issue, without giving details. President Trump appeared to agree--“Excellent!” he said in a reply to Macron’s post, without providing additional information. At the time, the President was en route to Davos, Switzerland, for the World Economic Forum. A White House readout of the call was notably more muted, saying only that the “two leaders agreed it is important to complete successful negotiations on the digital services tax” and “discussed other bilateral issues.” Bloomberg noted that “neither a White House spokesman nor officials with the U.S. Trade Representative’s office would confirm that the U.S. president had called off his announced tariffs.” Still, the possible respite may defuse transatlantic tensions that had been building between Washington and Brussels along another potential trade war front. The European Union is an even bigger U.S. trading partner than China and supply chains between the two economies, particularly in automotive and financial services industries, are intertwined in ways that would make a tit-for-tat tariff dispute even more harmful to the world economy, Bloomberg said. Macron’s government still hopes to find a solution that fits within discussions at the Organization for Economic Cooperation and Development’s work on the issue, according to a French official. While the organization is still working on its proposal for taxing tech companies around the world, France pushed ahead with its own levy last year that hit U.S. internet giants like Google, Apple Inc. and Amazon.com Inc. “We now have an agreement between the two presidents to avoid any tariff escalation and avoid any trade war,” French Finance Minister Bruno Le Maire told reporters in Brussels. Paris and Washington have discussed the possibility of France suspending the collection of the digital tax payments due in April as long as the U.S. refrains from imposing new tariffs, French officials said. But that wouldn’t constitute a withdrawal of the levy, they added. For its part, the French government denies its national tax is discriminatory and warned that the EU would retaliate if the U.S. imposed additional levies. The U.S. has charged that the French tax discriminates against American technology companies. It has threatened to hit $2.4 billion of French goods with tariffs in retaliation. The dispute was another headache for European trade officials scrambling to expand their policy arsenal as the U.S. takes aim at a rules-based system for global trade that Trump argues is outdated and tilted against America. It also coincided with a change in leadership at the European Commission, the EU’s executive arm. The truce follows weeks of discussions between Treasury Secretary Steven Mnuchin and Le Maire, who were scheduled to meet Wednesday in Davos, Switzerland. The dispute has ramifications outside France as other countries try to come up with ways to generate revenue from the digital economy. Mnuchin told the Wall Street Journal that the UK and Italy will face American tariffs if they proceed with similar levies on foreign tech firms. U.S. and EU trade relations started to sour in 2018 when the U.S. administration invoked national-security considerations to impose tariffs on steel and aluminum from Europe. As a U.S. military ally, the EU was infuriated and promptly retaliated with levies on iconic American brands such as Harley-Davidson Inc. motorcycles and Levi Strauss & Co. jeans. A subsequent U.S. threat to wreak significantly more economic damage by targeting the European auto industry with duties on the same security grounds led to a hastily agreed truce and a pledge by both sides to work toward reducing industrial tariffs across the board. Since then, the administration has refused to start the tariff-cutting negotiations unless Europe includes agriculture in them. Also, it imposed levies on EU products in retaliation over government aid to Airbus SE that was deemed illegal by the WTO and disabled the WTO’s appellate body. The EU, meanwhile, is pressing ahead with a plan for tariffs against the U.S. in a parallel WTO case over unlawful subsidies to Boeing Co. “Europe has had tremendous barriers to us doing business with them. All those barriers are coming down. They have to come down,” President Trump told a conference of farmers in Austin, Texas. “If they don’t come down, we’re going to have to do things that are very bad for them.” He added, “Europe was, in many ways, more difficult – and is more difficult – than China.” So, we will see. The phase-one deal with China has been well received by many in industry, even though there is substantial skepticism regarding the achievement of the main objectives like subsidies for Chinese companies. In the case of frictions with Europe, the stakes are extremely high, once again, and producers should watch closely as these talks proceed, Washington Insider believes.

| Rural Advocate News | Wednesday January 22, 2020 |


USTR Official Explains More on China Phase On Deal U.S. Trade Representative chief ag negotiator Gregg Doud told members of the National Association of Wheat Growers and U.S. Wheat Associates that the phrase of market terms links to seasonality. “We do not expect China to buy U.S. soybeans in the middle of the Brazilian harvest. That is what that term means,” Doud observed. “The expectation is they have a commitment to make. We expect them to make that, when it is our time.” He also noted the enforcement mechanism in the deal. “Either country has the right to put tariffs on, commensurate with the value of whatever the problem is,” he remarked. Doud added that when and if that were to take place, an important part is that “the other side cannot retaliate. The goal is not to have that happen — and I will tell you, that’s very sincere on both sides.” Regarding timing, Doud indicated that 60 days appears to be a key figure in the timelines relative to when U.S. ag exports could start materializing. “China enters into force in 30 days. And the beef component of that we supposed to have in another 30 days, so that is 60 days,” Doud said. “Then you think about it in terms of what we just did in poultry. We reopened the poultry market in the middle of November.” The poultry landed in China January 14, he noted, “so that is roughly 60 days.”

| Rural Advocate News | Wednesday January 22, 2020 |


USDA’s Perdue Predicts Record Exports For US USDA Secretary Sonny Perdue told Farm Bureau members that the signing of the phase-one agreement should mean that a third round of trade aid in 2020 should not be expected by farmers. He did say that the third installment of the 2019 Market Facilitation Program (MFP 2) payments should be dispatched shortly. He pointed to the purchase by China in the deal that he believes will alter China’s usual pattern of buying U.S. ag goods in the fall and winter. "If China is going to achieve that, and we believe they are, we think they have to buy earlier than the traditional export season from the United States," Perdue observed. He also predicted that the U.S. will post a record year for U.S. ag exports, especially with the additional Chinese purchases. This will put more attention on the U.S. ag export forecast which is not scheduled to be updated until February 20.

| Rural Advocate News | Wednesday January 22, 2020 |


Wednesday Watch List Markets On this holiday-shortened week of trading, Wednesday's reports include U.S. existing home sales at 9 a.m. CST and a monthly cold storage report at 2 p.m. Traders are also paying attention to the latest weather forecasts for South America and any hints of export activity, especially from China. Weather Rain, mixed precipitation and snow will cross the eastern and southeastern Plains, western Midwest, and Delta Wednesday. Transportation delays along with safety hazards and livestock stress will occur. The precipitation also threatens flooding along with keeping soils saturated ahead of spring field work.

| Rural Advocate News | Tuesday January 21, 2020 |


Ag Secretary Expecting the Third Round of Trade Aid Payments Even though the first trade deal with China has been signed, Ag Secretary Sonny Perdue says he still expects U.S. farmers to get a third-round of 2019 trade aid payments. USDA hasn’t officially announced if and when the farmers would get those payments. Perdue tells Bloomberg that the move is still waiting for approval from the White House Office of Management and Budget. Perdue says the agreement won’t interfere with the final round of trade assistance payments made under the Market Facilitation Program. “My expectation is the third round will be issued immediately,” Perdue says. “I’m counting on it, but we’ve got to get that allocated through OMB. But I see no reason why we can’t get that done.” The U.S. government instituted the aid program as the trade war with China escalated and the Asian country implemented retaliatory tariffs on American farm goods. The first round of payments was issued last fall, with the second payments coming in the winter. Perdue did say that farmers shouldn’t expect new assistance this year beyond the $28 billion that was previously approved. The administration wants to begin phase two trade talks with China as soon as possible, with President Trump willing to travel to China to help them get going. ********************************************************************************************** Europe Next in the Trade Negotiation Bullseye Phil Hogan, the new Trade Commissioner for the European Union, was in Washington, D.C., last week and spoke about the tense relationship between the EU and the U.S. The New York Times says Hogan promises to “robustly defend” European interests as he justified the European position on trade disagreements with the U.S. over airplane subsidies, digital taxes, and the World Trade Organization. He criticized American officials for being inaccurate in claiming that trade between the U.S. and EU was unbalanced, while also saying America’s aggressive use of tariffs against trading partners was “hardly sensible.” His comments came as the U.S. is considering the use of new tariffs against the European Union trading bloc. However, Hogan ruled out the possibility of a three-way trade relationship between the EU, the U.S., and the United Kingdom in a post-Brexit world. U.S. Commerce Secretary Wilbur Ross tells Fox Business News that sealing the phase one trade deal with China and congressional passage of USMCA boosts the U.S. negotiating stance with Europe. “Our position is infinitely better already just because of these two deals,” Ross says. ********************************************************************************************** Foreign Ag Service Chases New Trade Opportunities in 2019 The U.S. Department of Agriculture’s Foreign Agricultural Service was busy looking for new trade opportunities in 2019. Undersecretary for Trade and Foreign Agricultural Affairs Ted McKinney says the agency fought throughout the year to unlock new export opportunities for U.S. agriculture around the globe. Last year, the FAS hosted six trade missions and supported exporter participation in 22 international trade shows. Together, those activities resulted in nearly $3 billion in projected 12-month sales of U.S. farm and food products across the globe. The agency also facilitated another $2 billion in exports of American commodities to Latin America, Africa, and the Middle East. McKinney says, “While the U.S. was in the process of finalizing the phase one trade agreement with China, we successfully defended U.S. wheat, corn, and rice interests against China at the World Trade Organization.” FAS staff around the globe also helped U.S. exporters in releasing hundreds of shipments that were detained at ports of entry in overseas markets, ensuring that over $95 million in perishable products arrived safely at their final destinations. “USDA efforts to break down barriers and pursue export opportunities resulted in new or expanded market access for numerous U.S. farm products in 2019,” McKinney adds. ********************************************************************************************** National Biodiesel Conference Looks to the Future The National Biodiesel Conference and Expo get underway this week at the Tampa Convention Center in Florida on Tuesday. The biggest gathering of the biodiesel industry will unveil “Vision 2020.” The industry will look to the future after ending 2019 with recent policy victories in Washington, D.C. Donnell (duh-NELL) Rehagen (REE-hagen), CEO of the National Biodiesel Board, says, “Last year at this time, U.S. biodiesel and renewable diesel producers faced an uncertain future. Thanks to our members and the support of industry champions, we’re going into the new year ready to deliver even more biodiesel to both our transportation and home heating fuel customers.” He says the conference is an opportunity to lay out the road map for the next ten years for a fuel that’s better than ever, cleaner, and now available coast-to-coast. Industry stakeholders at the conference will get new information on the latest vehicle technology, take a deep dive into the future of renewable fuels, and they’ll hear from expert speakers on environmental policy. The vehicle showcases and ride-and-drive events provide a chance to check out the latest biodiesel cars and trucks coming out from the world’s biggest manufacturers. The NBB says biodiesel is a clean-burning diesel replacement that can be used in existing diesel engines without modification. ********************************************************************************************** Farm Lending Declines at the End of 2019 Farm lending activity dropped for a second consecutive quarter at commercial banks at the end of last year. A reduction in non-real estate farm lending, particularly for operating loans, was the primary contributor to a reduced volume of loans at banks with portfolios that concentrate heavily on agriculture. The declines came along with additional reductions in production expenses, but reduced loan demand likely also was due to an increase in revenue from government payments connected to the trade disputes that lingered through the year. Following average annual growth of more than 10 percent in 2017 and 2018, and several quarters of sharp increases, lending activity contracted in the second half of last year and, on average, was five percent lower in 2019. Despite decreasing from a year ago, farm lending volumes remained higher than the 20-year average. The total volume of non-real estate loans averaged about $90 billion in 2019 and was about eight percent above the average number stretching back to 1999. ********************************************************************************************** Bureau of Land Management Taking Steps to Improve Grazing The Bureau of Land Management recently announced it’s preparing an Environmental Impact Statement (EIS) on new grazing regulations. The bureau’s Notice of Intent will appear this week in the Federal Register on January 21st. A public comment period is now open and in-person meetings will be held across the western U.S. The National Cattlemen’s Beef Association’s Federal Lands Committee and the PLC’s Grazing Regulations Working Group both call this a “once-in-a-generation opportunity for BLM permittees to set the record straight.” The groups say they’ve endured Bruce Babbitt’s “Range Reform” for more than 25 years, with the land, native grasses, and local ranching families suffering as a result. The groups both say this is a great first step to righting that wrong and can’t emphasize enough how important it is for ranchers to submit comments and participate in the meetings. More information can be found on the BLM website.

| Rural Advocate News | Tuesday January 21, 2020 |


WASHINGTON INSIDER: FDA'S RECENT TUNA RECALL DECISION Food Safety News is running a guest editorial this week on the need to recall tainted tuna. The writer is Sandra Eskin who directs the Pew Charitable Trusts' work on food safety, a non-partisan, global research and public policy effort dedicated to serving the public interest. The editorial focuses on a recently announced FDA interpretation of authority on mandatory recalls that it claims "weakens food safety." The writer says that the Food and Drug Administration decided late last year not to order a mandatory recall of yellowfin tuna that sickened at least 50 people in 11 states—and thereby "threatens to undermine a crucial tool of last resort to protect consumers from hazardous food." "She urges FDA leaders to reverse course and require that the companies responsible for these products remove them from the market." In a Nov. 15 announcement, the agency said the illnesses were caused by imported tuna with high levels of scombrotoxin, a substance produced when certain fish species spoil. The company supplying most of the implicated tuna has not initiated a recall, despite an FDA request. In fact, she asserts that "these products could still be on the market," according to the agency and neither cooking nor freezing them will make them safe to eat. A Dec. 26 FDA update on the investigation said that additional illnesses had been reported and voluntary recalls by business customers of the fish supplier "have not effectively removed" the dangerous tuna from the market. Still, the agency stopped short of mandating a recall, Eskin noted. Congress armed the agency for exactly this kind of situation in 2011's FDA Food Safety Modernization Act. The law authorized mandatory recalls when companies do not conduct them voluntarily for products that may cause "serious adverse health consequences or death" to people or animals. The agency's initial announcement, however, argued that "because scombrotoxin fish poisoning causes temporary or medically reversible adverse health consequences this incident did not meet the threshold for the use of FDA's mandatory recall authority." Eskin argues that this interpretation of the law "fails to protect Americans from preventable illnesses." Scombrotoxin poisoning can cause serious adverse health consequences including nausea, headache, faintness, abdominal cramps, and diarrhea. According to the FDA, "severe cases may blur vision, and cause respiratory stress and swelling of the tongue." Patients may require medical treatment such as intravenous fluids, oxygen, and antihistamines, and people with particularly serious reactions to the toxin have experienced cardiac complications and low blood pressure. In addition, Eskin charges that this decision by FDA could set a dangerous precedent, one that may encourage companies to disregard requests for voluntary recalls or to challenge agency-mandated recalls on the grounds that the harm likely done by their products is not serious enough. The agency's response also runs counter to pledges by its leaders to "make more robust use of mandatory recall authority"—a power used just three times since FSMA's enactment nine years ago, Eskin says. In November 2018 FDA released final guidance to clarify for businesses when and how it will exercise this authority for potentially contaminated food. Then-Commissioner Scott Gottlieb explained the goal: "Our aim is to expand the appropriate use of our mandatory recall authority in cases where we have to intervene quickly to help protect consumers from unsafe products." The ongoing outbreak of scombrotoxin poisoning presents a crucial test of this commitment, Eskin says. "The agency's overly restrictive interpretation of serious adverse health consequences" undermines both the letter and the spirit of FSMA. She calls on FDA leaders to reconsider their response in this case and, going forward, should make greater use of mandatory recall authority to protect the public from preventable foodborne infections. Recalls of contaminated food products are an important regulatory tool of food inspection agencies, but are wielded reluctantly because of the inconvenience and cost to manufacturers. As a result, FDA has long been reluctant to impose recalls—and in cases where products have been recalled, have taken significant steps to make sure these have been as sensitive as possible to producer interests. The new FSMA was designed to provide rules that to make clear specific actions to be taken to protect consumers from exposure to contaminated food products—and to strengthen what was seen by many as the agencies reluctance to impose tough safeguards. These rules are crucially important to the credibility of the national food safety effort and debates about how those safeguards are defined and implemented should be watched closely by producers as they emerge, Washington Insider believes.

| Rural Advocate News | Tuesday January 21, 2020 |


CHINA KEEPS INSISTING PURCHASES OF US AG GOODS WILL BE BASED ON MARKET CONDITIONS Chinese officials continue to reiterated what Vice Premier Liu He said at the signing ceremony for the Phase One deal with the U.S. -- the purchases China has committed to making will be made based on market conditions. The purchases will also follow WTO rules, said Li Xingqian, head of foreign trade department at Ministry of Commerce. In remarks in Beijing, he said that the increased imports from the U.S. will not affect imports from other countries. China's Liu made the same point in this remarks at the signing ceremony. Further, Li said that the Chinese has large potential and it welcomes high quality and competitive U.S. goods.

| Rural Advocate News | Tuesday January 21, 2020 |


TRUMP TOUTS US-CHINA DEAL, WOTUS ACTIONS IN FARM BUREAU REMARKS President Donald Trump addressed the American Farm Bureau Federation annual meeting for the third year in a row, and predictably Trump spent a good portion of his time before the gathering talking about Phase One of the agreement signed with China on Jan. 15. He dubbed the accord "a bonanza for American farmers, adding he thinks the pact is "going to work out well. I think China is going to go all out. … I think they're looking to prove that it's going to be great for the farmer." Trump also pointed to regulatory relief measures his administration had taken, including the repeal of "waters of the U.S." (WOTUS) rule that expanded federal jurisdiction over some wetlands and streams. "As long as I'm president, government will never micromanage America's farmers. You're going to micromanage your own farm and that's the way it should be," Trump said. Trump also highlighted actions by the administration on issues like broadband access and farm labor. "We want them *immigrants) to come in, legally, and we want them to come in so they can help the farmer, just so you understand because I want them to be able to come in to help our farmers, and we're going to give you plenty of help," Trump said.

| Rural Advocate News | Tuesday January 21, 2020 |


Tuesday Watch List Markets Tuesday starts with a report on U.S. housing starts at 7:30 a.m. CST, followed by U.S. industrial production at 8:15 a.m. and an index of U.S. consumer sentiment at 9:00 a.m. South American weather forecasts remain of interest as do any clues of export activity after Wednesday's phase one agreement. Weather Snow and freezing rain are in store for the central and south-central Plains and western Midwest Friday, causing safety and transportation hazards and stressing livestock. Southern Plains areas will have moderate to locally heavy rain, favoring wheat moisture. Bitter cold will be confined to the Canadian Prairies.

| Rural Advocate News | Friday January 17, 2020 |


Senate Passes USMCA The Senate Thursday morning passed the U.S.-Mexico-Canada Agreement, sending it to President Donald Trump’s desk. The Senate vote, 89-10, moves the agreement ahead of the impeachment trial in the Senate. President Trump is expected to sign the agreement sometime next week during a formal ceremony, perhaps while the impeachment trial is underway. House Democrats took more than a year to make changes to the original agreement negotiated by the Trump administration. For agriculture, USMCA is expected to increase U.S. exports by $2 billion. The vote comes just one day after the United States signed a new trade agreement with China, which promises to increase agricultural exports overseas by tens of billions of dollars. On Twitter, President Trump proclaimed, “The farmers are really happy with the new China trade deal and the soon to be signed deal with Mexico and Canada.” The President said he hopes farmers remember he used tariff funds to “help them get through the tough times.” ************************************************************************************* Agriculture Reacts to USMCA Senate Passage Agriculture organizations offered applause to lawmakers in the Senate who overwhelming supported approval of the U.S.-Mexico-Canada Agreement Thursday. National Corn Growers Association President Kevin Ross says the vote ensures “corn farmers will continue to have access to our largest and most reliable markets.” Mexico is a top destination for U.S. corn. Meanwhile, Bill Gordon of the American Soybean Association says the vote “means we can start 2020 on a more positive note.” Mexico is the number two market for whole beans, meal and oil, and Canada is a top ten buyer of meal and oil. U.S. Meat Export Federation CEO Dan Halstrom says the vote “bolsters our position as a reliable supplier to two leading markets that account for about one-third of all U.S. red meat exports.” Meat shipments to Mexico and Canada in 2019 totaled about 1.25 million metric tons valued at $3.8 billion. Finally, American Farm Bureau Federation President Zippy Duvall says USMCA “comes at a critical time for farmers and ranchers, increasing optimism that we’ll turn the corner in 2020.” ************************************************************************************* Secretary Perdue Statement on Senate Passage of USMCA Agriculture Secretary Sonny Perdue says of the U.S.-Mexico-Canada Agreement, farmers "are eager to see the President sign this legislation and begin reaping the benefits." Canada and Mexico are the first and second-largest export markets for United States agricultural products, totaling more than $39.7 billion in food and agricultural exports in 2018. Under the agreement, all food and agricultural products that have zero tariffs under the North American Free Trade Agreement will remain at zero tariffs. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the United States and Canada, the USMCA will create new market access opportunities for United States exports to Canada of dairy, poultry, and eggs, and in exchange, the United States will provide new access to Canada for some dairy, peanut, and a limited amount of sugar and sugar-containing products. The agreement specifically addresses agricultural biotechnology, including new technologies such as gene editing, to support innovation and reduce trade-distorting policies, and the agreement institutes a more rigorous process for establishing geographical indicators. ************************************************************************************* USDA Reminds Producers to Pay Their Crop Insurance Premiums by January 31 The Department of Agriculture’s Risk Management Agency is reminding producers that their crop insurance premiums for the 2019 crop year are due January 31. Policies that do not have the premium paid by January 31, 2020, will have interest attach on February 1, calculated from the date of the premium billing notice. USDA had deferred to January 31, 2020, the accrual of interest on 2019 crop year insurance premiums for most policies with a premium billing date of August 15, 2019, to help the large number of farmers and ranchers affected by extreme weather and other challenges in 2019. RMA Administrator Martin Barbre says, “We urge producers to make their premium payment on time to ensure they don’t get charged interest back to their premium billing notice date.” Producers are encouraged to contact their crop insurance agents for more information or assistance. ************************************************************************************* USDA Seeks Input on New Ethanol Sales Infrastructure Incentive Program The Department of Agriculture announced Thursday it is seeking public input to help with the creation of the Higher Blends Infrastructure Incentive Program. The new program, according to USDA, will expand the availability of domestic ethanol and biodiesel by incentivizing the expansion of sales of renewable fuels. Agriculture Secretary Sonny Perdue says, "USDA remains committed to fulfilling a key promise to American farmers to enhance the promotion of biofuels." The request for information solicits ideas on options for fuel ethanol and biodiesel infrastructure, innovation, products, technology, and data derived from all program processes, or science, that drives economic growth, promotes health, and increases public benefit. Growth Energy CEO Emily Skor welcomed the request, saying, “Smart infrastructure investments will support rural jobs and allow more drivers across the nation to take advantage of the administration’s move to unleash sales of E15 year-round.” Working with Prime the Pump, Growth Energy has doubled the number of E15 stations five years in a row to include more than 2,000 stations across 30 states. ************************************************************************************ Mexico Strikes Down Nationwide E10 Mexico's Supreme Court this week ruled against a federal policy that would allow for higher ethanol blends nationwide. Mexico's Energy Commission sought a rule that would allow up to ten percent ethanol in gasoline nationwide, excluding the country's three biggest cities. The pre-existing fuel rule allows a maximum 5.8 percent ethanol content, according to Reuters. The court called for more science-based evaluation of higher-ethanol fuels. Kenneth Smith, a former Mexican trade negotiator, told Reuters Mexico should try again to craft a nationwide ten percent ethanol rule, calling it a “win-win” for Mexico. In a statement, the Mexican Association for Sustainable Mobility, an ethanol backing group, says, “Ethanol is part of the solution to reduce dependence on fossil fuels, use renewable energy, lower gasoline prices, create domestic jobs, boost the agricultural economy and improve the environment, it said.

| Rural Advocate News | Friday January 17, 2020 |


Washington Insider: China's Growing Economic Influence The complex phase-one trade deal with China was signed this week and the urban press, among others, is hard pressed to evaluate what it may mean. For example, while everybody thinks this "trade truce" is much better than the alternative, there also has been a rush to point out what it may not accomplish. For example, the Times emphasized the deal is a "truce" not a "peace treaty" and argued that while administration officials are bullish, "many economists are not." In addition, the general reaction to the agreement includes the deepening realization that China has, indeed, become an economically strong world competitor. In that regard, the Times reported extensively on one of China's major programs, its big-money push to build ports, rail lines and telecommunications networks -- and increase Beijing's political sway in the process. While the program seemed to be running out of gas just a year ago, it now "has come roaring back." In response, the Times notes Western officials and companies are renewing their warnings that China's gains in business and political clout could come at their expense. Chinese companies signed Belt and Road contracts worth nearly $128 billion in the first 11 months of last year, a 41% increase over the same period in 2018, the Times said. The contracts are mostly for construction and equipment by big Chinese companies using Chinese skilled labor and loans from Chinese banks, although the projects often create jobs for local laborers as well. The return of Belt and Road is likely to raise additional tensions with the United States, which worries China is building a globe-spanning bloc of nations that will mostly buy Chinese goods and tilt toward China's authoritarian political model. The rush of new Belt and Road contracts follows a public pullback by Chinese officials in 2018 after several projects were criticized by local officials and others as bloated and costly. China argues that, since then, it has fine-tuned practices to trim waste. Officials in the United States and Western Europe have long criticized Belt and Road as predatory and recently some officials in developing countries began to agree. Vice Premier Liu He of China publicly raised concerns in early 2018 about heavy lending by Chinese banks, not just for the Belt and Road Initiative. In the months that followed, Chinese financial regulators clamped down hard on domestic and overseas lending alike. New Belt and Road contracts plummeted, Chinese data showed. China's financial regulators told the country's banks to look twice at further lending to poor countries. But the credit crunch produced a much broader slowing in the Chinese economy than expected, so financial regulators reversed course. Contracts started to be signed in earnest again in the final weeks of 2018, and momentum built through last year. More recently, two western groups have raised questions about the resurgence of the Belt and Road Initiative. A report released Thursday by the European Chamber of Commerce in China concluded that Chinese-built telecommunications networks and ports are set up in ways that make it hard for European companies to compete. A survey by the chamber of its members also found they had been almost completely excluded from bidding on Belt and Road Initiative contracts, which went mostly to Chinese state-owned enterprises. The Institute of International Finance, a research group in Washington backed mainly by big Western banks, issued a different warning on Monday as part of a broader report on global debt. The institute's report said many poor countries in the Belt and Road Initiative now find themselves with sharply increased debt burdens. Many of these countries could barely qualify to borrow money even before they took on the new debt, the report said. The institute's report also said 85% of Belt and Road projects involved high emissions of greenhouse gases linked to climate change. These projects have included at least 63 coal-fired power plants, as well as loans that tend to carry considerably higher interest rates than those from lending institutions like the World Bank. The construction industry group and also the European chamber said the costs of Belt and Road Initiative projects are often greatly underestimated. They focus both on national telecom networks, new ports and other infrastructure that now mean a competitive disadvantage for both U.S. and European investors in several growing areas. China has contended that economic growth has long suffered in many emerging markets from high transportation costs, and that the construction of new ports can reduce these costs. So, we will see. Clearly, the hoped-for phase two of the China deal will be focused on a number of the remaining areas of anti-competitive behavior and will rely less on direct trade interventions like tariffs. The next steps will be crucial to ag producers and should be watched closely as they begin to take shape, Washington Insider believes.

| Rural Advocate News | Friday January 17, 2020 |


USDA Requests Info on Infrastructure Needed For Higher Renewable Fuels Blends USDA has published a request for information (RFI) for the Higher Blends Infrastructure Incentive Program (HBIIP). The RFI seeks to gain input "to expand domestic ethanol and biodiesel availability." USDA wants information "opportunities to consider infrastructure projects to facilitate increased sales of higher biofuel blends (E15/B20 or higher.)" This effort seeks to build on the Biofuels Infrastructure Partnership (BIP) program USDA operated from 2016 to 2019 through state and private partners to expand the availability of E15 and E85 infrastructure to make available higher ethanol blends at retail gas stations around the country. The request from USDA aims at informing where there may be "notable gaps, vulnerabilities, and areas to promote and protect in the HBIIP that may benefit from Federal government attention." Comments are due on or before Jan. 30.

| Rural Advocate News | Friday January 17, 2020 |


USDA'S Perdue Insists Final MFP 2 Payment Coming While there has been some uncertainty on whether the administration would make the final installment of the 2019 Market Facilitation Program (MFP 2) payment to farmers, USDA Secretary Sonny Perdue Wednesday appeared to put that issue to rest. In separate interviews with Ag Day and Bloomberg, Perdue sought to assure farmers he expects the payments will be made. Asked by Ag Day if the third MFP 2 installment would come, Perdue said, "I absolutely do expect that and I do not know, I do not know where the fake news came from over the anxiety of that maybe not being there. But it did not come from us. There has been questions from the Hill and from other industries there. But my expectation is that the president will direct us to fulfill that third tranche of the commitment of the 2019 MFP payments." In his remarks to Bloomberg, Perdue said, "I'm counting on it, but we've got to get that allocated through the Office of Management and Budget. But I see no reason why we can't get that done." Through Jan. 6, USDA has paid out $10.769 billion under MFP 2, with Iowa, Illinois, Texas, Minnesota and Kansas being the top five states receiving the payments.

| Rural Advocate News | Friday January 17, 2020 |


Friday Watch List Markets Friday starts with a report on U.S. housing starts at 7:30 a.m. CST, followed by U.S. industrial production at 8:15 a.m. and an index of U.S. consumer sentiment at 9:00 a.m. South American weather forecasts remain of interest as do any clues of export activity after Wednesday's phase one agreement. Weather Snow and freezing rain are in store for the central and south-central Plains and western Midwest Friday, causing safety and transportation hazards and stressing livestock. Southern Plains areas will have moderate to locally heavy rain, favoring wheat moisture. Bitter cold will be confined to the Canadian Prairies.

| Rural Advocate News | Thursday January 16, 2020 |


Trump Signs Phase One Agreement with China President Donald Trump signed a trade agreement with China Wednesday. The phase one deal, according to the Trump administration, is worth an extra $40-50 billion annually over the next two years in U.S. agricultural sales to China. However, Senate Minority Leader Chuck Schumer earlier this week called the deal weak, suggesting Trump reached a watered-down agreement to claim a “win” during his reelection campaign. Further information suggests the figure may be $32 billion in increased ag purchases, not $40-50 billion. Senator Chuck Grassley, a Republican from Iowa, attended the ceremony. Grassley welcomes the agreement but says, “Not only must China follow through with its commitments in this phase one deal, but also work toward a comprehensive agreement.” President Trump says the agreement removes trade barriers for U.S. agricultural products, particularly for beef. Meanwhile, Agriculture Secretary Sonny Perdue says the agreement will benefit many different U.S. farm commodities. The agreement should be implemented within 30 days, according to the Trump Administration. ************************************************************************************* USTR offers China Agreement Details Documents released by the U.S. Trade Representative’s Office offer details into the agriculture provisions in the U.S.-China phase one trade agreement. USTR Robert Lighthizer says China will purchase and import, on average, at least $40 billion of U.S. food, agricultural and seafood products annually for a total of at least $80 billion over the next two years. Products will cover the full range of U.S. agriculture. U.S. exports of pork products were $700 million in 2017 and are expected to reach $1.7 billion annually in the next two to three years. China will expand the scope of beef products allowed to be imported, eliminate age restrictions on cattle slaughtered for export to China, and recognize the U.S. beef and beef products' traceability system. The Department of Agriculture estimates U.S. beef and beef product exports to China could reach $1 billion annually. Further, China has agreed to implement a transparent, predictable, efficient, science- and risk-based regulatory process for the evaluation and authorization of products of agricultural biotechnology. ************************************************************************************* Peterson, Costa, Cautiously Optimistic about Phase One China Deal House Agriculture Committee Chairman Collin Peterson of Minnesota and Livestock and Foreign Agriculture Subcommittee Chairman Jim Costa of California say they are optimistic but cautious, regarding the phase one trade agreement with China. Peterson notes the agreement includes potential increased market access for U.S. farmers, adding, “The question now is whether China will play by the rules it has agreed to here.” Peterson says he is concerned that long-term, certain crops may not regain the foothold they lost in the trade war. Meanwhile, Costa says, “The key is getting the Chinese to stick to their commitments and prove that they will honor international agreements.” Costa adds it’s not immediately clear that the new purchases, at least $40 billion worth annually according the Trump Administration, “will make up for what we’ve lost along the way.” Both Peterson and Costa say they are pleased to see progress on negotiations with China. However, most tariffs on China will remain in place, while Trump seeks a phase two agreement. ************************************************************************************* Farm Groups Welcome Phase One Agreement Agriculture groups welcome the new trade agreement with China. The U.S. Grains Council says the agreement should reduce continued market uncertainty and incentivize China to purchase significant amounts of the full range of U.S. agricultural products. Growth Energy CEO Emily Skor says the signing is ”another positive step towards restoring market confidence for U.S. biofuel producers.” In 2016, China was the third-largest export market for U.S. biofuels, but exports were nearly eliminated due to retaliatory tariffs and trade negotiations. The National Cattlemen's Beef Association calls the agreement a "game-changer." NCBA President Jennifer Houston says the removal of trade barriers included in the agreement “gives Chinese consumers access to the U.S. beef they desire.” The National Pork Producers Council applauded the agreement, as well, saying pork producers are "ideally positioned to address this unprecedented sales opportunity for pork in China." However, NPPC urged the removal of the 60 percent punitive tariffs on U.S. pork to "fully capture the benefits" of the agreement. ************************************************************************************* USMCA Senate Vote Thursday The Senate is hopeful to vote on the U.S.-Mexico-Canada Agreement Thursday (this) morning. After quickly advancing the agreement through required committee approvals, the Senate will consider the agreement ahead of the impeachment trial next week. However, the Senate is not in session Friday, leaving little time to debate and pass the implementing legislation. Thought to be delayed until after the impeachment trial, the Senate moved up committee hearings to include USMCA passage during a busy week in Washington. The same day President Donald Trump signed the China agreement, the House of Representatives sent articles of impeachment to the Senate. Now, the Senate must make the impeachment trial a priority, which is expected to begin Tuesday. Action by the Senate would move USMCA to President Trump's desk for his signature. The signing of the agreement would signal Canada to approve the agreement, whose government is waiting for U.S. approval. Mexico already approved the agreement last year. ************************************************************************************* FSA Encourages Farmers to Enroll in ARC, PLC, Now USDA’s Farm Service Agency encourages producers to enroll now in the Agriculture Risk Loss (ARC) and Price Loss Coverage (PLC) programs. March 15, 2020 is the enrollment deadline for the 2019 crop year. Although more than 200,000 producers have enrolled to date, FSA anticipates 1.5 million producers will enroll for ARC and PLC. By enrolling soon, producers can beat the rush as the deadline nears. FSA Administrator Richard Fordyce says, “please do not wait to start the enrollment process,” adding producers “need to begin the program election and enrollment process now.” ARC and PLC provide financial protections to farmers from substantial drops in crop prices or revenues and are vital economic safety nets for most American farms. Until March 15, producers who have not yet enrolled in ARC or PLC for 2019 can enroll for both 2019 and 2020 during the same visit to an FSA county office unless yield updates are requested. Additionally, farm owners have a one-time opportunity to update PLC payment yields that take effect beginning with crop year 2020.

| Rural Advocate News | Thursday January 16, 2020 |


Washington Insider: EU Trade Commissioner Visits US Most of the press is focused on the first phase of the China trade deal this week but there is another effort underway as Europe’s new trade commissioner has come to Washington. His mission is “to prevent the Trump administration from ruining the European economy,” the New York Times said. The Times is not optimistic. It thinks that trans-Atlantic relations are so low that Commissioner Phil Hogan, a blunt-talking, physically imposing Irishman, “will probably do well if he can simply prevent things from going any further downhill.” The Times reviews its list: the U.S. is threatening tariffs that would double the price of imported French wine. The EU accuses the administration of paralyzing the system for resolving trade disputes and likely is “ushering in an era of conflict and disorder.” Punishing tariffs on European steel and aluminum remain in place. And, the administration continues to threaten duties on European cars, a potentially heavy hit. Finally, the Times says Europeans are deeply alarmed by “what they regard as the president’s recklessness in the Middle East.” “The current state of EU-U.S. relations isn’t good, and I don’t think it’s likely to get better anytime soon,” said Peter Chase, senior fellow at the German Marshall Fund of the United States in Brussels. Still, Commissioner Hogan brings a different set of skills than Cecilia Malmstrom, whom he succeeded at the beginning of December. Some in Brussels think his rawer style will make him a better match for the current occupant of the White House. “He is more direct,” said Luisa Santos, the director for international relations at BusinessEurope, an industry group. Gender may also play a role, Santos said. There is a widespread perception in Washington and Brussels that Trump officials were not comfortable with Ms. Malmstrom, an assertive Swede. But it’s unclear whether Hogan will have any more success than Malmstrom at repairing the largest trade partnership in the world, worth $1 trillion a year. His agenda includes meetings with Robert Lighthizer, the United States Trade Representative; Steven Mnuchin, the Treasury secretary; and Wilbur Ross, the Secretary of Commerce. To varying degrees, all support the president’s hard line on trade relations, the Times said. On Tuesday, there was a sign that the United States and Europe were still capable of cooperating. Hogan, Lighthizer and Kajiyama Hiroshi, the Japanese minister of economy, trade and industry, said in a joint statement that they would work together to tighten international rules on government subsidies and forced transfer of technology. The statement was clearly aimed at China, which is often accused of propping up its companies to give them an unfair advantage over foreign competitors and of forcing foreign companies to share sensitive technology in return for permission to operate in China. The three countries also agreed to work together to reform the WTO, a key objective of the Europeans. A 6-foot-5 former farmer from Kilkenny in southern Ireland, Hogan spent much of his political career in the trenches of Irish domestic politics, helping to build the centrist Fine Gael party into Ireland’s strongest bloc. He was Fine Gael’s director of organization in the early 2000s and later head of the party’s national election campaign. A former agriculture commissioner, Hogan was often involved in trade talks and gained a reputation for being canny and well prepared. Farm products are typically the most politically sensitive component of trade deals. A plan to reach a more comprehensive transatlantic trade deal early on in Trump’s tenure fell apart over disagreements about how to address agriculture. But little remains of the optimism that followed a meeting in July 2018 between President Donald Trump and Jean-Claude Juncker, then the president of the European Commission. The two men said they would work to reduce tariffs to zero and eliminate regulations that hindered trans-Atlantic trade. Still, progress has been modest at best. In July, they agreed to recognize each other’s inspections of factories that produce pharmaceuticals. But in most other ways, the relationship has only soured. The Europeans accuse the United States of crippling the WTO by blocking appointments of new members to a crucial panel that hears appeals in trade disputes. Without a system to enforce trade rules, Hogan told members of the European Parliament last year, “Well, then, there isn’t any point in having agreements.” “When sides take unilateral actions that harm the other side, that are inconsistent with international norms, the other side has a right to be angry,” said Clete Willems, a partner at the law firm Akin Gump who was an economic adviser in the White House until last year. “That’s where we are with the EU now.” Hogan is expected to try to convince his American counterparts that Europe and the United States should work together to rein in China, in part by fixing the WTO. He also plans meetings on Capitol Hill, where his Irish-ness is likely to play well. So, we will see. Clearly, avoiding negative trade sanctions is no small task, especially at this point in time. Thus, Hogan’s work in the U.S. is important and should be watched closely by U.S. producers throughout the week, Washington Insider believes.

| Rural Advocate News | Thursday January 16, 2020 |


DOE to Provide Funding For Research On Bioenergy Crops Up to $75 million over five years will be provided for research on development of sustainable bioenergy crops that can withstand environmental stress and changing environmental conditions, according to an announcement from the Department of Energy. The funding will be directed at universities, industry and nonprofit research institutions as the lead researchers and they may collaborate with DOE national labs and other federal agencies. The funding will be awarded on a competitive basis in the form of five-year grants ranging from $1 million to $3 million per year starting in Fiscal Year (FY) 2020. Planned funding is $75 million over five years, with outyear funding dependent on appropriations.

| Rural Advocate News | Thursday January 16, 2020 |


US-China Trade Deal Signed Addressing Several Key Issues President Donald Trump and Chinese Vice Premier Liu He signed the Phase One trade agreement at the White House Wednesday, flanked by more than 200 in attendance that represented several sectors of the U.S. economy that should see benefits from the trade deal. The purchase commitments of U.S. ag products in the agreement are for a two-year total of $80 billion. That comes from purchases of $12.5 billion beyond a $24 billion base period for $36.5 billion in 2020 and $19.5 billion beyond the $24 billion base period for $43.5 billion in 2021. The package also addresses issues in China such as their operation of their tariff-rate quotas (TRQs) for wheat, corn and rice. The U.S. successfully challenged China’s operation of the TRQs at the WTO as the country has not filled those for the commodities in question. The TRQs were part of China’s commitments when the joined the WTO. The agreement also calls on China to set maximum limits on residues for three growth hormones used in beef production and removes the age limit on animals that U.S. beef can come from to ship to China. The agreement also has China committing to a specific timeline for approving new GMO products and has other biotechnology-related provisions aimed at preventing future trade issues.

| Rural Advocate News | Thursday January 16, 2020 |


Thursday Watch List Markets Reports of weekly export sales, weekly U.S. jobless claims and monthly U.S. retail sales will be released at 7:30 a.m. CST Thursday, followed by weekly natural gas inventories at 9:30 a.m. South American weather remains of interest as well as any further information regarding the new phase one trade agreement with China. Weather Very cold and dry conditions will cover the entire central U.S. Thursday. The severe cold will be stressful to livestock and transportation. Precipitation will be noted in the southern tier with rain; snow in the Northeast; and moderate to heavy snow in the Far West and Northwest. The western U.S. storm system will bring snow, ice and rain to central U.S. areas during the end of the week.

| Rural Advocate News | Wednesday January 15, 2020 |


McConnell: Senate to Process USMCA This Week Senate Majority Leader Mitch McConnell suggests the Senate will vote on the U.S.-Mexico-Canada Agreement this week. Bloomberg News expects a vote Thursday, as the Senate committees required to sign off on the implementing legislation are doing so quickly. However, a final vote has not been confirmed. The Senate Environment and Public Works Committee approved the agreement on a vote of 16-4 Tuesday morning. The Senate Budget Committee also approved the trade agreement Tuesday. Up next, the bill must be approved by the Commerce, Science and Transportation Committee, along with the Health, Education, Labor, and Pensions Committee today (Wednesday). The Senate Foreign Relations Committee changed its hearing from Thursday to today (Wednesday), and the Senate Appropriations Committee is expected to do the same, sending the agreement to the full Senate for approval. The House of Representatives is expected to send the articles of impeachment to the Senate this week, but the trials won’t likely start until next week, offering a small window of opportunity for the Senate to pass the agreement. *************************************************************************************​ China Imports of U.S. Soy, Pork, Rebound China’s purchases of U.S. pork and soybeans rebounded in November and December, ahead of today’s (Wednesday’s) signing of the phase one trade agreement between the two nations. Reuters reports that Chinese agricultural imports from the United States were at 14.1 billion yuan, or $2 billion, in December. A Chinese customs spokesperson says the increase in imports of soybeans and pork comes as "positive U.S.-China trade sentiment has boosted companies' confidence in December." African swine fever has severely reduced China's hog herd, the world's largest producer and consumer of pork. China has since increased exports of U.S. pork to record levels. Pork exports to China and Hong Kong were up 49 percent in value at $1.18 billion from January to November 2019. Consumer prices for pork in China nearly doubled since the initial outbreak of African swine fever, and efforts to rebuild the hog herd in China are slow going. China has also released frozen pork from state-owned reserves to help ease the situation for consumers. ************************************************************************************* Trade Group Seeks Accountability and Transparency A trade lobby group seeks accountability and transparency from the phase one agreement between the U.S. and China. Farmers for Free Trade seeks further details regarding both the China agreement, and the U.S.-Mexico-Canada Agreement. The China agreement includes $40 billion of increased purchases of U.S. agriculture products, according to the Trump administration. Farmers for Free Trade Co-Executive Director Brian Kuehl says, “There is a healthy skepticism about whether American farmers will actually see these purchases, adding “that skepticism is only compounded when we’re told we won’t see the full text of the deal.” Specifically, the organization is asking whether the $40 billion in ag purchases commitment is contingent on any actions by the U.S. and for details on how China will meet the commitment if it’s been made. Meanwhile, Chinese Vice Premier Liu (Lou) He was reported to be in last-minute talks with the U.S. ahead of today’s (Wednesday’s) signing ceremony. A potential phase two agreement is expected to tackle more sensitive issues between the U.S. and China. ************************************************************************************* GMA Rebrands as Consumer Brands Association The Grocery Manufacturers Association is now the Consumer Brands Association, as part of a rebranding effort. Geoff Freeman, president and CEO of the association, says the Consumer Brands Association is “an entirely new organization with a focused, compelling agenda.” The association represents the grocery product industry. Research by the organization suggests the association should focus on concerns regarding transportation costs, growing investment and prioritization around sustainability. Board Chairman and CEO of General Mills, Jeff Harmening, says the association "will be a vital reflection of our united interests and alignment with today's consumer." From household and personal care to food and beverage products, the consumer-packaged goods sector contributes $2 trillion to U.S. GDP and supports more than 20 million American jobs. As the Grocery Manufacturers Association, the organization saw a handful of companies discontinue membership in 2017 over a GMO labeling disagreement. Several companies that left the organization went on to form the Sustainable Food Policy Alliance. ************************************************************************************* USDA Reminds Historically Underserved Producers of Advance Payment Option The Department of Agriculture reminds historically underserved producers, who are participating in the Environmental Quality Incentives Program (EQIP), of the advance payment option. The advanced payment option allows them to get conservation practice payments in advance of practice implementation. EQIP is administered by the Natural Resources Conservation Service. The program provides financial and technical assistance to address natural resource concerns and to deliver environmental benefits. In fiscal 2019, NRCS invested $1.3 billion through EQIP to implement conservation practices on more than 13 million acres. A historically underserved producer includes beginning farmers, socially disadvantaged farmers, veteran farmers and limited resource farmers. Under the advance payment option, producers may request payments when they have final designs and job sheets and are ready to begin their EQIP practices. Advance payments provide at least 50 percent of the payment rate for each practice. The funds must be spent within 90 days of receipt and practices must be completed as agreed to in an EQIP plan of operations. ************************************************************************************* Illinois Leads Nation in Soybean Production Again Illinois continues to top the annual crop production report estimate for soybean production, according to 2019 Department of Agriculture estimates. Despite a tough growing season for most of the Midwest, Illinois farmers consistently produced strong soybean yields. Illinois soybean farmers raised 532.4 million bushels of soybeans in 2019 on 9.86 million harvested acres with an average yield of 54 bushels per acre. Illinois Soybean Association chairman Doug Schroeder says 2019 will be remembered as the most challenging growing season on record, but adds “I think this report reflects the Illinois soybean industry’s resiliency and ability to produce a consistent, high quality product year after year.” Iowa ranked second in production with 501.6 million bushels raised on 9.12 million acres. Nationwide, soybean production in 2019 totaled 3.56 billion bushels, down 20 percent from 2018. The average yield per acre was estimated at 47.4 bushels, down 3.2 bushels from 2018. Harvested area was down 14 percent from 2018 to 75.0 million acres.

| Rural Advocate News | Wednesday January 15, 2020 |


Washington Insider: China No Longer Currency Manipulator The New York Times reported this week that the Trump administration “formally removed China’s designation as a currency manipulator on Monday, offering a major concession to the Chinese government as senior officials arrived in Washington to sign a trade agreement.” The Treasury Department released its long-delayed currency report Monday afternoon, providing its first public analysis of China’s currency practices since it was designated a manipulator in August. The report noted that China had made important commitments regarding the renminbi as part of the new trade agreement and that its value had appreciated since September. President Donald Trump had accused of weakening its currency, the renminbi, to make its goods cheaper to sell overseas. “China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability,” Treasury Secretary Steven Mnuchin said in a statement. Observers note that President Trump has long been critical of China’s currency practices, arguing that Beijing weakens the renminbi to make Chinese exports cheaper in the United States. He accused China of doing just that in August, when Beijing allowed its currency to weaken, saying it was an attempt to blunt the effect of tariffs he had imposed on Chinese imports. It was a rare point of bipartisan agreement that China deserved to be labeled a currency manipulator, bringing together Democrats like Senator Chuck Schumer, D-N.Y., the minority leader, and Republicans like Senator Rick Scott of Florida. The Times noted that the decision to remove the label was not unanimously supported. “Just because we’re negotiating a trade deal doesn’t mean we should ignore Communist China’s bad acts,” Scott said on Twitter. “They are a currency manipulator. Period.” Sen. Schumer, who has criticized China’s currency practices for years, accused Trump of caving to China in an attempt to score a political win. The currency report released on Monday said China had agreed to “publish relevant information related to exchange rates and external balances.” China will remain on the Treasury Department’s list of countries whose currency practices warrant close attention. The United States had last labeled China a currency manipulator in 1994. The designation, while seen as a type of public shaming, is largely symbolic and is supposed to prompt discussions between the United States, the IMF and the Chinese government on how China can make its currency more fairly valued. The International Monetary Fund said in a report last year that China’s currency was fairly valued. While most economists agreed that China had been distorting the value of its currency more than a decade ago, more recently it has been allowing market forces to play a role in letting the renminbi fluctuate within a set range. For much of last year, Chinese officials had actually been propping up the renminbi amid a weakening economy to prevent its value from falling too quickly. “China’s foreign exchange reserves, a key indicator of the degree of foreign exchange market intervention, has been quite stable over the last year,” said Eswar Prasad, former head of the International Monetary Fund’s China division. “While China still has a sizable trade surplus with the U.S., its overall current position is near balance, further undercutting the characterization of China as a currency manipulator.” Treasury’s currency report noted that the renminbi was trading as high as 7.18 per dollar in early September and was recently trading at 6.93 per dollar. Trump had promised as a presidential candidate to slap the manipulator label on China. Yet Mnuchin opted not to do so in the first five reports that his department issued. The department said China did not meet the department’s criteria for currency manipulation. As trade negotiations with China dragged on last summer, the President grew increasingly frustrated and seized upon China’s weakening currency as another source of leverage. Despite his own resistance, Mr. Mnuchin used his discretion as Treasury secretary to impose the label at the president’s urging. “They did it for political reasons,” Chad P. Bown, an international trade expert at the Peterson Institute for International Economics in Washington. “Clearly there was no legal basis or really an economic basis to do so.” Senior Chinese officials arrived in Washington on Monday to put the finishing touches on the trade agreement. In addition to the currency provision, the deal is expected to include a commitment by China to purchase more farm products and to open more of its markets, like financial services, to foreign firms and it is expected to agree to protect American intellectual property. In exchange, the Trump administration has reduced some tariffs on $360 billion worth of Chinese goods. Although the administration offered China an olive branch on its currency, it pressed ahead on Monday with new plans to scrutinize foreign investment that were devised with China in mind. The Treasury Department issued regulations to implement the Foreign Investment Risk Review Modernization Act of 2018, including exemptions for Australia, Canada and the United Kingdom from some of the more onerous requirements of the new law. So, we will see. Currency policies are fundamentally important and extremely complex to manage — trends producers should watch closely as they evolve, Washington Insider believes.

| Rural Advocate News | Wednesday January 15, 2020 |


USTR Assures Produce Growers On Imports From Mexico Southeast U.S. produce growers have gotten reassurances from U.S. Trade Representative Robert Lighthizer that the U.S. will be monitoring imports of fresh produce from Mexico as the implementation of the U.S.-Mexico-Canada Agreement (USMCA) takes place. The U.S. will increase scrutiny of Mexican produce pricing and hold field hearings after Congress approves the trade agreement's implementing legislation. Lighthizer said the U.S. will increase scrutiny of Mexican produce pricing and hold field hearings. Produce growers failed to get provisions in USMCA that would have made it easier to challenge imports of the products from Mexico.

| Rural Advocate News | Wednesday January 15, 2020 |


US-China Phase One Trade Deal Signing Today The signing ceremony for the U.S. and China to sign the phase-one trade deal will start at 10:30 a.m. (CT) at the White House Wednesday. In conjunction with the signing, the text of the agreement is to be made publicly available. However, there will not be certain components that are made public, including on the purchase commitment side. “The only non-public component of the agreement is a confidential annex with detailed purchase amounts, which has been previously described,” U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin said in a joint emailed response to questions, according to Bloomberg. “There are no other oral or written agreements between the U.S. and China on these matters, and there is no agreement for future reduction in tariffs.”

| Rural Advocate News | Wednesday January 15, 2020 |


Wednesday Watch List Markets The U.S. and China are expected to sign a phase one trade agreement sometime Wednesday and traders will be watching closely for details. The U.S. Labor Department releases a report on U.S. producer prices at 7:30 a.m. CST, followed by the Energy Department's weekly report of energy inventories at 9:30 a.m. At 1 p.m. CST, the Federal Reserve puts out its Beige Book, a monthly summary of how the economy is doing. Weather Snow, mixed precipitation, and very cold winds are in store for the Northern Plains and the northern and western Midwest Wednesday. These conditions will be stressful to livestock and will hinder transportation. We'll also see periods of rain in the eastern and southern Midwest through the Delta, keeping souls wet and threatening some local flooding.

| Rural Advocate News | Tuesday January 14, 2020 |


USMCA Likely on Hold for Impeachment Hearings Impeachment hearings are expected to now delay Senate consideration of the U.S.-Mexico-Canada Agreement. The House of Representatives will vote this week to send the articles of impeachment to the Senate. Senate leaders say the impeachment trial would last roughly two weeks, with members in session six days a week. That pushes any timeline for USMCA approval into February. Meanwhile, following approval of the implementing legislation in the Senate Finance Committee last week, other committees needing to approve the agreement are doing so quickly this week. The Environment and Public Works Committee, along with with the Senate Budget Committee, both scheduled hearings Tuesday morning. Meanwhile, the Commerce, Science and Transportation Committee will consider the agreement Wednesday morning, along with the Health, Education, Labor, and Pensions Committee. Finally, the Senate Foreign Relations Committee will consider the agreement Thursday morning. However, impeachment must take priority in the Senate, therefor holding up final approval of the agreement until after the impeachment process. ************************************************************************************* U.S.-China Agreement Concerns Remain President Donald Trump and Vice Premier Liu (Lou) He will sign the phase one trade agreement tomorrow (Wednesday) morning at the White House, with roughly 200 people invited to attend. However, some question China’s ability to increase expected purchases, and if the agreement will stick. The American Farm Bureau Federation says the agreement will open the market, but not exclusively to the United States. That means the U.S. will have to compete with other exporters for the expected $40-50 billion increase in annual purchases by China. Meanwhile, A U.S. Chamber of Commerce official told media members Monday the phase one agreement “stops the bleeding,” but doesn’t end the trade war. Reuters points out that the United States has left in place tariffs on $370 billion worth of Chinese imports. Further, negotiations for a phase two deal will probably touch on more difficult issues, including Chinese subsidies for state-owned firms and industrial policies perceived to be creating an uneven playing field. ************************************************************************************* GAO to Audit SRE’s Following Request The Government Accountability Office will review the Trump Administration’s biofuel small refinery exemptions, following a request from lawmakers. Representative Abby Finkenauer (Fink-en-now-er), a Democrat from Northeast Iowa, says, “Granting more than 80 small refinery exemption waivers isn’t just something this administration can sweep under the rug.” Finkenauer, along with a group of lawmakers from ethanol-producing states, sent a letter last August to the GAO, requesting a review of the small refinery exemptions granted by the Environmental Protection Agency. The letter sought review of EPA's approval process for the exemptions, the role the Department of Energy has in reviewing the exemption applications, and what is considered in the assessment of applications. The GOA responded late last week in a letter, stating, “GAO accepts your request as work that is within the scope of its authority.” Last year, the EPA announced it granted 31 new small refinery exemption waivers. Under the Trump administration, small refinery exemption waivers have more than quadrupled from the previous administration. ************************************************************************************* AEM Reports 2019 Full-year Tractor, Combine Sales Farmers bought more tractors last year compared to 2018, but combine sales remained flat. A new report for the Association of Equipment Manufacturers says for 2019, a total of 244,600 tractors were sold, which compares to 236,180 sold through December 2018, representing a four percent increase during the year. In 2019, two-wheel drive smaller tractors, rated under 40 horsepower, were up five percent, while 40 to under 100 horsepower tractor sales were even. Sales of two-wheel drive 100-plus horsepower tractors were up four percent, while four-wheel drive tractors sales were up six percent in 2019. Meanwhile, combine sales for the year totaled 4,807 compared to 4,839 in 2018. All sectors fell in Canada, with combine sales down 19.4 percent for the year. AEM senior vice president of Ag Services, Curt Blades, concludes, “While growth hit a bump toward the end of the year, ag tractor and combine sales overall for 2019 ended relatively flat.” ************************************************************************************ Trump to Attend AFBF Convention President Donald Trump will again join the American Farm Bureau Federation for its annual convention. The 101st AFBF Annual Convention and Trade Show runs January 17-22 in Austin, Texas. President Trump is scheduled to attend Sunday, January 19. This marks the third straight year Trump has attended the AFBF convention. AFBF President Zippy Duvall says in a statement, “We are grateful that he has made agricultural issues a priority." Duvall says AFBF welcomes Trump "at a time when there is much to talk about, from trade progress to important regulatory reforms." The Senate is close to finalizing the U.S.-Mexico-Canada Agreement, and the so-called phase one agreement will be signed this week. Other officials currently scheduled to attend include Agriculture Secretary Sonny Perdue, and Environmental Protection Agency Administrator Andrew Wheeler. Senate Agriculture Chairman Pat Roberts, a Republican from Kansas, and Senator Jerry Moran, also a Republican from Kansas, are on the schedule, as well. ************************************************************************************ Beef Quality Assurance Program Continues Growth The Beef Quality Assurance program continues to grow significantly, according to the National Cattlemen’s Beef Association. NCBA reports there are now more than 100,000 cattle producers certified through the BQA online learning system. The online option was introduced by NCBA, a contractor to the Beef Checkoff, in early 2017. Since the BQA program was initiated in the early 1990s, hundreds of thousands of producers and transporters have become BQA-certified through in-person and online training, with an estimated 85 percent of the U.S. fed beef supply now touched by BQA-certified operations. The program is a nationally coordinated and state implemented plan. The BQA program provides systematic information to U.S. beef producers and beef consumers of how commonsense husbandry techniques can be coupled with accepted scientific knowledge to raise cattle under optimum management and environmental conditions. Veterinarian Bob Smith, chair of the BQA Advisory Board, says the growth demonstrates that producers and transporters “continue to embrace this tool for optimizing quality in their operations.”

| Rural Advocate News | Tuesday January 14, 2020 |


Washington Insider: Trade Policy Objective Questioned Bloomberg reported recently that while current data are suggesting that President Donald Trump may be poised to deliver on one of his biggest economic promises: Reducing the annual U.S. trade deficit with China and the world, that accomplishment could come with plenty of caveats attached and even what some economists see as worrying signs for the U.S. economy. November trade data showed that the U.S. goods and services deficit decreased by 0.7%, or $3.9 billion, in the first 11 months of 2019 from the same period a year earlier. That puts the annual deficit on track to fall for the first time since the president took office, promising to rebalance America’s economic relationship with the world. The administration also claims that despite the continuing doubts of many mainstream economists, “clearly the Trump tariffs are working,” said White House adviser Peter Navarro. However, most of the tariffs now in place on some $360 billion in imports from China are due to remain despite the phase one deal. “We should see continued improvement in the China numbers as tariffs remain largely in place while purchases should increase significantly across our agricultural, energy, manufacturing, and services sectors,” Navarro said. The U.S. tariffs so far have clearly had an effect on trade with the world’s second-biggest economy but the trend has been down in November, declining for the sixth straight month and reaching the lowest since March 2013. The biggest contributor to the drop in the deficit from January through November was the continuing boom in shale oil, Bloomberg reported. In nominal terms, the U.S. petroleum-trade shortfall with the world fell to $13.1 billion in the first 11 months of 2019, more than $35 billion less than it was in the same period of 2018. When it comes to the rest of the U.S. economy – including a manufacturing sector the administration has promised to revive – the trade picture looks very different. The non-petroleum deficit grew almost $20 billion to $766.2 billion in the first 11 months of 2019, putting it on track to beat 2018’s full-year record deficit of $824.8 billion. The other major factor driving the narrowing of the U.S. trade deficit was a decrease in imports rather than an increase in exports. That is often a sign of weaker demand for the U.S. rather than an economy poised to record another burst of growth, Bloomberg notes. It also creates a statistical quirk that has long been the source of a bitter debate between advocates of tariffs like Navarro and other economists. Because of the way gross domestic product is calculated, a reduction in imports contributes to faster headline growth. Yet most economists argue that is an accounting anomaly rather than a reason to cheer, especially if it is a sign of a weakening demand rather than stronger domestic production. The slowdown in imports has been accompanied by one in exports. It also has been exacerbated by companies drawing down on inventories built up earlier this year to try to get ahead of tariffs, according to Eliza Winger, who covers the U.S. economy for Bloomberg Economics. The import contraction in the fourth quarter of last year appeared to be the largest seen since the 2007-2009 recession, said Greg Daco, chief U.S. economist for Oxford Economics. By his calculations, net exports would add 1.2 percentage points to GDP growth in the fourth quarter of 2019 – also the biggest such contribution seen since the crisis a decade ago. That it was likely to make up half the 2.4% growth Daco is forecasting for the quarter is not necessarily encouraging. Navarro insists that the tariffs have contributed to a re-shoring of manufacturing and broader investment in the U.S. economy. It’s not clear from the data that has in fact happened, however. Last year saw a slump in business investment, with many companies blaming uncertainty related to Trump’s trade policies for holding off on big capital investments. Other data have pointed to a slowdown in U.S. manufacturing last year. It’s also unclear how beneficial a small reduction in the trade deficit in 2019 would be in an election year, Bloomberg says. At more than $562 billion, the U.S. goods and services deficit in the first 11 months of the year is already more than $60 billion higher than it was in all of 2016, the year President Trump was elected. Over the course of the Trump administration’s term, the deficit is clearly up, so in that sense he has not succeeded, said Brad Setser, a senior fellow at the Council on Foreign Relations. “What he has shown is if you put big enough tariffs on, that can change both the bilateral balance of trade,” Setser said. “What he hasn’t shown is that his tariff-based strategy can generate a revival in U.S. manufacturing.” Clearly, the administration is continuing to aim for lower trade deficits – and there is considerable industry and academic skepticism of that objective. Now as the phase one deal is signed with China and attention shifts to next steps, producers should watch that debate closely as it proceeds, Washington Insider believes.

| Rural Advocate News | Tuesday January 14, 2020 |


GAO To Study Small Refiner Waivers Under RFS The Government Accountability Office (GAO) will investigate the EPA's issuance of hardship exemptions to small refineries, which allow them to avoid complying with the (Renewable Fuel Standard). The probe was requested by a bipartisan group of Midwestern lawmakers who say the waivers hurt the revenues of farmers and biofuel producers. Meanwhile, the matter will be the subject of a meeting in Washington to close out the week. The National Capital Area Chapter of the U.S. Association for Energy Economics holds a discussion on "State of the Renewable Fuels Standard," focusing on "Renewable Volume Obligations, Renewable Identification Numbers, and the small refinery exemption."

| Rural Advocate News | Tuesday January 14, 2020 |


US-China Phase One Trade Deal Signing Still on For Wednesday A Chinese delegation, led by Vice Premier Liu He, arrived in China Monday in preparation for signing of the phase-one deal with the U.S. There have been more than 200 invited to the signing ceremony. Despite some conjecture to the contrary, Treasury Secretary Steve Mnuchin said the agreement was not changed as it was translated and still calls for China to buy $40 billion to $50 billion in U.S. ag goods annually and a total of $200 billion in U.S. goods over two years. The U.S. and China will undertake semiannual talks to push for economic reform and resolve disputes, similar to a format from previous administrations that Trump trade officials had once criticized. The effort (separate from trade talks) will be headed by and Liu, among other senior officials, according to a statement by Mnuchin and U.S. Trade Representative Robert Lighthizer. As for enforcement, Mnuchin also said that if China does not comply with terms of the deal, “the president retains the authority to put on tariffs, both existing tariffs and additional tariffs.” A special office will be set up in each country to monitor implementation. If conflicts are not resolved within 90 days, the U.S. could take unspecified “proportionate” action against China and vice versa..

| Rural Advocate News | Tuesday January 14, 2020 |


Tuesday Watch List Markets Tuesday is expected to be a quiet day with just one report on U.S. consumer prices due out at 7:30 a.m. CST. Traders are watching weather forecasts and for any news about the signing of a phase one trade agreement with China. January futures contracts in the soy complex are set to expire by noon CST. Weather ­Tuesday features a variety of winter weather-related transportation and safety issues in the primary crop areas. Cold conditions and snow are in store in the northern Midwest; fog in the central U.S.; and rain in the southeastern U.S. Meanwhile, moderate to heavy snow in the northwestern U.S. signals the onset of a new round of winter storm potential in the central U.S. during late week

| Rural Advocate News | Monday January 13, 2020 |


China Confirms January 15th Signing Day for “Phase One” Wednesday is an important day for the trade dispute that’s dragged on between China and the United States. The South China Morning Post confirms that the Chinese Vice Premier will be heading to Washington to participate in the signing ceremony for a partial trade agreement between the two nations. The deal will boost U.S. agricultural commodity shipments to China in exchange for the White House cutting back on some of the existing tariffs on Chinese goods. U.S. President Donald Trump has said China will buy as much as $50 billion worth of agricultural goods every year within the next two years. However, Beijing still hasn’t confirmed any of those numbers yet. A deputy ag minister quoted by a Chinese magazine last week says his country has no plans to change its grain import quota system. Politico says trade analysts point out that could make it extremely difficult for Beijing to meet U.S. demands. The other fact that makes many economists skeptical is the most U.S. agricultural products China has ever purchased was $26 billion back in 2012. President Trump recently said on Twitter that he’ll be heading to Beijing to begin talks on Phase Two of an agreement, but a spokesperson for China’s Ministry of Commerce didn’t provide any additional details on potential talks. ********************************************************************************************* Hopes for Jump in U.S. Farm Exports Dim Ahead of Signing Days ahead of the Phase One trade deal signing between the U.S. and China, hopes appear to have dimmed somewhat for a spike this year in U.S. farm shipments overseas. China recently made large buys of Brazilian soybeans and made a pair of unexpected policy moves, two things that Reuters says have put a damper on that optimism. China confirmed late last week that their Vice Premier will be in Washington to sign the Phase One partial trade deal with the U.S. Chinese forward purchases of Brazilian soybeans that totaled about 800,000 tons are causing doubts about whether Chinese buyers will have any need to tap into the vast soybean supplies available from the U.S. American traders who spoke anonymously with Reuters say China’s soybean needs have been covered through the first quarter of 2020. Adding to U.S. concerns, Beijing announced plans to suspend its implementation this year of a nationwide gasoline blend that contains 10 percent ethanol. The plan originally brought about the hope that U.S. exports of the biofuel to China would leap upward, as well as hopes of more corn shipments to the country to help it produce the biofuel domestically. ********************************************************************************************** Bad News for U.S. Beef/Chicken in Potential U.S.-U.K. Trade Deal The U.S. beef and poultry industries got some bad news through a recent article on BBC Dot Com. Chlorine-washed chicken and hormone-treated beef will be kept out of the United Kingdom under any potential trade deal with the U.S. That comes straight from the UK environmental secretary. Theresa Villiers (VILL-ee-ehrs) tells the BBC that the current European Union ban on the products will carry over into UK legislation after the United Kingdom leaves the EU. Villiers says, “There are legal barriers to the imports and those are going to stay in place. We will defend our national interests and our values, including our high standards of animal welfare.” The EU says using chlorine to wash the chickens and kill salmonella infections allows American farmers to be careless with the welfare of chickens. There is no known human health threat from using the solution to keep chickens free of infection. The EU also says feeding cows with growth-enhancing chemicals could potentially have negative health effects on the humans that consumer the beef products. The United States says these rules are nothing more than an attempt by Europe to protect its producers. America has stated publicly that both of these meat products will be central to any possible U.K.-U.S. deal after Brexit. ********************************************************************************************** ADM Appears Close to Leaving Biofuels Business for Good The Archer-Daniels-Midland Company is a giant agribusiness in the U.S. biofuels industry. However, that could be changing. Bloomberg says the company is in advanced stages of discussions on a deal that could mean a sale or joint venture for its ethanol dry mills. The agricultural company that dates back for 118 years is in discussions with multiple companies about its future. CEO Juan Luciano (Loo-see-AH-no) spoke last week about the discussions but wouldn’t name the fewer than five companies said to be involved. “We are advancing things along with several different parties, and I can say that we are advanced in those discussions,” he says. “We want to find either the right buyer or the right partner for these things.” He says while they haven’t made a final decision yet, “we are close.” ADM started producing ethanol back in 1978. This isn’t the first time they’ve taken steps to divest themselves of the dry mills. The company put the assets up for sale back in 2016, looked at the bids, and then decided to go ahead and keep the business. Luciano adds,” I wanted to make sure at the start of my tenure that we focused on nutrition and food, not fuels. I like ethanol and I believe there’s a lot of potential for the product. I just don’t feel it’s for us.” ********************************************************************************************** House Bill Introduced to Oversee USDA Checkoffs Nevada Democrat Dina (Deena) Titus introduced legislation titled “The Opportunities for Fairness in Farming Act” (OFF) into the House of Representatives. The Hagstrom Report says it’s designed to create financial controls and transparency for the USDA agricultural checkoff programs. Titus says, “The USDA’s checkoff programs have operated without sufficient oversight for far too long. This legislation brings much-needed accountability and transparency.” She feels family farmers shouldn’t be forced to pay into organizations that may sometimes lobby against their interests and threaten animal welfare. Congress authorized the commodity checkoff programs that allow farmers to bill themselves to pay into research and promotion programs for their particular commodities. However, groups backing the legislation say that organizations like the National Cattlemen’s Beef Association and other groups get access to these funds and don’t use them for their intended purposes. Marty Irlby, executive director of Animal Wellness Action, says, “USDA’s runaway checkoff programs must be held accountable. Family farmers have a right to know where their hard-earned dollars are being spent.” Earlier this year, four senators introduced companion legislation into the Senate for consideration. ********************************************************************************************** Corn and Soybean Harvest Results Higher Than Expected in January WASDE Report The January Word Ag Supply and Demand Estimate numbers show that the final 2019 corn yield came in at an average of 168 bushels per acre, nearly two full bushels above industry estimates. Total corn production was 13.7 billion bushels, up 31 million as higher yield more than offset a reduction in harvested acres, which totaled 81.5 million. The season-average corn price for producers is unchanged at $3.85 per bushel. Soybean production came in at 3.56 billion bushels, eight million larger on higher yield results. Yield estimates were 47.4 bushels per acre, with harvested acres at 75 million, down slightly from the previous report. The season-average price for beans is $9.00 a bushel, up 15 cents in part because of stronger soybean oil prices. The outlook for wheat is stable supplies, increased feed and residual use, as well as lower stocks. Feed and residual use rose 10 million bushels on lower second-quarter stocks, while seed use dropped by one million bushels on lower planted area forecast for the upcoming season. The season-average farm price for wheat is unchanged at $4.55 per bushel.

| Rural Advocate News | Monday January 13, 2020 |


Washington Insider: Reaction to Monthly Jobs Report The Labor Department’s monthly jobs report released last week suggests that the economy ended 2019 on a steady footing, the New York Times reported last week. The American labor market “still shows few signs that it is running out of breath.” Payroll gains in December capped a year of steady but slowing gains in employment, the government said, nudging the year’s total past 2.1 million jobs. That was fewer than 2018’s additions but more than enough to outpace population growth. “We had relatively strong and steady job growth over the year despite a number of headwinds including a trade war with China, weaker global activity and heightened policy uncertainty,” Gregory Daco, the chief United States economist at Oxford Economics, said. Employers added 145,000 workers in December. Looking ahead, Daco said the nation’s job machine was likely to crank down further. “I know it’s hard to get accustomed to,” he said, adding that he expects average monthly job growth to fall to 125,000 from 175,000 last year. “But that’s still enough to provide for a stable unemployment rate and provide for people coming back into the labor force.” One discouraging piece of the Labor Department’s monthly report was anemic wage growth. “It’s easier to get a job than a raise in this economy,” said Diane Swonk, chief economist at Grant Thornton. Consumer spending is a pillar of the economy, and it depends on income growth. Over the past 12 months, wages grew just 2.9%. That was substantially below the 3.3% average in 2018. “Something that the Fed has been humbled by is how little wage acceleration there’s been,” Swonk said, referring to the Federal Reserve. Even so, the report is unlikely to push policymakers at the central bank from their wait-and-see approach on further cuts to its benchmark interest rate. The labor squeeze has helped workers at the lowest end of the pay scale, giving their wages a push that exceeds the average increase. By contrast, wage growth for managers slowed in December. Limp wage growth is puzzling when the jobless rate has settled at 3.5%, a half-century low. Finding qualified workers was the top challenge cited by small-business owners in December, according to a monthly survey by the National Federation of Independent Business. What the tightening labor market has done, though, is draw in people who were not previously job hunting. Nearly three-quarters of new hires have come off the sidelines. The unemployment rates for groups that have tended to receive a smaller share of the expansion’s rewards, including high school dropouts, African-Americans and Latinos have also dipped since December 2018. The share of the population in the work force remains at the top of the post-recession range, even though it’s lower than before the financial crash of 2008. Many of the new entrants have been women, who now make up a majority of the nonfarm payroll for the first time in nearly a decade and dominate sectors that are expanding fastest, like health care. Job totals, of course, can mask wide differences based on location, skills and industry. And finding stable jobs that pay middle-income wages, offer benefits and a regular schedule can be difficult. Health care and hospitality, leisure, professional and business services flourished last year. Mining and manufacturing both struggled. Industrial goods and automobile manufacturers were the hardest hit, in part because of the trade war, said Andy Challenger, a vice president at Challenger, Gray & Christmas, an outplacement firm that tracks layoff announcements. Because the company’s survey tracks layoff announcements, Challenger said, it’s “a bit more forward looking” than the Labor Department’s figures. Plans can change, he noted, but the results “point to sentiments, if they think they’re going to cut.” Boeing, as well as the aerospace industry on the whole, is still reeling from the aftermath of two accidents. Boeing said on Friday that it would lay off 2,800 people in response to Boeing’s decision to suspend production of that jet. The manufacturing sector is particularly sensitive in this political context and “especially in an election year, the trajectory is going to be important,” said Rubeela Farooqi, chief United States economist for High Frequency Economics. There has been some progress on the trade front: The United States and China are expected to sign an agreement on the first phase of talks this week. But persistent uncertainty, which nudges businesses to be more cautious in hiring and investment, is far from clearing. Two-thirds of Chinese imports, worth $360 billion, are still subject to tariffs. And more tariffs on imports from Europe could be imposed this month. Julia Pollak, a labor economist for the employment site ZipRecruiter, said the combination of strong wage and job growth had been concentrated in nine states. In the top four, which are Utah, Nevada, Arizona and Colorado, the expansion has been driven by the technology industry. Those states have benefited in part because they have lower housing costs than Silicon Valley, Ms. Pollak said. So, we will see. Certainly the trends in job creation are fundamental to economic growth and these trends should be watched especially closely as they proceed, Washington Insider believes.

| Rural Advocate News | Monday January 13, 2020 |


Army Corps Officials Address Climate Questions in WRDA Review The House Transportation & Infrastructure Water Resources and Environment Subcommittee held a hearing on proposals for a Water Resources Development Act of 2020. The session featured testimony from RD James, assistant secretary of the Army for Civil Works and Lieutenant General Todd Semonite of the U.S. Army Corps of Engineers. While lawmakers focused most of their attention on specific projects important to their congressional districts, the issue of climate change also emerged frequently. That was likely generated by the Trump administration’s release of a proposal to reform the National Environmental Policy Act (NEPA), which many Democrats blasted as indicating that climate change was no longer going to be a factor in decision-making on projects. But the administration officials offered the same response to the repeated question of whether climate change was still going to be factored into the decisions made on projects undertaken via WRDA by the Corps. “We will continue use science” or some similar refrain was the answer from James, prompting most lawmakers to express some relief.

| Rural Advocate News | Monday January 13, 2020 |


Trump Says Phase One Deal With China To Be Signed January 15 Or Shortly Thereafter President Donald Trump has injected a little uncertainty into the situation relative to the phase-one agreement with China, telling a television station in Ohio that the deal will be signed on January 15 or perhaps shortly thereafter. "We are going to be signing on January 15th - I think it will be January 15th, but shortly thereafter, but I think January 15th - a big deal with China,” Trump told the ABC affiliate. There was no clarification of the comment issued by the White House and it comes after China confirmed that Vice Premier Liu He would be leading a delegation to Washington January 13-16 to sign the deal in Washington. As for phase two, Trump reiterated Thursday that he could wait until after the 2020 election to reach a phase-two accord with China. Trump said he thinks he could get a better deal if he waits until after his November reelection bid. The president said his administration will start “right away” negotiating the next piece of an agreement after striking the phase-one deal. But he said “it will take a little time” to finish an phase-two accord and suggested he could have more leverage after his reelection bid in November. “I think I might want to wait to finish ’til after the election, because by doing that, I think we can actually make a little bit better deal, maybe a lot better deal,” Trump told reporters at the White House.

| Rural Advocate News | Monday January 13, 2020 |


Monday Watch List Markets Monday's only official report, USDA's weekly grain inspections is due out at 10:00 a.m. CST. In addition to the latest weather reports, traders will be watching for news of a phase one trade agreement with China, expected to be signed this week. Weather Rain or showers and thundershowers during Monday from the southern Delta through the southeast U.S. Rain and high elevation snow through the Pacific Northwest southward into northern California Monday. Snow or snow showers across the northern Rockies. Light snow or snow showers may develop over the Northern Plains and the northwestern Midwest later in the day or during the evening. In Brazil, beneficial rains finally returned to Rio Grande Do Sul during the weekend. It will be drier and cooler today. Argentina will see will see a few light showers and somewhat warmer temperatures Monday.

| Rural Advocate News | Friday January 10, 2020 |


Senate Committee’s Plan USMCA Approvals The Senate committees tasked with markup and approval of the U.S.-Mexico-Canada Agreement are planning to do so quickly. The agreement must be approved through the committees before reaching the full Senate. Senate Finance Committee Chairman Chuck Grassley, who's panel has already approved the agreement, Thursday said, "it takes just a short period of time" for other committees to review the implementing legislation. However, the impeachment impasse could end as early as Friday, further casting a cloud on just when the full Senate will consider USMCA. House Speaker Nancy Pelosi says she’ll send the articles of impeachment “when I’m ready,” indicating that could be soon. Meanwhile, Senate Leader Mitch McConnel says the Senate will move on with other work until Pelosi sends the articles of impeachment. And, Grassley says the Senate is "not going to dilly-dally around while we're waiting to see what Speaker Pelosi wants to do on impeachment," adding, the Senate committees will act very quickly next week. ************************************************************************************* Trump Announced National Environmental Policy Act Changes President Donald Trump Thursday announced new proposed regulations to implement the National Environmental Policy Act. Trump says the announcement is part of his effort of “fixing this regulatory nightmare,” in which projects are delayed by “an outrageously slow and burdensome federal approval process.” Trump says the policy will cut the timeline for obtaining permits and force federal agencies to work more closely together to speed the process. Administered by the Environmental Protection Agency and enacted in 1970, NEPA assures all branches of government properly consider the environment before undertaking any major federal action that significantly affects the environment. The policy has not undergone substantive regulatory revision since 1986. The National Cattlemen’s Beef Association hailed the announcement. NCBA President Jennifer Houston called the action a “commonsense regulatory relief.” Ranchers must undergo NEPA reviews for many reasons, but common examples include renewal of a term grazing permit, construction of range improvements, or to become eligible for participation in USDA programs. ************************************************************************************* FCC Proposing $20.4 billion for Rural Broadband Federal Communications Commission Chairman Ajit Pai (Uh-JEET Pie) this week presented his colleagues with final rules to launch the new $20.4 billion Rural Digital Opportunity Fund. Chairman Pai says the fund would “target rural areas across the country where residents currently lack access to adequate broadband.” The rules will be voted on by the FCC at its Open Meeting on January 30. The proposal would establish a two-phased process to provide funding for the deployment of high-speed broadband in areas of the United States where there is currently not fixed broadband service that meets the Commission’s minimum speed standard of 25/3 Megabits per second. For Phase I, the FCC would target $16 billion to areas that are wholly unserved by such broadband. For Phase II, the FCC would use its new granular broadband mapping approach, called the Digital Opportunity Data Collection, to target unserved households in areas that are partially served by such broadband. ************************************************************************************* China Announced Ethanol Mandate Rollback China this week announced a suspension of its ethanol mandate, signally a further reduction of imports from the United States. The E10 target was suspended because China says, "any promotion of ethanol-gasoline must be based on the precondition that food security is guaranteed." The mandate was implemented in 2017 to draw down massive corn stocks in China. The U.S. exported about 20 percent of its ethanol supplies to China in 2016, worth about $300 million. However, shipments have since sharply declined. Renewable Fuels Association Geoff Cooper told Reuters, “This is definitely a step in the wrong direction, but it was not completely unexpected.” Beijing announced a 30 percent import tariff in 2017, and added additional tariffs through the U.S.-China trade war of another 40 percent. China was expected to sharply increase imports of U.S. ethanol under the recently announced phase one trade deal, but is now unlikely to require large ethanol supplies without the mandate. ************************************************************************************* USDA, FDA, EPA Launch Website for Biotechnology Regulation A joint-agency venture launched the Unified Website for Biotechnology Regulation Thursday. The Department of Agriculture, Food and Drug Administration and Environmental Protection Agency announced the website, which streamlines information about the three regulatory agencies charged with overseeing agriculture biotechnology products. The Unified Website for Biotechnology Regulation describes the federal review process for certain biotechnology products and allows users to submit questions to the three agencies. The goals of the website are to provide enhanced customer service to innovators and developers, while ensuring Americans continue to enjoy the safest and most affordable food supply in the world and can learn more about the safe use of biotechnology innovations. The website is part of President Donald Trump's Executive Order on Modernizing the Regulatory Framework for Agricultural Biotechnology Products. Agriculture Secretary Sonny Perdue says the website is “proof of President Trump’s commitment to provide the American people with sensible regulations in a clear and transparent manner.” Website: https://usbiotechnologyregulation.mrp.usda.gov/biotechnologygov/home/ ************************************************************************************ New Holland Partnering with National Hemp Association New Holland is partnering with the National Hemp Association to accelerate the return of hemp commodity crops on farms across North America, under the banner "Pushing Progress Together." Announced at the Pennsylvania Farm Show this week, through the partnership, the National Hemp Association will participate alongside New Holland at 16 national farm shows throughout North America. The association will deliver educational sessions and panel discussions, as well as exhibiting the variety of products produced from hemp. The alliance will also work toward solving the industry's biggest challenge: the absence of commercial-scale harvesting and equipment needed to meet demand. New Holland officials say the partnership will help the hemp industry to respond to concerns as it grows, and hear from its dealer network and customers “who are looking to New Holland to bring forward supply chain solutions." The alliance will call on other industry partners to join a "Hemp Pledge" and commit to purchasing hemp grown and processed in the U.S. by U.S. farmers.

| Rural Advocate News | Friday January 10, 2020 |


Washington Insider: Looking Ahead on Spending Concerns Everyone seems to expect political volatility to worsen next year, but many say they are working to tamp down potential fights to the extent possible. For example, the Senate’s top appropriators said this week that they are hoping the Fiscal Year (FY) 2021 budget that the President will send to Capitol Hill next month will closely follow the parameters of the recent two-year spending caps deal and “make it easier for them to start writing a new set of bills this spring.” Senate Appropriations Chairman Richard Shelby, R-Ala., said he will meet later this week with ranking member Patrick Leahy, D-Vt., to discuss plans for handling the budget request, set to be released on Feb. 10. Shelby said a White House blueprint that honors the caps agreement will make it easier to avoid delays and crises as next fall’s election nears. Shelby told reporters the deal that raised the discretionary spending caps still can guide appropriators’ work, even if the administration proposes increasing defense spending at the expense of domestic spending. “We have a two-year deal, we have the outlines to work on,” Shelby told reporters earlier this week. “In any president’s budget, and I’ve been here a few years, I’ve never known one to be adopted — Democrat or Republican. A lot of them are unrealistic, lots of them are wish lists and some of them have good stuff,” Shelby said. Leahy said President Trump’s FY 2020 budget that proposed deep cuts in domestic programs only added to appropriators’ difficulties in writing and moving bills out of committee last summer. He said that he and Shelby don’t want a replay of last year, where no bills moved until September, just weeks before the start of the fiscal year on Oct. 1. “Our bills were done separate from it and I don’t think anyone expects the president’s budget this year to be anything more than a suggestion,” Leahy said. Senator Roy Blunt, R-Mo., chairman of the Labor-HHS-Education Subcommittee, said appropriators still will have to set top-line spending figures for each of the 12 bills – called 302(b) numbers – even with the budget caps deal, so a fiscal 2021 budget from the White House that’s politically realistic could increase the odds the process goes more smoothly. “My advice would be to send a budget that’s more realistic to the final outcome than the budgets we’ve gotten in the last few years,” Blunt said. He added that lawmakers in both parties are likely to once again ignore the deep cuts Trump’s budgets have proposed. He said both parties want to keep domestic funds steady. “When I called the secretaries of Education and Labor and HHS this year, my first comment was ‘you didn’t get what you asked for,’” Blunt said. Shelby didn’t rule out a budget that seeks more money for Defense than agreed to in the budget caps deal. But he said the most likely vehicle for additional funds will be an “emergency” request to fund heightened military activities in the Middle East. He said he doesn’t know when such a request may come. “We’re always aware they could come but we haven’t seen anything yet,” Shelby said. Sen. Lisa Murkowski, R-Alaska, who leads the Interior-Environment Subcommittee, said she would like to see funding for a road into Denali National Park. She said the road is slipping a lot but has never been a part of the deferred maintenance list, and she’s hoping the administration has “gotten the word on that one.” Senate Military Construction-VA Subcommittee Chairman John Boozman, R-Ark., said he sees veterans’ programs getting a boost in the president’s request. “I think we’re going to see another significant increase,” Boozman said, pointing to needs for IT improvement and health care programs at the Veterans Affairs Department, and implementation of a law signed last year to expand a presumption of benefits to veterans who served in waters off the coast of Vietnam. “All those things are going to cost money,” he said. Senate Appropriations Defense Subcommittee member Susan Collins R-Maine, and Senate Armed Services Committee member Angus King. I-Maine, wrote to Defense Secretary Mark Esper pressing the administration to support a larger Navy fleet. “We write to express our strong support for a 355-ship Navy and to urge continued support from the Department for a robust shipbuilding budget,” they said. Senate Energy and Water Subcommittee ranking member Dianne Feinstein, D-Calif., is watching for funds to address nuclear cleanup. “We’ve got nuclear waste spread all over the country, in more than 80 different places and we need to get it confined in safe and secure underground placement, and so, that’s been a major priority for me,” she said. So, we will see. Certainly the appropriations bills are not the only hot potatoes expected in the coming months, but a “modest calming” of the normal tensions over the size of the government and spending proposals are typically strong points of contention and should be watched closely by producers as the spending proposals and talks proceed, Washington Insider believes.

| Rural Advocate News | Friday January 10, 2020 |


Senate Committees Mostly Set USMCA Consideration Plans At least five of the six Senate committees that are to vote on the U.S.-Mexico-Canada Agreement (USMCA) have set their plans in place for the action next week. The Budget Committee and Environment and Public Works Committee will vote Tuesday, with Wednesday votes scheduled in the Commerce Committee and Health, Education, Labor and Pension Committee with the Foreign Relations Committee to vote Thursday. The Senate Appropriations Committee had not yet set a date for its consideration of the update to NAFTA as of late-Wednesday. Despite the extra committee action, USMCA is expected to be approved handily by the chamber.

| Rural Advocate News | Friday January 10, 2020 |


China Confirms Trade Deal Signing In Washington Next Week China has finally confirmed that the Phase One trade deal between the U.S. and China will be signed next week in Washington, with Commerce Ministry spokesman Gao Feng saying Vice Premier Liu He would travel to Washington January 13-15 to sign the pact. Teams from the two sides remain in close communication on the signing, he noted. "The two teams have been engaging with each other closely about the text and the terms of that agreement," Gao said. Bloomberg reported that Liu will be joined by People’s Bank of China governor Yi Gang, Commerce Minister Zhong Shan, vice minister of finance Liao Min, deputy chief of the National Development and Reform Commission Ning Jizhe, deputy international trade representative Wang Shouwen, and others. China’s ambassador to the U.S., Cui Tiankai, will also attend. As for ag imports, Gao said that China will continue to improve the administration of its tariff rate quotas under its WTO commitments and will make full use of the quotas based on market conditions, a situation which Gao said is not inconsistent with increasing imports of ag products from the U.S. Gao made the comments in response to a question on whether China would have to lower its grain imports from other countries to meet purchase commitments under the deal.

| Rural Advocate News | Friday January 10, 2020 |


Friday Watch List Markets Early Friday morning features non-farm payrolls and the unemployment rate. There is a slew of ag-related information. First is export sales at 7:30 central. At 11 a.m. the USDA and WASDE January report is out including final production, December 1 stocks and winter wheat seeding. After the close, we'll see the CFTC Commitment of Traders report. We'll be watching South American weather and the U.S.-Iran conflict as well. Weather Heavy rain and thunderstorms with a flooding risk from the southeast Plains through the south and east Midwest and the Delta Friday and Saturday. Snow, ice and some mixed precipitation from the southwest and central Plains through portions of the west-central and north-central Midwest during this time. Increased stress to livestock in the feedlots of southwest Kansas and the Texas Panhandle, travel and transport concerns elsewhere in these locations. Rain, ice and snow also over the Pacific Northwest across to the northern Rockies. Little elsewhere in the U.S. areas. Southern Brazil corn and soybean areas continue hot today but may see scattered thunderstorms this afternoon and tonight. Central Argentina crop areas again saw thunderstorms during the night and are not very hot.

| Rural Advocate News | Thursday January 9, 2020 |


USMCA to face Additional Approvals in Senate The U.S.-Mexico-Canada Agreement timeline remains uncertain. However, lawmakers in the certain seem certain they will pass the agreement, at the latest, following impeachment hearings. The House is still holding the articles of impeachment, alleging the Senate won't agree to a fair trial. At issue is the Senate must make impeachment a priority. Depending on how long a further review of USMCA takes in the Senate, and how long House Speaker Nancy Pelosi holds the articles of impeachment, will change the trajectory of USMCA. The Senate Finance Committee approved the agreement this week. However, a Senate parliamentarian has determined that eight other Senate committees must offer approval of the agreement. However, U.S. law states the agreement will be discharged from those committees in 15 days, regardless of approval. If Nancy Pelosi sends articles of impeachment to the Senate between now and whenever the committees approve the agreement, perhaps next week, the USMCA implementing legislation would have to wait until the impeachment trial is over, likely at the end of this month. ************************************************************************************* China to Release Pork Reserves Ahead of the Chinese New Year, China will release 20,000 metric tons of frozen pork in state-held reserves. China has previously released more than 100,000 metric tons of pork from state reserves since last month, seeking to stabilize supplies following impacts of African swine fever. A Chinese Agriculture Ministry official told the South China Morning Post this week that the African swine fever situation “is still severe and complex,” adding the risk of outbreaks rise with the increase of live hogs in the nation. China’s sow herd declined roughly 40 percent, perhaps more since the initial outbreak of ASF in the nation. However, Chinese officials say the herd has increased two percent in December. Restocking the herd poses the risk of recontamination, if efforts to eliminate the presence of the disease in pork producing facilities failed. However, for U.S. producers, China's ASF troubles and the expected signing of a phase one trade agreement provide export opportunity. China is the largest producer and consumer of pork on the globe. ************************************************************************************* NMPF Encouraged by Recent Labeling-related Actions Heading into 2020, two major actions provide cause for optimism regarding a change in labeling enforcement at the Food and Drug Administration, according to the National Milk Producers Federation. First, the Senate confirmed Dr. Stephen Hahn to lead the FDA December 12. In an exchange with Senator Tammy Baldwin, a Wisconsin Democrat, during his confirmation hearing, Dr. Hahn stated his support for “clear, transparent, and understandable labeling.” More recently, the House and Senate included language in the report accompanying the final Fiscal Year 2020 government funding measure to urge FDA to complete its job and enforce dairy-product standards. Both the House and Senate versions of the Agriculture-FDA bill report included language reaffirming bipartisan congressional concern with mislabeled imitation dairy products, and directs FDA to enforce its own rules on labeling. NMPF says this week that the report reaffirms Congress’s concern regarding products “that include the names of dairy products that do not contain milk or ingredients derived from milk,” as stated in Senate language. ************************************************************************************* Toomey, Blumenthal, Announce Food Bank Bill The new Food Donation Improvement Act of 2019 seeks to help food banks collect and distribute more food to needy families. The legislation was announced by Republican Senator Pat Toomey of Pennsylvania and Democratic Senator Richard Blumenthal of Connecticut Wednesday. The Senators say new and innovative food assistance models repurpose items from donating entities and sell prepared dishes like microwavable dinners for a nominal cost. But federal law does not currently extend liability protections to food donors when food is either given directly to a person in need or when a recipient pays a deeply reduced cost. Specifically, the legislation would extend liability protections to food-donating entities and food banks for food sold at a reduced price. The bill also would extend liability protections to qualified donors who give food directly to needy individuals and families without going through a non-profit intermediary. Finally, the legislation requires the Department of Agriculture to issue regulations clarifying the quality and labeling standards donated food must meet. ************************************************************************************ Farmland Market Continued Plateau in 2019 The land market in 2019 continued the plateau trend of the past several years, where the supply of agricultural land for sale on the market remained lower than average, and prices for good quality cropland held mostly steady. Farmers National Company says farmland sale activity in the first part of 2019 was slower than it had been for some time with late spring and early summer, especially void of farms for sale. Planting delays and prevent plantings contributed to the sluggish activity. However, despite the slower land market, Farmers National Company and its agents saw a 25 percent increase in acres sold in 2019 from the prior year and the most since 2014. Several factors will impact the 2020 land market, according to Randy Dickhut of Farmers National. He says Interest rates are low and are poised to remain so during the foreseeable future. Overall, he says, "agriculture is in adequate financial shape, but there are individual and regional concerns." ************************************************************************************ RFA: Ethanol Keeps Gas Prices Lower Amid High Oil Prices Tensions in the Middle East are creating volatile oil markets, as the U.S. ethanol industry reminds drivers how biofuels keep gas prices lower. Oil prices fell on a potential de-escalation between the U.S. and Iran, after reaching a nine-month high this week. Still, analysts expect gas price increases to reach the pump in the days ahead. The Renewable Fuels Association says that at fuel terminals where gasoline is blended, ethanol is currently selling for 40-50 cents per gallon less than gasoline. As U.S. consumers brace for higher prices, a recent study shows the nation’s growing supply of ethanol significantly helps dampen gasoline price shocks that result from sudden oil market disruptions. The study says that if renewable fuels were removed from the fuel supply, gas prices would be more than $1 per gallon higher. RFA President and CEO Geoff Coopers says the recent tensions in the Middle East, and the recent study “highlights the critical need for greater domestic energy security and diversity.”

| Rural Advocate News | Thursday January 9, 2020 |


Washington Insider: Americans Paying Trump Administration Tariffs American businesses and consumers, and not China, are bearing the financial brunt of President Trump’s trade war, the New York Times said this week, and new data is undermining the president’s assertion that the United States is “taxing the hell out of China.” The Times cites a number of studies. For example, “U.S. tariffs continue to be almost entirely borne by U.S. firms and consumers,” Mary Amiti, an economist at the Federal Reserve Bank of New York, wrote in a National Bureau of Economic Research working paper. The other authors of the paper were David Weinstein of Columbia University and Stephen Redding of Princeton. Examining the fallout of tariffs in data through October, the authors found that Americans had continued paying for the levies — which increased substantially over the course of the year. Their paper, which is an update on previous research, found that “approximately 100 percent” of import taxes fell on American buyers. The findings are the latest evidence that voters and American businesses are paying the cost of the administration’s penchant for using tariffs to try to rewrite the terms of trade in favor of the United States. For one thing, manufacturing is slumping, a fact economists attribute at least partly to uncertainty stemming from the trade spats and business investment has suffered as corporate executives wait to see how — or if — the tensions will end. The United States and China have reached a trade truce and are expected to sign an initial deal this month, but tariffs on $360 billion worth of Chinese goods will remain in place. The levies, which are as high as 25%, have forced some multinational businesses to move their operations out of China, sending operations to countries like Vietnam and Mexico. Tariffs may have worked as a negotiating chip to get China to the table, the Times says, but recent academic research shows that leverage has come at a steep price for some American businesses and consumers. The authors of the latest study used customs data to trace the fallout, examining import values before and after the tariffs. The research showed that the tariffs had little impact on China. “We’re just not seeing foreigners bearing the cost, which to me is very surprising,” Weinstein said in an interview. The authors also found a delayed impact from the tariffs, with the decline in some imports roughly doubling on average in the second year of the levies. That is because “it takes some time for firms to reorganize their supply chains so that they can avoid the tariffs,” the authors write. Reaction to the tariffs has varied across business sectors, however. In the steel industry, for example, companies that export to the United States have dropped their prices—suggesting that other countries are in fact paying “close to half” of the cost of tariffs, according to the paper. “The steel industry isn’t getting that much protection, as a result,” Weinstein said. In previous research, the authors found that by December 2018, import tariffs were costing United States consumers and importing businesses $3.2 billion per month in added taxes and another $1.4 billion per month in efficiency losses. They did not update those numbers in the latest study. Their analysis joins a growing body of research examining the effects of the escalating tariffs Trump has imposed since the beginning of 2018. A study released in late December by two economists at the Fed, Aaron Flaaen and Justin Pierce, found that any positive effects that tariffs offered American companies in terms of protection from Chinese imports were outweighed by their costs. Those costs include the higher prices companies must pay to import components from China and the retaliatory tariffs China placed on the United States in response, the economists said. Another study, published in October by researchers at Harvard University, the University of Chicago and the Federal Reserve Bank of Boston, also found that almost all of the cost of the tariffs was being passed on from businesses in China to American importers. The October study found that the situation was not the same for the tariffs that China has placed on American goods in retaliation. The researchers found that American businesses had less success passing on the costs of those tariffs to Chinese importers, most likely because of the types of goods being sold. Many of the products that the United States sells to China are undifferentiated commodities like agricultural goods but China sends many specialized consumer goods to the United States. Amiti’s colleagues at the New York Fed have traced the costs of tariffs in other research and similarly found that import prices on goods coming from China had remained largely unchanged as tariffs rolled out and argued that already-narrow profit margins that leave no room for cutting and a dearth of competitors could be among the factors insulating Chinese exporters. So, we will see. In general, it appears that U.S. industries are increasingly opposing the imposition of higher tariffs as evidence of their impact on domestic consumers and markets has grown, Washington Insider believes.

| Rural Advocate News | Thursday January 9, 2020 |


API Uses Annual Energy Report to Continue Its Attack On Biofuels The American Petroleum Institute (API) utilized a portion of its State of American Energy 2020 report to reiterate its complaints about U.S. biofuel policy. “Biofuel mandates distort the marketplace to use products that can damage vehicles,” API sated. API maintained that the Renewable Fuel Standard (RFS) of reducing U.S. crude oil imports is now “obsolete given growing domestic oil production, and its goal of producing commercially viable cellulosic biofuel has never materialized.” They commented that around 70% of vehicles on the road weren’t designed to run on E15 fuel and that no boats, small engines or motorcycles can use the product. While API makes that claim, EPA approved E15 for any vehicle make from 2001 or newer. Since IHS Markit tracks the average age of vehicles, it shows there are roughly 278 million autos on the road. Of those, nearly 221 million are from model year 2003 or newer. The arguments laid out by API are nothing new and signal that the refining industry will continue their challenges to U.S. biofuel policies ahead.

| Rural Advocate News | Thursday January 9, 2020 |


Other Senate Panels to Consider USMCA Legislation Passage of the U.S.-Mexico-Canada Agreement (USMCA) by the Senate Finance Committee Tuesday, via a 25-to-three vote, is the first consideration of the deal by Senate Committees. The Senate parliamentarian determined Monday that the USMCA legislation will also have to be considered by the Health, Education, Labor, and Pensions Committee; the Environment and Public Works Committee; the Senate Appropriations Committee; the Foreign Relations Committee; the Budget Committee; and the Commerce, Science, and Transportation Committee. Several of those committees have indicated they will hold their votes next week. Their action on the bill does not have to take place in any particular order and the measure cannot be amended – it is an up-or-down vote in each panel. Under U.S. trade law, the USMCA legislation will be discharged from the panels within 15 days whether they act on it or not. But the process of getting their markups scheduled and completed will add additional time to the USMCA approval process. Indications are the initial consideration by the full Senate may not come until late next week at the earliest. USMCA is still fully expected to easily clear the Senate, but the combination of additional committees considering the implementing legislation and the still-pending impeachment trial in the Senate clouds the exact timing at this point.

| Rural Advocate News | Thursday January 9, 2020 |


Thursday Watch List Markets Early tomorrow morning all eyes will be on weekly jobless claims. Also, DTN will be watching for any new developments in the U.S.--Iran conflict, and weather changes in both Brazil and Argentina. Export sales, originally scheduled for Thursday will now be Friday morning. Weather Light, mixed precipitation is expected through the north-central Midwest region Thursday afternoon and evening. Showers and thundershowers develop from the southeast Plains through the southwest and central Midwest mainly late Thursday or during Thursday night. Scattered snow showers and squalls through the Rockies and into the high elevations of northeast California. Rain showers may occur through central and south California. Mainly dry elsewhere in the key U.S. crop and livestock areas. Southern Brazil will see a few thundershowers this afternoon with continued high temperatures. Central Argentina had thunderstorms during the night which will linger today.

| Rural Advocate News | Wednesday January 8, 2020 |


Senate Finance Committee Advances USMCA The Senate Finance Committee Tuesday approved the U.S.-Mexico-Canada Agreement on a 25-3 vote, setting the agreement up for a potential quick passage. Chairman Chuck Grassley, a Republican from Iowa, says the full Senate could consider the agreement within a week. However, if House Speaker Nancy Pelosi sends articles of impeachment to the Senate, that must immediately take priority and would stall USMCA until after the impeachment hearings in the Senate. Grassley told the Finance Committee the USMCA implementing legislation “has something in it for everyone, and it’s not often that we can say that about an implementing bill." Mexico's Senate has already approved the agreement, and Canada plans to approve USMCA following U.S. action. Ranking member of the committee, Democrat Ron Wyden of Oregon, says USMCA provides “long-overdue upgrades to labor standards, the environment and digital trade” compared with the North American Free Trade Agreement, adding the agreement also provides certainty to farmers and manufacturers. ************************************************************************************* Farm Groups Applaud USMCA Action Agriculture groups welcome action in the Senate to advance the U.S.-Mexico-Canada Agreement. Passed by the Senate Finance Committee Tuesday, American Farm Bureau Federation President Zippy Duvall says the agreement is "one step away" from completion. Duvall says passage of the agreement "will protect our valuable trade relationships with our nearest neighbors and return certainty to our markets." The agreement is expected to increase U.S. ag exports by $2 billion and result in a $65 billion increase in gross domestic product. National Pork Producers Council President David Herring in a statement said, "We now urge Senate Majority Leader Mitch McConnell to schedule a vote on the floor as soon as possible." For the U.S. pork industry, USMCA will maintain long-term, zero-duty market access to Mexico and Canada. In 2018, Canada and Mexico took over 40 percent of the pork that was exported from the United States, and a similar percentage is expected in 2019. U.S. pork exports to Canada and Mexico support 16,000 U.S. jobs ************************************************************************************* Purdue/CME Group Ag Economy Barometer December The December Purdue/CME Group Ag Economy Barometer suggests farmers are optimistic about the future, despite a weakened perception of current conditions. The survey dropped three points in December to a reading of 150, down from 153 in November. The Index of Current Conditions dropped 12 points to 141, down from 153 in November. Meanwhile, the Index of Future Expectations remained strong, up two points to a reading of 155. In the December survey, producers were asked whether their farm's 2019 financial performance was better, as expected, or worse than their initial budget projections. Just over-half, 52 percent, stated that their initial projections matched their farm's financial performance. Meanwhile, 30 percent stated it was worse, and 19 percent stated it was better than expected. The barometer is based on a mid-month survey of 400 U.S. crop and livestock producers. A reading over 100 suggests optimism, while a reading under 100 indicates pessimism amongst farmers regarding the ag economy. ************************************************************************************* Loeffler Joins Senate Ag Committee Newly appointed Senator Kelly Loeffler (Leff-ler), a Republican from Georgia, is replacing Georgia Republican David Perdue on the Senate Agriculture Committee. Loeffler was appointed to fill the vacancy caused by the resignation of Senator Johnny Isakson (eye-zeck-son). The Illinois native grew up on a family farm and says she “will stand with our farmers.” Loeffler is co-owner of the Atlanta Dream professional women’s basketball team, and has spent her career as a finance executive. Senate Agriculture Committee Chairman Pat Roberts of Kansas says of Loeffler, “Her farming roots make her a welcome addition to the Committee.” The 49-year-old Loeffler is recognized as the 26th woman currently serving in the Senate. The Senate seat formally occupied by Isakson will face a special election for the seat this year, which could be highly competitive. The winner of the special election will serve out the last of Isakson's term and face reelection in two years. ************************************************************************************* NPPC: Impossible Pork is Impossible The National Pork Producers Council Tuesday called Impossible Foods' naming convention for its plant-based products designed to mimic real pork a brazen violation of labeling law. Citing law that prohibits the use of words that redefine pork as consumers have known it for centuries, Dr. Dan Kovich, director of science and technology for the National Pork Producers Council, says, "What's impossible is to make pork from plants." NPPC supports consumer choice and competitive markets on a level playing field. Accordingly, plant-based and cell-cultured products designed to mimic real meat must face the same stringent regulatory requirements as livestock agriculture, including truthful labeling standards, according to NPPC. Kovich calls the efforts by Impossible Foods, "a brazen attempt to circumvent decades of food labeling law and centuries of precedence." NPPC maintains "plant-based alternative protein products cannot be called pork, and cultured products cannot be called pork without qualification making it clear how they were made." ************************************************************************************ 36th ASA Young Leader Class Kicks Off in Indianapolis The 36th class of American Soybean Association Corteva Agriscience Young Leaders recently began its journey at the Corteva Agriscience Global Business Center in Indianapolis, Indiana. The training session was the first phase of the program designed to identify future leaders within the agriculture community and provide them with opportunities to enhance their skills and network with other farmers. A Corteva spokesperson says the program “provides participants developmental training to hone their leadership skills and strengthen the voice of agriculture.” Representatives from 19 states and the Grain Farmers of Ontario participated in the program. The attendees learned about the soy checkoff and leadership in the future. The Young Leaders also participated in leadership styles and communications training, discussed consumer trends and acceptance. Additional discussion provided updates on other soybean industry advancements. The second phase of the Young Leader program will take place February 25 – 29, 2020 in San Antonio, Texas, with training held in conjunction with the annual Commodity Classic Convention and Trade Show.

| Rural Advocate News | Wednesday January 8, 2020 |


Washington Insider: Possible Digital Tax War Big internet companies have long been the target of complaints that they don’t pay enough taxes. In response, France imposed a 3% levy last year on the digital revenue of companies that make their sales primarily in cyberspace, such as Facebook Inc. and Alphabet Inc.’s Google, Bloomberg is reporting this week. Other countries also are targeting big tech companies, many of which are American, that have multinational earnings that often escape the taxman’s grip. The French law imposes the 3% levy on companies with at least 750 million euros ($834.5 million) in global revenue and digital sales of 25 million euros ($27.8 million) in France, a move that affects “about 30 businesses” Bloomberg says. While most of these are American, the list also includes Chinese, German, British and even French firms. The idea is to focus taxation where users of online services are located, rather than on where companies base their European headquarters or book their earnings. Targeting revenue rather than profit gets around techniques many companies use to shift their earnings to lower-tax jurisdictions. The taxation effort is not entirely French — Italy enacted a similar tax that took effect on Jan. 1. Turkey has proposed a digital tax of 7.5%. Legislation proposed in the UK last year would impose a 2% levy on the revenues of search engines, social media platforms and online marketplaces that “derive value from UK users.” Austria, Spain and Belgium say they are also considering digital levies, typically following the French model, by taxing sales of electronic data, online advertising and the services of intermediaries such as Uber Technologies Inc. and Airbnb Inc. that connect users to products. The U.S. government is charging that the French tax discriminates against American companies. In response, it proposed tariffs on roughly $2.4 billion in French products and says it’s exploring whether to open investigations into the digital taxes proposed in Austria, Italy and Turkey. The authority for the U.S. move is Section 301 of the U.S. Trade Act of 1974 — the same tool used to impose tariffs on Chinese goods due to alleged theft of intellectual property. France says the European Union will retaliate against any U.S. sanctions. France’s finance minister, Bruno Le Maire, said on Jan. 7 that he and U.S. Treasury Secretary Steven Mnuchin had resolved to try to find a compromise, and that France had said it would drop its tax if the U.S. and others agree to a global effort for a uniform approach under the stewardship of the Organization for Economic Cooperation and Development. Before it adopted its digital tax, France pushed for a European Union-wide digital levy that was scrapped when four countries — Sweden, Finland, Denmark and Ireland — declined to sign off on it. Resolving the dispute without escalating trade tensions is a goal of Phil Hogan, the EU’s new trade commissioner. Tax advocates argue that major tech companies are often domiciled overseas in low-tax jurisdictions such as Ireland or Bermuda shift money seamlessly across borders, and can easily avoid paying taxes in countries where they nevertheless make significant sales. More fundamentally, France argues that the structure of the global economy has shifted to one based on data, rendering 20th century tax systems archaic. European Commission data indicate that global tech companies pay a 9.5% average tax rate compared with 23.2% for traditional firms. Bloomberg points out that transatlantic tax wars aren’t new and that Apple Inc. was slapped with a 13 billion-euro bill for back taxes by the European Commission three years ago which the company called political. The U.S. Treasury tried and failed to sway the EU’s Apple investigation, which alleged that the company got an illegal subsidy in Ireland due to rules there governing the transfer of sales booked elsewhere in Europe. The Commission has also probed Google’s Irish tax arrangements and ordered it to pay 250 million euros ($278.17 million) in back taxes to Luxembourg. Other U.S. companies, including non-technology firms such as Starbucks Corp. and Nike Inc., have also been targeted in tax probes. The EU insists that the common thread isn’t that they’re American but that they’ve used complex legal structures and intellectual property licensing to limit their tax payments. Bloomberg says that taxes are only part of a bigger EU backlash against big tech. Internet firms have been put on notice over issues ranging from privacy to market dominance — and they’re fighting back with lobbying and court cases. Google won a legal fight against a $1.2 billion French tax bill in April. Apple and Amazon are contesting their respective European tax decisions in EU courts, and a legal victory could halt that part of the bloc’s crusade. Some companies may be changing their tax structures or moving income outside of the EU to stay ahead of the curve, as some European lawmakers alleged about Apple. So, we will see. Bloomberg editors have criticized both sides, arguing that the French tax is wrong, and so is the U.S. response. They may be right, since such fights often expand to include other vulnerable sectors well beyond the initial contestants — as the NAFTA fight did. Thus the digital tax issue is one producers should watch closely as it emerges and intensifies, Washington Insider believes.

| Rural Advocate News | Wednesday January 8, 2020 |


FSA Suspends Payments On 2018, 2019 Sugarbeet Losses Under WHIP+ USDA’s Farm Service Agency (FSA) is instructing state and county offices to not approve any sugarbeet pay groups on any application under the Wildfire and Hurricane Indemnity Program Plus (WHIP+) application, advising them that “additional guidance for processing sugarbeet losses will be forthcoming.” The agency cited the Fiscal Year (FY) 2020 government funding package which provided new legislation for paying sugarbeet losses under WHIP+ that require USDA to pay 2019 and 2019 losses through cooperative processors. “Due to the new legislation, 2018 and 2019 sugarbeet loss payments may be paid outside of WHIP+,” FSA said. It is not clear what the new guidance referenced by FSA will be. However, contacts advise the payments will be made.

| Rural Advocate News | Wednesday January 8, 2020 |


Report: China Will Not Boost Grain Import Quotas Under Phase One Trade Deal China will not increase the tariff-rate quotas on corn, wheat and rice under the phase-one trade deal, according to Han Jun, a vice minister of agriculture, as quoted by Caixin media. The TRQ is available to global markets and "we won't adjust it for one country,” Han said. Reuters reported there was no comment from the Chinese Ag Ministry on the matter. China has previously set the TRQs at 9.64 million metric tons of wheat, 7.2 million metric tons of corn and 5.32 mmt of rice. U.S. trade officials have been pressing China to fulfill the TRQs, but contacts indicate no increase was expected. The U.S. challenged China’s operation of the TRQs at the WTO and won the case, and China said they would comply with the WTO ruling.

| Rural Advocate News | Wednesday January 8, 2020 |


Wednesday Watch List Markets Early on Wednesday the ADP Employment report will be out as well as consumer credit. DTN will be watching closely the updated South American weather forecasts along with any news from the U.S.-Iran conflict ongoing. Weather Snow showers in the northeast U.S. during Wednesday. Rain through coastal areas of the Pacific Northwest and southward into northern California. Snow or snow showers and squalls from the mountains of the Pacific Northwest, across the northern Rockies and the northern portion of the Plains through the southeast portion of the Canadian Prairies. Some within these areas may see up to several inches of snow bringing impacts to travel and transport. Some impact to livestock. Mainly dry elsewhere in the key U.S. crop and livestock areas Wednesday. Mostly dry in key corn and soybean areas of southern Brazil and central Argentina. Temperatures near to slightly above normal.

| Rural Advocate News | Tuesday January 7, 2020 |


USMCA Senate Passage Possible This Week The Senate could pass the U.S.-Mexico-Canada Agreement by the end of this week. A Trump administration official told reporters over the weekend the agreement could clear the Senate by Thursday or Friday. The Senate Finance Committee scheduled a markup the agreement Tuesday (today), and the Senate could schedule a floor vote following the hearing. White House trade adviser Peter Navarro says fast track trade legislation requires a minimum wait of 20 hours after a committee markup before a vote. The timeline differs from what was offered by Senate Majority Leader Mitch McConnell following House passage of the agreement. At the time, McConnell said USMCA would follow impeachment hearings in the Senate towards the end of this month. However, the impeachment trial won’t begin this week in the Senate. The House passed the trade deal following a year-long negotiation between the Trump Administration and House Democrats seeking changes to the agreement. ************************************************************************************* Chinese Officials to Travel to Washington to Sign Phase One Deal A Chinese delegation will travel to Washington, D.C. next week to join President Donald Trump in signing the phase one trade agreement between the two nations. The South China Morning Post reports China’s trade delegation plans to travel to the U.S. on January 13, two days before President Trump plans to sign the accord. China and the White House both have yet to officially announce the visit and the officials included in the delegation. However, Chinese Vice Premier Liu (Lou) He will lead the group to Washington. The signing of the deal will mean increased agricultural purchases by China, as well as a partial end to the trade war that’s dominated headlines for the past 18 months. China’s soybean imports from the U.S. recently hit a 20-month high at 2.6 million tons, the highest number since March of 2018, when the trade war between the world’s largest economies began to pick up steam. ************************************************************************************* USDA Seeks Input on Agricultural Conservation Easement Program Rule The Department of Agriculture’s Natural Resources Conservation Service seeks public comments on its interim rule for the Agricultural Conservation Easement Program, known as ACEP. The rule is considered USDA’s premier conservation easement program, helping landowners protect working agricultural lands and wetlands. The rule – now available on the Federal Register – takes effect on publication and includes changes to the program prescribed by the 2018 Farm Bill. NRCS Chief Matthew Lohr says the changes to the program “make it stronger and more effective and will result in even better protection of our nation’s farmlands, grasslands and wetlands.” Changes to ACEP for agricultural land easements include USDA authorizing assistance to partners who pursue “Buy-Protect-Sell” transactions. Additionally, the new rule requires a conservation plan for highly erodible land that will be protected by an agricultural land easement. Changes to wetland reserve easements will identify water quality as a program purpose for enrollment of wetland reserve easements and expand wetland types eligible for restoration and management under wetland reserve easements. ************************************************************************************* NASDA: Policy Dominates 2020 Priorities Policy issues top the priority list for the National Association of State Departments of Agriculture in 2020. The NASDA board of directors identified several policy issues to tackle this year, focusing most efforts on international trade, workforce development, food safety and hemp production. NASDA is urging lawmakers in the Senate to quickly pass the U.S.-Mexico-Canada Agreement, which could happen this week. The organization also seeks full funding to implement the Food Safety Modernization Act and pledges to work with the Food and Drug Administration and states to effectively implement the Act. However, hemp may be the top priority for NASDA in 2020. Before harvest comes and the Department of Agriculture interim rule goes final, many questions and details remain to be navigated. NASDA is working with USDA to “provide a clear pathway for U. S. hemp growers.” NASDA CEO Barb Glenn says, “it’s imperative that FDA establishes consistent CBD regulations to ensure the crop has a stable market and consumers are safe.” ************************************************************************************ 2020 Fuel Outlook: Lower National Average Prices National average fuel prices for both gasoline and diesel in 2020 are expected slightly lower than 2019, but with several uncertainties. Gas Buddy’s 2020 Fuel Outlook predicts 2020 will feature a yearly national average of $2.60 per gallon, representing a two-cent drop versus 2019. The report predicts the 2020 national average diesel price at $3.03 a gallon. However, the report notes prices are largely season and location-driven, noting that refinery maintenance, seasonable blend switches, and environmental regulations all impact price. Further, the report suggests that with the U.S. entering an election year in 2020, the most likely scenario will be for President Donald Trump to shore up the U.S. economy ahead of the election to increase his chances of being re-elected. Researchers say such a move may contribute to a more reliable period of growth and rise in oil demand, met by increasing global oil production, even against OPEC’s production curb through March. ************************************************************************************* Coca-Cola Company Purchases all Shares of fairlife Milk Brand The Coca-Cola Company announced the acquisition of all shares of fairlife LLC. Coca-Cola Company takes 100 percent control of fairlife after previously owning a minority stake of 42.5 percent of the company. Financial terms of the transaction were not disclosed. Launched in 2012, fairlife LLC started with a high-protein milkshake called Core Power and has grown to offer a broad portfolio of products in the fast-growing value-added dairy category in North America. Coca-Cola says fairlife will continue to operate as a stand-alone business based in Chicago. Value-added dairy products have been growing steadily in the United States, in contrast to the traditional fluid milk category, with fairlife milk products playing a significant role in that growth. The brand also has been supported by the reach of Coca-Cola’s U.S. system with products distributed both through the Minute Maid distribution system, as well as by Coca-Cola bottlers across the country. 2018, fairlife also launched in Canada and will begin local production and sourcing in Ontario in spring 2020.

| Rural Advocate News | Tuesday January 7, 2020 |


Washington Insider: Economists and Economic Advice The American Economic Association has been meeting this week, and has not done much to clear up the outlook for the U.S. and global economies, it seems. For example, the U.S. and the euro area face “daunting economic challenges” in a world of low inflation and interest rates and central banks alone don’t have the tools to cope, according to former European Central Bank President Mario Draghi and ex-Federal Reserve Chair Janet Yellen. “I believe that for the euro area there is some risk of Japanification but it is by no means a foregone conclusion” if it acts comprehensively to avoid a deflationary malaise, Draghi said via a video link to the conference in San Diego. “The euro area still has space to do this, but time is not infinite,” he added. Yellen, now at the Brookings Institution in Washington, said she agreed with former Treasury Secretary Lawrence Summers that the U.S. was enmeshed in “secular stagnation” — a state where desired savings are bigger than investment and interest rates are depressed as a result, Bloomberg said. Yellen ticked off a number of structural forces holding down interest rates--including an aging population and sluggish productivity--and suggested they might be around for a while. “These factors are apt to prove chronic by nature,” she said. Draghi took euro area governments to task for working at cross purposes with the ECB’s efforts to aid the economy in recent years by pursuing restrictive fiscal policies. “This is why the ECB has been consistently calling for fiscal policy to play a stronger role and capitalize” on the low rates, he said. He counseled policy makers in Europe against becoming resigned to slipping into deflation. “It is certainly not too late for the euro area to avoid this,” he said, adding, “The euro area is not in a deflationary trap.” Yellen said that monetary policy in the U.S. should not be written off as a policy tool to combat recessions just because interest rates are so low. She agreed with her predecessor, Ben Bernanke, that quantitative easing and forward interest-rate guidance can be effective in providing stimulus to the economy. But while “monetary policy has a meaningful role to play, it’s unlikely to be sufficient in the years ahead,” Yellen said. It “should not be the only game in town.” “We can afford to increase federal spending and cut taxes” to support the economy in a recession even though government debt has risen sharply in recent years, the former policy maker said. Yellen did, though, express concern about financial stability risks arising out of an extended period of low interest rates. She also bemoaned the paucity of macro-prudential tools the U.S. has to deal with that. In the meantime, Bloomberg also highlighted the results of an evaluation by the U.S. Chamber of Commerce that said that the ongoing trade wars threaten negative impacts for numerous U.S. states. The Chamber warned that American businesses and consumers are “bearing the brunt of the trade war” and called on the administration to change course. Crunching Commerce Department data, it concludes that more than half of U.S. states are facing retaliatory tariffs on at least 25% of their exports to the European Union and China. The report lumps together impacts for consumers and exporters, and is likely aimed at administration assertions that exporting countries bear the brunt of tariffs, many of which actually are paid by U.S. consumers. In the meantime, the sudden shift in focus in Washington from the economy and global trade prospects to tensions with Iran, together with the impeachment process, has the potential to change the tone and perhaps the process itself. So, we will see. The administration is pushing ahead on several fronts, including current and hoped for trade talks — but prospects of war may change a great deal and should be watched closely as the national debates continue, Washington Insider believes.

| Rural Advocate News | Tuesday January 7, 2020 |


Fed Acknowledges Ag Struggles U.S. agriculture was on the mind of central bankers when the Federal Open Market Committee (FOMC) meet December 10-11, according to the minutes of that session released Friday. Agriculture is not typically something that gets much focus by Fed officials. But Agriculture and energy sectors were a concern point for Fed members. “A number of participants commented on challenges facing the energy and agriculture sectors,” the minutes said. “A few participants remarked that activity in the energy sector was especially weak, reflecting low petroleum prices, low profitability, and tight financing conditions for energy-producing firms.” As for agriculture, the minutes indicated “several participants noted that the agricultural sector also faced a number of difficulties, including those associated with trade developments, weak export demand, and challenging financial positions for many farmers.” But “a couple” of FOMC participants pointed out that “farm subsidies from the federal government were offsetting a portion of the financial strain on farmers.”

| Rural Advocate News | Tuesday January 7, 2020 |


USMCA Action on Tap in Senate The Senate Finance Committee is setting the stage for action on the U.S.-Mexico-Canada Agreement (USMCA) in the chamber. The panel will hold its mock markup today. “This markup will move us closer to ratifying USMCA in early 2020,” Grassley said when the markup was announced in December. “Farmers, manufacturers and all American workers will soon be able to benefit from a stronger and modernized trade agreement with Canada and Mexico.” Timing of a vote in the full Senate, however, may now come sooner than previously expected. The House has so far delayed sending its articles of impeachment to the Senate, delaying when the trial in the Senate can begin. In December, Senate Majority Leader Mitch McConnell, R-Ky., said that the USMCA action in the upper chamber would await completion of the impeachment process. But as the delay continues relative to impeachment continues, it ups the odds that the full Senate could act on USMCA before the impeachment trial.

| Rural Advocate News | Tuesday January 7, 2020 |


Tuesday Watch List Markets Early on Tuesday we'll have the trade deficit numbers out, along with factory orders and the manufacturing index. We'll also watch for any new reaction to the U.S.-Iran conflict. Weather in South American crop areas will be closely watched as well. Weather A small area of snow, ice and rain through the east-central U.S. during Tuesday. Rain through coastal areas of the Pacific Northwest and ice or snow across the northern Rockies to the northwestern Plains. Mainly dry elsewhere in the key U.S. crop and livestock areas during Tuesday. In South America we can expect scattered showers from the Parana area of southern Brazil northward and mostly dry conditions in the central and south Argentina crop belt. No significant hot weather in either Brazil or Argentina today.

| Rural Advocate News | Monday January 6, 2020 |


Senate to Continue Ordinary Business During Impeachment Hearings Delay Senate Majority Leader Mitch McConnell signaled an opportunity to quickly consider the U.S.-Mexico-Canada Agreement. In a speech on the Senate floor Friday, McConnell says the Senate will "go about ordinary business," because House Speaker Nancy Pelosi is holding the articles of impeachment, thought to delay USMCA consideration in the Senate this month. A hearing is on the calendar Tuesday morning for the Senate Finance Committee to markup the implementing legislation for USMCA. McConnell charged Democrats in the House were “searching desperately for some new talking point” on impeachment, and alleged they were developing cold feet. Senate Minority Leader Chuck Schumer responded, however, that "instead of trying to find the truth,” comments by McConnell indicate there will not be a fair impeachment trial. Senate consideration of USMCA was expected after the impeachment trial in the Senate. However, with a delay and fighting amongst lawmakers regarding the trial, USCMA could sneak through before a trial begins. ************************************************************************************* R-CALF: Cattle Importers Control U.S. Policy The Department of Agriculture last week issued a proposed rule to reapportion the Beef Checkoff Program’s Cattlemen’s Beef Board. R-CALF says the proposed rule reveals importers control more cattle inventories than any state in the United States except Texas. To make its calculations regarding who controls domestic cattle inventories, R-CALF says USDA counts imported live cattle and converts imported beef into a live cattle equivalent. Importers now control about 6.9 million cattle in the U.S. market. Only the state of Texas, which controls about 12.6 million cattle, exceeds the importers' control. The organization says the combination of cattle and beef imports represent the largest agricultural commodities imported from Canada and Mexico. USDA data shows U.S. imported $4.1 billion in cattle and beef from Canada and Mexico in 2018. R-CALF CEO Bill Bullard claims the importers dominant control over cattle inventories “affords them extraordinary influence” on U.S. lawmakers, adding cattle and beef importers are opposed to mandatory country-of-origin labeling because “they do not want consumers to know the origins of their cheaper-sourced products.” *************************************************************************************​ Bunge Sells Share of U.S. Ethanol Plant Bunge last week announced the sale of its share of an ethanol production facility. Southwest Iowa Renewable Energy, or SIRE, repurchased Bunge’s membership units effective December 31, 2019. The purchase was made under the terms of the Bunge Membership Interest Purchase Agreement and ends Bunge’s 13-year ownership interest in SIRE. Andrés Martín, North America country manager for Bunge, stated, “As Bunge focuses our resources on our core businesses, selling our shares in SIRE, while maintaining a relationship, is an attractive opportunity.” SIRE is located on 275 acres in Council Bluffs, Iowa, operating an ethanol plant that is permitted to produce 140 million gallons per year. In addition to the stock repurchase, SIRE will assume responsibility for originating corn and selling dried distillers grains produced by the plant. Under a revised agreement, Bunge will continue to purchase all of the ethanol produced by SIRE. SIRE will also continue to lease rail cars from Bunge under existing lease agreements. ************************************************************************************* Corn Growers Call EPA Atrazine Decision a Reasonable Approach Corn farmers say the Atrazine Preliminary Interim Decision is a positive for farmers who rely on atrazine for weed control. The Triazine Network, a coalition including the National Corn Growers Association and advocates for science-based regulatory decisions regarding atrazine, welcomed the document published in the Federal Register last week. The coalition says the decision supports the Environmental Protection Agency's commitment to using credible scientific research in setting a reasonable aquatic ecosystem Level of Concern for atrazine. The decision corrects a recommendation made in the 2016 Ecological Risk Assessment to set the Level of Concern at 3.6 parts per billion, an ultra-low level that would have banned the use of atrazine in much of farm country. The lower level was based on questionable research, according to the coalition, including studies that had been turned down by EPA's 2012 Science Advisory Panel. The publication of the atrazine decision in the Federal Register opens a 60-day comment period that ends on March 2, 2020. ************************************************************************************ AFIA: December Spending Bills Improve Feed Ingredient Approval Process The American Feed Industry Association says spending bills passed last month will improve the approval process for animal feed ingredients. The 2020 fiscal year appropriations package allocates new dollars to the Food and Drug Administration’s Center for Veterinary Medicine to hire additional staff specifically for reviewing new animal food ingredient submissions. The $5 million allocation from appropriators will allow the FDA to nearly double ingredient approval staff, which will reduce the length of review time by the agency in the approval timeline. Constance Cullman, AFIA’s president and CEO, says, "the lengthy ingredient review processes have hindered the approval process for animal feed ingredients” that can improve the safety, quality and nutrition of feed. A study funded by the Institute for Feed Education and Research found that for every year of delay in the approval process, submitting companies across the animal food manufacturing industry were losing an average $1.75 million annually in revenue per ingredient. ************************************************************************************ Syngenta Announces Crop Challenge Prize Committee Syngenta and the Analytics Society of INFORMS have selected the prize committee for the 2020 Syngenta Crop Challenge in Analytics, a competition in which entrants develop data-driven models to address various challenges inherent in agriculture. Now in its fifth consecutive year, the Syngenta Crop Challenge in Analytics is a collaborative effort between Syngenta and the Analytics Society of the Institute for Operations Research and the Management Sciences, or INFORMS. In the 2020 challenge, entrants are tasked with developing data-driven methodologies that can help predict the performance of potential corn seed products. Judges include experts from U.S. universities, Syngenta, American Airlines and Land O’Lakes. The prize committee will evaluate entries following the January 21, 2020, submission deadline, and finalists will be announced in March 2020. Winners will be announced during the 2020 INFORMS Conference on Business Analytics in April. The first-place winner will receive $5,000, the runner-up will be awarded $2,500, and the third-place winner will receive $1,000.

| Rural Advocate News | Monday January 6, 2020 |


Washington Insider: Monetary Policy Seen as Appropriate Late last week, Federal Reserve officials reported on their review minutes of recent meetings and called their monetary policy “likely to remain appropriate for a time” even amid what they saw as persistent downside risks, Bloomberg reported over the weekend. The minutes of the Dec. 10-11 Federal Open Market Committee released Friday noted that global developments, related to both persistent uncertainty regarding international trade and weakness in economic growth, continued to pose some risks to the outlook. However, Fed officials left interest rates unchanged at their final 2019 meeting following three straight cuts. They also signaled expectations that monetary policy would be on hold through 2020, which would keep the central bank on the sidelines during a U.S. presidential election year. Participants saw sustained economic expansion, labor market strength, and inflation near their 2% goal as the most likely outcomes, in part because of their monetary policy support. A number said the economy was showing resilience amid global headwinds. Fed officials worried that inflation continued to fall short of their 2% target, the minutes said. “Various participants were concerned that indicators were suggesting that the level of longer-term inflation expectations was too low.” Policy makers were also optimistic about the labor market, with participants remarking on indications that the unemployment rate could fall further without putting pressure on inflation. In addition, a “number of participants noted that the labor force participation rate could rise further still,” the minutes said. Thirteen of 17 officials forecast leaving rates on hold in 2020, according to projections released at the last meeting, with four penciling in a quarter-point hike. A majority forecast at least one increase in 2021 and 2022. Not a single official forecast a rate cut in the next three years. Officials also focused on their recent steps to calm money markets following strains in September that sent overnight rates surging. Among topics mentioned were “the potential role of a standing repo facility in an ample-reserves regime,” the minutes said. The Fed provided $256 billion of temporary liquidity via open market repurchase operations over the end of the year to avoid a cash crunch. The final operation of 2019 saw just $25.6 billion pumped into the system, compared with a maximum available offering of $150 billion. It plans repo operations through January. The minutes also discussed highlights from the system’s open market account manager’s report to the committee with the expectation that the Fed could consider expanding security purchases for reserve management to include coupon-bearing Treasury securities with a short time to maturity if necessary to ease liquidity constraints in the Treasury bill market. The minutes noted that expectations for the future include a gradual transition away from active repo operations next year as bill purchases supply a larger base of reserves, although it noted that “some repos might be needed through April, when tax payments reduce reserves,” and that it may be appropriate at some point to adjust rates on excess reserves and on overnight reverse repurchase agreements. It noted that the Fed is currently buying $60 billion of Treasury bills a month to boost bank reserves and meet longer-run liquidity demand. So, we will see. Considerable uncertainty continues to threaten the outlook as the mid-January date for signing Phase One of the expected China deal approaches and as tensions with Iran continue to grow. At the same time, it is clear that the sharp signs of economic slowdown that were evident in recent months have abated significantly, in spite of the new threats from the Middle East, Washington Insider believes.

| Rural Advocate News | Monday January 6, 2020 |


EU Trade Chief to Visit US The European Union’s new trade chief Phil Hogan plans to visit Washington on Jan. 14-16 in a bid to mend transatlantic relations impacted by U.S. measures against imports from the bloc and its attacks on the international commercial order. Hogan will meet with U.S. Trade Representative Robert Lighthizer to discuss disputes including an American threat to hit $2.4 billion of French goods with tariffs in retaliation over a digital-services tax in France. Plus, Hogan figures to be potentially a key player relative to any agricultural negotiations as he previously served as the EU Ag Commissioner.

| Rural Advocate News | Monday January 6, 2020 |


Monday Watch List Markets There are very few government reports to talk about on Monday. DTN will be watching for any news over the weekend of reactions to the airstrike that took out the known terrorist and Iranian commander Soleimani. We will also be focusing on South American weekend weather and forecasts ahead. Monday's export inspections will be closely watched. Weather Mainly dry conditions or with only small areas with light precipitation through the key crop and livestock areas of the central and southeast U.S. Monday. No significant transportation concerns today. Rain through the Pacific Northwest and snow across the northern Rockies. In South America, southern Brazil continues on the hotter and drier side today while central Argentina has lingering rain after thunderstorms developed last night. The recent spell of hotter, drier weather over Rio Grande Do Sul, Brazil remains a concern.

| Rural Advocate News | Friday January 3, 2020 |


Coalition Seeks Ag Labor Wage Reforms The Agriculture Workforce Coalition Thursday urged the U.S. Senate to take up legislation to solve the agricultural labor crisis. A letter penned by the coalition to the Senate urges lawmakers to address the Adverse Effect Wage Rate, which increased nationally by six percent for 2020. The rate is the required wage for farmers who use the H-2A program. In its letter, the coalition asks the Senate to consider the impacts of the rate on U.S. farmers. The group seeks an alternative that will ensure a level playing field for farmers and ranchers making them more competitive with foreign producers. Additionally, the coalition says farmers who use the H-2A program to procure legal workers from other countries must comply with “a complicated and expensive application” process. Over the last five years, the Adverse Effect Wage Rate has increased nationwide by 17 percent on average while revenues for fruits and nuts have increased only three percent and vegetables and melons have seen no revenue increases. *************************************************************************************​ USMCA Senate Markup Scheduled for Tuesday The U.S. Senate will take its first look at the U.S.-Mexico-Canada Agreement Tuesday if the House sends the implementing legislation to the Senate. Senate Finance Chairman Chuck Grassley announced the hearing after the House passed the agreement, along with articles of impeachment, when House Speaker Nancy Pelosi chose to hold the articles of impeachment, rather than sending them on to the Senate. However, the hearing is still not on the official calendar for the committee. The hearing, if held, would be the first step in getting the trade deal passed by the Senate. Progress will depend on the impeachment hearings. Previously, Senate leadership expected the impeachment hearings to take up to a month, leaving little room at the end of January or early February for USMCA passage. If the impeachment hearings are delayed by a few weeks, the Senate could consider and pass the USMCA implementing legislation before the hearings. The House approved the agreement by a 385-41 vote on December 19. ************************************************************************************* Grains Council Announces Annual Corn Harvest Quality Report After one of the United States’ most challenging growing seasons in history, The U.S. Grains Council annual Corn Harvest Quality Report shows resiliency in agriculture. The report is based on 623 samples collected from inbound farm-originating trucks at harvest. Kurt Shultz, USGC senior director of global strategies, says the report provides “transparency about crop conditions and consistently reinforce that the United States is the world’s most reliable supplier of good quality corn.” The Grains Council’s global staff and grower-leaders will share the results of the first report in a series of crop quality seminars around the world, beginning in Taiwan this month. A forthcoming companion report – the 2019/2020 Corn Export Cargo Quality Report – will focus on export cargo samples collected from corn shipments undergoing federal inspection and grading processes at export terminals. The reports offer reliable information on U.S. corn quality from the farm to the customer based on transparent and consistent methodology. ************************************************************************************* USDA Accepting Applications for North Africa Trade Mission The Department of Agriculture is recruiting interested U.S. exporters for its first 2020 trade mission, which will take place in Casablanca, Morocco, March 16-19. The mission will focus on boosting U.S. agricultural exports to North Africa and will include interested buyers from several countries in the region. This will be the second USDA trade mission to Africa within six months, supporting the Donald Trump administration’s Prosper Africa initiative to foster two-way trade and investment between the United States and Africa. With North Africa’s growing demand for food and feed products, the region is fertile ground for U.S. agricultural export sales, according to USDA. Officials say Morocco is a promising market thanks to the U.S.-Morocco Free Trade Agreement and the country’s high-quality infrastructure and stable economy. In 2018, the country imported $595 million of U.S. agricultural and related products. The deadline to apply for the North Africa trade mission is January 16, 2020. Learn more at www.fas.usda.gov. ************************************************************************************* First 2020 Drought Monitor Released The first weekly Drought Monitor of 2020 shows dry conditions in Texas, the Four Corners states, and the Pacific Northwest. Released Thursday, the report shows moderate to severe drought continues across southwest Oklahoma and areas of the Texas Panhandle and northwest Texas, which received lighter rainfall amounts. Changes to the drought picture across the remainder of Texas included a slight drought reduction in central and southwest parts of the state, based on recent rainfall and lack of short-term dryness. Meanwhile, drier weather returned to the Pacific Northwest during the final week of December. Following the period of heavy precipitation during mid to late December, no changes were made to the ongoing abnormal dryness and short-term moderate drought areas. Water year to date, since October 1, shows precipitation deficits of more than 12 inches. And, pockets of moderate to severe drought cover parts of the Four Corners states, with the majority of Utah experiencing drought conditions. ************************************************************************************ 2020 Offers Fewer Tax Burdens for Farmers, Ranchers The new year brings less of a tax burden for farmers and ranchers when it comes to health insurance, according to the American Farm Bureau Federation. In spending bills passed by Congress before the holiday break, lawmakers included a permanent repeal of the Health Insurance Tax, which was enacted as part of the Affordable Care Act. AFBF says the tax has increased health insurance costs for farmers, ranchers and other small businesses by imposing a levy on the net premiums of health insurance companies, which is then passed on to consumers. The spending bill also retroactively reinstates and extends tax incentives for biodiesel and renewable biodiesel through December 31, 2022, and tax credits for second-generation biofuels through 2020. In addition, the measure retroactively restores and extends through December 31, 2022, the 50 percent tax credit for short line railroad maintenance. Short line railroads are first- and last-mile carriers that connect small towns, farms and factories to the national rail network, creating jobs and stimulating economic growth in thousands of local communities.

| Rural Advocate News | Friday January 3, 2020 |


Washington Insider: Outlook for China Tech The media is full of prognostications these days, mainly focused on the U.S. outlook. However, Bloomberg is focusing heavily on China, as well, and says this week that the tech industry there enters a new year after weathering unprecedented turbulence in 2019. In the past, when giants emerged in social media and artificial intelligence they faced “the brunt of Washington’s campaign to contain the world’s No. 2 economy,” Bloomberg says and believes that there is little reason to think 2020 will be much different, given U.S. efforts to hobble Chinese champions from Huawei Technologies Co. to SenseTime Group Ltd. American lawmakers went after some of the country’s biggest names last year. The heightened scrutiny came just as pressure back home intensified. Beijing worked to scrub sensitive content from ByteDance apps and Tencent Holdings Ltd.’s WeChat, while the economy grew at its slowest pace in decades. Investors cooled on the sector with venture capital activity halving, triggering fears the industry’s heyday is over. That in turn demoralized the country’s already-overworked tech professionals, who rebelled for the first time against the 70-plus hour workweeks that Alibaba founder Jack Ma labeled the norm. Now Bloomberg thinks that, given Washington’s increasing hostility, China is even more intent on devising alternatives to foreign technology from AI chips to blockchain solutions while propping up local champions and that this is “bad news for the likes of Qualcomm Inc. and Apple Inc. that depend on China for much of their revenue.” It has started to upend a decades-old supply chain centered around China, threatening to split the old world order in two. It’s not just in hardware – from Russia to Southeast Asia, many governments have begun to co-opt characteristics of the Chinese internet arena, from harsh fake-news laws to censorship and data sovereignty. This was the first year we understood China tech at its most global ever – but that glimpse revealed “the specter of it becoming more and more insular,” said Michael Norris, research and strategy manager at Shanghai-based consultancy AgencyChina. “This is bigger than just the U.S., in terms of assuaging the fears of countries like India that (Chinese) platforms aren’t going to disseminate nude photographs or hate speech.” The industry’s woes may be best quantified by a plunge in capital flow. The amount of venture money invested plummeted by more than 50% to about $50 billion from a record $112 billion in 2018, when it topped the U.S., according to the market research firm Preqin. Funding dropped in the U.S., too, but only slightly. China birthed only 15 unicorns, or startups worth at least $1 billion, down from 35 the year before, according to CB Insights. The decline coincided with a loss of confidence in some of the industry’s marquee names, exemplified by the rocky debuts of WeWork and Uber Technologies Inc. While Alibaba raised $13 billion in a milestone Hong Kong offering, smaller names like SenseTime and Full Truck Alliance struggled to raise capital. “The power of the mobile revolution is coming to an end. Globally, we are seeking what comes next,” said Kai-Fu Lee, founder of Sinovation Ventures. The startup and venture capital industry is likely headed for a shakeout. Many investments from the past bubbly years aren’t panning out, with startups struggling to live up to their valuations. Fundraising by China-focused venture firms fell by about 50% to about $13 billion, according to Preqin. “China tech is going global, going mainstream and shaking things up more than ever,” said Rebecca Fannin, founder of technology consultancy Silicon Dragon. “More U.S. startups will follow China business models.” However, China’s position as factory for the world of technology is in jeopardy. The (mainly Taiwanese) assemblers of the world’s electronics are exploring options beyond China to varying degrees. From Inventec Corp. to Foxconn Technology Group and Quanta Computer Inc., the makers of everything from iPhones to Dell laptops have either moved production back to Taiwan or to further-flung regions around Asia, seeking to escape U.S. tariffs. The idea is that, even if Washington and Beijing strike a trade deal, diversification is essential in the longer term given tensions are unlikely to subside and labor costs will rise. Even leading Chinese hardware suppliers recognize the risks. In addition, last year’s experience forced Chinese tech workers to come to terms with the new reality. Many had taken jobs with startups in the hope of cashing in when they debut or get bought. But as that deal-making streak cooled, the prospect of working long hours – 996, or 9 a.m. to 9 p.m., six days a week – lost much of its appeal. In March, Chinese programmers on GitHub put together a list of companies known for short-changing their employees on overtime which led to a greater awareness of the human cost of China’s tech boom. “What’s changed is the trade war, the talk of decoupling,” said Paul Triolo, head of global technology policy at Eurasia Group. “This has really galvanized the authorities. It doesn’t necessarily mean that they will be more successful. But they’re determined.” So, we will see. Chinese competition in high tech areas has shocked many in the U.S., at the same time it has strengthened that nation’s demand for many U.S. products – so the implications of trade concessions have the potential to be highly complex, observers say. Clearly, the evolution of any trade deal with China should be watched closely by U.S. producers as the trade policy debates intensify, Washington Insider believes.

| Rural Advocate News | Friday January 3, 2020 |


CCC Commodity Loan Interest Rate Down For January Marketing Assistance Loans of less than one year disbursed in January will carry an interest rate of 2.5%, according to the Commodity Credit Corporation (CCC). The rate for January is down from 2.625% in December. While not a significant decline, this still gives those opting to use the marketing assistance loan program a slightly lower cost to the nine-month loans. And, loan activity at times can pick up in January as producers seek cash flow

| Rural Advocate News | Friday January 3, 2020 |


US-China Trade Still in Headlines as 2020 Opens China remains the focal point for many in U.S. agriculture as 2020 arrives, with the signing of the phase-one trade deal now expected to happen January 15. China has taken actions on imports, implementing provisional import tax rates that are lower than the most-favored-nation rates for more than 850 commodities on Jan. 1, 2020. The list includes frozen pork, frozen avocados and non-frozen orange juice, in addition to some pharmaceutical products/materials. China signaled the action was coming just ahead of 2020 and appears to have made good on the action. This also puts attention on the level of tariff reductions that will be seen under the Phase One agreement which would greatly enhance U.S. competitiveness in several areas. Chief U.S. ag trade negotiator Gregg Doud said the purchase commitments by China equate to $16 billion in additional ag buys beyond the $24 billion baseline level of Chinese purchases in 2017 – before the trade war with the U.S.

| Rural Advocate News | Friday January 3, 2020 |


Friday Watch List Markets Friday's early reports will feature a manufacturing index report and construction spending. We will be watching South American weather updates for any changes, and any news regarding the U.S.-China phase one trade signing, expected to take place January 15 in Washington. Weather Rain, showers and thundershowers during Friday from the north and east Delta and the southeast to east-central Midwest through the east-central and southeast U.S. areas. The heaviest activity will occur in the southeast US to the Carolinas as thunderstorms develop. A band of mostly light snow or snow showers is expected to develop over the northwest Midwest and move into central areas of the Midwest during today. The northeast Midwest may also see snow or mixed precipitation tonight. Drier elsewhere in the key US crop and livestock areas Friday. In South America key growing areas of southern Brazil and central Argentina will be dry today but with cooler than normal temperatures.

| Rural Advocate News | Thursday January 2, 2020 |


Trump Will Sign Phase One Deal January 15 President Donald Trump put a date on signing the Phase One trade deal with China, thanks to Twitter. He’ll sign the deal with China on January 15, making the agreement between the two largest economies official. The highlight of the deal that’s most interesting to agriculture is China will increase its purchases of U.S. agricultural products in exchange for the U.S. lowering tariffs on some of its imports. “The ceremony will take place at the White House,” Trump says on Twitter. “High-level representatives of China will be present.” In addition to the ag purchases, China agreed to new commitments on intellectual property protections, forced technology transfers from U.S. companies, as well as new currency practices. Bloomberg says the deal will calm some of the fears that the trade war between the nations would continue long term. The president also says he’ll be traveling to Beijing at a later date to begin Phase Two negotiations. The precise details of the agreement haven’t been released to the public yet. U.S. Trade Representative Robert Lighthizer says the details will come out when it’s officially signed by both countries. ********************************************************************************************* China Bans Pork Imports from Indonesia Due to ASF China is doing everything it can to rebound from the African Swine Fever epidemic that decimated its hog herds. Chinese customs officials say they’ve banned imports of pigs, wild boars, and related products from Indonesia due to the ASF virus outbreak in the northern part of the country. A Reuters article says the deadly disease roared across China itself after first being detected in August of 2018. Some estimates say the disease reduced the world’s biggest pig herd by up to 40 percent. Beijing has recently issued a series of new measures to boost pig production, while also maintaining strict prevention and control measures designed to prevent new outbreaks of the disease. China’s General Administration of Customs says on its website that as of December 17, Indonesia had reported almost 400 cases of African Swine Fever outbreaks. As of mid-December, official reports say the virus has killed almost 30,000 pigs across a province in north Indonesia. Authorities are still trying to quarantine the area, which has suffered millions of dollars in economic losses. ********************************************************************************************** China Loosens Restrictions on Importing GMO Crops A government body in China has given its approved safety certificates to 203 new genetically modified crops for planting and import purposes. Official documents that came out Monday should pave the way for wider GMO adoption in the country. The Chinese Ministry of Agriculture and Rural Affairs shared three lists of newly approved GMO crops, including soybeans, corn, cotton, papaya, and many others. One market source told Agri Census Dot Com that, “It might be possible that China will open up domestic planting of GMO soybeans sometime soon.” China has maintained tight restrictions on using GMO crops in domestic planting in the past. However, it’s been more willing to import GMO crops in recent years, including soybeans, corn, and rapeseed. Soybeans, corn, and rapeseed that were domestically produced within China are said to be non-GMO. Two of the newly approved crops were developed in the U.S. and were licensed for import; One for soybeans and the other is papaya. The newly approved certificates will be valid between three and five years, depending on the crop. ********************************************************************************************** 2019 Squeezing Grain Elevators in Rural America CoBank says it isn’t just farmers that saw lower cash returns in 2019. Grain elevators will also see their profit margins drop compared to the previous year. The lower returns are blamed on a higher basis for corn, soybeans, and wheat. A release from CoBank’s Knowledge Exchange Division says, “In addition to having to buy a more expensive basis, grain elevators are offering farmers incentives to sell bushels, such as lower rates on storage, free delayed pricing, and free grain drying.” Lower quality and high-moisture grain coming in from wet fields around rural America also boost elevator costs. Propane shortages in 2019 also continued to put a damper on elevator revenue. As if that’s not enough, drying wet grain can lead to commodity shrinkage, which adds to lost bushels and higher costs for elevators. CoBank says those challenges from 2019 will likely carry into the new year. “Grain elevators’ margins will get squeezed in 2020 by the tightness in basis, diminishing carries in the futures markets, and many other challenges from low test-weight and high-moisture grain,” CoBank says. ********************************************************************************************** Organic Sales Doubled Over Five Years; Percentage Still Small U.S. organic sales doubled between 2012 and 2017, even though the total value of U.S. agricultural sales remained flat. The USDA says growth in the organic sector has taken off since the early 2010s as food manufacturers, retailers, and livestock producers have increased their demand for organic foods and inputs. Organic operations’ average sales were just over $400,600 in 2017, more than doubling the average sales for all farms, which came in at just over $190,000. The organic share of all agricultural sales in the U.S doubled to two percent between 2012 and 2017, but the share was over six percent in some states. California took the top spot in the nation in terms of organic and overall ag sales. Most of the other top organic producing states were in the Pacific Northwest, which is a major grower of organic produce. Other states were in the Upper Midwest, a major producer of organic milk, and the Northeast U.S., which has many smaller-scale organic farms. Pennsylvania and North Carolina had the fastest organic growth between 2012 and 2017. ********************************************************************************************** Study Shows Farmers are Paying Higher Wages Than Ever Before Farm Journal recently conducted a study that encompassed all sectors of agriculture. What they found was farmers are paying more in wages than at any point in history. They’re more efficient in using their available labor. However, they’re still frustrated. The survey of more than 2,100 farmers included almost 200 dairy farmers. Of the total producers, 87 percent say they pay more in wages than they did five years ago. While 58 percent of the employers have offered higher wages to attract labor, few can and do offer benefits. Just 20 percent of the farmers offer health insurance. Almost 45 percent offer their employees paid time off. A handful of the dairy farmers in the survey says they milk their cows with robotics. But, the majority of the dairy farmers say milking help is the hardest position to both fill and retain employees. Employers’ biggest frustrations are those who show up late, don’t show up at all, or don’t follow protocols in place. They say the best employees have a sense of ownership, which is easier to say than to find.

| Rural Advocate News | Thursday January 2, 2020 |


Washington Insider: Economic Prospects Improved In something of a shift from recent trends, Bloomberg is reporting this week that “as a new decade dawns, some, but not all, of the dark clouds hanging over the U.S. economy have cleared.” Looking back, it calls 2019 “a year on the edge” that began with a government shutdown, was dominated early by fears of recession as the trade war with China intensified into a battle “that hurt business investment and threatened the economic expansion.” Nevertheless, last year continued the country’s longest expansion on record --thanks to “nonplussed” Americans who kept on spending. The strength was fueled by job gains that unexpectedly picked up steam late in the year, bucking forecasts for a slowdown and now “downside risks have eased somewhat as the Federal Reserve lowered interest rates three times, U.S.-China tensions cooled and the UK election removed some of the Brexit uncertainty that’s haunted the global economy.” Still, Bloomberg thinks, “this outlook doesn’t necessarily mean growth will enjoy a resurgence.” Economists still expect a slowdown to about 1.8% for gross domestic product growth in 2020, which is around what most analysts see as the long-run potential rate but well short of the 3% that President Donald Trump pledged to achieve. In addition, the trade war with China is far from over, corporate debt is piling up, global growth remains sluggish and Boeing Co.’s production halt on the troubled 737 Max jet will ripple through factories, Bloomberg emphasizes and focuses on “five key trends in the U.S. economy to watch” in 2020. It notes that the job market outperformed projections at the tail end of the year, with unemployment matching a half-century low and wages picking up – particularly among the average, non-supervisory worker where gains are approaching 4%. A strong payroll gain of 266,000 in November was enough to undermine projections that things were shifting into lower gear. It also warns “that narrative” could weaken a bit with payroll revisions due in February that will make the past look less shiny. Analysts still reckon that a downshift will arrive in 2020, with average monthly job gains slipping in the third quarter as the pool of available workers shrinks further – a trend that “suggests” that this year will be the time that wage gains accelerate and finally push inflation higher. However, Bloomberg allows that even if it cools a bit, “the labor market alone is likely to continue sustaining spending on goods and services, the economy’s lifeblood, as well as in housing. It sees the real estate sector as primed for a stronger 2020 – thanks to lower interest rates – after “a dismal 2018 and yawn-inducing 2019.” Builders and consumers are optimistic, permits are rising and there’s plenty of pent-up demand. Yet supplies may continue to be thin amid constraints like restrictive zoning regulations and baby boomers staying in their homes. The report identifies the manufacturing sector as “appearing” to be emerging from its contraction that lasted two quarters in 2019 but thinks that trend is “not about to go gangbusters.” For one thing, demand may take some time to recover following the China trade truce and companies could remain wary until a more comprehensive agreement is reached. In addition, the “strong dollar will continue to weigh on exports.” With manufacturers eyeing a pullback in spending next year for the first time since 2009, their health will potentially hold back growth from being more robust. Bloomberg also argues that while the “national-level data may remain solid, states could run hot or cold.” What happens in local economies is seen as key for the 2020 presidential election, given how narrow 2016 victories were in a few swing states. That means factory-job numbers in places like Michigan, Pennsylvania and Wisconsin are likely to get outsize attention following conflicting data in 2019 — and shifting demographics along with an influx of transplants in once-reliable Republican strongholds like Texas “could make making things less predictable in other places as well.” In addition, Bloomberg says “risks lurk in the shadows of a 2020 outlook for steady growth.” Debt is one of them, it says, as former Fed officials are among those warning of dangers of a prolonged period of easy policy, which can increase investors’ appetite for riskier and higher-yielding assets. It also notes the possibility of a re-escalation in the trade war with China along with continued sluggishness in the global economy and weakness in business investment. Finally, the group thinks that wage gains could accelerate more forcefully and finally feed through to inflation, putting pressure on the Fed to raise rates. So, we will see. The economy still is seen as clearly improved in recent weeks, but key areas of uncertainty remain and should be watched closely by producers as the year with its many election-linked fights proceeds, Washington Insider believes.

| Rural Advocate News | Thursday January 2, 2020 |


Some Direct Shipments Avoid US Tariffs on China Direct shipments of goods from China to the U.S. worth $800 or less, which are exempt from current tariffs, appear to be growing, the Wall Street Journal said. The $800 threshold is known as the de minimis exemption. WSJ cited data from the U.S. Census Bureau showing an 11% increase in the value of shipments of goods worth less than $2,000 since the trade war began in July 2018, despite the value of all shipments dropping around 15% over the same period. Many consumers are purchasing the goods, which often include electronics, auto parts and clothing, directly from Chinese suppliers using marketplaces like Amazon.com. US Trade Representative (USTR) Robert Lighthizer has voiced opposition to the current threshold and attempted to have it lowered for goods from Mexico and Canada during negotiations over the US-Mexico-Canada Agreement (USMCA). He noted other countries often set much lower de minimis thresholds than the US imposes on them and argued the situation “adds to the trade deficit,” in testimony to a House panel earlier this year.

| Rural Advocate News | Thursday January 2, 2020 |


US-China Phase One Deal to Be Signed Jan. 15: Trump The phase-one U.S.-China trade deal will be signed Jan. 15 at the White House, President Donald Trump said in a tweet Tuesday (Dec. 31). Trump also confirmed that “high level representatives of China will be present” at the ceremony. Earlier reports had suggested Chinese trade officials led by Vice Premier Liu He would be in Washington through the middle of next week to sign the trade deal. Additional U.S.-China trade talks are set to begin “at a later date,” Trump said, adding he would travel to Beijing to kick off “phase two” trade deal negotiations. Provisions of the phase-one agreement include purchases of U.S. ag products by China, a promise by China to bolster intellectual property protections and new enforcement provisions, among others. The final text of the deal is still undergoing a legal scrub and is expected to be released following the signing.

| Rural Advocate News | Thursday January 2, 2020 |


Thursday Watch List Markets Weekly jobless claims will be out early on Thursday. DTN will be closely watching updates on South American weather forecasts, where Brazil has turned a bit dry in some areas. We will also be looking for any news regarding the U.S.-China trade deal. Weather Moderate to heavy rain and flooding are in store for the Delta, Mid South and Deep South Thursday. Meanwhile, light snow will cross the northern Plains and northern Midwest. Temperatures will be seasonal to above normal north and central and near normal south.

| Rural Advocate News | Tuesday December 31, 2019 |


Report says Phase One Trade Deal Signing May Happen This Weekend Reports surfaced early on Monday that the Chinese Vice Premier will lead a delegation to Washington, D.C., to sign the Phase One trade deal. A source close to the situation tells the South China Morning Post that Liu (Lou) He will fly to Washington on Saturday to sign the agreement. The source said the U.S. extended the invitation and Liu has accepted. Farm Futures reports that Beijing and Washington haven’t confirmed the trip yet. China is already buying larger amounts of U.S. agricultural products, including soybeans, which was a big part of the agreement for U.S President Donald Trump. The possibility of making the deal official this weekend will mean increased purchases by China, as well as a partial end to the trade war that’s dominated headlines for the past 18 months. China’s soybean imports from the U.S. recently hit a 20-month high at 2.6 million tons, the highest number since March of 2018, when the trade war between the world’s largest economies began to pick up steam. Reports of higher food prices in China will likely mean a need for increased imports of U.S. agricultural goods in the months ahead to bring down those prices. ********************************************************************************************** White House Adviser says Agreement with China is a Done Deal White House Trade Adviser Peter Navarro said on Monday afternoon that the Phase One trade deal with China is wrapped up. “That’s a done deal,” Navarro says. “You can put that one in the bag.” The one thing he didn’t do was confirm a report by the South China Morning Post that China’s Vice Premier will be in Washington to sign the deal this weekend. Navarro giving his affirmation to the deal with China shows that President Trump doesn’t face pressure from conservatives to negotiate more favorable terms for the U.S. Navarro’s hostility toward China and its global trade and economic practices is well known in Washington, as he published a book during his career titled “Death by China.” Under the agreement announced on December 13, the U.S. put off implementing new tariffs on Chinese imports while reducing some existing duties. China agreed to bigger purchases of American agricultural products and made new commitments on intellectual property projections and forced technology transfers. As of now, the exact terms of the agreement haven’t been announced. ********************************************************************************************** Ag Negotiator; $80 Billion in Purchases “Doable” for China The Phase One trade agreement between China and the U.S. has the two nations in “close contact” as they work toward getting the deal finally signed. U.S. Chief Ag Negotiator Gregg Doud says the agreement between the world’s two largest economies will mean big numbers of Chinese agricultural purchases of U.S. ag commodities. He tells Farm Journal that, “China’s purchase commitment is built upon a base year of $24 billion in ag purchases, which occurred in 2017. What China has agreed to do is buy an additional $32 billion over the next two years on top of that $24 billion mark.” Doud did acknowledge there are those people who say China’s potential purchase levels will be hard to reach. However, he says that it doesn’t take into account some of the new structural changes in the agreement. “China imported $124 billion in ag products last year from around the world,” he says. “What we’re asking China to do is to commit to $40 billion out of that $124 billion total.” He thinks because of the structural changes in the deal, China will be more than able to accomplish that. ********************************************************************************************* U.S. Farm Exports to Philippines Hit Record The United States has seen a lot of benefits from the Philippines’ growing demand for imported agricultural products. The USDA’s Foreign Ag Service says agricultural exports to the Philippines will reach a record of $3 billion by the end of this year as shipments continue to arrive. The U.S. currently commands 28 percent of market share in the nation, making it the largest supplier of agricultural products. Last year, the Philippines was the 11th-largest market for U.S. ag exports. The top five products included soybean meal, wheat, dairy products, pork and pork products, as well as poultry. Last year, ag exports to the Southeast Asian nation reached a record of $2.9 billion. U.S. soybean meal was the highest-value export, worth $884 million in 2018. USDA data shows that “While sales were down four percent from January to October year-on-year, Manilla officials still expect a record $3 billion as shipments picked up ahead of the holiday season.” U.S. food and beverage products alone will reach a record $1.2 billion by the end of 2019, which amounts to more than 29,000 container trucks. ********************************************************************************************** USDA Sets Requirements for Meat and Poultry Labels The U.S. Department of Agriculture released a clarification on its requirements for accuracy in labeling of meat and poultry products. An Agri-Pulse report says the Food Safety and Inspection Service says the only way beef can be labeled “grass-fed” is if they fed on grass or forage 100 percent of the time after they were weaned. Because cattle would then have to have access to pasture until slaughter, they can’t ever be put into a feedlot. Products that come from animals with less than 100 percent access to grass or forage before slaughter can’t use the term grass-fed. The only way that can happen is if the label makes it clear that at least some of the animal’s dietary needs came from grain. As an example, the report says an acceptable label could be “Made from cows that are fed 85 percent grass and 15 percent corn.” The guidance that came out late last week also says certified organic products can be labeled legally as “raised without antibiotics” or “no added hormones” with no documentation required. The farm that produced the organic livestock or poultry, as well as the processor, have to be certified organic under USDA standards. ********************************************************************************************** USB Sets Goals for 2020 United Soybean Board CEO Polly Ruhland recently announced her group’s priorities for the year ahead. 2020 goals will include improving farmer profitability by focusing in on meal, oil, and sustainability. One of the things they’re researching this year is to prove the amino acid profile, as well as how valuable it can be to livestock producers that feed soy to their animals. That’s why they’re looking further into both their meal and protein quality improvements in the soybean. Another area of focus for USB is enhancing and communicating the sustainability of soy. Improvements in technology over the years have allowed soybean farmers to grow more soybeans and use fewer acres of land to do it. They want the public to know that the sustainability of soy can help the planet and put profit into a farmer’s operation at the same time. Another 2020 objective is to focus their research on the benefits of soybean oil, more specifically in high oleic soybean oil. The objectives were highlighted this month during the United Soybean Board meeting in December.

| Rural Advocate News | Tuesday December 31, 2019 |


Washington Insider: Challenges to Trade Policy Authorities Bloomberg is reporting this week that a number of international trade cases are expected to be decided next year and could change the president's "unlimited authority" to force U.S. importers to pay steep tariffs on steel and other goods that the administration says threaten national security. While courts are largely deferential to the executive on national security, a recent case involving steel tariffs on Turkey is sending a message that the president doesn't have "carte blanche" when he uses a Cold War era law to impose tariffs, according to Clark Packard, trade policy counsel at the R Street Institute, a research organization promoting free markets. The case, brought by Transpacific Steel LLC, could have wide-ranging impacts, including undermining the administration's threats to impose auto tariffs, R. Will Planert, a partner in Morris Manning and Martin LLP's international trade practice, told Bloomberg. In addition, Ford Motor Co. is expected to make a bid for a U.S. Supreme Court review of steep tariffs on imports of Transit Connect vans in 2020, while a solar firm will fight to preserve a tariff exclusion the administration is trying to nix. Transpacific Steel's challenge focuses on so-called "double tariffs" and could shed light on how courts may limit the president's use of a basic law, Section 232 of the Trade Expansion Act, Devin Sikes, an international trade attorney at Akin Gump Strauss Hauer & Feld, said. The U.S. Court of International Trade, in denying the government's bid to toss the case last November, rejected its argument that the president can modify tariffs without following the statute's procedures. Transpacific would get a hefty tariff refund if it wins this challenge, which is expected to proceed with the steel importer's brief due Jan. 21, 2020. The company, which bought steel from Turkey for rebuilding after major hurricanes, alleges the administration flouted the law by singling out Turkey for 50% tariffs five months after the original 25% tariff was imposed. A constitutional challenge to the tariff law is set for a Jan. 10 oral argument at the U.S. Court of Appeals for the Federal Circuit, Bloomberg notes and a decision in American Institute for International Steel v. United States could follow between 90 and 120 days later. If the appeals court strikes the law down, current steel and aluminum tariffs would be eliminated -- however, a ruling upholding the law could embolden the administration to seek more tariffs. The American Institute for International Steel argues the current law violates the non-delegation doctrine by ceding lawmaking authority to the president. In Gundy v. United States, which involved a non-delegation challenge to a sex offender law, four justices in June signaled an interest in revisiting the doctrine. Justice Brett Kavanaugh, who didn't participate in Gundy, said Nov. 25 in a matter unrelated to the steel case that the court may want to reconsider the doctrine. Trade law firms are telling industry clients there could be an "avalanche" of claims if the Court of International Trade backs JSW Steel in a separate challenge to a Commerce Department tariff exclusion decision according to Adams Lee a trade lawyer with Harris Bricken. The court in JSW Steel (USA) Inc. v. United States could order Commerce to revisit its decisions and give importers who want to escape steel tariffs "new clarity," Lee said. In addition, industry challenges are appearing from several other directions, Bloomberg said. For example, the newest steel tariff challenge in Universal Steel Products Inc. v. United States questions whether the Commerce report forming the basis for the levies met the law's standards. Universal Steel and other importers joining the challenge say Commerce didn't explain the likely impact of the recommended remedies on downstream industries that manufacture products critical to national defense readiness. If the Court of International Trade agrees, it could force Commerce to re-evaluate. So, we will see. While many observers indicate hopes for a diminution in trade tensions following the expected phase one deal with China, there are indications the administration intends to continue to push forward with its "managed trade" initiatives in China and in numerous other countries. Growing industry pushbacks on this policy indicate a "political pause" during the coming election could be undertaken, but it is clear that not all administration policy advisers agree on such a policy decision -- so a significant policy fight can be expected to continue, possibly even after the approaching 2020 elections shift the government into "all politics, all the time." As always, the trade debate should be watched closely by producers as it intensifies, Washington Insider believes.

| Rural Advocate News | Tuesday December 31, 2019 |


USDA Approves First State, Tribal Hemp Plans Hemp production plans submitted by three states and four Indian tribes have been approved by USDA, the Agricultural Marketing Service (AMS) announced Dec. 27. Louisiana, New Jersey, and Ohio are the first set of state hemp production plans approved under the U.S. Domestic Hemp Production Program, AMS said, while those submitted by the Flandreau Santee Sioux, Santa Rosa Cahuilla, and La Jolla Band of Luiseno Indian tribes were also given the green light. Under the 2018 farm bill USDA was directed to develop a regulatory oversight program for hemp, including approval of hemp production plans submitted by states and Indian tribes. Currently, 17 states have submitted plans to USDA that are under review, while another eight are working on plans to submit for review.

| Rural Advocate News | Tuesday December 31, 2019 |


Report Indicates China's Liu to Arrive in US Saturday for Signing of Phase One Deal Chinese Vice Premier Lui He will lead a delegation to Washington to sign the phase one trade agreement between the U.S. and China, with the South China Morning Post reporting the delegation will arrive in Washington Saturday and be in the U.S. a "few days." President Donald Trump on Dec. 24 said he and Chinese President Xi Jinping would meet to sign the phase one deal, "but China has yet to confirm this." U.S. Trade Representative Bob Lighthizer said earlier this month that representatives from both the countries would sign the phase one trade deal agreement in the first week of January. Meanwhile, China's Ambassador to the U.S. Cui Tiankai told China state television CGTN that there is no problem for the country to live up to the commitments it has made in the phase one trade deal. "We will always implement what we promised. There is no problem with that," Cui said. "The U.S. has made commitments to the one-China policy. I just hope they will honor their commitment."

| Rural Advocate News | Tuesday December 31, 2019 |


Tuesday Watch List Markets Consumer confidence index and home price index will be out early on Tuesday. We will also be watching for CFTC's Commitment of Traders report findings on fund activity last week. Also, any confirmation of Chinese trade delegates coming to Washington for the trade deal signing will be important. Weather Snow squalls and blustery winds are in store for the northern and eastern Midwest Tuesday. Dry conditions will be in effect elsewhere for New Year's eve. Temperatures will be milder after last weekend's storm. However, heavy snow cover in the Northern Plains will have a notable chilling effect.

| Rural Advocate News | Monday December 30, 2019 |


Skepticism Remains Over China’s Ag Purchases An Associated Press report says there are still people on both sides of the Pacific Ocean who remain skeptical about the actual amount of farm goods that China committed to buy in the “Phase One” trade agreement with the U.S. Trade Representative Robert Lighthizer said the amount will total $40 billion a year. However, President Trump says the total is actually “much more than $50 billion.” Is it realistic? Even in the best of times, exports to China has never been higher than $26 billion in any year. Beijing may be locked into contracts with other suppliers like Brazil and Argentina it lined up after the trade war broke out with the U.S. Chad Hart, an Ag Economist with Iowa State University, says, “History says we’ve never been close to that level. There’s no clear path to getting us there in one year.” However, the skepticism actually works both ways. A trade specialist at the University of International Business in Beijing says the figure is $40 billion and he wonders if the U.S. can ensure the full supply of products to equal that value. At this point, farmers that talked to the AP say they’re hopeful but guarded in their expectations. Iowa farmer Jeff Jorgeson says, “At this point, we have to see more details.” ********************************************************************************************* Don’t Forget about Wheat in the Phase One Trade Deal When news broke about the Phase One trade deal between the U.S. and China, it made the soybean industry especially happy. A Bloomberg report says don’t forget about wheat, which could also be a big winner in the agreement. Speculation is rising that China will work to fill its wheat-buying quota as part of the agreement. That will likely create new demand for wheat because China has failed to live up to its wheat-purchasing promises in the past. Soybean purchases are likely to be somewhat more limited because of the African Swine Fever outbreak across the country, which will lower typical demand levels. If Chinese wheat purchases were to reach the quota mark of 9.6 million tons, that would represent a huge demand jump. In the six years prior to and up through 2017, buying has averaged less than 50 percent of that allotment. The timing could be good for U.S. farmers. Tighter corn supplies in Brazil and wheat supplies in Russia, the world’s top wheat exporter, have made American grain more competitively priced in the world market. That’s already causing Chinese importers to begin to boost their purchase levels from the U.S. ********************************************************************************************** China Changing Hog Production After AFS Outbreak The Chinese Ag Ministry says large hog farms are lining up with the smaller family-owned farms as part of a state-initiated investment worth about $7.1 billion dollars. The goal of the new initiative is to boost hog operations across the country that were hit hard by the African Swine Fever outbreak. A Reuters report says fifteen of the country’s leading pig farms signed 19 agreements with local governments in 16 Chinese cities to raise pigs together. The Ministry of Agriculture and Rural Affairs says these projects should produce over 22 million hogs for slaughter every year and will involve 33,000 poor rural families. While announcing the plan, the ministry didn’t give a specific timeline on when this would take place. Bigger farms are being encouraged to purchase a stake in or lease medium and smaller farms. They’re also being asked to make these arrangements as quickly as possible by building a number of standardized household-based farms, slaughterhouses, and refrigerating centers. China’s hog herds, once the biggest in the world, has dropped almost 40 percent since the ASF outbreak began in mid-2018. China is the world’s biggest producer and consumer of pork. ********************************************************************************************** USDA; Climate Change May Increase the Cost of Federal Crop Insurance The USDA’s Economic Research Service looked into the ways that climate change could affect the cost of the Federal Crop Insurance Program. Researchers worked with statistical models to predict crop yields from historical weather data. They used weather simulations from climate models to build scenarios showing how yields might respond to climate change. Economic models then simulated how farmers and markets might respond to changes in weather and yield. The study explored the potential impacts in the year 2080. It compared climate scenarios arising from different projections of greenhouse gas emissions levels to a hypothetical future with a climate similar to that of the past several decades. Under that scenario with moderate emissions reductions, in which farmers adapt to changes in climate with adjustments to what they plant, where they plant it, and how they manage it, the cost of today’s Federal Crop Insurance Program would average about 3.5 percent higher than under a future with a climate similar to that of the recent past. Under the scenario in which emissions trends continue, the cost of the FCIP would increase by an average of 22 percent. ********************************************************************************************** Brazil Soybeans Taking Much of U.S. Market Share in China While China has been the world’s largest importer of soybeans for some time, Brazil and the U.S. have been competing for the top spot as the world’s largest exporter to China. Back in the 1990s, the U.S. was the top soybean exporter. During the end of that decade, both the U.S. and Brazil increased their exports to answer a growing demand for soybeans in China. Brazil’s exports grew more quickly than the U.S. During the ‘90s, the U.S. supplied as much as 50 percent of China’s soybean imports, but that number gradually declined further into the 2000s. Brazil’s share first matched the U.S. total in 2002 when each country supplied about 35 percent of China’s imports. Between 2002 and 2011, each country’s share of soybean exports to China totaled between 35 and 50 percent. Brazil’s share jumped to 50 percent of all exports to China between 2012 and 2016 as the U.S. share dropped to about 40 percent. That number would drop to 30 percent in 2017 as China’s tariff on U.S. soybeans took effect later in the marketing year. During the first nine months of China’s 2018/19 marketing year, Brazil’s share of the soybean import levels rose to 77 percent, while the U.S. share was just 10 percent. ********************************************************************************************** Ten Signs of Farm Financial Stress to Watch Out For Things have been hard in agriculture and more specifically, it’s been hard to be a farmer. Wet weather, low crop prices, as well as trade disputes have put some farmers on the edge. Financial stress is taking a toll and Successful Farming has put together a list of signs that may indicate a farmer is suffering from significant financial stress. Signs include isolation or withdrawal, as well as talking in a monotone voice or lacking facial expressions, and outbursts of anger or abrasive behavior toward others, including children. After that, they list confusion, forgetfulness, and difficulty concentrating. Also on the list is blaming others such as banks or spouses, binge eating, gambling, or drinking. Sleeping too much or not enough is also on the list, as is a lack of pride in the appearance of the operation, including the buildings and grounds. Not caring for livestock is another sign to watch for, as are more farm accidents.

| Rural Advocate News | Monday December 30, 2019 |


Washington Insider: Growing Trade Policy Angst The media are increasing their focus on trade policy now and pointing out that for years America’s trade agreements have tried to break down economic barriers and remove tariffs and other impediments to cross-border commerce. However, the newly emerging deals “have turned that approach on its head” the New York Times reported last week. For example, while the phase one China deal promises to lower some of the walls Beijing has erected for foreign companies -- including opening its financial markets, streamlining imports of American agriculture and offering greater protection for intellectual property -- it leaves in place tariffs on the bulk of Chinese imports, more than $360 billion worth of goods. And it requires some $200 billion of additional purchases of U.S. products over the next two years, according to the Trump administration, but also “moves trade policy away from promoting free markets and back toward an earlier era of managed trade.” The Times notes the new NAFTA similarly contains provisions that open up markets for dairy, digital services and other industries. But its most “transformative changes” tighten the rules for North American automotive manufacturing to try to spur more production within the continent, a move some Republican lawmakers say will weigh on trade. The New York Times sees these modifications as “the product of the administration’s 'transactional trade approach,' one that aims to wield America’s economic power to force other nations to buy more American products. President Trump's 'America First' philosophy looks with suspicion upon global supply chains and free trade deals and seeks to force sprawling multinational companies to move operations to the United States in an effort to lower the trade deficit.” The Times also charges the administration has little use for the type of multilateral organizations that have tried to lift economic growth around the world by promoting free trade. Last week, the administration effectively crippled the World Trade Organization’s ability to resolve trade disputes after a sustained campaign against a critical part of the body. Doug Irwin, a trade historian at Dartmouth College, said the pacts were a substantial departure from those enacted under previous U.S. presidents -- both Republicans and Democrats. “Most trade agreements that we’ve seen in recent history are agreements to liberalize markets,” he said. In a TV interview last week, Robert Lighthizer, the administration’s top trade negotiator, acknowledged the agreements were not likely to please those who prioritized free markets. “I understand the people that believe in just protecting investors and pure market efficiency,” Lighthizer said. “They’re not going to be happy because we are making it more expensive to operate in some other areas and less expensive in the United States.” President Trump’s aggressive approach to reworking the global trading system has been praised by some parts of industry as an attempt to fix a situation they say has been disastrous for American workers. “Trump and team have what appears to be a strong deal,” Daniel DiMicco, a former steel industry executive, who leads the Coalition for a Prosperous America, said of the China trade pact. Still, many economists and trade experts fear the approach could backfire on the United States, by degrading the international trading system and raising the cost of manufacturing -- resulting in lower productivity and economic growth. In a recent analysis, Mary E. Lovely and Jeffrey J. Schott, two economists at the Peterson Institute for International Economics, projected that the provisions in the U.S.-Mexico-Canada Agreement would hurt American industry by driving up the cost of making cars and dampening growth. Analysts at Fitch Ratings said Tuesday the China deal had raised their estimates for global growth but does less to lower trade barriers than anticipated. The trade truce leaves the effective American tariff rate on Chinese products at 16%, below the 25% level that the president had threatened, but up from roughly 3% before the trade war, they said. The North American and China pacts, which together cover countries responsible for more than half of America’s trade, are the first translation of the administration’s trade ideals into policy. But they also bear U.S. Trade Representative Lighthizer’s imprint and his long history of favoring a “managed trade approach” as a Reagan administration official, the Times said. The WTO later banned agreements that seek to restrain a country’s exports. That history has direct parallels to China, where American officials have been urging the government for decades to reduce its role in the economy. Administration officials, including Lighthizer, have also criticized Beijing for using preferential policies, subsidies and central planning to give its businesses an advantage over American ones. But the trade deal announced this month appears to make little progress on those issues. Instead, its largest feature appears to be purchases that are likely to be beneficial for American businesses but may wind up further strengthening the hand of the Chinese state. So, we will see. Competitive prices for U.S. goods and increasing access to developing-country markets are fundamentally important to U.S. producers and the newer administration approaches should be watched closely by U.S. producers to determine their likely longer-term impacts on ag industries -- along with potential implication for government interventions in both the U.S. and its trading partners, Washington Insider believes.

| Rural Advocate News | Monday December 30, 2019 |


Trying To Gauge Products In US Exports To China Under Phase One Deal Not Just a US Exercise The effort of trying to determine what products are expected to be involved in the phase one deal with China is also going on within China. The China Daily reported Zhang Xinyuan, a researcher at Huatai Securities, said “increased imports from the U.S. will mainly include crude oil, semiconductors, gas, soybeans, consumer goods, automobiles, ethanol and tourism services.” From a macro perspective, the paper said that the phase-one deal will reduce downside risks to the global economy, with Ding Shuang, chief economist of Greater China and North Asia at Standard Chartered predicting 2020 “should be a year of soft but stabilizing growth for the global economy.”

| Rural Advocate News | Monday December 30, 2019 |


Xinhua: US Pecan Growers Eye Regaining Chinese Market Via Phase One Trade Deal The state-run Xinhua News Agency reported U.S. pecan growers are eager to get back into the Chinese market. In 2017, U.S. pecan in-shell exports reached more than $300 million with more than 76% going to China. The report noted U.S. growers indicate the trade battle with China has prompted a 40% decline in prices via oversupply from the loss of exports to China. Meanwhile, early this week Bloomberg reported U.S. chicken firm Sanderson Farms has kick-started exports to China after a ban on American poultry supplies was lifted last month. The company earlier this month sent its first container of chicken feet to China since the 2015 ban and is loading more this week, said Chief Executive Officer Joe Sanderson. The third-largest U.S. chicken producer expects the 35% tariffs will be removed next year, helping accelerate exports. Green Plains Ethanol expects the corn-based fuel will also be in the mix, predicting there could be one billion gallons of the product moved to China.

| Rural Advocate News | Monday December 30, 2019 |


Monday Watch List Markets As far as reports go, Monday is fairly quiet with USDA's weekly grain inspections due out at 10:00 a.m. CST. Traders will be checking the latest forecasts, including those for South America, and any comments about the pending trade agreement with China. CFTC releases its Commitments of Traders report at 2:30 p.m. CST. Weather Moderate to heavy snow and rain are in store for the Northern Plains and northern through eastern Midwest Monday, causing safety and transportation hazards and livestock stress. These conditions also will end corn harvest efforts until spring. Other areas will be drier. Temperatures will be seasonally cold north and central and warm south and southeast.

| Rural Advocate News | Friday December 27, 2019 |


Chinese Soybean Purchases Rise in November Soon after China announced a partial trade agreement with the U.S., their purchases of American soybeans in November jumped higher. November imports jumped to 5.4 million tons, which was almost 54 percent higher than last year. An Associated Press report says U.S. soybean imports into China more than doubled from the previous month’s 2.6 million tons. That number comes from AWeb.com, a news website that serves the Chinese farming industry. China cut off purchases of U.S. soybeans as the trade war with Washington, D.C., kicked into high gear. While the two countries announced the “Phase One” deal back in October, they haven’t released any specific details regarding the agreement. The AP report says U.S. officials now think the agreement could be signed as early as January. As a part of the agreement, U.S. officials say Beijing will be buying a lot more U.S. farm products. However, Chinese officials have yet to confirm how big the purchases will be. Chinese government spokespeople did confirm that importers were already placing orders in September but didn’t give out any details of those purchases. Chinese buyers use a lot of soybeans as animal feed and to crush for their cooking oil. ********************************************************************************************* First U.S. Shipment of Chicken to China Arrives in January USA Poultry and Egg Export President Jim Sumner tells Agri-Pulse that the first U.S. chicken shipment to China in a long time will enter the Asian country next month. It marks a resumption of those shipments after China lifted a ban on U.S. chicken just over a month ago. The Chinese ban was initially implemented after an avian influenza outbreak in the U.S. While that outbreak was stamped out a long time ago, China finally lifted its ban after the U.S. approved the importing of Chinese chicken, something Beijing had demanded for a long time. “The first shipment heading to China is chicken paws from Georgia that will head out from the Port of Savannah,” says Sumner. “We’re thrilled that the first shipment in years is coming from Georgia, the number one chicken producer in the nation.” The first shipment is expected to contain about 50,000 pounds of chicken paws and is the start of what should be a quick ramp-up in chicken shipments to China. The U.S. industry got Chinese approval for shipments from 172 facilities, but most of those cold storage units weren’t included. That should be rectified soon as 177 applications came in from cold storage facilities that should be approved any day now. ********************************************************************************************* USMEF Looks to Expand Pork Opportunities in Hong Kong The U.S Meat Export Federation is planning to fill the fresh pork supply shortfall in Hong Kong with U.S. chilled pork. The African Swine Fever Virus caused the number of live hogs coming into Hong Kong from China to drop by fifty percent, with the numbers running below 2,000 head per day. “This has caused a shortage of local, fresh pork, and the fresh pork product that is available is being sold at much higher prices,” says Joel Haggard, USMEF senior vice president for the Asia Pacific. He says the opportunity could benefit the U.S. industry in both the short and long term, as more Asian consumers get used to chilled pork. “The opportunity for more pork supplies has never been better,” Haggard adds. It does take a bit more time shipping to Hong Kong than it does to Japan and Korea. Also, the wet market vendors in the country will need to be taught the proper way to handle the vacuum-packaged chilled product. “The product will initially be sold in supermarket chains,” Haggard says. “More than 100 supermarkets in Hong Kong are selling U.S. chilled pork, along with some of the city’s traditional wet markets.” Haggard says this is the largest chilled pork distribution that USMEF has ever seen, calling it, “satisfying to see it finally come to fruition.” ********************************************************************************************** Farmers Union Wants Improvements to USMCA Back on December 10, Speaker of the House Nancy Pelosi announced that the White House and her chamber of Congress had reached an agreement on the U.S.-Mexico-Canada Trade Deal. While the National Farmers Union was happy to see an effort to update the old North American Free Trade Agreement, the group says that effort didn’t go far enough. They’re calling on the Senate for improvements to the deal before the final passage. “The free trade framework established by NAFTA has dominated international trade deals for 2.5 decades, to the detriment of American workers,” says NFU President Roger Johnson. “It’s contributed to the movement of rural manufacturing jobs overseas, caused our national deficit to skyrocket, lowered wages, and eroded national sovereignty.” Johnson says the deal doesn’t go far enough to specifically protect family farmers and the rural communities they live in. U.S. neighbors Canada and Mexico are the largest export markets for U.S. food and agricultural products, totaling more than $39.7 billion in 2018. A USDA report says those exports support over 325,000 jobs. Ag Secretary Sonny Perdue says the agreement is a big win for American workers, the economy, and farmers and ranchers. ********************************************************************************************** High Stakes, High Rewards Ahead for Hemp Production Many farmers across the country are spending time thinking about the potential pitfalls and the possible opportunities that hemp production can offer them. Farm Journal’s Ag Web Dot Com says many are taking the leap into hemp production. Colorado farmer Dion Oakes says, “Hemp has a very promising outlook for farmers as a rotational cash crop that can be very viable for them.” Looking ahead to the new year, only four states, including Idaho, South Dakota, Mississippi, and New Hampshire, haven’t made it legal to grow industrial hemp within their borders. U.S. Hemp Growers Association Executive Director Caren Wilcox says she expects those four states to move toward legalizing it sometime next year. Wilcox says farmers will need time to relearn how to grow the crop. She says it will be important to get advice and counsel from those farmers who have hemp growing experience. Make sure to source where your seed comes from. She says farmers have to know their state’s regulations. The other big piece of advice is to have a customer lined up before planting their first crop. ********************************************************************************************** Have Action Plan in Place in Case of ASF The National Pork Board put out an end of the year reminder about safeguarding the country’s pork farms against African Swine Fever and other Foreign Animal Diseases. U.S. pork farmers know full well that the virus is wreaking havoc on the international pork industry. While ASF isn’t in the United States at this time, the NPB says the possibility of it or another foreign animal disease means American pig farmers should be taking steps to protect the domestic pork industry. Last year, U.S. pork exports totaled 5.37 billion pounds and were valued at more than $6.3 billion. If a disease like ASF entered the country, the U.S. would lose valuable export markets for some time. NPB says anyone who works with pigs should know the signs of ASF in their animals. Those signs are high fever, decreased appetite and weakness, red and blotchy skin or skin lesions, diarrhea and vomiting, as well as coughing or difficulty breathing. To help farmers make sure they don’t miss those signs, the National Pork Board has free hard copies of Foreign Animal Disease barn posters and fact sheets available in English or Spanish. Get them free by going to the Pork Store at www.pork.org.

| Rural Advocate News | Friday December 27, 2019 |


Washington Insider: Booming Meat Market Expectations Well, the urban media are paying more than usual attention to ag matters these days, especially to the outlook for meat sales. Bloomberg notes this week that for most of the important meats – poultry, beef and pork, U.S. supplies are surging. The hog herd is the biggest it’s been since the series began in 1943, while egg and chicken production also rose in November, USDA says. Also this week reports also showed the most cattle in U.S. feedlots since 2011. The reason for this optimism is anticipation of increased export demand in China where African swine fever has devastated the hog herd, as it has elsewhere. With Beijing and Washington reaching a first-phase trade deal that includes increased purchases of ag products, U.S. livestock producers are hoping to start shipping big cargoes soon. While prices for some meat cuts have started to rise, the ample supplies have helped keep gains in check for consumers, Bloomberg says, noting that USDA expects “continued expansion next year.” Also this week, the New York Times focused on China’s food production policies and charged that it “bungled the effort to contain African swine fever, a mistake that could result in higher Chinese food costs for years and shows the limits of Beijing’s top-down approach to problems.” The magnitude of the losses is breathtaking, NYT said—claiming that it has cost the world roughly one quarter of its pigs as the “disease has spread from China, “reshaping farming and hitting the diets and pocketbooks of consumers around the globe.” Even worse, China’s “unsuccessful efforts to stop the disease may have hastened its spread—and extended its impacts, the Times said. To halt African swine fever, authorities must persuade farmers to kill infected pigs and dispose of the carcasses properly. But its “frugal incentives” and requirements that farmers jump through hoops to seek compensation from often cash-poor local governments are causing farmer reactions that “make things worse.” The Times concludes that the epidemic also “shows the limits of China’s emphasis on government-driven, top-down solutions to major problems, sometimes at the expense of the practical. It has also laid bare the struggle of a country of 1.4 billion people to feed itself,” the Times said. China has long viewed food security as tantamount to national security, and had become essentially self-reliant in pork, rice and wheat thanks to subsidies and aggressive farmland management—but this epidemic will “test that commitment to its increasingly affluent people, who more often expect meat at the dinner table,” the Times says. The disease—a highly contagious and untreatable outbreak that is not fatal to humans but can be spread by them – has now extended swiftly out of China and across nine other Asian countries, particularly Vietnam, the world’s fifth-largest pork producer which lost much of its herd this year. Before reaching China, the disease had been slowly infecting occasional farms in Russia and elsewhere in Eastern Europe. Powered by pork, China’s overall food prices last month were one-fifth higher than they were a year ago, after seven years of little change. Large purchases of pork by China are driving up live hog prices in the United States, Europe and around the globe, pushing up costs for everything from German sausages to Vietnamese pork meatballs. Beef and lamb prices have risen as families worldwide seek alternatives, so much so that overall meat prices in international commodity markets have increased nearly 20 percent in the past year. Brazil is now ramping up beef and chicken production to meet demand, partly by burning forests in the Amazon to clear land for agriculture, the Times said. The epidemic is leading to “broad and deep economic impacts at the global level,” said Boubaker Ben Belhassen, the director of trade and markets at the United Nations’ Food and Agriculture Organization in Rome. “We don’t think there’s enough pork in the world to offset China’s shortfall.” NYT also said that the “hog problem” was an important factor in Beijing’s acceptance of a partial trade deal with the U.S. last month--in part to resume imports of American food. Pork prices have climbed so high that one livestock company, Guangxi Yangxiang, printed red banners to recruit potential farmers that read, “Raise 10 sows and drive a BMW next year.” China’s leadership has focused on remaking farming to stop the spread. Using subsidies and generous credit, Beijing has pushed industrial-scale farms with safeguards like quarantine areas for new arrivals and incinerators for diseased pigs, but the Times criticized that effort as inadequate. Chinese officials have tried to be reassuring and frequently claimed the disease was under control – only to see signs of further spread. Most recently, the agriculture ministry said that it only hoped production at the end of next year would be four-fifths of normal levels – a shortfall equal to the entire pork production of the United States, the world’s second-largest pork-producing nation, the Times said. So, we will see. U.S. producers tend to recognize the threat from over responding to the outlook, but still willing to invest to expand production, observers say. This means that objective outlook data will be increasingly important in the coming months, trends producers should watch closely as new trends develop Washington Insider believes.

| Rural Advocate News | Friday December 27, 2019 |


MFP Payments Continue to Rise As of December 23, USDA’s Farm Service Agency has paid out $10.707 billion in 2019 Market Facilitation Program (MFP 2) payments to farmers under the first two installments of MFP 2 payments. The top five states for the payouts were Iowa, Illinois, Texas, Minnesota and Kansas. Signup for MFP 2 ended December 20. The watch now is on whether USDA will announce the third installment of the MFP 2 payments will be issued in early January. Sources indicate they expect the payments will be made and that the decision has already likely been made but not yet announced.

| Rural Advocate News | Friday December 27, 2019 |


Trump, Chinese Again Commenting on US-China Trade Deal The U.S. and China are in close contact relative to signing the phase-one trade agreement, Chinese Commerce Ministry spokes Gao Feng said at the regular Thursday briefing. Gao said the two sides are still going through needed procedures relative to the Phase One agreement. This comes as President Donald Trump on December 24 said the deal was "done" but was being translated. Asked if there would be a signing ceremony with Chinese President Xi Jinping, Trump told reporters, "I will be, probably, doing that. Yeah. At the right time, we will be doing a smaller ceremony. Ultimately, we will be having one. The China deal — we will be having a signing ceremony. Yes." Asked further if it would be signed by himself and Xi, Trump said, "We will probably, yes. We will sign it. When we will get together." However, Trump did not say when it would be signed, noting it will be a "quicker signing, because we want to get it done."

| Rural Advocate News | Friday December 27, 2019 |


Friday Watch List Markets USDA's weekly export sales report will be released at 7:30 a.m. CST Friday, followed by weekly energy inventories from the Energy Department at 10:00 a.m. The Friday after Christmas will likely be a day of quiet trading, but any trade news concerning China will be examined and a surprise is always possible. This week's holiday also pushes CFTC's Commitments of Traders report to Monday afternoon. Weather An intense storm system in New Mexico Friday will move to the Great Lakes during the weekend. This system will bring rain to the Southern Plains Friday, with western through north-central Plains moderate to heavy snow and south-central Plains through western Midwest rain and mixed precipitation Saturday and Sunday. Blizzard and whiteout conditions are possible along with river basin flooding. Moisture favors winter wheat, but snow and cold will stress livestock along with causing transportation and safety hazards.

| Rural Advocate News | Thursday December 26, 2019 |


Rural Mainstreet Index Rises Again The Creighton University Rural Mainstreet Index remained above growth-neutral in December. It’s the fourth-straight month that’s happened and the tenth time in the past 12 months. The index is a monthly survey of bank CEOs in rural areas of a 10-state region that depends on agriculture and/or energy. While it’s still above growth-neutral, the index did drop from 54.2 in November to 50.2 in December. A Creighton University news release says, “Federal agriculture crop support payments and somewhat higher grain prices gave a boost to the Rural Mainstreet Index.” The index shows bank CEOs, on average, expect about 12 percent of grain farmers to experience financial losses in 2020. “However, this is down from last year at this time, when bankers expected about 15 percent of their grain farmers to have a negative cash flow during 2019,” says Dr. Ernie Goss of Creighton University. For example, Jeff Bonnett is president of the Havana National Bank in Illinois, who says, “If grain prices remain where they are today, we will have a small percentage of borrowers who will struggle with their cashflow.” There was some good news as the farmland and ranchland price index soared to 52.8 from a weak 40.4 in November. ********************************************************************************************* Ag Lenders Talk Economic Conditions During DC Testimony Agricultural lenders were on Capitol Hill this week to talk to legislators about the current credit conditions in farm country. An Agri-Pulse report says the lenders appeared before the House Agricultural Subcommittee on Commodity Exchanges, Energy, and Credit. Steve Handke of the First Option Bank in Kansas, says agricultural portfolios are remaining stable but showing signs of deterioration. “Many bankers are concerned about low commodity prices and their negative impact,” he said during testimony. “While credit is plentiful, competition for loans is intense as interest rates remain near historic lows. All that is beneficial to farmers.” However, what’s not beneficial is the fact that $22.4 billion of the total farm income in 2019 came from government payments, which is not sustainable income. Shan Hanes of Heartland Tri-State Bank in Kansas told legislators that net farm income dropped an average of 85 percent in just six years. “I dare say, many of us wouldn’t survive if our paychecks were cut 85 percent,” he said during testimony. Other bankers testified that working capital levels, the difference between current assets and current liabilities, have declined sharply since 2013. A North Dakota banker says it’s the cushion against tough times that just isn’t there anymore. ********************************************************************************************** Israel is Latest Country to Chase a Trade Deal with China A close ally of President Donald Trump and his biggest economic rival are looking at a possible trade relationship in 2020. Israel is another U.S. ally that’s now looking to conclude a free-trade agreement with China as early as next year. A senior Israeli official anonymously tipped off Bloomberg because the discussions aren’t public. The two countries first began talking back in 2016. The latest round of discussions is causing other countries to closely scrutinize the potential cooperation between a U.S. ally and adversary. The U.S. is pressuring Israel to be cautious when talking about China playing a role in its economy. From a trade perspective, it’s a balancing act for Israel, who faces a “more assertive China” as the United States takes a different military posture in the Middle East. Israeli and Chinese officials met about a month ago for their seventh round of talks. The official who spoke with Bloomberg says it’s still not yet a sure thing that Israel will be able to wrap up a deal next year. A political deadlock is preventing the establishment of a new government in Jerusalem. ********************************************************************************************* U.S. Won’t Implement Steel, Aluminum Tariffs on Brazil Imports The president of Brazil, Jair (Jayr) Bolsonaro (Bowl-soh-NAH-roh) said late last week that U.S. President Trump won’t implement a new tariff on Brazilian steel and aluminum imports as threatened earlier in December. “I had a phone conversation with President Trump,” Bolsonaro said during a Facebook Live session. “He was convinced by my arguments and I decided to tell all Brazilians that our steel and aluminum won’t be hit by additional tariffs.“ A U.S. source confirmed to Reuters that the administration won’t be implementing the tariffs talked about by Trump earlier this month. Trump announced the possibility of tariffs on Brazil and Argentina during a Tweet on December 2, accusing the two countries of devaluing their currencies, a move that hurts U.S. farmers by making their agricultural commodities more expensive on the world market when compared to those from Brazil and Argentina. The U.S. had originally exempted steel and aluminum imports from Brazil and Argentina from the sweeping metal tariffs implemented in March of 2018. ********************************************************************************************** USDA Sends Livestock Dealer Trust Study to Congress The USDA sent Congress details on a study to determine whether a Dealer Statutory Trust would improve the recovery of livestock sellers in cases of dealer payment defaults. The Hagstrom Report says the study, which was required under the 2018 Farm Bill, was undertaken by the Ag Marketing Service’s Packers and Stockyards Division. “Based on its analysis of industry data, public input, and experience with the livestock industry, USDA finds it would be feasible to implement a Livestock Dealer Statutory Trust,” says the Livestock Marketing Association in a news release. “Under current law, farmers, ranchers, and livestock auctions have been devastated when livestock dealers default on payments.” They say the sellers don’t often get the livestock back that they weren’t paid for. The producers also recover little from the dealer’s bond. The USDA report analyzes 83 dealer defaults that occurred between October of 2013 and June of 2019. The LMA says, “A Dealer Statutory Trust would give unpaid livestock sellers the legal right to reclaim the animals, or if they’ve been resold, proceeds from the livestock in the unfortunate event of a livestock dealer payment default.” The report found that existing statutory trusts in other segments of agriculture have been effective in improving financial recoveries and LMA says similar results could be expected in the livestock industry. ********************************************************************************************** U.S. Hog Inventory Climbs Higher As of December first, U.S. farms contained 77.3 million hogs and pigs. That’s a three percent jump from December of last year, but down slightly from September first of this year. Those were some of the numbers released in the Quarterly Hogs and Pigs report this week, published by the National Agricultural Statistics Service. Other key findings in the report said of those 77.3 million hogs and pigs, 70.9 were market hogs while 6.46 million were kept for breeding purposes. Between September and November of this year, 35.1 million pigs were weaned across U.S. farms, which is up two percent from the same time in 2018. From September through November, U.S. hog and pig farmers weaned an average of 11 pigs per littler. U.S. producers intend to have 3.13 million sows farrow between December of this year and February of 2020. They’ll also have another 3.15 million sows farrow between March and May of next year. Iowa has the largest inventory among the states, coming in at 24.8 million head. North Carolina and Minnesota tied for second, with each having 9.2 million head of hogs in inventory.

| Rural Advocate News | Thursday December 26, 2019 |


Washington Insider: Bloomberg’s Expectations for Central Banks Well, there’s lots going on in Washington these days, but at least some of the earlier hot spots seemed to have cooled a little. For example, there are growing rumors of trade overtures from China. In the meantime, Bloomberg has published its review of what it expects the world’s central banks to do next year — it labels this year as the time central banks jumped back into the fray, cutting interest to deal with a trade slowdown and subsequent declines in manufacturing. Some, central banks, like the Federal Reserve, had made rate hikes before 2019, creating “room” to loosen policies amid weaker growth. At the same time, others, like the European Central Bank, “found themselves in a more difficult position and had to cut benchmarks further below zero, stoking resentment about subzero rates.” Looking ahead, Bloomberg says it thinks that 2020 “might be a quieter year for monetary policy—and that fiscal [policy] “may take up some of the lifting work as growth prospects are looking a little brighter.” Still, it sees the economic numbers as “mostly mixed” rather than positive. On balance, while the big guns are set to hold fire, others, especially in the emerging markets, are projected to cut interest rates again. There is a danger, Bloomberg thinks, that the current “moment of calm in the global economy is obscuring a serious challenge for the world's central banks.” Low rates for most and negative for some means “policy space is severely depleted.” At the same time, the report concludes that “we don't think the next downturn is coming in 2020—but that when it does come, central banks won't have all the answers.” With regard to the United States, Fed Chairman Jerome Powell “has left no doubt that interest rates are on prolonged hold — based on his earlier comment that the current stance “likely will remain appropriate” unless the Fed's favorable outlook for the economy sees a “material reassessment.” He spoke after policy makers kept interest rates steady in a 1.5% to 1.75% target range “following three consecutive cuts” and published forecasts showing 13 of 17 officials are projecting no change in rates through 2020. That would keep them on the sidelines during a presidential election year, Bloomberg thinks. However, the report cautions that the U.S. central bank “isn't entirely fading into the background.” Strains in money markets has pushed it to buy Treasury bills to restore ample reserves in the banking system and some investors argue it will need to broaden the scope of those purchases to short-dated coupon-bearing securities. Powell said they are not yet ready to take such a step, but “would do so if necessary.” In conclusion, Bloomberg reports that its experts see the Fed “comfortably on hold for the foreseeable future,” as policy makers are less concerned by the risks which justified their ‘insurance cuts’ in the latter half of 2019 including trade tensions, below target inflation and sluggish global growth. Bloomberg says this outlook makes the threshold high for policy adjustments in the near term, particularly for rate hikes. It also thinks that “the impetus to stand pat will increase as the U.S. election draws nearer.” The report is extensive and emphasizes the uncertainty it sees, especially in areas like the UK where major policy changes are under consideration following Boris Johnson’s decisive win in December's election that “cleared the way for his government to take the nation out of the European Union at the end of January.” For now, concern about the outlook means two of the Bank of England’s nine policy makers want to cut interest rates, the report says, and notes that all eyes will be on whether Johnson’s win, as well as Brexit developments which could change the picture. Still, Bloomberg expects the combination of looser fiscal policy and reduced Brexit uncertainty could “lift growth next year,” and that in response, “the central bank’s tone could change leading to a rate increase in fourth quarter 2020.” Bloomberg also sees the People’s Bank of China is disappointed in the results of the beginning of its “large-scale monetary easing.” And suggests that “if weakness in the economy worsens, the central bank likely will continue to release cash into the system via cuts to the reserve ratio, which has been a preferred method to shore up output this year. China is battling a form of “stagflation” now which includes consumer price gains driven beyond the target of 3% by food, amid factory price declines and could well encounter economic growth below 6%, depending significantly on whether trade conflicts continue to cool. The report runs through its quarterly review of 23 of the world’s top central banks, which together set policy for almost 90% of the global economy, and finds several of those are worth noting, along with Bloomberg’s overall assessment. It concludes that while 2020 looks like a quieter time, there are still a considerable number of potential trouble spots in a mostly mixed picture. These signals reflect significant global economic trends should be watched very closely in the weeks and months ahead, Washington Insider believes.

| Rural Advocate News | Thursday December 26, 2019 |


Doud Comments On US-China Phase One Trade Deal The phase-one U.S.-China trade deal “is done” and is currently going through a legal scrub, chief U.S. ag trade negotiator Gregg Doud said in an interview with Pro Farmer. Doud elaborated on expected U.S. ag buys by China, saying the average $40 billion in purchases over two years represents the $24 billion baseline of purchases seen in 2017 plus an additional $16 billion in purchases above that. “Now in the first year, it'll be a little less, and the second year will be a little more,” he noted. On the U.S. ag products China might purchase, Doud said “I think you're going to see a lot in demand for meat. And China's just extraordinary right now because of the African swine fever thing.” Though the phase-one U.S.-China deal does not specify China ag purchase levels beyond 2021, Doud said U.S. ag exporters will still see benefits from “structural changes that were negotiated in this deal,” including reduced sanitary and phytosanitary non-tariff trade barriers. Doud also touted the initial U.S.-Japan trade deal, saying it puts “over 90% of the ag products that we send to Japan” at tariff parity with those from competitors covered under other trade agreements. Though many rice producers were disappointed in the U.S.-Japan accord, Doud suggested a welcome development could be around the corner. “I've got a huge deal for them that I can't talk about yet here just for another few days,” he said.

| Rural Advocate News | Thursday December 26, 2019 |


USDA Announces Crop Insurance Pilot for Hemp USDA announced a pilot Multi-Peril Crop Insurance (MPCI) product for hemp producers in select counties in 21 states will be available for the 2020 crop year. USDA created the new program in partnership with the U.S. Hemp Farming Alliance and AgriLogic. Eligible producers may participate in certain counties in Alabama, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Maine, Michigan, Minnesota, Montana, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Tennessee, Virginia and Wisconsin. “We are excited to offer coverage to certain hemp producers in this pilot program,” said USDA Risk Management Agency (RMA) Administrator Martin Barbre. “Since this is a pilot program, we look forward to feedback from producers on the program in the coming crop year.” MPCI coverage under the pilot program is available for hemp grown for fiber, grain or CBD, according to USDA. To be eligible for coverage, producers must meet various requirements including compliance with applicable state, tribal or federal regulations for hemp production, having at least one year of history producing the crop and having a contract for the sale of the insured hemp. Meanwhile, beginning with the 2021 crop year, hemp will be insurable under the Nursery crop insurance program and the Nursery Value Select pilot crop insurance program, USDA said.

| Rural Advocate News | Thursday December 26, 2019 |


Thursday Watch List Markets U.S. grain and livestock futures resume trading Thursday at 8:30 a.m. CST. U.S. weekly jobless claims will be out at 7:30 a.m. CST with a new U.S Drought Monitor. The U.S. Energy Department will issue weekly inventories, starting at 9:30 a.m. Note USDA's weekly export sales report will be released Friday morning, due to this week's holiday schedule. Weather Snow squalls will move across the far Northern Plains and northern Midwest Thursday, hindering late-harvest efforts. Other primary crop areas will be dry. A large storm system with rain and snow is indicated for the Southern Plains during the end of the week.

| Rural Advocate News | Tuesday December 24, 2019 |


China Can Fulfill Pledge to Purchase $40 Billion in U.S. Farm Goods China’s top agriculture consultancy said last week that it believes China can and will make good on a promise to purchase more than $40 billion in U.S. agricultural products per year. That pledge is part of a Phase One trade deal the two countries recently signed. Reuters says China will increase its agricultural purchases to anywhere between $40 and $50 billion over the next two years. The deal isn’t signed yet and that’s led to skepticism over whether China can handle purchases that large. Shanghai-based consultant group JCI released a document saying that most foreign media don’t believe China can fulfill that level of commitment. “As a Chinese consultant company on the agricultural market, JCI strongly believes that China has the ability and will fulfill its promise,” the company says. JCI estimates that China can buy approximately $41.3 billion worth of U.S. farm products every year, including around $18.7 billion worth of soybeans, which would amount to 45 million tons. The projections from JCI were based on what they say was a “careful study” of China’s import volume of U.S. farm products in the past and does assume favorable weather and pricing throughout the term of the agreement. ********************************************************************************************* China Lowering Tariffs on Goods from Around the World China announced a change in tariff rates on imported goods from around the world that will start on January first. The country will lower tariffs on global imports in a move that’s designed to give domestic consumers some support, even as a trade truce with the U.S. takes some pressure off the Chinese economy. The New York Times says the move comes less than two weeks after China and the U.S. reached a Phase One trade deal. It also helps China by showing that the country is continuing to open up its market in spite of the more than yearlong conflict with the U.S. However, China’s economy still has some question marks to deal with as it tries to recover from a slowdown brought on by the tariff conflict. The deal with the U.S. hasn’t been signed yet and that means a lot of tariffs on American imports are still in place. China is opening its market to other countries to help satisfy consumer demand. A list of 859 products will face lower tariffs in 2020. Among the goods are frozen pork, which China has to have after its pig herds were decimated by African Swine Fever. Tariffs will also fall on grocery items like avocados, orange juice, and seafood. ********************************************************************************************* Pilot Insurance Coverage Available for Hemp Growers The Risk Management Agency announced its offering a new crop insurance option for hemp growers in select counties across 21 states next year. The pilot insurance program will provide Actual Production History coverage (APH) under 508(h) Multi-Peril Crop Insurance. The offer is for eligible producers who raise the crop in certain counties throughout states like Alabama, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Michigan, Maine, Minnesota, Montana, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Tennessee, Virginia, and Wisconsin. The MPCI coverage applies to hemp grown for fiber, grain, or CBD oil for the 2020 crop year. This is in addition to the Whole-Farm Revenue Protection coverage available to hemp growers that was announced earlier this year. “We are excited to offer coverage to certain hemp producers in the pilot program,” says RMA Administrator Martin Barbre. “Since it’s a pilot program, we look forward to feedback from producers in the program during the upcoming crop year.” To be eligible for the program, producers must meet several requirements, including complying with applicable state, tribal, or federal regulations for hemp production, they must have at least one year’s history of producing the crop, and they must have a contract for the sale of the insured hemp. ********************************************************************************************** NASS Looking for Survey Responses The 2019 Census of Horticultural Specialties and the 2019 Organic Survey are both underway now, with the National Ag Statistics Service looking for as many responses as possible. They’d also like producers to respond online if they can. Online responses are more user-friendly, accessible on most electronic devices, and can save time by calculating totals and automatically skipping questions that don’t apply to an individual operation. “Horticulture and organic agriculture are important segments of U.S. agriculture and our economy,” says NASS Administrator Hubert Hamer. “When producers respond to the surveys, they’re helping associations, businesses, and policymakers advocate for their industry, influence program decisions, and educate others about the importance of these agriculture segments.” The Census of Horticultural Specialties is conducted once every five years to give a comprehensive picture of U.S. horticulture. The deadline for responding is February fifth of 2020. The Organic Survey asks more than 22,000 U.S. producers involved in certified or transitioning to organic farming questions about 2019 production, marketing practices, income, and expenses. The deadline to return the questionnaire or answer online questions is January tenth, 2020. ********************************************************************************************** “Beef. It’s What’s for Dinner” Campaign Reaches Over One Billion Consumers The “Beef. It’s What’s For Dinner” campaign relaunched two years ago. Over that time, the campaign has reached more than one billion consumers with informative digital marketing and social media content. The campaign was developed by the National Cattlemen’s Beef Association and funded by the Beef Checkoff. The campaign is designed to encourage families to make more meals with nutritious and delicious beef, as well as to connect consumers with stories of the farmers and ranchers who raise real beef. The “Beef. It’s What’s For Dinner” brand is reaching consumers more frequently and effectively than it ever has. Market research shows people who are aware of “Beef. It’s What’s For Dinner,” are more likely to eat beef, do so more often, and they feel good about buying and preparing beef for their families. Laurie Munns is a cattle rancher from Utah and NCBA Federation Division Chair. She says, “For a brand to have a reach of more than one billion people in today’s crowded marketing environment is a major milestone. It’s clear that consumers want more information about beef, it’s nutrition profile, and the hardworking farmers and ranchers who raise the beef they eat.” The NCBA first introduced the “Beef. It’s What’s For Dinner” campaign 25 years ago. ********************************************************************************************** EPA, Justice Department Want Glyphosate Ruling Reversed The U.S. government jumped into a California court case that found glyphosate, the active ingredient in Roundup, causes cancer. The Environmental Protection Agency filed a friend of the court brief last week that said it reviewed and approved the label on the weed-killing product and that a jury finding based on California law should be reversed. Even the Department of Justice joined the EPA in weighing in on the ruling in the long-running court battle over Roundup. Over the summer, the judge in the case cut the jury award to $25 million in the case of a man who claimed his non-Hodgkin’s lymphoma was caused by years of Roundup use. However, the judge didn’t reverse the jury finding in the case, saying in his opinion that Roundup was defective because the label didn’t include a cancer warning. Back in May, the EPA issued a statement saying it “continues to find no risks associated with glyphosate if it’s used following the current label and that glyphosate is not a carcinogen.” Bayer, which acquired Monsanto, the company that originally produced Roundup, was optimistic after the latest legal turn in the case, saying the company is encouraged after the U.S. government and other parties opted to support the company’s appeal.

| Rural Advocate News | Tuesday December 24, 2019 |


Tuesday Watch List Markets There are no official reports scheduled for Tuesday, Christmas Eve and federal employees have been given the day off. Most U.S. grain futures close at 12:05 p.m. CST and livestock futures finish 10 minutes later. Traders will also remain interested in any trade details with China that may emerge over the holiday. U.S. grain and livestock futures resume trading Thursday at 8:30 a.m. CST. Weather Rain and high-elevation snow during Tuesday from northern California through the western portion of the Pacific Northwest. Snow and rain through the central and southern Rockies mountain region. Mainly dry elsewhere in the key U.S. crop and livestock areas. Favorable conditions for any late fieldwork and for travel during Christmas Eve, outside of the western U.S. In South America the key growing areas of southern Brazil, central and southern Argentina will be dry and hot Tuesday. Somewhat stressful for developing corn and soybeans, especially in Argentina.

| Rural Advocate News | Monday December 23, 2019 |


USMCA Senate Prospects, Markup January 7, 2020 Following a landslide vote to pass the U.S.-Mexico-Canada Agreement in the House last week, the trade deal heads to the Senate. A vote, expected in January, could come early in the month, pending how the impeachment articles are handled. House Speaker Nancy Pelosi last week elected to hang on the impeachment documents, rather than send them off immediately to the Senate. Pending on how long she chooses to hold them, the action could clear a window for the Senate to consider USMCA. Senate Finance Chair Chuck Grassley Friday announced his committee intends to hold a markup hearing on January 7, 2020, based on the expectation that the Senate will have received the legislation beforehand from the House of Representatives. Grassley says, “This markup will move us closer to ratifying USMCA in early 2020. Senate leadership expects they could quickly consider and pass the agreement within a couple of days. However, if the Senate must start the year with impeachment trials, then a vote will come near the end of January, following the hearings. ************************************************************************************* USCA Disappointed in Lack of COOL in USMCA The U.S. Cattlemen’s Association expressed disappointment last week because country of origin labeling was not included in the U.S.-Mexico-Canada Agreement. The group penned a letter to President Donald Trump following House passage of the USMCA implementing legislation. Leo McDonnell, USCA Director Emeritus, writes, “This administration promised to "Make America Great Again," but it is becoming evident this does not include U.S. ranchers." He calls the lack of COOL in USMCA "disheartening at best." The letter presented years of data, dating back to 1988, as evidence of unfair trade in the beef sector by Canada and Mexico, in making a case for the necessity of COOL. However, COOL, which is illegal by World Trade Organization standards, was in place, but repealed by the U.S. Congress after Canada and Mexico planned trade retaliations. McDonnell concludes, "I appreciate that USMCA may be too far along to address some of these measures, but I feel it is important that, at the minimum, the record needs to be set straight.” *************************************************************************************​ Ernst Will Call for Wheeler Resignation if RFS Doesn’t Reach 15 Billion Gallons Republican Senator Joni Ernst of Iowa says she will call for Environmental Protection Agency Administrator Andrew Wheeler’s resignation, if the Renewable Fuel Standard doesn’t meet the statute requirement of 15 billion gallons. Her comments follow Wheeler’s final supplement rule released by his agency last week. In a joint statement with Iowa Republican Senator Chuck Grassley, Ernst says, “We will keep holding EPA’s feet to the fire to ensure they truly uphold the RFS as intended.” Ernst alleges that the industry was “guaranteed a deal” earlier in the year that would appease biofuels producers. The agreement would account for all lost gallons to small refinery exemptions. However, the industry says EPA’s plan to reallocate exempted gallons based on a three-year rolling average won’t make up for the four billion lost gallons. The agreement that the Iowa Senators say made earlier in the year would have based the three year average on actual gallons waived. ************************************************************************************ Iowa Ag Secretary: RVO Ruling Hurts Rural America Iowa Secretary of Agriculture Mike Naig (Nayg) says the Environmental Protection Agency’s final rule regarding Renewable Fuel Standard volumes for 2020 “creates unnecessary uncertainty in our markets,” and is “detrimental to so many across rural America.” The EPA proposal did not follow a request from the biofuels industry. Naig calls the rule flawed, adding, "We must continue to work together to hold the EPA accountable for ensuring the 15 billion gallons mandated by the Renewable Fuel Standard are met." He made additional calls to invest in biofuels infrastructure. The Iowa Department of Agriculture and Land Stewardship administers the Iowa Renewable Fuel Infrastructure program, which offers cost-share grants to help fuel retailers install infrastructure to increase the availability of ethanol and biodiesel. Secretary Naig has requested $3 million in the fiscal year 2021 to continue supporting the program. To date, the program has distributed or obligated over $33 million, with $200 million added in private economic activity. ************************************************************************************* Seven Sue USDA Over Pork Processing Revisions Seven organizations last week jointly filed a lawsuit against the Department of Agriculture over its decision to reduce oversight at pig slaughterhouses and eliminate limits on slaughter speeds. The groups claim the changes ”expose pigs to greater suffering,” and defy federal slaughter, meat inspection, and environmental protection laws. The lawsuit was filed in the U.S. District Court for the Western District of New York on behalf of Farm Sanctuary, Animal Equality, the Animal Legal Defense Fund, the Center for Biological Diversity, Compassion Over Killing, Mercy For Animals, and North Carolina Farmed Animal Save. In a statement, a spokesperson from the law firm filing the suit says the revised regulation “reads like a joint venture between big business and the federal government.” The lawsuit challenges USDA's revocation of limits on the number of pigs that can be slaughtered per hour. The lawsuit also challenges USDA's decision to remove and relocate federal inspectors in slaughterhouses. ************************************************************************************* Broadband Map Fix Will Reveal Needs The House of Representatives passed legislation last week that will improve the accuracy of broadband coverage maps to better identify needs. The Broadband Deployment Accuracy and Technological Availability Act requires broadband providers to report more specific data to create a significantly more accurate and granular National Broadband Map. With more precise data, federal agencies can target funding to areas that need it most. American Farm Bureau Federation President Zippy Duvall says, “it’s critical” to do so, adding “broadband is a necessity.” Current broadband coverage maps are inadequate, according to AFBF, because they rely on census block data to determine which areas are covered. Census blocks "are too large in rural and remote locations to accurately determine need." In addition to creating more accurate maps, the bill requires the FCC to establish an audit process that ensures internet service providers are providing accurate data used to create the maps. It also would create a user-friendly process to challenge the data.

| Rural Advocate News | Monday December 23, 2019 |


Washington Insider: Brazilian Metal Tariffs Lifted Amid all the chaos and anger in Washington these days, the New York Times reported on Sunday that President Jair Bolsonaro of Brazil said “Mr. Trump decided not to pursue tariffs on Brazilian steel after a phone call on Friday.” The Times said the development represented a decision to “back off a threat made this month to impose tariffs on Brazilian metal,” a move that would have broken a previous agreement with the country and risked reigniting trade tensions. The news came in a somewhat unusual way — NYT said that President Bolsonaro “wrote in a post on Facebook Friday that he had spoken with Mr. Trump who decided not to make good on his plan to impose tariffs on our steel/aluminum. Our commercial relations and friendship are getting stronger every day,” he added. President Trump appeared to confirm Friday night that he would not be pursuing tariffs, writing on Twitter that he had just had a “great call” with Bolsonaro. “We discussed many subjects including Trade. The relationship between the United States and Brazil has never been Stronger!” he said. President Trump has routinely threatened—and imposed— tariffs to punish trading partners over practices he has deemed unfair to the United States, NYT said. On Dec. 2, President Trump tweeted that he would impose metal tariffs on Brazil and Argentina, accusing the countries of weakening their currencies and hurting American farmers. “Therefore, effective immediately, I will restore the tariffs on all steel & aluminum that is shipped into the US from those countries,” President Trump said. The tariffs have not gone into effect. Last week Larry Kudlow, the president’s economic adviser, told The Wall Street Journal CEO Council meeting that the Trump administration might not proceed with the tariffs. “No decisions have been made,” Kudlow said. The Dec. 2 announcement appeared to surprise Bolsonaro, a populist president who had gone to great lengths to strengthen personal ties with Trump. “Aluminum?” Bolsonaro asked when reporters presented him with President Trump’s tweet. “If that’s the case, I’ll call Trump. I have an open channel with him.” That same day, Brazilian authorities started calling the White House, the Commerce Department and the Treasury Department, as well as some lawmakers, to argue that Brazil does not manipulate its exchange rate. The Brazil Steel Institute said in a statement at the time that it was shocked by the announcement and warned that the decision would hurt the American steel industry which needs semi-finished products exported by Brazil to operate its mills. It is unclear if Trump has also backed off his threat to impose metal tariffs on Argentina, the Times said. The United States had initially exempted Brazil and Argentina from the tariffs placed on global steel and aluminum in March 2018, as the countries continued to negotiate over trade terms. In May 2018, the United States announced that it had reached an agreement with both countries that would cap their metal shipments at a specific volume each year. Trump and his advisers have lamented the negative effects of a strong dollar which makes American goods more expensive to purchase overseas. Administration officials have accused a wide range of governments of manipulating their currencies, including China and the European Union. The Treasury Department, which issues an official determination on which countries are currency manipulators, has not placed that label on Brazil or Argentina and neither country is on its list of nations that warrant monitoring. The most recent report, which was due in October, has yet to be released. Administration officials have not clarified when it will be published or the reason for the delay. Economists say that the value of the Brazilian and Argentine currencies have recently fallen, but that the countries are not intentionally devaluing them, despite what President Trump said. Instead, the two governments have actually been selling foreign currency and buying their own money to try to prop up its value. Still, the falling value of both currencies has made Brazilian and Argentine products cheaper to purchase abroad — especially in China, where the president had been waging a protracted trade war. As China imposed tariffs on American farm goods like soybeans and halted purchases in retaliation for President Trump’s tariffs, Beijing switched to buying Brazilian and Argentine products instead. That hurt American farmers and rankled Trump. Those tensions have now eased after the announcement last week that China and the United States had reached a Phase 1 trade deal, in which China has committed to buying large amounts of American farm goods. Brazilian officials have already made some trade concessions to the United States, including improving the terms of trade for wheat and ethanol. Brazil has also agreed to forgo a special status for developing countries at the World Trade Organization, dropped visa requirements for visitors from the United States and granted permission for United States companies to launch satellites from a Brazilian base. Carlos E. Abijaodi, director of industrial development at Brazil’s National Confederation of Industry, said he believed tariffs would not be imposed and that the threat mainly served as a signal to administration supporters in the upcoming election. So, we will see. This trade decision, if it holds, likely will be welcomed by U.S. farm equipment manufacturers and others. Clearly, decisions that support free-market relationships are important to producers and should be watched closely as political fights multiply, Washington Insider believes.

| Rural Advocate News | Monday December 23, 2019 |


EPA Releases More SRE Data The Environmental Protection Agency (EPA) released refreshed data on Small Refinery Exemptions (SREs), showing 16 waiver petitions had been filed for the 2019 compliance year as of Nov. 21. The 2019 SRE total is up six from the agency’s previous report. So far, all 16 petitions remain pending and there are no petitions pending for any earlier compliance years. For 2018, EPA granted 31 of 42 SRE petitions it received, while in 2017 it granted the largest number ever at 35 of the 37 total petitions it received. Biofuel proponents remain focused on EPA’s granting of SREs and whether it follows through on a promise to accurately account for exempted volumes when setting renewable volume obligations (RVOs) in coming compliance years. Many biofuel groups voiced concern last week after EPA released its final rule for 2020 biofuel and 2021 biodiesel RVOs. EPA’s rule retained language relying on Department of Energy (DOE) SRE recommendations when accounting for the waivers. In the past the agency has not always followed DOE’s suggestions, particularly in situations calling for only partial exemptions. While the agency said it is “committed to following the DOE recommendations” going forward, many biofuel proponents remain skeptical.

| Rural Advocate News | Monday December 23, 2019 |


Trump, Xi Speak by Phone on U.S.-China Trade Deal President Donald Trump and Chinese President Xi Jinping spoke by telephone Friday about the phase-one U.S.-China trade deal, with Trump describing the exchange as “a very good talk,” in a tweet following the call. Trump said China “has already started large scale purchases of agricultural product & more,” and added a formal signing of the phase-one trade deal is “being arranged.” Late last week, Treasury Secretary Steven Mnuchin indicated the signing will take place in early January. For his part, Xi also spoke positively after speaking with Trump, saying the trade deal would benefit both countries and help advance the world economy, Chinese state-run media outlet Xinhua reported. At the same time, Xi warned that China has “serious concerns” about what it views as U.S. interference in Taiwan, Hong Kong, Xinjiang and Tibet.

| Rural Advocate News | Monday December 23, 2019 |


Monday Watch List Markets Monday before Christmas will have more reports than usual, starting with U.S. new home sales at 9 a.m. CST and grain export inspections at 10 a.m. At 2 p.m. CST, USDA will release a monthly cold storage report and quarterly Hogs and Pigs report. Any news on trade with China will also get attention. Weather Dry and mild conditions will cover all major crop areas Monday. Precipitation will be confined to the northwestern and southeastern U.S. Southern Plains areas have moisture indicated at the end of the week.

| Rural Advocate News | Friday December 20, 2019 |


House Passes U.S.-Mexico-Canada Agreement Implementing Legislation Agriculture groups are calling on the Senate to “finish the job” and pass the U.S.-Mexico-Canada Agreement following approval in the House of Representatives Thursday. The U.S. House overwhelmingly passed implementing legislation for USMCA, sending the trade agreement to the Senate. The vote came following a delay of more than a year to make changes and reach an agreement between House Democrats and the Trump administration. Representative Richard Neal, who led the House efforts to modify the agreement, says the transformed trade deal approved Thursday “closes important loopholes and enables the United States to ensure our trading partners live up to their commitments.” Senate leader Mitch McConnell last week stated the Senate would not consider approving the agreement until after the Senate completes an impeachment trial in January. Members of the National Corn Growers Association were in Washington this week, urging the Senate to quickly consider and pass the trade agreement in the new year. ************************************************************************************* House, Senate, Pass Ag Spending Package The House and Senate this week came together in passage of spending bills for fiscal year 2020. Senate Appropriations Committee Chairman Richard Shelby, an Alabama Republican, says, "bipartisan cooperation has made this possible.” The spending package for agriculture includes $23.5 billion in discretionary funding, $451 million above fiscal year 2019 enacted levels. It also includes $1.5 billion in disaster funding for farmers and ranchers that was set to expire at the end of this year. Additionally, the bill includes $550 million for the rural broadband ReConnect Pilot program, along with fulling funding the Farmer and Rancher Stress Assistance Network, and reinstating the expired biodiesel tax credit retroactively through 2022. As farm groups welcomed the spending package, the National Milk Producers Federation applauded the legislation for including direction on dairy imitating products using labels containing dairy terms. The Food and Drug Administration provisions include language reaffirming bipartisan congressional concern with mislabeled imitation dairy products, directing FDA to enforce its own rules on labeling. ************************************************************************************* EPA Maintains SRE Supplemental Rule as Proposed The Environmental Protection Agency Thursday finalized renewable volumes under the Renewable Fuel Standard for 2020. Through the action, EPA says it has “fulfilled yet another key promise" to farmers, however, corn and biofuel producers disagree. The EPA did not make changes to the proposal, as requested by the biofuels industry. The final rule will use a three-year rolling average of recommended small refinery exemptions by the Department of Energy to account for waived gallons. Farm groups told the EPA during the comment period to account for the actual number of waived gallons, rather than the DOE recommendations. The EPA says conventional biofuel volumes, primarily met by corn ethanol, will be maintained at the 15 billion gallon target set by Congress for 2020. Cellulosic biofuel volumes for 2020, and thus advanced biofuel volumes, will increase by almost 170 million gallons over the 2019 standard. Biomass-based diesel volumes for 2021 will be equivalent to the standard for 2020, and total RVO gallons for 2020 is 20.09 billion gallons. ************************************************************************************* Corn, Biofuels Groups, Disappointed in EPA Decision Corn and biofuels groups expressed disappointment in the Environmental Protection Agency’s decision to finalize a rule relating to small refinery exemptions under the Renewable Fuel Standard. The final rule uses a three-year average of the Department of Energy recommended waivers as an estimate for 2020 waivers rather than an average of actual gallons waived by the EPA, as requested by biofuel supporters. The National Farmers Union says President Donald Trump broke a promise to farmers. The Trump administration in October promised to fully account for waived volumes due to small refinery waivers. NFU’s Rob Larew says, “farmers are sick and tired of this biofuels bait and switch.” Growth Energy CEO Emily Skor says more action is needed on the proposal to restore growth under the RFS, adding “this rule leaves important work unfinished.” National Corn Growers Association President Kevin Ross says the final rule “falls short of adequately addressing the demand destruction caused by EPA’s abuse of RFS refinery waivers.” ************************************************************************************* EPA Approves Hemp Pesticides, Proposes Atrazine Reregistration The Environmental Protection Agency Thursday approved ten pesticides for use on hemp crops for use during the 2020 growing season. The much-needed action allows hemp growers to protect their crops with approved products. Kentucky Agriculture Commissioner Ryan Quarles says the action “is a step in the right direction” for hemp growers, adding “it is important our growers have new technologies and tools to better help protect their crops and increase their yields.” While EPA oversees pesticide registrations for hemp, other federal agencies are working to streamline their separate regulatory implementation processes for the newly legalized crop. The agency also advanced the reregistration of atrazine, a widely used product for weed control. Missouri Corn Growers Association CEO and Triazine Network Chair Gary Marshall says, "We appreciate" the proposal, adding atrazine is "tremendously important to farmers across the country.” The agency is proposing a reduction to the maximum application rate for atrazine used on residential turf, and other updates to the label requirements, including mandatory spray drift control measures. ************************************************************************************* USDA, USTR, Seek Trade Advisory Committee Applications The U.S. Department of Agriculture and the Office of the United States Trade Representative are accepting applications for new members to serve on seven agricultural trade advisory committees. Members of the Agricultural Policy Advisory Committee advise USDA and USTR on operating existing U.S. trade agreements, on negotiating new agreements, and on other trade policy matters. Members of six Agricultural Technical Advisory Committees provide technical advice and guidance on international trade issues that affect both domestic and foreign production in specific commodity sectors. The committees focus on trade for Animals and animal products, Fruits and vegetables, grains, processed foods and sweeteners, along with a committee on tobacco, cotton and peanuts. To be considered for candidacy, applicants must have significant expertise in both agriculture and international trade matters. The committees hold frequent conference calls and generally meet in Washington, D.C., twice a year. Committee members serve four-year terms. Application instructions are available at fas.usda.gov. Applications must be received by 5 p.m. ET on January 31, 2020.

| Rural Advocate News | Friday December 20, 2019 |


Washington Insider: Trade War Costs While nearly everybody is happy to see reduced tensions between the U.S. and China over trade, new questions are being raised by many in the media regarding what the current deal means and what are the longer-term costs of the recent battle. The administration claims that the current deal “promises” to double U.S. exports to China and sees a “two-year spending spree on everything from airplanes to pork chops and chicken feet.” Still, Bloomberg argues that the “inescapable reality” is that even this extraordinary splurge – if it happens – may not make up the economic cost of the trade war it seeks to defuse. Not surprisingly, the report says what everybody knows – that “the precise toll of an economic conflict that is far from over is difficult to isolate.” Currently, however, economists are busily calculating the impact of the fight and notes that most U.S. tariffs will remain in place. These, along with China’s retaliatory measures, along with the impact of the resulting uncertainty – range from 0.3% to 0.7% of real gross domestic product this year alone. But even with the phase-one trade deal, many economists expect the “tariff drag” to extend for years and to continue to “stymie business investment” and to take a toll on future growth. While a few tenths of a percentage point may not seem like much, it’s consequential in the world’s biggest economy. In 2019 dollars, Bloomberg estimates the cost in lost U.S. GDP has reached $134 billion to date and will rise to a total of $316 billion by the end of 2020. Bloomberg also cites a study by researchers at the New York Fed and Princeton and Columbia universities who estimated the cost to consumers of the tariffs that will remain in place at $831 per household per year – with “an annual cost of more than $106 billion for the U.S. economy as a whole.” That alone could more than wipe out the gains from the Chinese buying surge the administration says has been negotiated, Bloomberg says. The report says that the costs are also “not one-time” and are likely to build up for years “even as businesses get used to the tariffs, or to adjusted supply chains.” For example, the International Monetary Fund’s estimates are that the U.S. tariffs will subtract from real GDP in every year to 2023, when real GDP will be 0.5% lower than it would have been had the duties not been imposed. The administration and its supporters argue they are “in a bigger fight to address longstanding American complaints regarding Chinese investment policies” and that the current agreements “will be to the long-term benefit of U.S. businesses and workers,” but that has been a difficult argument to make on the basis of the Phase One deal, critics say. The administration also points to a U.S. economy growing faster than its peers and continuing to generate jobs as vindication of its trade policies, and expect today’s report to confirm the U.S. economy grew at a 2.1% annualized rate – or perhaps better – in the third quarter. Larry Kudlow, the head of the administration’s National Economic Council, this week said he expected the combination of the deal with China and the imminent Congressional passage of an update of the North American Free Trade Agreement will mean an addition of 0.5% to U.S. growth – but didn’t release any details regarding the White House analysis. A challenge facing critics of Trump’s trade policies is the fact that the economic effects of recent trade fights have been largely countered by strong national-level data and a robust economy, driven by domestic consumption that largely offsets negative trade impacts on the manufacturing and farm sectors, Bloomberg says. Still, the negative effects are real, argues economist Mark Zandi, chief economist at Moody’s Analytics and others. From the third quarter of 2018 to the same quarter this year – the period in which the trade war really started to bite – Zandi calculates the U.S. lost 0.4% of real GDP to various trade measure impacts, or $88 billion. It also lost 340,000 jobs to the trade wars, he contends, via a mix of stalled investment and higher costs due to new import duties. The uncertainty affecting business decisions isn’t evaporating, Zandi thinks, and “that will continue to weigh on business investment, hiring and wage growth and will have continued negative consequences for the economy.” So, we will see. Skeptics of the administration trade objectives have been increasingly vocal recently, across most economic sectors. These intense debates likely will continue and should be watched closely by producers as they evolve, Washington Insider believes

| Rural Advocate News | Friday December 20, 2019 |


China, US Details on Phase-One Deal Not Coming Just Yet China is signaling the details of the phase-one trade agreement with the U.S. will not be made public until the deal is signed, according to Ministry of Commerce spokesman Gao Feng. The two sides are in close communication, but said there was no specific information he could provide on the deal. "After the official signing of the deal, the content of the agreement will be made public," Gao said. Sen. Chuck Grassley, R-Iowa, echoed the situation, saying he has only had “very general conversations” with U.S. Trade Representative Robert Lighthizer on the specifics of the phase-one deal with China. “The reason why he would not want to be very specific to us is these texts are still being translated and we have got to know that they say what was agreed to before we talk,” Grassley told reporters on Wednesday. He said the only detail on the benefit for agriculture is the U.S. claim that China has agreed to purchase between $40 billion and $50 billion worth of U.S. farm goods next year.

| Rural Advocate News | Friday December 20, 2019 |


EPA Releases Final 2020 Biofuel, 2021 Biodiesel Plan EPA has released their final rule for the 2020 biofuel and 2021 biodiesel levels under the Renewable Fuel Standard (RFS), but biofuel backers remain unhappy with the result. In a release accompanying the final rule which is yet to be published in the Federal Register, EPA said they were “committed to ensuring a net of 15 billion gallons of conventional biofuel is blended in 2020.” EPA stated that by “By proposing effectively 15.8 billion gallons for 2020 we will ensure meeting our target of 15 billion gallons.” However, the 172-page final rule from EPA does not mention the 15.8 billion gallon figured referenced in the release, a figure apparently generated by the percentage standards the agency will set for the various biofuels for 2020. EPA’s final rule will adopt the plan to account for small refinery waivers (SREs) that they proposed in October, “based on a three-year average of the relief recommended by the Department of Energy (DOE) for 2016–2018. In this action, we are finalizing these proposed changes.” Sen. Chuck Grassley, R-Iowa, expressed disappointment on Twitter, saying he will keep EPA Administrator Andrew Wheeler’s “feet to the fire” to make sure the 15 billion gallons for conventional (primarily corn-based) ethanol is blended.

| Rural Advocate News | Friday December 20, 2019 |


Friday Watch List Markets On Friday, the U.S. Commerce Department releases its latest estimate of U.S. GDP in the third quarter at 7:30 a.m. CST. USDA's cattle on-feed report for December 1 is due out at 2 p.m. CST with on-feed inventory expected up 1.9% from a year ago. Traders will be watching for news on any last minute Congressional bills or trade agreement developments with China. Weather Another dry day is in store across the primary crop areas Friday. Temperatures will continue to show a warming trend going into the weekend. This combination favors livestock and transportation along with offering some late harvest progress.

| Rural Advocate News | Thursday December 19, 2019 |


Republicans, Democrats Battle to Claim Credit for Final Version of USMCA While the U.S-Mexico-Canada Trade Agreement is set for a vote in the House on Thursday, Republicans and Democrats both claimed credit for the final version of the pact on Wednesday. Agri-Pulse says Republican lawmakers piled their praise upon President Trump for demanding that the North American Free Trade Agreement be renegotiated. However, Democrats say the changes they demanded were what made the agreement work. During the early days of negotiations, Democrats said they wouldn’t support the agreement unless it discouraged U.S. companies from relocating to Mexico. “The Trump Administration’s initial agreement fell short, but House Democrats fought hard for greater accountability in the final draft,” says California Representative Linda Sanchez. Republican Kevin Brady of Texas says, “President Trump and Ambassador Lighthizer delivered on their promise for a pro-growth and modern trade pact. We now have a trade deal that will deliver historic wins for our economy.” Democrats say the new measures in the USMCA will allow for unions nationwide in Mexico and will eventually push wages higher within that country. Republicans point out that it’s been over a year since the new agreement was signed, saying Democrats’ obsession with impeachment has kept a vital agreement from getting approved. ********************************************************************************************* China Appears Set to Buy U.S. Ethanol Some details are starting to emerge on how China would increase imports from the U.S. by as much as $200 billion over the next two years. That would meet its commitments under the phase one trade deal announced last week. Bloomberg says the still-unsigned deal includes Chinese purchase levels of $40 to $50 billion in U.S. ag commodities, a level which many experts think isn’t reachable. To help get closer to that figure, sources close to the matter tell Bloomberg that Beijing plans to restart purchases of ethanol by lifting or waiving trade war tariffs on the fuel. China is also considering taking U.S. trade from Hong Kong into its mainland ports, which would enable about $10 billion a year in U.S. goods to go directly to the mainland, which would boost the tally. The U.S. doesn’t count the shipments that go through Hong Kong as a part of its trade with China. China will also grant more regular waivers on retaliatory tariffs to local buyers of U.S. farm products like soybeans and pork. Back in November, China had lifted its ban on U.S. poultry shipments as a part of trade negotiations. U.S. officials estimate poultry exports will top $1 billion a year. ********************************************************************************************* ASF Makes First Appearance in Indonesia; Growing Outbreak in Poland The African Swine Fever virus continues its relentless march across Asia. Indonesia’s Minister of Agriculture confirms the country’s first outbreak of the virus in the far northwest part of the multi-island nation. The confirmation came on December 12 and wasn’t unexpected as increasing reports of pig deaths have come from that area, as well as several others, since late September. The United Nation’s Food and Agriculture Organization is working with Indonesia’s director-general of Livestock and Animal Health Services. The nation’s animal health director asked the FAO to provide guidance on containment and control measures for the virus. Indonesia joins an unfortunate list of Asian countries with ASF outbreaks. In a different part of the world, a pocket of the African Swine Fever virus in Poland is continuing to grow near the border with Germany throughout the past month. Even though the outbreak is 30 miles from Germany, which is the European Union’s top pork producer, the European Commission has extended Poland’s ASF control zone to the German border. For German hog producers, the increasing number of positive ASF reports is very bad news. Some German producers and officials are asking Poland to construct a border-type wall to keep infected wild pigs from entering into Germany. ********************************************************************************************** Farm Groups Want Crop Insurance Protected in Fiscal 2021 Budget The Crop Insurance Coalition is asking Ag Secretary Sonny Perdue and the Office of Management and Budget to oppose crop insurance cuts as the Trump Administration develops its fiscal year 2021 budget. The Hagstrom Report says the coalition sent a letter to President Trump and OMB Acting Director Russel Vought (Vote), saying, “For good reason, the state of the agricultural economy has been the subject of numerous hearings, reports, and media coverage. Cash crop receipts have dropped more than $34 billion since 2012.” They point out that despite a recent bump in net farm income this year, net farm income is still down $44 billion from 2013 in inflation-adjusted dollars. Multiple hardships have taken a big toll on farm families all over the country, with farm bankruptcies up 24 percent from last year. “Given the state of the ag economy,” the coalition writes, “now is not the time to make cuts to crop insurance, a program that farmers have described over and over as a linchpin of the farm safety net.” It provides predictable, on-budget assistance to farmers in a way that helps lenders continue to support American farmers and ranchers. The Crop Insurance Coalition Is made up of 57 national farm, lending, ag input, conservation, and insurance organizations. ********************************************************************************************** NPPC Applauds Funding for Ag Inspectors The House of Representatives approved $19.6 million in funds for more agricultural inspectors at U.S. land, air, and seaports. The main goal is to keep African Swine Fever and other foreign animal diseases from getting into the United States. The funding is a part of the fiscal year 2020 Department of Homeland Security appropriations bill and a top priority for the National Pork Producers Council. “For more than a year, the NPPC has advocated for an increase in the number of agricultural inspectors at our borders,” says NPPC President David Herring. “We applaud the approval of an essential provision to reduce the risk of ASF and other diseases, as well as to protect the rural economy from a devastating outbreak.” The NPPC also says they would also like to thank USDA and Customs and Border Protection for all they have done to strengthen U.S. biosecurity. The most likely path for a foreign animal disease to enter the country would be through the importation of infected animals or contaminated products. An outbreak would immediately close U.S. pork export markets, causing significant economic harm to U.S. farmers, consumers, and the overall economy. Herring adds, “NPPC continues to advocate for other disease preparedness measures, including establishing a U.S. Foot-and-Mouth Disease vaccine bank as provided for in the 2018 Farm Bill.” ********************************************************************************************** Farmers Launch U.S. Hemp Growers Association The formation of the new U.S. Hemp Growers Association was announced in Indianapolis. The brand-new association will focus on things like educational efforts and market development resources, research, and networking opportunities. A USHGA release says the organization will provide a unified voice for farmers to actively engage in critically important advocacy efforts. More than 300 members of the U.S. Hemp Farming Alliance will fold into the new USHGA. Caryn Wilcox will serve as the initial executive director of the organization. A majority of the organization’s board of directors is expected to be active hemp farmers. “The forward-thinking industry leaders who’ve come together in this association see the potential for hemp as an agricultural commodity,” Wilcox says. “They also understand how much this industry can contribute to the environment and the sustainable products that benefit farmers and consumers at the grassroots level.” Wilcox also says she’s honored to be part of this historical moment.

| Rural Advocate News | Thursday December 19, 2019 |


Washington Insider: Tax Break Controversies As the Congress works to authorize federal spending for the current fiscal year amid the bitter, ongoing political fights, it is also working to authorize the array of tax credits that negotiators typically work out annually. This year’s package was unveiled Tuesday, and, “as usual, is intended to transcend partisan bickering and allow lawmakers to dole out special-interest tax breaks credits “that were set to expire or had already ended.” The temporary nature of those benefits tends to set off a year-end scramble, NYT says, with lawmakers trying to aid businesses and entities that have come to depend on them. Among the biggest changes tucked into this year’s agreement is the elimination of taxes intended to fund the Affordable Care Act, including a tax on medical devices, health insurers and generous health plans. That tax had never gone into effect and the House voted overwhelmingly to repeal it this year. The health insurance tax, which applied to health insurers and the medical device tax, has been sporadically carried out, NYT said. This year’s deal, which passed the House as part of an overall spending plan for eight agencies 297 to 120 on Tuesday, also extends tax benefits for railroad track maintenance, racehorse and racetrack ownership, hiring and investment on Native American reservations and some victims of natural disasters. A one-year extension was given to winemakers, beer brewers and liquor distillers allowing them to avoid tax increases of as much as 400 percent. It also extends a handful of credits for renewable energy, like wind production, but does not include an extended credit for the buyers of electric cars, the Times emphasized. Congressional staff and lobbyists were referring to Tuesday’s agreement as a “skinny” deal, which fell short of both Democratic and Republican ambitions and could have included additional aid to low-income families and fixes for errors written into the sweeping package of tax cuts signed in 2017. This year’s deal also highlights the inability of the administration’s tax cuts to reduce businesses reliance on targeted credits and other breaks. The 2017 tax package that cut the corporate rate to 21% was intended to reduce the need for specialized tax breaks that had been good for lobbyists but costly and inefficient for taxpayers. Those provisions were usually made temporary for budgetary reasons and allowing lawmakers to provide breaks without adding to the 10-year federal budget deficit. But many have routinely been renewed “continuing to add to America’s fiscal woes,” the Times said. The provisions in the current deal could add more than $427 billion to the federal debt over the next decade, according to the congressional Joint Committee on Taxation. Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, said “there isn’t a single credible justification to defend it.” Negotiators reached the deal hours before they were set to vote on spending legislation to keep the government fully funded through the end of the fiscal year. The extenders, through a procedural maneuver on the House floor were to be attached to one of the spending packages up for a House vote that then will go to the Senate which expects to take up the legislation before government funding expires on Friday, the Times said. Congressional staff said that a broader agreement including more tax credits had been “at hand” earlier but that White House officials and Treasury Secretary Steven Mnuchin ultimately rejected it. Secretary Mnuchin pushed for any larger deal to include the relief for restaurant owners, they said, but Democrats were unwilling to support it without more in return on their priorities. The deal as agreed to includes a few reversals from the 2017 law. It eliminates a tax increase that hit the children and spouses of deceased members of the military, along with a new tax that was set to hit churches and other nonprofit organizations that offer parking to their employees. Other tax break winners include movie, television and theater producers and “energy efficient” homes—as well as owners who install electric charging station or other types of renewable refueling in their principal residence. However, supporters of renewable energy generally panned the package, saying it does little to incentivize a shift to cleaner power. So, we will see. Politico emphasized that the House bill included a $15 billion tax break for biodiesel through 2022 that Sen. Chuck Grassley, R-Iowa, and other Midwestern members were pushing to benefit “states where biodiesel plants shut down throughout the year.” The bill would also renew through 2020 a 46-cent-per-gallon credit for production of cellulosic and algae-based fuels and it would extend a special allowance for biofuel plant property. So, we will see. Clearly, the current package includes significant benefits for producers and should be watched closely as it proceeds, Washington Insider believes.

| Rural Advocate News | Thursday December 19, 2019 |


More Time to Comment on USDA’s Hemp Rule The comment period on USDA’s interim final rule for hemp production has been extended until January 29, 2020. USDA took the move after requests from several stakeholders who felt that more time was needed to offer their views on the regulation. The comment period had been set to end December 30. USDA’s Ag Marketing Service (AMS) has already received nearly 1,200 comments on the rule, many of them raising concerns that the sampling and testing protocols are unworkable and could undermine the growth of the hemp industry.

| Rural Advocate News | Thursday December 19, 2019 |


USTR Formally Publishes Suspension of December 15 Tariffs On China The Office of the U.S. Trade Representative (USTR) on Wednesday in the Federal Register published the formal notice that suspends indefinitely the tariffs that were to go into effect on a host of Chinese goods December 15. “On December 13, 2019, following months of negotiations, the United States and China reached a historic and enforceable agreement on a Phase One trade deal that requires structural reforms and other changes to China's economic and trade regime, including with respect to certain issues covered in this Section 301 investigation,” USTR said. “In light of progress in the negotiations with China, and at the direction of the President, the U.S. Trade Representative has determined that the action announced on August 20, as modified by the August 30 notice, is no longer appropriate. Specifically, and in accordance with the President's direction, the U.S. Trade Representative has determined to suspend indefinitely the imposition of additional duties of 15% on products of China covered by Annex C of the August 20 notice, which otherwise would have been effective on December 15, 2019.” Further, USTR said they expect to issue another notice in the near future “reducing the rate of additional duty” on good from China that were covered under Annex A of the notice published August 20 “in light of progress in the negotiations.” USTR also said that if further modifications are needed, they will take into account comments and testimony that have previously been provided by stakeholders.

| Rural Advocate News | Thursday December 19, 2019 |


Thursday Watch List Markets Thursday is a busy day of reports, starting with weekly export sales, U.S. jobless claims and a new U.S. Drought Monitor at 7:30 a.m. CST. Reports on U.S. existing home sales and the Conference Board's leading indicators are due out at 9 a.m., followed by natural gas inventory from the U.S. Energy Department at 9:30 a.m. The National Weather Service will also have a new 30-day forecast early Thursday. Weather Thursday will be dry and warmer over the central, eastern and southern U.S. Conditions will favor transportation and livestock, and may offer some late-harvest opportunity. Precipitation will be confined to rain and snow in the Pacific Northwest.

| Rural Advocate News | Wednesday December 18, 2019 |


USMCA Nearing House Vote Lawmakers in the House of Representatives are on track to pass the U.S.-Mexico-Canada Agreement this week. The House Ways and Means Committee began the process Tuesday, considering the implementing bill in a markup hearing. During the hearing, Committee Chairman Richard Neal said during his opening statement, which included no mention of agriculture, that the changes “set a new standard for U.S. trade agreements.” Ranking Republican on the Committee, Kevin Brady, stated the agreement “pries open Canada’s market” for several U.S. farm commodities. The committee moved the bill on to the full House for consideration. The House is expected to vote on the implementing bill Thursday. The Senate, however, will not consider the legislation until after any impeachment hearings, likely around late January. The bill repeals the current North American Free Trade Agreement and replaces it with USMCA. President Donald Trump sent the implementing legislation to Congress last week, following an agreement on changes to the deal with House Democrats. ************************************************************************************* House Approves Spending Package for Agriculture Through September 30, 2020 The House of Representatives Tuesday advanced a spending package that will extend the biodiesel tax credit and offer additional disaster aid to farmers. The American Soybean Association says the biodiesel tax credit will "expand markets for soybean growers." The tax credit expansion is part of a tax package amendment included in a funding bill for the Department of Agriculture and others. If passed, the credit would be extended at $1 per-gallon for five years covering 2018-22, retroactive to December 31, 2017, through December 31, 2022. The biodiesel tax incentive lapsed in December 2017. The National Biodiesel Board says the credit will support expansion of biodiesel and renewable diesel production. NBB’s Kurk Kovarik says the deal provides policy certainty that needed to “support investments and continued growth of production.” Lawmakers are also including an additional $1.5 billion in disaster aid in the spending bill, aimed at helping farmers recover from damages in 2019. The Senate is expected to pass the legislation later this week. ************************************************************************************* National Bio and Agro-Defense Facility Authorization Clears Senate Ag Committee The Senate Agriculture Committee Tuesday announced committee passage of legislation to support agro-biodefense. Committee Chairman Pat Roberts, a Kansas Republican, says the legislation means “we are one step closer to securing a more robust defense of our nation’s agriculture and food supply.” The National Bio and Agro-Defense Facility Act of 2019 would authorize the Agriculture Secretary to use the facility as a national security laboratory protecting agriculture and food. The bill directs NBAF to carry out the relevant objectives of a Homeland Security Presidential Directive and the National Biodefense Strategy, both aimed at securing the nation's food and agriculture. The $1.25 billion facility in Manhattan, Kansas, is expected to be operational by 2022-2023. Ranking member of the Committee, Democrat Debbie Stabenow of Michigan, says the legislation is "important in the critical effort to help safeguard our food supply from animal diseases and intentional threats." The bill also outlines the national security mission of the facility and the duties of the agencies responsible for implementing the mission. *************************************************************************************​ CoBank: Challenges Ahead for 2020 A new report from CoBank suggests more challenges are ahead for Rural America and agriculture. CoBank recently released its report titled The Year Ahead: Forces That Will Shape the U.S. Rural Economy in 2020. The trade environment for 2020 remains hazy, according to CoBank, which says beyond a possible U.S.-China phase one deal, “more progress with China will be a challenge.” Trade is one of the many challenges producers face in the coming year. A phase one agreement could be completed in January. However, without a meaningful full trade deal with China, CoBank says, "the U.S. agricultural economy will continue to struggle with trade uncertainty." Further uncertainty focuses on potential payments to farmers, which helped prop up farm income in 2019. Meanwhile, the report says the last few years demonstrate the resiliency of U.S. agriculture, and there is room for optimism in 2020. Rising animal protein and dairy exports will be a bright spot for producers, with African Swine Fever outbreaks abroad creating export opportunity for U.S. producers. ************************************************************************************* NMPF REAL Seal Redesign Seeks to Clear Consumer Confusion The National Milk Producers Federation Tuesday unveiled a redesigned website for the REAL® Seal, www.realseal.com. The website seeks to help consumers avoid marketplace confusion regarding real dairy products and imitators. This is the first significant change in the online presence for the REAL Seal since NMPF first assumed management of the seal in 2012. The new website will contain more content to educate consumers about why they should look for the seal on foods they buy, while also continuing to help those companies using the seal to enhance their product marketing. Jim Mulhern, president and CEO of NMPF, says the website redesign comes as NMPF “continues to battle the misuse of dairy terms by plant-based products.” The new website both educates consumers about how real dairy foods compare to imitators, and explains how the REAL Seal program delineates which brands can use the seal. The REAL Guide component of the website helps shoppers find certified brands and products displaying the seal. ************************************************************************************ USDA Funds Conservation Innovation across the Country The Department of Agriculture’s Natural Resources Conservation Service Tuesday announced $12.5 million in Conservation Innovation Grants. The effort supports development of innovative systems and technologies for private lands conservation. The funding is provided through the Conservation Innovation Grants program, which “funds the future of agriculture and conservation” through grants to organizations and universities that are developing the next generation of tools and technologies to boost conservation on agricultural lands. NRCS Chief Matthew Lohr says the projects will “result in new science-based tools for our toolbox.” The 2019 funding pool focused on four priority areas: water quantity, urban agriculture, pollinator habitat and accelerating the pace and scale of conservation adoption. NRCS selected 19 projects for the grant awards. One of the projects, at the University of Minnesota, will evaluate cover crop rotations for vegetable systems, and their impact on pollinators. A complete list of funded projects is available online, at nrcs.usda.gov.

| Rural Advocate News | Wednesday December 18, 2019 |


Washington Insider: New Fed Criticism Criticism of the Fed is coming from a relatively new direction just now, Bloomberg is reporting this week. The administration has been a persistent critic for not reducing interest rates further and quicker — but now the bank is being accused for “running the risk of fomenting an eventual financial crisis by easing banking regulations at the same time that it’s cut interest rates.” The criticism is coming from “some former Fed officials, including ex-Vice Chairman Alan Blinder and financial stability experts Daniel Tarullo and Nellie Liang, Bloomberg says. They worry that the combination of looser credit and laxer rules will prompt financial institutions and investors to pile on leverage and take excessive risks. After lowering rates three times, Fed policy makers left them unchanged on Dec. 11 and forecast they would stay that way through the 2020 presidential election year. The central bank has also made or proposed various changes in financial oversight, including alterations to the stress tests that banks undergo and an overhaul of the Volcker Rule’s trading restrictions. Some observers including presidential candidate Elizabeth Warren have warned the central bank against loosening its regulatory grip. Liang, who was nominated by President Trump to the Fed board but later withdrew, voiced concern about mushrooming corporate credit. “I worry that defaults and investor losses will be higher than expected in the next downturn and will make the next recession more severe,” she said. Fed leadership has pushed back hard against any suggestion it has made the financial system more vulnerable by loosening regulations, arguing that the capital requirements of the biggest banks “remain as tough as ever.” The U.S. has “a stable, healthy and resilient banking sector,” Randal Quarles, Fed vice chairman for supervision, told lawmakers on Dec. 4. He said that the Fed’s focus has been on tailoring the regulation of regional and smaller lenders. “One of our principles has been to ensure that we do not reduce in any material way the loss absorbing cushion of the institutions,” he said “I think we have succeeded in doing that.” Former Fed Governor Tarullo is not so sure. He zeroed in on the stress tests, including the disclosure of more information about the models behind them. “I suspect quite strongly that the effective amount of capital the banks have to have for a given portfolio is lower because they have so much more information about the stress tests,” said Tarullo, who was the Fed’s point man on regulation after the 2008 crisis and is now at the Harvard Law School. Ex-central bank Vice Chairman Donald Kohn welcomed efforts to tailor rules to fit the size of the institution but cautioned regulators against taking their eye off of “very sizable” regional banks. “You get a bunch of regional banks all doing the same thing at the same time then that could be systemic,” said Kohn, a member of the Bank of England’s Financial Policy Committee. There’s also “reason to be cautious about what’s going on outside the banking system when you lower rates because you have fewer macro-prudential tools to deal with that sector,” he said. For example, under the Dodd-Frank Act, the sweeping post-crisis regulatory reforms introduced to strengthen the banks, the Financial Stability Oversight Council monitors the overall financial system. Headed by Treasury Secretary Steven Mnuchin, it has the power to designate nonbank financial institutions such as insurance companies as systemically important and so subject them to increased regulation. The council, which includes the heads of the Fed, the Securities and Exchange Commission and other regulatory agencies, has recently shifted its focus toward monitoring potentially risky financial activities and raised its hurdle for singling out individual firms for more supervision. “They come very close to saying that they’re never going to designate a nonbank no matter what,” Tarullo said. Former Fed Vice Chair Alan Blinder said Trump appointees at other regulatory agencies were more to blame for what he called “backsliding,” but thought the Fed is “not immune and shouldn’t be easing credit and bank rules simultaneously.” “You can try to push up aggregate demand and expand the economy but don’t drop your regulatory safeguards as well,” the Princeton University professor said. Some current Fed policy makers share the concerns of their former colleagues. For example, Fed Governor Lael Brainard has voted against some of the board’s rule changes while Boston Fed President Eric Rosenberg has called for higher bank capital in today’s low interest rate environment. Liang, who is friend of Powell’s, said she agrees with him that financial stability risks aren’t elevated currently. “If you took a snapshot of the situation now, it looks OK,” the Brookings Institution fellow said. “But I worry about what the situation would look like in a year or two given the incentives from recent policy changes.” So, we will see. These are important concerns, but likely will be unpopular just now given the improved prospects for the economy since the phase one China deal seems to be agreed. Still, they are extremely important and should be watched closely by producers amid the current political horse trading, Washington Insider believes.

| Rural Advocate News | Wednesday December 18, 2019 |


USMCA Measure Advances The House Ways and Means Committee Tuesday advanced to the floor implementing legislation for the U.S.-Mexico-Canada Agreement (USMCA) on a nearly unanimous vote. The panel agreed to favorably report the bill (HR 5430) without changes after a mock markup where members reviewed the 239-page legislation. By law, implementing legislation for a trade agreement cannot be amended. One of the panel members registering his disappointment was Rep. Bill Pascrell Jr., D-N.J., who said the bill was getting “a bum’s rush in an effort to schedule a White House East Room victory celebration. I want to register that I am at best deeply uneasy about how this process has concluded.” He appeared to cast the only audible “no” vote on the plan. House is scheduled to vote Thursday on the bill. Senate action, however, will take place in 2020, said Majority Leader Mitch McConnell, R-Ky., after the chamber finishes the impeachment trial of President Donald Trump.

| Rural Advocate News | Wednesday December 18, 2019 |


House Approves Spending Bills Totaling Nearly $1.4 Trillion The House on Tuesday approved $1.4 trillion in spending for Fiscal Year (FY) 2020 that began Oct. 1. There were two large “minibus” packages, largely to avoid the even bigger omnibus bill that both sides say represents the worst of the "swamp." The page tally totaled 2,313 pages; more than 3,800 pages if explanatory statements are included. Ag interests are noting the tax package included in the bill which has a retroactive extension of the $1 per gallon biodiesel tax incentive program, from 2018 through 2022. Senate Finance Chairman Chuck Grassley, R-Iowa, helped establish the credit 15 years ago. The Senate is expected to vote on the spending packages this week and key White House aides have indicated Trump plans to sign the bills before a temporary spending bill expires at midnight Friday.

| Rural Advocate News | Wednesday December 18, 2019 |


Wednesday Watch List Markets The only official report on Wednesday comes from the U.S. Energy Department's weekly inventory report, due out at 9:30 a.m. CST and includes ethanol inventory. Weather forecasts for North and South America remain of interest as does any news pertaining to the new trade agreement with China or the proposed biodiesel tax credit in Congress. Weather Dry conditions will be in place over almost all primary crop areas Wednesday. Precipitation will be confined to snow in the immediate Great Lakes. Temperatures will be seasonal to below normal, coldest in the northern and eastern Midwest.

| Rural Advocate News | Tuesday December 17, 2019 |


USMCA: Mexico Objection Won’t Stop House Vote An objection by Mexico won’t stop the U.S. House from approving the U.S.-Mexico-Canada Agreement. Mexico had promised reciprocal measures regarding labor enforcement inspections. However, Agri-Pulse reported late Monday that Mexico was going to withdraw the objection. Mexico previously approved the agreement this summer, and even approved the modified agreement last week, before announcing the concerns. An official from Mexico is in Washington, D.C., this week to talk with lawmakers. President Donald Trump sent implementing legislation for USMCA to the House late last week, and the chamber still plans to vote and approve the agreement this week. Spending bills are expected Tuesday, followed by a vote on the articles of impeachment Wednesday, setting up a vote on USMCA Thursday, in the House. Meanwhile, the U.S. Senate will not consider USMCA until January, or later, following impeachment hearings. Also, last week, Senate Majority Leader Mitch McConnell said there was “no chance” the chamber would remove the president from office. ************************************************************************************* Skepticism Remains over China Deal Commodity markets have done relatively little in reaction to the phase one trade agreement between the U.S. and China. Trade expert Jim Bower in his daily newsletter, states there "remains a lot of skepticism" regarding the agreement, suggesting it's "unclear" how China can manage to increase purchases of U.S. agricultural products. The agreement reportedly includes $40-$50 billion in annual purchases of U.S. ag products by China for two years. And, a fact sheet on the agreement states that the agriculture provisions address “structural barriers to trade,” and will support a “dramatic expansion” of agricultural exports. The agreement, expected to be signed in early January, received cautious praise from U.S. agriculture. U.S. Trade Representative Robert Lighthizer told CBS over the weekend regarding the phase one agreement, “This is totally done. Absolutely.” The U.S.-China Business Council called the agreement “an encouraging first phase,” while adding, “but, this is just the beginning.” The council says both sides “must commit to developing a new paradigm and economic relationship.” ************************************************************************************* Farm Credit Administration: Expect Low Crop Prices in 2020 A quarterly report to the Farm Credit Administration last week suggests commodity prices will mostly remain low next year. The report cites large global supplies of crops in storage, saying that will limit attractive price opportunities for U.S. farmers. For the next three years, soybean prices are projected at roughly $8.50 a bushel, with corn at $3.70 a bushel. The report says livestock and dairy returns are likely to be positive in early 2020, but trade risks remain elevated. Meanwhile, the report says that while it’s been a difficult year in 2019 for farmers and ranchers, facing trade disruptions, weather extremes and low prices. Crop insurance indemnities, farm programs, and Market Facilitation Program payments continue to provide financial support to the farm economy. The report says farm financial conditions may become more challenging next year without stronger markets, or more aid payments. Further, the Farm Credit System remains financially sound, according to FCA, and lenders continue to have the risk-bearing capacity to respond to the credit needs of agriculture. ************************************************************************************* USDA Seeks Input on Environmental Quality Incentives Program Rule The Department of Agriculture wants input on proposed changes to the Environmental Quality Incentives Program known as EQIP. The rule takes effect upon publication and includes changes to the program in the 2019 farm bill. Natural Resources Conservation Service chief Matt Lohr says the new rule will "enable NRCS to better support locally-led conservation efforts while also expanding producers' ability to address significant resource concerns." NRCS will make available $1.2 billion for producers in fiscal 2020, and NRCS state offices will announce signup periods for EQIP in the coming weeks. Changes to EQIP include creating incentive contracts and payments for incentive practices. The new rule requires NRCS to offer an advance payment option for historically underserved producers. USDA also proposes changing the payment cap for producers participating in the Organic Initiative to $140,000 for contracts entered between fiscal 2019 through 2023. Finally, the new rule expands the Conservation Innovation Grant program. The comment period closes February 18, 2020. ************************************************************************************* U.S. ACOE: Missouri River Flood Event Over The Army Corps of Engineers Kansas City District Monday declared the Missouri River flood event over. The district’s emergency operations center returned to normal operations for the first time since March 13, 2019 - 279 days. However, emergency work continues to repair a levee in Northwest Missouri damaged by flooding this year. As of last Wednesday, all Missouri River stages within the Kansas City District area of operations were below flood stage for the first time since March 13 of this year. Forecasts call for the water levels to continue to decrease. Flooding began during the March so-called bomb-cyclone winter storm, and continued all year in the lower reaches of the Missouri River, downstream of the Gavins Point Dam in Yankton, South Dakota. The Corps is continuing to draw down excess water, as releases from the dam will be reduced to 25,000 cubic feet per second in January and remain near that rate for the remainder of the winter. Normal winter releases range between 12,000 and 17,000. ************************************************************************************ Booker Announced CAFO Moratorium Legislation Senator Cory Booker Monday announced legislation to phase out concentrated animal feeding operations, known as CAFOs. The New Jersey Democrat says the Farm System Reform Act of 2019 would place an immediate moratorium on new and expanding large CAFOs, and phase out by 2040 the largest CAFOs as defined by the Environmental Protection Agency. The legislation would also restore mandatory country-of-origin labeling requirements for beef and pork and expand to dairy products. Additionally, it would prohibit the Department of Agriculture from labeling foreign imported meat products as “Product of USA.” Booker labels CAFOs as “large factory farms,” claiming the operations “are harmful to rural communities, public health, and the environment, adding “we must immediately begin to transition to a more sustainable and humane system.” As noted by Politico, Booker, a vegan, has said he’s not interested in telling Americans what to eat. However, proposing sweeping reforms to the U.S. food system is routine for the Senator.

| Rural Advocate News | Tuesday December 17, 2019 |


Washington Insider: Administration Considers More Tariffs on Europe The urban media, and others, are reporting this week that even as administration officials are taking public victory laps over the phase-one deal with China — and in spite of continuing criticism of that agreement — they are considering heavy tariffs on a broad range of European goods that could reach "100 Percent in some cases." The import taxes are retaliation for excessive subsidies by the European Union to the aerospace giant Airbus. The World Trade Organization ruled in favor of the United States this year in a dispute centering on European support for the aerospace giant Airbus that has lasted 15 years. In May, the WTO ruled that Europe's financial assistance to Airbus violated global trade rules and then in September, it effectively authorized the Trump administration to impose tariffs of up to $7.5 billion a year on European imports, pending negotiations over the removal of the subsidies. The administration unveiled an initial list of tariffs in October. Then, this month, after Europeans suffered another setback in the dispute, administration officials said they would expand the list and increase tariffs already in place. Last week, the United States Trade Representative (USTR) published the updated list, including a variety of items Americans buy from Europe, including dairy products such as yogurt, butter and several types of cheese; olives and olive oil; other food products; hand tools; clothing; wine and grape brandy; and Scotch and Irish whisky. The trade representative also warned that it was considering raising tariff rates on imported items that are already subject to 25 percent tariffs as part of the Airbus dispute. The Times report said that the administration has increasingly seized on tariffs to punish Europe. In addition to considering tariffs on German cars, the United States is mulling separate tariffs on French wine and other products as retaliation for a new tax that the administration says unfairly targets American technology companies. This year, France passed a so-called digital service tax, which hits large companies that sell and advertise to French consumers but have not faced large tax liabilities in France. Then, the USTR recently recommended tariffs up to 100 percent on $2.4 billion of French products after declaring the tax a threat to America's national security. Some of those products, most notably French wines and cheeses, are also on the new list released on Friday. President Trump told reporters this month that the USTR finding was justified. "They're starting to tax other people's products," he said. "So therefore we go and tax them." The extension of tariffs on the European Union is a rare example of the administration's agreeing with the WTO. Administration officials have frequently criticized the body, which they call unfair to the United States, and they have worked to undermine its effectiveness. The administration has blocked new appointments to a crucial panel at the organization that hears appeals in trade disputes. This week, the terms of two appointees to the panel expired, leaving the panel without sufficient membership to hear new cases. That means there will be no official resolutions of many global trade disputes for the foreseeable future. So, we will see. The Europeans are tough negotiators and have numerous "high protection" tariffs of their own that are well supported politically. While this particular fight may have less potential influence on U.S. producers than the tariff retaliation fight with China does, it can play an enormous role in the global economy—especially as economic uncertainty is increasingly identified as a potential threat to future U.S. growth. Thus, these fights are important and should be watched closely by U.S. producers as the details and trends emerge, Washington Insider believers.

| Rural Advocate News | Tuesday December 17, 2019 |


US Commodity Groups Eyeing China Market Several U.S. commodity organizations are looking at the U.S.-China Phase One deal as an opportunity to sell more of their products to China. Jim Sumner, president of the USA Poultry and Egg Export Council, said Friday's deal opened an opportunity for $2 billion in annual poultry exports to China. "We hope to have a good share of that $40 billion," he said. Meanwhile, U.S. pork exports to China were $1 billion in 2017, according to the U.S. Meat Export Federation. An Iowa State University analysis in 2018, published before the swine fever outbreak, concluded that China could import $8.9 billion more U.S. pork once tariffs were gone. Chinese officials at a Friday press event signaled they would buy some U.S. wheat and rice, among other commodities. Before that China confirmation, many U.S. commodity analysts said there were low odds China would purchase U.S. rice or wheat.

| Rural Advocate News | Tuesday December 17, 2019 |


Mexico Accepts US Assurance on Labor Attachés The road toward approval of the U.S.-Mexico-Canada Agreement (USMCA) hit a bit of a bump to open the week, but a quick exchange between U.S. and Mexican trade officials smoothed things over. Mexican Undersecretary for North America and Chief Trade Negotiator Jesús Seade feared language in the implementing legislation for USMCA Mexico meant the U.S. was going to send labor inspectors to Mexican plants. U.S. Trade Representative Robert Lighthizer Monday quickly fired off a letter to assure Seade that Department of Labor attachés that would be in Mexico were not labor inspectors and pledged that the attaches would "abide by all relevant Mexican laws." Lighthizer said the use of the attaches was "routine" and that the Labor Department attachés would "work with their Mexican counterparts, workers, and civil society groups on implementation of the Mexican labor reform." At an event in Washington, Seade declared Lighthizer's response eased his fears. "We are satisfied, very satisfied," Seade said, noting other authorities in Mexico were also pleased. Further, Seade indicated that Mexico has not found any other issues in the implementing legislation that would be questionable. The Mexican Senate December 12 approved the modifications to the USMCA pact in a 107-1 vote. The House is expected to vote yet this week, but the Senate will not take up the USMCA legislation until later in January, after the impeachment trial.

| Rural Advocate News | Tuesday December 17, 2019 |


Tuesday Watch List Markets On Tuesday, the U.S. Census Bureau will release November housing starts at 7:30 a.m. CST, followed by a monthly Federal Reserve report on U.S. industrial production at 8:15 a.m. Until the new trade deal with China is in writing, traders will continue to look for any helpful details of the agreement. Weather Snow, ice and rain will occur Tuesday from the northern middle Atlantic region through the northeast U.S. with the potential for travel delays. Rain or showers from the southern middle Atlantic area through the southeast U.S. with thundershowers also possible in southeast areas. Mainly dry elsewhere in the key U.S. crop and livestock areas Tuesday. Snow showers or squalls may develop through the Michigan area towards evening. Rain continues in Brazil corn and soybean areas while Argentina is drier today.

| Rural Advocate News | Monday December 16, 2019 |


Details Emerging on the U.S. and China Phase One Agreement Both China and the U.S. officials confirmed on Friday that they’ve reached a “Phase One” agreement. Emerging details show the agreement includes some tariff relief, increased agricultural purchases, as well as structural changes to intellectual property and technology issues. However, a CNBC report says some details of the partial accord between the world’s two largest economies remain cloudy. As Chinese officials briefed reporters of some details on Friday morning, President Trump also announced some of the terms of what he called an “amazing deal.” The U.S. does plan to eliminate tariffs on multiple Chinese goods in stages, which was a priority for Chinese negotiators. Details on when that would take place weren’t announced. Trump announced that the U.S. would cancel its next round of tariffs on Chinese goods that were scheduled to go into effect over the weekend. Via Twitter, Trump announced the White House will leave 25 percent tariffs on $250 billion in imports in place, while also cutting existing duties on another $120 billion in goods. Beijing will increase its agricultural purchases from the U.S. by a significant amount, though Chinese officials didn’t say by how much. Politico says some of the details include China giving up its restrictions on growth hormones for beef and easing an approval process for genetically modified crops. ********************************************************************************************** Ag Reacts to Phase One U.S., China Trade Deal Reaction from U.S. agriculture and its stakeholders across the country is positive regarding the “Phase One” trade deal between the U.S. and China. Colin Woodall, CEO of the National Cattlemen’s Beef Association, says the agreement is welcome news for the U.S. beef industry. “We’re optimistic that this positive news will bring long-lasting relief to farmers and ranchers who’ve been targeted by China’s retaliatory tariffs for many months,” Woodall says. “China’s unjustifiable non-tariff barriers and restrictions on science-based production technologies must be addressed as part of this agreement.” Zippy Duvall, President of the American Farm Bureau, says farmers are looking forward to getting back to business around the globe. “China went from the second-largest to the fifth-largest market for U.S. agricultural products since the trade war began,” Duvall says. “Reopening the door for trade with China and other countries is key to helping farmers and ranchers get back on their feet.” Senate Finance Chair Chuck Grassley of Iowa says easing tensions and lowering tariffs are welcome news. “This paves the way for a broader agreement that must address non-tariff barriers and intellectual property issues,” Grassley says. U.S. Wheat Associates and the National Association of Wheat Growers say they’re looking forward to learning more about the agreement. ********************************************************************************************** Senate Republicans Appear Unhappy About USMCA Changes Some Senate Republicans appeared to be unhappy with the final agreement on changes to the U.S.-Mexico-Canada Trade Agreement worked out between the White House and House Democrats. Politico says the Republicans appeared to be “grumbling” as they came out of a meeting with U.S. Trade Representative Robert Lighthizer last week. Conservatives say they were left out of the negotiations and think the new version of the North American Free Trade Agreement is too liberal. Pennsylvania Republican Pat Toomey is especially unhappy with the Trump Administration, describing the deal as a “terrible new standard” for future trade agreements. One of his biggest concerns is a key provision regarding prescription drugs. Senator John Cornyn of Texas says he’ll likely support the agreement but thought the Finance Committee had been “frozen out.” Reports say it’s unlikely that Republicans won’t support the deal. Republican supporters are confident the deal will win approval, especially because it just needs a simple majority to pass. Senate Finance Chair Chuck Grassley says he’ll skip the optional mock markup process, setting up a quick consideration of the agreement. ********************************************************************************************* House Votes Expected on Appropriations, USMCA, and Impeachment This Week Congress took a long weekend out of town as soon as a White House Congressional Ball wrapped up last Thursday. The House is expected to cast some key votes this week, starting on Tuesday, and the chamber will likely be in session through Friday. The House will meet at nine a.m. for legislative business, with votes expected sometime between nine and ten o’clock that morning. The Hagstrom Report says House and Senate appropriators and Treasury Secretary Steven Mnuchin (Muh-NOO-chin) reached an agreement on all 12 major appropriations bills last week. A vote on the bills is expected on Tuesday. House Majority Leader Steny Hoyer of Maryland says the agreement reached on the U.S.-Mexico-Canada Agreement “could be brought to the floor sometime this week, provided the president has submitted the implementing legislation to Congress.” Hoyer also says if the House Judiciary Committee marks up the articles of impeachment, “a path forward will be announced” on that as well. ********************************************************************************************** Roberts says Arkansas Senator will be the Next Ag Committee Chair Current Senate Ag Committee Chair Pat Roberts will be retiring soon, so the logical question is who will replace him. Roberts, the longtime Senator from Kansas, says he expects John Boozman of Arkansas to take his spot as Chair. He told the National Journal last week that he thinks Boozman will be an excellent committee Chair. The report quoted Roberts as saying, “the soft-spoken senior appropriator from Arkansas will replace him as chairman, and that he’ll be excellent.” The National Journal notes that Boozman isn’t the most senior member of the Ag Committee. However, more long-standing members have other responsibilities. For example, Mitch McConnell can’t serve as the Senate Majority Leader and the head of a committee at the same time. In an interview, Boozman says as chair, he would focus on the farm bill and promoting bipartisan cooperation. He’s also planning to take up child-nutrition legislation if the push by Roberts to get it passed falls short of a December deadline. ********************************************************************************************* USDA to Make $550 Million Available for Rural Broadband Internet Infrastructure Ag Secretary Sonny Perdue says his agency will make $550 million available through its ReConnect Pilot Program. The application window for the funding will open on January 31st of next year. “The second round of ReConnect funding will help USDA be an even stronger partner in closing the digital divide in America’s rural communities,” Perdue says. “Our core mission at USDA is to increase rural prosperity by boosting economic opportunity in rural America.” USDA knows that rural communities need robust, modern infrastructure to thrive, and that includes having access to broadband e-Connectivity. Perdue made the funding announcement during a stop in Iowa, alongside Governor Kim Reynolds. Perdue was in the state to congratulate the Farmers Mutual Telephone Company of Stanton, Iowa, which received $6.4 million in first-round ReConnect program funding. The funds help the company connect 477 households, 35 farms, and 21 businesses to the internet. In the second round, USDA will make up to $200 million in grants available, up to $200 million in 50-50 grant/loan combinations, and up to $200 million available for low-interest loans. To learn more about the program, go to www.usda.gov/reconnect.

| Rural Advocate News | Monday December 16, 2019 |


Washington Insider: US, China Trade Deal Analysts are working hard this week to study the “phase one” deal that the U.S. and China agreed to last week — a deal the Washington Post said meant that the 21-month trade war is “on pause — for now.” Now, the Post notes that both sides are claiming the win. The White House characterized it as “amazing” and “historic.” Top Chinese officials held a rare news conference to claim the win for them and “the Chinese people.” Many business groups were cautiously optimistic. While the full text had not been made public, both sides confirmed that the U.S. committed to scaling back some tariffs in exchange for China’s purchases of about $200 billion more U.S. goods in the next two years and opening up to U.S. financial firms. The Post also published a rundown of winners and losers, beginning with the President who “can say he made a deal, even it’s limited.” It said that the administration was “trumpeting the deal particularly to farmers and manufacturing workers hit hard by the war,” the Post said. The Post also said that this deal, together with the recent Congressional approval announced by the House for the “New NAFTA” make it likely the U.S. economy will grow at 2% or more next year avoiding a recession and helping the president politically, especially with farmers. U.S. officials are saying that China agreed to buy $40 billion of agricultural products and could “hit $50 billion” in purchases. The Chinese “refuse to utter that exact figure” but they have agreed to bump up purchases, even if it’s not quite $50 billion, the Post said. The Post also lists as winners Apple and other tech companies; Walmart and other retailers; Wall Street investors; JPMorgan Chase and other U.S. financial companies and business leaders and the Chinese government—which “didn’t have to give too much,” the Post said. It charged that Chinese leaders played the U.S. president “skillfully at the end, refusing to confirm there was a deal for hours after the White House leaked there was one.” The Post also carped that the newly agreed level of purchases had already been offered “as long ago as mid-2018.” It said the biggest concession China made is to agree to penalties if it doesn’t hold up its end of the bargain — although there is a long process the U.S. agreed to go through before imposing punitive tariffs. Also, the Post identified “losers” including Peter Navarro, Stephen Bannon and China “hawks.” It said that the deal does little to fundamentally change China’s “Made in China 2025” plans and noted that the President “had many trade advisers like Navarro” urging him to keep the tariffs on and push China for a bigger deal that would commit to pulling back industrial subsidies and ending the theft of U.S. trade secrets. Instead, he scaled back tariffs and settled for a much less ambitious agreement, the report said. The President promises there will be a “phase two” after the election but many fear this will end up being a one-and-done deal. As a result, the Post says that while the deal may be a political win, the goal of forcing China to overhaul its economic policies “did not happen here.” It remains a power player and its “Made in China 2025″ plan is still moving ahead, the report says. While the latest trade data shows a small reduction in the trade deficit with China, the U.S. trade deficit with other nations is growing, the Post says. Also, the Post placed in the loss column some farmers who “didn’t make it to see the gains from this deal after two brutal years,” and noted that some U.S. companies still face tariffs on Chinese imports. The report adds China’s economy to the “list of losers” noting that it was already facing a slowing economy before the trade war began. While there is now relief that the U.S. will not go forward with tariffs on all Chinese products, the administration kept in place tariffs on nearly $370 billion worth of sales. Even more important, there is evidence that some companies shifted their supply chains out of China to other countries — lost business, that while modest as a share of China’s total economy, is unlikely to return. Finally, the Post thinks there will be debates for years about whether the administration’s China trade war was worth it and whether enough was achieved from the deal. But there is agreement that it changed the conversation about China and expanded “bipartisan support” for confronting unfair Chinese business practices. So, we will see. A key concern is what the new U.S.-China policies turn out to be and what impacts linger on important markets — developments producers should watch closely as the deal’s “devilish details” emerge, Washington Insider believes.

| Rural Advocate News | Monday December 16, 2019 |


Tax Extenders May Wait Until 2020 It looks like key House Democrats are back to a big package of tax extenders and that will present approval hurdles for items like the lapsed biodiesel tax incentive, congressional sources advise. House Ways and Means Chairman Richard Neal, D-Mass., reportedly altered his prior view this week for a “skinny” package of tax provisions that did not include more than $100 billion worth of refundable tax credits for low-income workers and families that Neal has been pushing since June. But on Thursday, Neal changed. Asked if the skinny package was still on the table, Neal said, “Nah. We are trying to negotiate a big ending... Everything is in the mix now.” In the Senate, Republicans appeared downbeat on the prospects for a tax deal before the year is out. Sen. Pat Roberts, R-Kan., said he thought January was more likely. If so, that means the lapsed biodiesel tax credit will not likely be dealt with yet this year.

| Rural Advocate News | Monday December 16, 2019 |


US-China Trade Deal Completed The U.S. and China reached a phase one trade agreement Thursday, with U.S. and Chinese officials talking about some of the details on Friday. The Chinese have committed to purchase an additional $16 billion in U.S. ag goods beyond a $24 billion base – the level of U.S. ag exports to China in 2017. The total of $40 billion in purchases includes China indicating they will work to try to make additional purchases. While the U.S. has indicated the list of commodities will not be made public, commodities mentioned thus far are corn, wheat, cotton and rice by the Chinese. But perhaps more important are issues covering broader agricultural trade matters. The Agriculture Chapter addresses structural barriers to trade and will support a dramatic expansion of U.S. food, agriculture and seafood product exports, increasing American farm and fishery income, generating more rural economic activity, and promoting job growth, according to the U.S. Trade Representative (USTR). “A multitude of non-tariff barriers to U.S. agriculture and seafood products are addressed, including for meat, poultry, seafood, rice, dairy, infant formula, horticultural products, animal feed and feed additives, pet food, and products of agriculture biotechnology,” USTR said. China is expected to purchase a total of $200 billion in U.S. goods, including agriculture items.

| Rural Advocate News | Monday December 16, 2019 |


Monday Watch List Markets Traders will likely be talking about and watching for more information on the phase one trade deal that was reached on Friday. Documents have not been signed yet so it will be a while before details are nailed down. Weather forecasts remain important and USDA will have its weekly report of export inspections at 10 a.m. CST. The National Oilseeds Processors Association will publish a monthly soybean crush estimate later in the morning. USDA has tabled Crop Progress reports until April 6, 2020. Weather Moderate to heavy snow and rain are in store for the southern Plains and southern Midwest Monday. Snow offers benefit for winter wheat, but will cause transportation and safety hazards along with possibly ending field work for the year. We'll also see rain in the Delta and Mid South. Temperatures will be cold north and central and very warm south.

| Rural Advocate News | Friday December 13, 2019 |


China, U.S. Reach Tentative “Phase One” Trade Agreement President Trump signed off on the “Phase One” trade deal on Thursday afternoon. The agreement between the worlds’ two largest economies averts the December 15th introduction of a new wave of U.S. tariffs on $160 billion in Chinese goods. Bloomberg News reports the agreement was reached on Thursday afternoon and presented to the president shortly afterward. The deal does include a promise from China to buy more agricultural products. Officials also talked about possible reductions in existing duties on a number of Chinese products. The terms have been agreed on, but the legal text hasn’t been finalized yet. A White House spokesman declined a request for comment. In addition to a significant increase in Chinese agricultural purchases, officials also say the phase-one pact would include commitments from China to do more to stop intellectual property theft, something the administration has been pushing for. The phase one deal also includes commitments from both countries to no longer manipulate their currencies. Negotiators had been working on the phase one deal for months after the president announced the countries had reached an agreement. ********************************************************************************************* House Passes Farm Workforce Modernization Act The House of Representatives passed the Farm Workforce Modernization Act by a vote of 260 to 165. The bill would ease immigration for agricultural workers. It won the support of over 300 farm groups, as well as the United Farm Workers. The Hagstrom Report points out that the California Farm Bureau supported the bill but the American Farm Bureau Federation did not. AFB fears the bill will lead to higher wages for farmworkers and increase the legal vulnerability of farm employers. President Zippy Duvall says several amendments that would have addressed Farm Bureau concerns were blocked from consideration, so they “do not support the final bill passed by the House.” Heritage Action for America says it grants amnesty to millions of illegal immigrants without doing anything to “reform our broken immigration system.” Zoe Lofgren of California, the lead sponsor of the bill, says, “Our bill offers stability for American farms by providing a path to legal status for our farmworkers.” Republicans weren’t happy about the bill's formula for calculating farm wages and complained that the year-round visa pilot program doesn't include the meat and poultry sectors. They also objected to providing "amnesty" to undocumented immigrants working on U.S. farms. The bill’s prospects in the Senate and with President Trump are described as problematic. ********************************************************************************************* Ag Groups, Organizations React to House Passing Labor Bill Several agricultural groups and organizations reacted positively to the news that the House of Representatives voted in favor of the Farm Workforce Modernization Act. The National Farmers Union says the bill is the product of negotiations between a diverse array of agricultural stakeholders and farmworker advocates. “Our current farm labor system is badly broken,” says NFU President Roger Johnson. “This bill secures a legal and adequate supply of workers for family farmers and ranchers, as well as stability for farmworkers who help put food on our tables.” United Fresh Produce Association says the produce industry has suffered for far too long under a system that doesn’t meet its need for labor. The organization says, “This represents an important step in ending decades of uncertainty for growers of fresh fruits and vegetables.” Dairy groups, one of the hardest-hit ag sectors when it comes to labor shortages, are also pleased with the bill’s passage. The National Milk Producers Federation says the legislation helps to address the dairy industry’s unique workforce challenges, which is the need for year-round labor. The current labor program is seasonally-based. NMPF CEO Jim Mulhern says, “Agricultural reform is long overdue.” Mike McCloskey, Chair of the NMPF’s Immigration Task Force, says, “The urgency to reform the agricultural labor system cannot be overstated for dairy farmers.” ********************************************************************************************** United Soybean Board Elects New Chair The United Soybean Board farmer-directors have elected Jim Carroll III as Chair at the annual board meeting this week. Additionally, 19 new directors appointed by Ag Secretary Sonny Perdue were sworn in by the USDA. Carroll is a farmer from Brinkley, Arkansas. He says, “We’ve made great strides to innovate beyond the bushel and infuse every opportunity we can into growing markets and creating new uses for soybeans. We have a lot to be proud of but also have tremendous potential to further demand as we continue our progress through wise and strategic investments.” Carroll says one of his priorities as Chair will be to recognize the performance and sustainability of U.S. soy and to show their customers its many capabilities as a renewable alternative. The recent USB board meeting included remarks from Gregg Doud, Chief Agricultural Negotiator in the Office of the U.S. Trade Representative. Doud highlighted recent trade negotiations and opportunities for U.S. soybean farmers in the international marketplace. Other session topics included the Global Landscape for U.S. Soy, What’s Next for High Oleic Soybean Oil, and Agriculture’s Advantage in Capturing Carbon. ********************************************************************************************** Rise in Iowa Land Prices Not Seen as a Market Rebound The difficulties of 2019 for agriculture have been numerous. One positive note at the end of the year is a two percent rise in the price for farmland in Iowa. Favorable interest rates, strong yields, and limited land supply combined to push Iowa’s farmland values up for just the second time in the past six years. An Iowa State University news release says the statewide value of an acre of farmland is estimated at $7,432. That’s a 2.3 percent increase, totaling about $168, since last year. That number represents the average of low, medium, and high-quality farmland prices. An Iowa State University expert says that the reprieve in the land market isn’t driven by a stronger ag economy. “The recent modest increases in land values reflect a lower interest rate environment and slowly improving U.S. farm incomes,” says Dr. Wendong Zhang, leader of the Iowa Land Value Survey effort. While the growth in land values is positive, Zhang says it shouldn’t be thought of as a “sound rebound” in the land market. “Market Facilitation Payments helped to stabilize farm income and the land market,” he adds. “However, escalation of the U.S. and China trade war will put more downward pressure on farm income and land prices.” ********************************************************************************************** Arkansas Temporarily Stopped from Enforcing Meat-Labeling Law A federal judge restricted Arkansas from enforcing a law that bans the use of terms like “burger” or “sausage” when selling plant-based or vegan products. An Associated Press report says U.S. District Judge Kristine Baker granted a preliminary injunction keeping the state from enforcing the law against the Oregon-based Tofurky Company, while the constitutionality is being challenged. Tofurky produces products like tofu, as well as plant-based sausage, deli slices, and burgers. Groups like the American Civil Liberties Union, the Good Food Institute, and the Animal Defense Fund got behind Tofurkey and filed suit in July. They say the law amounts to an “unconstitutional effort” to boost the state’s meat industry. Under the law, which hasn’t been enforced yet, companies can be fined up to $1,000 for each violation of the labeling law. While putting the injunction in place, Baker did note that Tofurkey does face a credible threat of retroactive penalties under the law. The labeling law is similar to ones passed in other states like Louisiana, Mississippi, and South Dakota.

| Rural Advocate News | Friday December 13, 2019 |


Washington Insider: Fed and the US Economic Outlook While there is more angst and anxiety around Washington these days than most of us can comprehend involving trade policy, national politics and who knows what else, one sort of constant remains: the Fed’s tiff with the president. Chairman Jerome Powell “still isn’t heeding President Trump’s demands to slash interest rates,” the Washington Post is reporting this week. However, the report has a twist of its own — the Post thinks “the central bank chief still delivered unequivocal good news for President Trump’s reelection hopes.” Powell, addressing reporters after the Fed’s final meeting of a turbulent decade, predicted smoother sailing next year. He said monetary policymakers “expect moderate growth to continue,” at a slowed but still healthy 2% pace. And he took some credit for helping navigate head winds from the administration’s trade war and choppiness abroad, saying the Fed’s three interest rate cuts over the summer and into the fall, “kept the economy on track.” Indeed, the Fed’s official statement—accompanying the announcement it is holding the benchmark interest rate steady between 1.5% and 1.75% — dropped its mention of “uncertainties” facing the economic outlook, the Post noted. Actually, Powell left the door open to changing interest rates in 2020, but stressed “there is a high bar for moving rates up or down.” He emphasized that the Fed was going to do what we think is the right thing for the economy and if there is a material reassessment of our outlook, “we would respond accordingly,” he said. Powell’s presentation marked a “heel turn” from earlier this year, the Post said. Stocks tanked in July after Powell described the Fed’s first interest rate cut in a decade as a “mid-cycle adjustment,” because investors interpreted the remark as a signal the relief monetary policymakers were providing was only temporary. Now, however, “the cuts look much more permanent,” Grant Thornton chief economist Diane Swonk wrote. The vote to hold rates unchanged was unanimous, the first time that all agreed on what the Fed should be doing since May. Also 13 of the 17 members of the Fed policy setting officials indicated they expect the borrowing rate to remain untouched next year, while four projected one hike. As recently as September, nine of the policymakers projected at least one rate hike next year. Investors had largely priced in the Fed’s decision to hold rates steady and stocks rallied modestly on the chairman’s comments. Major indexes snapped a two-day losing streak, with the S&P 500 closing up 0.29% and the Dow Jones industrial average climbing 0.11% on the day. “Markets liked Mr. Powell's assertion that he would want to see a ‘significant’ and ‘persistent’ increase in inflation before he would want to raise rates and he again drew attention to the undershoot to the target in recent years,” Pantheon Macroeconomics chief economist Ian Sheperdson said, “Mr. Powell's view is not shared by all his colleagues, given that most of them expect rates to rise slightly over the next three years while core inflation is expected to be little changed. But markets put much more weight on the views of the Chair; that's probably the right approach.” Still the Post observed that “if Powell is landing on a position that benefits Trump, it’s no indication the president and his handpicked Fed chair are simpatico.” The President has treated Powell like a punching bag, attacking him relentlessly for leading the Fed to raise rates last year and not cutting them as far or as fast as the president would have liked in 2019. Now, “the pressure is largely off.” While the administration’s trade war continues to inflict harm “the Fed’s actions are widely credited with offsetting most of it, at least for the United States,” the Post said. Still, the president hasn’t extended an olive branch, although his top economic adviser, Larry Kudlow, said at a recent conference that the Fed’s role in the economy has been overstated. He thinks that the chairman may be less of a central figure in 2020, able to deliver “needed rate cuts without undermining investor confidence in an independent central bank.” And Powell has garnered improved marks from Fed watchers, including former central bank officials, who criticized his communications strategy and execution as uneven. At his most-recent news conference, Powell “projected more confidence than at any presser before,” former Dallas Fed President Richard Fisher told the Wall Street Journal. “He is visibly in command of the ship.” So, we will see. There seems to be broad agreement with Post view of a stronger Fed just now, but potential turbulence could lie ahead. It will be important for producers to watch closely the coming decisions about new tariffs on Chinese goods and on the FY2020 spending bills other issues over the coming weeks, Washington Insider believes.

| Rural Advocate News | Friday December 13, 2019 |


House Passes Ag Labor Bill The House voted 260-165 Wednesday to send to the Senate legislation that would allow undocumented farmworkers to earn legal status and streamline the H-2A guest worker program. The measure faces an uphill battle in the Senate because of the provisions for undocumented agricultural workers and their families. Thirty-four Republicans — nine more than the 25 who cosponsored the bill (HR 5038) — joined 226 Democrats in passing the measure. Of note, the passage count was not enough to override any presidential veto should the legislation, however unlikely, get to President Trump's desk. Plus the American Farm Bureau Federation came out against the legislation, expressing disappointment that efforts to improve the legislation via amendments were blocked.

| Rural Advocate News | Friday December 13, 2019 |


Government Shutdown Appears Averted on Deal Over FY 2020 Spending Lawmakers from the House and Senate reached a bipartisan deal to fund the government beyond December 20 when the current stopgap spending plan runs out. The agreement was announced by House Appropriations Chair Nita Lowey, D-N.Y. Lowey and her Republican appropriations counterparts and Senate appropriators made the announcement that they have agreed on all 12 spending bills for Fiscal Year (FY) 2020. Details of the deal, however, are not yet available even though lawmakers want to release it as soon as possible, Lowey said. Keys will be what lawmakers were able to work out on the border wall and on the Trump administration’s Title X policy blocking federal funds to groups that refer patients for abortions. Bloomberg reported the deal includes $1.375 billion for the border wall. As for the White House, Senate Appropriations Chair Richard Shelby, R-Ala., said, “They’ve been involved. But we have to make the decisions.” Expectations are the House will vote on the plans Tuesday, December 17.

| Rural Advocate News | Friday December 13, 2019 |


Friday Watch List Markets A report on U.S. retail sales at 7:30 a.m. CST is the only item on Friday's official docket. The main interest for traders is apt to be any news of a trade deal with China. Multiple sources have reported a deal is close, but official confirmation remains elusive early Friday. The weather forecast for North and South America will also attract interest heading into the weekend. Late Thursday, the Washington Post reported a deal has been reached to avoid a shutdown of the U.S. government. Weather Friday will bring snow and cold to northern areas, rain to the Southeast, and dry conditions with seasonal to above normal temperatures elsewhere. The pattern turns colder over most of the contiguous U.S. during next week.

| Rural Advocate News | Thursday December 12, 2019 |


USDA Extends MFP, DMC Deadlines The Department of Agriculture Wednesday extended sign-up deadlines for the Dairy Margin Coverage program to December 20. USDA officials cited the prolonged and extensive impacts of weather events this year for moving the deadline beyond its original date of Friday, December 13. USDA announced it is also continuing to accept applications for the Market Facilitation Program through December 20, 2019. Bill Northey, USDA undersecretary for farm production and conservation, says some farmers are still in the field, adding, "we hope this deadline extension will allow producers the opportunity to participate in these important programs.” The DMC program offers protection to dairy producers when the difference between the all-milk price and the average feed cost, the margin, falls below a certain dollar amount selected by the producer. The Market Facilitation Program is part of a relief strategy to support farmers while the administration continues to work on trade agreements. Another round of payments could come next month. ************************************************************************************* Senate Won’t Vote on USCMA Until After Christmas U.S. farmers won’t see a North America trade deal under the Christmas tree this year, despite this week’s deal to move the U.S.-Mexico-Canada Agreement forward. The House of Representatives, which must act first, plans to vote by the end of next week, sending the trade deal to the Senate. However, Senate Majority Leader Mitch McConnell told reporters Wednesday the Senate won’t be able to consider the agreement until after Christmas, pushing Senate action on USMCA into 2020. McConnell cited a full slate of issues to consider, including spending bills, judicial appointments and the pending impeachment trial. The January Senate calendar is blank, leaving room for a month of impeachment proceedings in the Senate. While Democrats were blamed for stalling the agreement, they’ve flipped the coin to blaming Senate Republicans for causing further delays. McConnell claims House Democrats waited too long before advancing the agreement to allow for the trade to become law this year. But, McConnell’s intentions could push a Senate vote to February. ************************************************************************************* Real Meat Act Introduced in Senate Lawmakers in the Senate Wednesday introduced the Real MEAT Act, a bill seeking to end deceptive labeling practices for alternative protein products. Senator Deb Fischer, a Nebraska Republican, introduced the bill Wednesday. Fischer says the bill would clarify the definition of beef for labeling purposes, eliminate consumer confusion resulting from misbranding, and ensure that the federal government can enforce the law. Fischer says, “Beef is derived from cattle—period.” She adds the legislations will stop so-called fake-meat companies from misleading consumers about “the nutritional merits and ingredient composition of their products.” The National Cattlemen’s Beef Association applauded the introduction of the legislation. NCBA President Jennifer Houston says the bill will “allow cattle producers to compete on a level playing field.” NCBA found in a study that 55 percent of consumers did not understand that “plant-based beef” wasn’t beef at all, but instead an entirely vegan or vegetarian product. The Senate bill is a companion to similar legislation in the House. ************************************************************************************ Farm Groups Partner to Help Farmers Manage Stress Top farm organizations Wednesday announced a partnership to address high levels of stress affecting farmers and ranchers. Farm Credit, the American Farm Bureau Federation and National Farmers Union, announced the partnership that will provide training to individuals who interact with farmers and ranchers. AFBF President Zippy Duvall says the partnership will "help our members recognize the warning signs and empower them to get help for their friends." In a national Morning Consult poll commissioned by AFBF in April 2019, a strong majority of farmers and farmworkers said financial issues, farm or business problems, and fear of losing the farm, impact the mental health of farmers and ranchers, and nearly half of rural adults said they are personally experiencing more mental health challenges than they were a year ago. Research also shows that while farmers experience higher levels of psychological distress and depression than the general population, they are less likely to seek help for mental health issues. ************************************************************************************ Johnson to Retire from Role as Farmers Union President National Farmers Union President Roger Johnson announced earlier this week he will retire from his role in Washington, D.C. next year. Johnson will not seek reelection during the 2020 NFU annual convention in March, when his current term will end. NFU will elect his successor during the meeting in Savannah, Georgia. Johnson told reporters that Rob Larew, NFU’s senior vice president of public policy, is currently the lone candidate for the role. Before leading the family farm organization, he served as North Dakota Agriculture Commissioner and as president of the National Association of State Departments of Agriculture. Johnson, a third-generation family farmer from Turtle Lake, North Dakota, grew up in Farmers Union, participating in the organization's youth programs and serving as a county president and chairman of the board of a local Farmers Union cooperative. He says, "it has been my greatest honor to serve this organization and the admirable farmers and ranchers who comprise its membership." ************************************************************************************* American Royal Acquires Land for “Epicenter of Agriculture” The American Royal Association is one step closer to its goal of being the “Epicenter of Agriculture.” The organization recently acquired 115 acres in Kansas City, Kansas, following a purchase of 47 acres earlier this year. The association recently submitted its preliminary development plan country officials, which was approved this month. The one million-plus square foot complex with an outdoor plaza and arena will allow for an expansion of programming to 365 days a year. The facility features more than 800,000 square feet of indoor event space, including barn and exposition areas, three performance arenas, a large educational area, and more than 50,000 square feet of exhibit space. The American Royal has been a nationally recognized brand for more than a century. Beginning in 1899 as the National Hereford Show, the American Royal has evolved into a comprehensive season of food and agriculture activity. A ceremonial groundbreaking is expected Spring 2020, with construction beginning Summer 2020. The core complex is to be complete by winter of 2021.

| Rural Advocate News | Thursday December 12, 2019 |


Washington Insider: Hints at Delays for Scheduled Tariff Boosts Well, there’s lots going on in U.S. trade policy these days but the implications are still tough to interpret. For example, House Speaker Nancy Pelosi, D-Calif., said she would support the new NAFTA deal in in the House – less than an hour after she announced the articles of impeachment against President Donald Trump. Though a dense fog of uncertainty remains, the Times says it sees signs that the U.S. may delay scheduled increases in duties on Chinese imports – but that the decision “rests with the president who could go either way,” the report said. So, new tariffs on over $100 billion of Chinese goods are due to take effect on Sunday. While many American officials are eager to avoid the tariffs, key observers insist that no decision has been made and the President is continuing to meet with advisers this week. The United States and China announced in mid-October that they had reached a so-called Phase 1 trade agreement that would allow Chinese purchases of American agricultural goods to resume while the United States would cancel additional tariffs scheduled for Oct. 15. American officials said that future tariff increases could also be avoided if the pact were signed. Since then, negotiators have continued to grapple over the deal’s terms. The two sides remain divided over how many of the tariffs will be canceled in return for China’s trade concessions, and over the terms that will govern Chinese purchases of tens of billions of dollars worth of American agricultural products. The administration’s next scheduled tariff increase is set for 12:01 a.m. on Dec. 15 and would place a 10% tariff on $156 billion of products, including toys, smartphones and other electronics, weighing on consumers and potentially turning into a political liability for a president headed into a re-election campaign. Business groups are worried about the new levies. “We’re still in a high-stakes poker game,” Myron Brilliant, the executive vice president at the U.S. Chamber of Commerce, said. “Having another round of tariffs would be a poison pill in the context of the current U.S.-China negotiations and in the context of the global economy,” Brilliant added. “We hope both sides understand the urgency of getting an agreement finalized as soon as possible.” If President Trump delays those tariffs to allow more time for negotiations, it would be the fifth time this year that he has delayed or canceled tariffs—and could prompt criticism that China is taking advantage of the negotiating process. In addition, the significant progress this week on moving the revised North American trade deal toward a vote in Congress appears to have slowed progress toward a resolution by diverting the administration’s attention away from China, the Times said. The Times report concludes that “as the deadline nears, the December tariffs’ fate has grown particularly cloudy.” And, China apparently tried to appeal to the administration’s desire to see more farm purchases by offering a waiver on tariffs it had placed on U.S. soybeans as Chinese companies made large bulk purchases of American goods. In addition, USDA Secretary Sonny Perdue said this week during a trip to Indiana that he did not expect the new tariffs would be imposed. Also, critics continue to argue that the Phase 1 deal would do little to address America’s longer-term concerns about China’s economic practices. Reports from China this week indicate that the Chinese government had discernibly hardened its negotiating positions since President Trump and Vice Premier Liu He reached their agreement in October. That deal has attracted criticism from the more nationalistic wing of the Chinese government, especially since it lacks any U.S. pledge to roll back some of the tariffs already imposed. Since early November, Chinese negotiators have demanded that a Phase 1 deal include some tariff relief in order to make the deal “equal” – otherwise it will be one-sided, said Professor Tu Xinquan, the executive dean of the China Institute for WTO Studies at the University of International Business and Economics in Beijing. The trade ministry founded the university and retains close links to it. But China clearly has been wary of offering further concessions to offset a tariff rollback. That has stymied negotiators at least temporarily. Now, U.S. officials are telling the press that they are still waiting for China to signal its willingness to make “necessary concessions” to seal a deal. Clete Willems, a partner at Akin Gump who left the White House this year, said China appeared to be taking actions, like the soybean purchases, to persuade the administration to delay the tariffs as both sides work toward a deal. The president has a decision to make,” Mr. Willems said, “and realistically he could still go both ways.” So, we will see. Political tensions are so high just now that it is increasingly difficult to anticipate any economic decision, especially in the area of trade. As a result, the trade talks should be watched very closely by producers, especially as the scheduled deadlines approach, Washington Insider believes.

| Rural Advocate News | Thursday December 12, 2019 |


Full US Approval Of USMCA Seen In Early 2020 Signing of the updates to the U.S.-Mexico-Canada Agreement (USMCA) Tuesday by officials from the three countries was hailed by both Democrats and Republicans in Washington. The House vote on the pact is expected to come next week, with some suggesting December 19 after the House finishes its action on the articles of impeachment. Senate approval, however, is not expected until early 2020. Senate Majority Leader Mitch McConnell, R-Ky., said Tuesday that a Senate vote “will have to come up in all likelihood right after the (impeachment) trial is finished in the Senate.”

| Rural Advocate News | Thursday December 12, 2019 |


More Time To Sign Up For Trade Aid, Dairy Program USDA says the brutal weather conditions this year that have continued recently are enough to have the agency extend signup for the 2019 Market Facilitation Program (MFP 2) and the Dairy Margin Coverage (DMC) program. MPF 2 signup was to have ended December 6 and DMC enrollment for 2020 was to end December 13. USDA says enrollment will now be open through December 20. Just over one quarter of licensed dairy operations, 7,204 farms, have enrolled in DMC for the 2020 calendar year as of Dec. 9. By comparison, 82% of licensed operations, 23,164 in all, signed up for the program for 2019. Under the first two of three possible tranches of MFP 2 payments, FSA has paid $10.470 billion in MFP payments to farmers. The top five states were Iowa, Illinois, Minnesota, Texas and Kansas.

| Rural Advocate News | Thursday December 12, 2019 |


Thursday Watch List Markets In addition to weekly export sales at 7:30 a.m. CST, there will be weekly jobless claims, and producer price index reports. We will also be watching for any updates regarding ongoing trade negotiations, and of course any changes in South American weather. Weather Snow squalls will move across the northern Midwest Thursday, causing transport delays and stressing livestock. We'll also see rain and snow in the Northwest. Snow and cold will focus on northern areas through the end of the week. The Southeast will see rain on Friday.

| Rural Advocate News | Wednesday December 11, 2019 |


Pelosi Announces USMCA Deal with White House House Speaker Nancy Pelosi Tuesday morning announced a “win” for workers and Democrats, saying they reached an agreement with the Trump Administration to move the U.S.-Mexico-Canada Agreement forward. Pelosi says the agreement is “infinitely better than what was initially proposed by the administration.” Representative Richard Neal, a Democrat who helped lead the effort, says Democrats support the new agreement because they crafted the details of the improved trade pact. President Donald Trump says the agreement is “Good for everybody - Farmers, Manufacturers, Energy, Unions,” adding USMCA has “tremendous support.” The Trump administration now must send implementing legislation to the House. Neal told reporters a vote in the House isn’t likely this week, but adds “we’re close,” saying he’s hopeful for a vote possibly next week. Agriculture Secretary Sonny Perdue says the agreement “improves virtually every component” of its predecessor, the North American Free Trade Agreement. Perdue adds, “the House and Senate need to work diligently to pass USMCA by Christmas.” ************************************************************************************* Farm Groups Welcome USMCA Announcement Agriculture groups applauded the announcement by House Democrats regarding a deal with the Trump Administration on the U.S.-Mexico-Canada Agreement. In a statement, National Corn Growers Association President Kevin Ross says, “NCGA appreciates the bipartisan efforts between Speaker Pelosi, Ambassador Lighthizer and the House working group to reach an agreement.” While the announcement is a step forward, agriculture groups are calling for quick passage of the agreement. The National Chicken Council in a statement says that after a year of negotiations,” the time to act is now,” adding “We encourage swift Congressional consideration and passage of USMCA before Christmas.” American Farm Bureau Federation President Zippy Duvall says, “This is an opportunity for Congress not only to help U.S. farmers and ranchers turn the corner on trade, but also show that Washington can still get things done on a bipartisan basis.” Once the agreement is sent to Congress for a vote, Congress has 90 congressional days, 45 in the House and 45 in the Senate, to consider USMCA. ************************************************************************************* December WASDE Report Mostly Unchanged The monthly World Agriculture Supply and Demand report offered little to excite or scare markets Tuesday. As the market and trade experts expected, there was little change in the monthly figures by the Department of Agriculture, with no change to corn and soybean production expectations or yields. Trade experts say it’s likely significant updates will wait until the January 2020 WASDE report. The projected season-average farm price for corn was unchanged at $3.85 per bushel. Meanwhile, Total U.S. oilseed production for 2019/2020 is forecast at 107.6 million tons, down slightly due to a decrease for cottonseed. Soybean supply and use projections for 2019/2020 are unchanged from last month. The U.S. season-average soybean price for 2019/2020 is forecast at $8.85 per bushel, down 15 cents. The outlook for 2019/20 U.S. wheat is for decreased supplies, higher exports, and lower ending stocks. Wheat imports are lowered 15 million bushels to 105 million on a slower than expected pace to date. And, the season-average farm price for wheat was lowered $0.05 per bushel to $4.55. ************************************************************************************* GOA to Review USDA’s Emergency Watershed Protection Program The Government Accountability Office will review the Department of Agriculture Emergency Watershed Protection Program. The announcement follows a request by Senators Michael Bennet, a Colorado Democrat, and Mitt Romney, a Utah Republican. Bennet and Romney requested that the GAO focus on several specific items, including approval processes under the program, project timelines, opportunities to expand eligible projects, and agency and stakeholder views of the program. Administered by USDA's Natural Resources Conservation Service, the Senators call the program an important tool designed to reduce financial strain and help communities across the West address imminent threats following a wildfire. However, communities often face challenges when attempting to use the program to support recovery efforts, including after fires in Colorado and Utah in 2018. The GAO review, which will commence in the coming months, will lead to recommendations to improve EWP and more effectively assist communities recovering from wildfires across the West. ************************************************************************************ Farmers Union Urges White House to Replace Aromatics with Biofuels The National Farmers Union Tuesday sent a letter to President Donald Trump endorsing the Governors’ Biofuels Coalition recommendation to lower air toxic emissions caused by the use of gasoline aromatics. Following the coalition's position, the organization suggested that aromatics be replaced with biofuels, which NFU says are higher octane, burn more cleanly, and are “far better” in terms of greenhouse gas emissions, air quality, and public health. NFU is a longtime proponent of replacing toxic aromatics with ethanol, filing comments to that effect on several different rulemakings, including the Safer Affordable Fuel Efficient Vehicles Rule. In a statement, NFU President Roger Johnson emphasized the benefits of doing so and advised the administration to adopt the recommendations. Johnson says biofuels are "substantially cleaner than petroleum-based octane additives," and cost-effective and readily available. Johnson urged the administration to make the change, that would "reduce health care costs, ease compliance burdens, and provide lower-cost fuel for consumers." ************************************************************************************ Extreme Weather Leads to Silage Mycotoxin Concerns Given the extreme weather in 2019, producers and users of silage should carefully watch for molds and mycotoxins. In a company news release, Alltech says extreme weather conditions and moisture levels can reduce yields and induce plant stress, and they can also lead to future issues for the crop, including mycotoxins and molds. Mycotoxins are a concern for livestock producers, as they influence feed quality and animal safety. Samples of the 2019 corn silage from across the U.S. submitted to the Alltech mycotoxin analytical services laboratory include high levels of mycotoxins. The samples have included an average of 7.13 mycotoxins, with a range of two to 14 mycotoxins per sample. Dr. Max Hawkins, nutritionist with the Alltech Mycotoxin Management team, says, “These levels of mycotoxins found in the 2019 crop are significantly higher than the average values.” He recommends livestock producers across the U.S. should test their own corn silage to identify the levels of individual mycotoxins and the subsequent risk present to livestock health and performance.

| Rural Advocate News | Wednesday December 11, 2019 |


Washington Insider: Trade Rule Confusion Washington has hardly ever been as divided as it is today, and the debate is unusually toxic including new and old trade fights, Bloomberg says this week. In addition, this fight appears to focus on how trade disputes may be settled in the future. The background is that the United States has been systematically undercutting the WTO’s trade dispute settlement mechanism, Bloomberg reports. It has blocked new appointments to the WTO appellate body, a policy that will “effectively paralyze it on Dec. 11,” Bloomberg says. That panel is responsible for “final trade rulings” that can affect billions of dollars in commerce. Now, Bloomberg thinks, the U.S. policy has forced governments to select among four options if a dispute is to be settled: Option 1: Trade wars with tit-for-tat tariffs and other anti-trade policies; Option 2: File a WTO claim “with the knowledge that the losing party may appeal it into legal limbo;” Option 3: Launch a dispute with an understanding that neither party will appeal a WTO’s dispute ruling; Option 4: Engage in an appeal-arbitration system that replicates the work of the WTO appellate body. The U.S. administration has shown a preference for option one – unilateral tariffs instead of waiting for a WTO dispute settlement award, Bloomberg says Now, however. China is in preliminary talks to support the European Union’s backup plan for settling international trade disputes as the U.S. administration gets closer to “scuttling” the current WTO role in refereeing cross-border commerce. On Tuesday, China’s Ambassador to the WTO Zhang Xiangchen told Bloomberg that Beijing is actively working to support the EU’s vision of an appeal-arbitration model, which essentially replicates the work of the WTO’s soon-to-be defunct appellate body. Until now, only Canada and Norway have endorsed the EU’s plan. “This is not the best option” but “this is an interim solution that can help countries to deal with their disputes,” Zhang said in the interview. While the conversations are still preliminary, the plan has drawn serious interest from various other WTO members such as Australia, Argentina, Brazil, Chile, Japan and Turkey, Bloomberg said. “There has been a gradual support for this as a very unfortunate Plan B,” former appellate body member James Bacchus told Bloomberg. “Now it seems to be the best option, given all the lousy options we have left.” Trade officials concede that the second option is basically a waste of time and money and the third option isn’t much better because there’s little incentive for a defending nation to participate if they know they’re going to lose. This is why a growing number of WTO members -- except for the U.S. – are beginning to take a hard look at the appeal-arbitration approach, Bloomberg says. The model is rooted on an existing WTO rule – Article 25 of the Dispute Settlement Understanding – that permits nations to agree to a voluntary form of arbitration to settle their disputes. Under this approach, the WTO Director-General can select a panel of previously vetted former appellate body members who apply the same procedures of the appellate body to reach a final judgment. As a practical matter, WTO members who sign on to such an approach will basically undergo the same process as the current appellate body. “If enough other countries sign up to the EU proposal, it could work as a stop-gap measure that would temporarily allow the WTO to arbitrate disputes between the other 163 members,” said Chad Bown, a senior fellow at the Washington-based Peterson Institute for International Economics. “But there are downsides,” he said. “The biggest is obviously that the U.S. is unlikely to sign up, so it will not work to solve any disputes that countries have with America.” But the EU has a plan for that, too, Bloomberg says. The EU is due as soon as this week to move toward strengthening its trade-policy arsenal by allowing for penalties against nations that undermine WTO rulings by appealing them into a legal void. The plan has backing from European Commission President Ursula von der Leyen, who instructed European Trade Commissioner Phil Hogan to bolster the EU’s toolkit in international commerce. In September, EU leadership moved to upgrade its enforcement regulation “to allow us to use sanctions when others adopt illegal measures and simultaneously block the WTO dispute settlement process.” “It proposed an interim appeal arrangement for those partners who are willing to continue to resolve disputes in a binding way in respect of the WTO rules,” Hogan said in a statement. “The European Commission will soon unveil further proposals to make sure that the EU can continue to enforce its rights in international trade matters should others block the system.” So, we will see. At the current moment, the U.S. administration is claiming progress toward a trade deal with Mexico and Canada--but is facing high hurdles in talks with China and others, including the EU. In addition, it no longer has its familiar leadership role in expanding access to growing markets in several key areas, including agriculture. Still, the economic impacts of current trade policies seem less threatening to economic growth than they did only a few weeks ago. However, a number of important, well established overseas markets are involved in critical discussion that should be watched closely by producers as they continue, Washington Insider believes.

| Rural Advocate News | Wednesday December 11, 2019 |


Sen. Grassley Still Says He Has Again Been Assured On The RFS Plan EPA will finalize its plan for 2020 biofuel and 2021 biodiesel levels under the Renewable Fuel Standard (RFS) in line with the September agreement between President Donald Trump and biofuel backers and corn producers, Sen. Chuck Grassley, R-Iowa, told reporters Tuesday. Grassley indicated he had been assured about the mandates when he spoke with Office of Management and Budget (OMB) acting director Russell Vought, and he also had conversations recently with White House adviser Larry Kudlow. Contacts have indicated Kudlow has been formulating the plan. “I believe Kudlow understands why the market reacted negatively to the proposed rule,” Grassley said. “I also called OMB acting director Vought on Friday and he assured me that he would work to make sure the rule is finalized according to the agreement that was made on September 12.” The final EPA plan is currently at OMB for review with the agency planning to issue the final rule yet this month.

| Rural Advocate News | Wednesday December 11, 2019 |


USMCA Deal Reached, Shifting Focus To Ratification Months of negotiations between several parties involved finally reached the conclusion that some did not expect would happen – an agreement on altering provisions in the U.S.-Mexico-Canada Agreement (USMCA). Signed by leaders from the U.S., Canada and Mexico in November 2018, the USMCA pact already won approval in Mexico. But Democrats in the U.S. House of Representatives complained the pact did not do enough to address labor issues that they said had to be adjusted before winning their support. And perhaps more importantly, the deal has come together despite the global tensions on trade and areas like the WTO that have seen parties remain at odds. U.S. House Democrats on Tuesday claimed victory in negotiating changes to a U.S.-Mexico-Canada trade agreement to ensure better protection for workers, the environment and remove key provisions that they said would have benefited big pharmaceutical companies. But the year-long negotiations between a Democratic working group and U.S. Trade Representative Robert Lighthizer produced an agreement all parties could accept. Expectations are the pact can still come up for approval in the House yet this year, with Senate approval also expected. However, the latter could spill into the early part of 2020.

| Rural Advocate News | Wednesday December 11, 2019 |


Wednesday Watch List Markets Early in the morning there will be the Consumer Price Index and Core CPI, two indicators of inflation, and comments from the Fed regarding interest rates. We will also be looking for any additional news about the USMCA and U.S.--China trade deals. Weather Snow and rain in the northeast to middle Atlantic region will end early Wednesday. Showers in Florida during the day. Light snow or snow showers in the Dakotas late in the day. Drier elsewhere in the key U.S. crop and livestock areas Wednesday. The central Argentina corn and soybean areas will be hot for one more day before the heat wave breaks. Highs yesterday were middle 90s to low 100s F. Increased stress to these crops

| Rural Advocate News | Tuesday December 10, 2019 |


USCMA Tentative Deal Reached A deal to allow the U.S.-Mexico-Canada Agreement to move forward seemed imminent Monday, with anonymous sources telling the Associated Press a deal was reached. President Donald Trump told reporters Monday afternoon there were "a lot of strides over the last 24 hours" with unions, adding "if they put it up for a vote, it'll pass." Fox Business News first reported an agreement between Trump and Mexico, along with House Democrats, and that it could be finalized and ready for action before the House of Representatives adjourns for the year. However, details reportedly still need to be finalized, and implementing legislation must be submitted to Congress. Additionally, the House of Representatives will need to schedule a vote on the agreement. The news broke as 158 lawmakers penned a letter the House Speaker Nancy Pelosi urging her to "seize this opportunity" to create a win for America. The lawmakers say expanding agriculture exports through USMCA “will help put American agriculture back on its feet.” ************************************************************************************* Trade War Impact $42 Billion A trade organization says the U.S. trade war with China has cost the U.S. $42 billion since February of 2018. Tariffs Hurt the Heartland Monday released data showing that in October alone, Americans paid a total of $7.2 billion in tariffs, more than any other amount in U.S. history, with $4 billion of that total stemming from the trade war. Americans for Free Trade spokesperson Jonathan Gold says, "It's time the administration finalizes a deal with China to end the trade war and remove all tariffs.” Talks of a phase one agreement continue, which would include agriculture provisions, but new tariffs are planned on China starting December 15. President Donald Trump last week indicated a final overall agreement could wait until after the 2020 U.S. elections. Brian Kuehl, co-executive director of Farmers for Free Trade, says the 2020 campaign will turn to farm states, adding, “The president needs to show he can close not just a phase one deal, but a comprehensive deal,” for farmers and rural America. ************************************************************************************* China Fuels October Pork Exports, Beef Exports Down from Last Year Strong demand from China bolstered U.S. pork exports in October, while October beef exports were below the high totals posted a year ago. Department of Agriculture data, compiled by the U.S. Meat Export Federation, shows October pork exports increased 8.5 percent year-over-year to 225,300 metric tons, while export value climbed ten percent to $592 million. January-October export volume was five percent ahead of last year's pace at 2.13 million metric tons, while value increased three percent to $5.48 billion. Although still burdened by China's retaliatory duties, October pork exports to the China region reached 61,000 metric tons, up 150 percent year-over-year, while export value climbed 127 percent to $141.3 million. USMEF CEO Dan Halstrom says China’s efforts to rebuild its domestic swine inventory continue, but added, "there are still excellent opportunities for pork-supplying countries." Meanwhile, October beef exports totaled 108,000 metric tons, an eight percent decline from last year's large volume, while export value of $649.1 million was down 11 percent. ************************************************************************************ Farm Groups Plead for Biodiesel Tax Extenders A group of farm organizations is asking House and Senate leadership to extend the biodiesel tax credit. A letter sent last week to leaders of both chambers says, "we believe that Congress can, and must, pass an immediate extension before returning home at the end of the year.” The group includes 11 farm and biofuels groups, including the American Farm Bureau Federation and National Farmers Union. Since 2005, there has been a $1.00 per gallon biodiesel and renewable diesel blenders' tax credit, which was created to stimulate production and consumption of biodiesel and renewable diesel. The tax credit expired on December 31, 2017. Separately, the Petroleum Marketers Association of America says Congress must “act now to retroactively extend the credit for calendar year 2018 and through at least 2019.” The farm groups charge that since the start of the year, producers have cut back production, investments in new technologies and facility upgrades, and purchases of raw materials, because of the uncertain future of the tax credit. ************************************************************************************* Petersen Sends Letter to EPA Criticizing RFS Proposal A letter by House Agriculture Chairman Collin Peterson criticizing the Environmental Protection Agency suggests EPA's proposal to "fix" the Renewable Fuel Standard undermines the program. Peterson sent a letter to EPA Administrator Andrew Wheeler last week raising concerns about the October supplemental rule proposed by the EPA. In October, the agency submitted a supplemental proposed rule and suggested changes to the formula EPA uses to restore gallons waived through the small refinery exemptions process. Biofuels and farm groups are disappointed that the proposal doesn't fully address lost demand stemming from small refinery exemptions. Peterson says, "any action from EPA that does not uphold the integrity of the RFS is unacceptable." He claims, "The bottom line is the EPA continues to undermine the RFS at the expense of our farmers and biofuel producers. A public comment period on the proposal closed late last month. The EPA is expected to release the final rule soon, possibly on December 20. ************************************************************************************* NCBA Accepting Intern Applications for Fall 2020 The National Cattlemen's Beef Association, along with the Public Lands Council, is seeking fall 2020 policy internship applications. Positions for next fall, early-September - mid-December 2020, include public policy interns and a law clerk. The public policy internship will give students an opportunity to learn about career options and provide practical experience. From tax and trade to environmental and food safety regulations, interns will work on a variety of issues and have the opportunity to work specifically in the area of their interest. The law clerk will provide support to NCBA’s Environmental Counsel on issues relating to environmental legislation and regulations that impact beef producers. The deadline to apply for either position is March 6, 2020College juniors, seniors and graduate students are encouraged to apply. PLC Associate Director, Policy & Administration, Allie Nelson, a former NCBA intern herself, says the internships “let students get an up-close look” at how policy impacts cattle producers.

| Rural Advocate News | Tuesday December 10, 2019 |


Washington Insider: Insider Jobs and Lessons to Learn Well, the media was quite surprised by last week’s very positive jobs report and now is scrambling to interpret what it means. For example, the New York Times concedes that “conventional wisdom” was too pessimistic about how much the economy could grow before setting off inflation. In hindsight, this was a “costly mistake,” the Times said. It concludes that there are a lot of good things to say but also a few not so good things regarding the November employment numbers. The 266,000 job-growth number is a “blockbuster” even after accounting for the one-time boost of about 41,000 striking GM workers who returned to the job,” the report said. Revisions to previous months’ job counts were positive. The unemployment rate fell to 3.5%, matching its lowest level since 1969. The report also noted that the share of the adult population in the labor force ticked down and average hourly earnings “continued growing at only a moderate pace, up 3.1% over the last year. Still it said it “feels churlish” to focus on a weaker area “when the big-picture numbers are so good.” However, the Times thinks it sees a “bigger lesson” contained in the data, one that is important beyond any one month’s tally of the job numbers — and that is that the US economy is “capable of cranking at a higher level” than conventional wisdom held as recently as a few years ago. It now sees the economy as “continuing to grow well above what once seemed like its potential without inflation or other clear signs of overheating” and concludes that it’s “clearer” that the old view of its potential was an extremely costly mistake. The mainstream view held by the economics profession—including leaders of the Federal Reserve, the Congressional Budget Office, private forecasters and many in academia—was that the United States economy was at, or close to, full employment.” Looking back, the NYT said that in January 2017, for example, nearly three years ago, the Congressional Budget Office forecast a 4.7% unemployment rate as far as the eye could see, and it projected that the United States labor force would consist of 163.3 million in 2019. The jobless rate has averaged less than 3.7% through the first 11 months of the year, and the labor force now stands at 164.4 million people. The Federal Reserve likewise was too pessimistic about the potential of American workers; in projections three years ago, the consensus view of its leaders was that the unemployment rate would average 4.5% in the final months of 2019. “If that forecast had materialized, 1.6 million more Americans would currently be unemployed than actually are,” the Times said. That view also expected that the target interest rate to be around 2.9%, reflecting rate increases they believed would be needed to head off inflation. Instead, that interest rate is around 1.6% —"and you have to squint to see signs of inflation,” the Times said. If you go back even further, to the late Obama years, there was an even more pessimistic tone about the outlook for American workers embedded in the fine print of both public and private-sector forecasts. If we knew then what we know now, it would have had big implications for what seemed like sensible policy, the Times concluded. Thus, the US probably didn’t need to reduce budget deficits the way it did between 2013 and 2016 — now that we know how much untapped growth potential there was. The Fed probably didn’t need to raise rates as quickly or as much as it did. The Times also thinks that markets “seem to be getting that message.” For years, whenever there has been a strong jobs report like the one issued Friday, markets viewed it as hawkish for monetary policy — as tilting the balance toward more interest rate increases. But this time, analysts and financial markets seemed to take the big-time job growth numbers in stride, given that they weren’t accompanied by any signs of ill effects from the low unemployment rate and strong growth. Still, the Times urges caution. It notes that people still worry that this expansion, now in its 11th year, is growing long in the tooth or that we are late in the cycle. And maybe that’s right. But the biggest lesson when you contrast where the labor market stands at the end of 2019, versus where smart people thought it would stand just a few years ago, is that “there’s a lot we don’t know about just what is possible and how strong the United States economy can get.” Well, that’s a mouthful for the Times — or anybody — and it likely means that the economy certainly will bear watching in today’s turbulent times. Inflation likely is a threat in the minds of many observers even if it has been slow to show itself. Global weakness and uncertainty in trade still must be factored in — very carefully. But, good news is still good news even if it is complicated. Global market access still needs to be expanded even if that continues to be heavy, heavy lifting. These are trends producers should watch closely and carefully, as usual, Washington Insider believes.

| Rural Advocate News | Tuesday December 10, 2019 |


Groups Fighting California Rules On Animal Housing The National Pork Producers Council (NPPC) and American Farm Bureau Federation (AFBF) have filed a legal challenge to California’s Proposition 12, which imposes animal housing standards. The state’s law would force hog farmers who want to sell pork to the state that makes up around 15% of the US pork market to switch to alternative housing systems. The new rules slated to take effect Jan. 1, 2022 would prohibit the sale of pork not produced via California’s “highly prescriptive standards” under which only 1% of US pork production would qualify, according to a press release from NPPC and AFBF.

| Rural Advocate News | Tuesday December 10, 2019 |


Final EPA RFS Plan At OMB EPA’s final rule for the 2020 biofuel and 2021 biodiesel levels and how they intend to account for small refinery exemptions (SREs) has arrived at the Office of Management and Budget (OMB) for review. Biofuel supporters continue to express disappointment at EPA’s supplemental plan to account for SREs, but Sen. Chuck Grassley, R-Iowa, has continued to express hope that EPA will live up to the White House commitment on conventional ethanol under the Renewable Fuel Standard (RFS). EPA is still targeting to issue the final rule on the 2020 biofuel and 2021 biodiesel levels yet this month. Some reports indicate EPA will use “partial” waivers to address the SRE and others indicate there has been little change in the EPA compared with the proposed effort. If there are few changes, that will continue to keep this issue as a factor even once it is finalized.

| Rural Advocate News | Tuesday December 10, 2019 |


Tuesday Watch List Markets There will be an NFIB small business index. DTN will also be watching for any news regarding both the USMCA and U.S.-China trade pacts. We will also be watching the USDA WASDE report for any changes in demand in the U.S. and any production changes in export competitor countries. Weather Mixed precipitation is expected during Tuesday through the northern Delta region and just south of the Ohio river. Rain through the southern Delta and from the middle Atlantic region into the northeast U.S. Dry but much colder through the Northern Plains and Midwest regions as an Arctic air mass continues to move south and east. The East Coast states will continue to see well-above-normal temperatures during Tuesday. In South America, Argentina will see a second day with readings reaching the 90s and low 100s F increasing stress to early planted crops. Showers in Brazil mainly in and around the Mato Grosso area. No significant concerns in Brazil crop areas at this time.

| Rural Advocate News | Monday December 9, 2019 |


Last Minute Demands Further Complicate USMCA Passage Speaker of the House Nancy Pelosi has an unlikely ally in Republican Senator Ted Cruz of Texas when it comes to a last-minute push for changes to the U.S.-Mexico-Canada Trade Agreement. They’re pushing to strip the trade pact of language shielding internet companies from liability over user-generated content. The protection has come under scrutiny in Washington, D.C., as companies like Facebook, YouTube, and Twitter, come under fire for harmful content and political misinformation on their pages. Critics are arguing that putting those protections in trade deals limits Congressional ability to reconsider them domestically. However, Republican lawmakers see the effort to eliminate the language as a last chance move to delay the trade deal. Adding in a new and potentially controversial request could significantly delay the process that everyone involved repeatedly says is close to finishing up. Texas Democrat Henry Cuellar (KWAY-ar) said the U.S. put an additional demand on the table that Mexico “doesn’t want to touch.” He didn’t say what the new demand was but did say that it came about as Mexico was “pretty much almost ready to go.” ********************************************************************************************* China will Lift Some Tariffs on Some U.S. Pork, Soybean China announced plans on Friday to lift some tariffs on U.S. soybeans and pork. A CNN report says the move could be designed to take some of the heat out of the talks aimed at bringing a truce to the trade war. The Chinese finance ministry said last week it would waive taxes on some imports once companies had applied for exemptions. It didn’t specifically say which goods or how many of the goods would be exempted. Back in September, China said it would exclude some soybeans and pork products from its newest tariffs. China’s Customs Tariff Commission of the State Council says it will “dedicate a range of goods to be excluded from tariff countermeasures against the U.S. Section 301 measure.” President Donald Trump had told reporters late last week that talks with China were going well and hinted that he may not place new tariffs on Chinese goods on December 15th as planned. When asked about the new tariffs going into effect on December 15th, Trump said “We’ll have to see. Something could happen but we aren’t discussing that yet. However, we’re having very good discussions with China.” ********************************************************************************************** China, U.S. still at Odds Over Ag Purchases The Wall Street Journal reports that the U.S. and China still can’t agree on the size of future Chinese purchases of U.S. agricultural commodities. President Donald Trump wants China to commit to buying $40 to $50 billion worth of American farm goods per year, which is significantly higher than the $8.6 billion the country bought a year ago. The administration is also asking China to announce its purchase plans, which the White House says shouldn’t depend on market conditions or other Chinese trade obligations. The two countries are working to get a Phase One trade deal signed ahead of a potential 15 percent tariff increase on Chinese imports that is scheduled to begin on December 15. Trump said last week that something could very well happen with those tariffs but did say the two countries aren’t discussing that yet. The Chinese Commerce Department’s Ministry spokesman also said last week that the two sides remain in “close communication” on trade. He says that China believes relevant tariffs must be lowered if both sides can reach an agreement on the phase one deal. ********************************************************************************************* NPPC, Farm Bureau Team up to Challenge Prop 12 in California The National Pork Producers Council and the American Farm Bureau have filed a legal challenge to California’s Proposition 12. The proposition imposes animal housing standards that reach outside of California’s borders to farms across the U.S. “Proposition 12 revolves around a set of arbitrary standards that lack any scientific, technical, or agricultural basis, and will only serve to inflict further harm on U.S. hog farmers,” says Jen Sorenson, NPPC vice president. “U.S. farmers are already fighting to expand overseas market opportunities. We shouldn’t have to fight to keep our domestic markets too.” Prop 12 will force hog farmers who want to sell pork in California to switch to alternative housing systems, at a significant cost to their business. “The law was sold to California voters as a solution to improve animal welfare and food safety,” says AFB General Counsel Ellen Steen. “However, it has nothing to do with food safety and many animals will suffer more injury and illness under its arbitrary rules.” Farm Bureau says farmers are best qualified to make farm-specific and animal-specific decisions on animal care. Prop 12 will drive up costs and force smaller farmers out of business, leading to greater consolidation in the pork industry. ********************************************************************************************** White House Adviser Working on Biofuel Mandate Plan White House economic adviser Larry Kudlow is working on improving the Trump administration’s plan for bolstering biofuel requirements. Bloomberg says the move comes after ethanol boosters in politically important farm states said the current proposal doesn’t compensate for waivers that exempt some small refineries from the mandates under the Renewable Fuels Standard. Biofuel producers, corn farmers, and Midwest political leaders blasted the Environmental Protection Agency’s current approach to biofuels as inadequate. They say the EPA mandates completely ignored the terms of an agreement reached on October 1st to raise biofuel blending requirements enough to fully offset refinery exemptions. Senator Chuck Grassley of Iowa says the EPA could have the best of intentions but “farmers don’t believe it” because of the agency’s track record. Oil industry leaders say the EPA’s current proposal is illegal, arguing that it would unfairly force the larger refineries to bear a higher burden of biofuel-blending requirements. EPA is currently reviewing public comments as it prepares a final rule that will set the 2020 biofuel quotas. Kudlow’s work could lead to changes in the final rule that would ensure the final measure is more in line with what Trump gave approved in negotiations that led to the October 1st agreement. ********************************************************************************************** USDA Reminds Producers to Contact Insurance Agents about Harvest Delays The USDA is reminding producers with crop insurance are facing harvest delays to make contact with their crop insurance agents by December 10th. Farmers need to file a Notice of Loss by that date or the applicable end of their insurance period to request an extension of time to finish harvest. Once the extension gets approved, an insured producer needs to harvest the crop at the first feasible opportunity. “Farmers are certainly struggling this year because of wet weather conditions,” says Martin Barbre, Administrator of the Risk Management Agency. “Producers covered by Federal Crop Insurance that are unable to harvest on time need to contact their crop insurance agents to file a notice of loss.” The goal of filing the notice is so that crop insurance claims are settled based on the amount of harvested production. For crops like corn and soybeans, the end of the insurance period is December 10th. For other crop deadlines, farmers must make contact with their agents to find out the specific dates.

| Rural Advocate News | Monday December 9, 2019 |


Washington Insider: NAFTA and Why It Isn’t Dead Yet Bloomberg is reporting this week that uncertainty remains about the proposed new North American Trade deal and why the “original NAFTA” isn’t dead and gone in spite of numerous administration pledges to wipe it out. In the 2016 campaign, candidate Donald Trump frequently pledged to renegotiate and terminate the deal “if we don’t get the deal we want.” The 1994 agreement included the U.S., Canada and Mexico and was intended to phase out tariffs on most goods to create “the world’s largest free-trade zone,” and to “triple trade among the signatories.” Negotiations over a replacement deal were underway for more than 13 months in 2017 and 2018, and the three countries have agreed to modest changes to NAFTA and a new name, the U.S.-Mexico-Canada Agreement. However, the changes have still not been implemented, Bloomberg says. In fact, the original deal is still in effect, covering most of the $1.25 trillion in annual trade among the three countries while leaders work on the USMCA. The administration “never actually pulled the U.S. out of NAFTA,” Bloomberg says. A year ago, the three countries signed a new pact and Mexico’s Senate ratified it in June. President Trump has been pressing the U.S. Congress to approve it but House majority Democrats are seeking changes, including stronger enforcement of the stepped-up labor and environmental provisions. Canada’s Parliament has held off on ratifying the deal as talks continue. Bloomberg says that the reason why the administration disliked the agreement so much was that it integrated North American supply chains in auto manufacturing and other industries and removed barriers to foreign investment and cross-border trade in services—and so was blamed for “increasing the U.S. trade deficit and sending manufacturing jobs to Mexico.” Though economists argue over NAFTA’s actual impacts, most objective studies have found it didn’t cause major aggregate job losses in the U.S., but also “didn’t significantly boost U.S. GDP. Bloomberg and others note that NAFTA did need updating although the deal which had been in place since 1994 “couldn’t have anticipated e-commerce and digital trade.” Now, while the administration says the proposed new agreement is “altogether different”—many agree that it is quite similar. Even fellow Republicans such as Senate Finance Chairman Chuck Grassley, R-Iowa, believe that “95% of the new deal is the same as NAFTA,” Bloomberg says. Some industries would notice changes, however. For example, automakers would require more vehicle components to be made in North America with a portion made by workers earning an average of at least $16 per hour. In addition, Canada agreed to allow more imports of U.S. dairy products and both Canada and Mexico would increase the value of goods that can be imported duty-free. Bloomberg cites the U.S. International Trade Commission finding that the new deal would boost U.S. trade with Mexico and Canada by about 5% overall, resulting in a 0.35% GDP increase in its sixth year. It would also boost U.S. workers’ annual incomes by an average of $150 and increase employment by 0.12%, or roughly 176,000 jobs. Bloomberg adds that the deal also would “benefit businesses by providing increased certainty about the future, especially because it would largely exempt Canada and Mexico from future auto tariffs.” So, it appears that the deal “has momentum” but still faces hurdles. U.S. Democrats have pushed for changes on pharmaceuticals, environmental protections, labor and enforcement of the accord and have especially focused higher wages for Mexico to reduce pressure on U.S. companies to move across the border. However, there is growing concern that Mexico will come up short on the reforms expected of it, which include independent labor courts and the right to elect union representatives. Mexican officials say they’re near a deal but have balked at proposals such as unannounced labor inspections that they say would infringe on their sovereignty. As negotiations drag on, other sticking points have emerged, including the agreement’s liability shield for tech companies and the required use of North American steel and aluminum in vehicles. The administration is pushing Congress to ratify the deal by year’s end. So, we will see. These talks involve high stakes for U.S. producers who have long invested in building access to growing markets across the region. Certainly, they should be watched closely by producers as they proceed, Washington Insider believes.

| Rural Advocate News | Monday December 9, 2019 |


FERC Approves Two More Tariff Amendments In Another Bid To Boost Midwest Propane Supplies Two oil pipeline tariff amendments aimed at boosting propane supplies to the Midwest were approved by the Federal Energy Regulatory Commission (FERC). ONEOK North System and Enterprise EU Products Pipeline Company said they received requests from shippers for the changes after the start of the alternative dispute resolution (ADR) process initiated by FERC in November, the regulator said. The action was to “alleviate propane pipeline constraints in Midwest states,” FERC said. Relative to ONEOK, FERC cleared a revised pipeline transportation capacity allocation policy allowing shippers to transfer allocated capacity to other shippers through the end of this month, and to receive credit to their allocation history for barrels moved by replacement shippers. In the Enterprise TE case, the company is extending emergency transportation service of propane to the Midwest region. The Enterprise TE action will continue until canceled or modified by Enterprise TE, FERC said. “FERC continues to monitor the Midwest propane situation, and the ADR process is continuing,” the regulator noted.

| Rural Advocate News | Monday December 9, 2019 |


Agriculture Opens FY 2020 With Solid Rise In Exports U.S. agricultural exports improved to $12.08 billion in October, up from $10.3 billion in September, and the highest since they were $12.08 billion in November 2018, according to USDA’s Latest U.S. Agricultural Trade Data update. However, they were below the October 2018 mark of $12.16 billion. Imports, meanwhile, were at $10.92 billion, up from $10.08 billion in September, marking an eight straight month at $10 billion or more. They were just slightly ahead of the year-ago mark. The result is a trade surplus of $1.17 billion, down from the year-ago mark of $1.26 billion, but up from just $219.8 million in September. October and November tend to be the strongest two months for U.S. agricultural exports each FY, while imports have tended to peak in the March-May period. Imports have been at $10 billion or more in all but two months since October 2017. During FY 2019, which ended with a trade surplus of $4.6 billion, the smallest since FY 2006, only October and November saw the trade surplus above $1 billion and there were three monthly deficits registered, including a record monthly deficit of $865 million in April. USDA forecasts FY 2020 ag exports will rise to $139 billion versus the FY 2019 result of $135.5 billion, while imports are seen at a record $132 billion, taking out the prior record registered in FY 2019 of $130.9 billion. That is forecast to leave a trade surplus of $7 billion. But with imports maintaining a solid pace, the USDA forecast is far from certain at this point.

| Rural Advocate News | Friday December 6, 2019 |


Trump; China Agreement has to Work for the U.S. Ag Secretary Sonny Perdue made a recent appearance on CNBC to talk about U.S. trade negotiations with China. The secretary says President Trump wants a “phase one” deal with China that works for the United States. “The president wants to come to a deal that’s enforceable, that’s reliable, and will be consistent with what the deal says.” His appearance on CNBC happened shortly after a Bloomberg report said that the U.S. and China were edging closer to wrapping up an agreement before new U.S. tariffs go into effect December 15th on more Chinese imports. During the NATO summit this week, Trump told reporters that trade talks with China are “going well.” He made those comments just one day after saying he might want to delay a deal with China until after the 2020 presidential election. Beijing and Washington have hit each other’s goods with billions of dollars in tariffs. The moves have hit U.S. farmers especially hard. Nearly $20 billion in U.S. agricultural exports went to China last year alone. “We in agriculture are optimistically hopeful that we can conclude this,” Perdue tells CNBC. However, he reiterated administration concerns that China won’t follow through on what it promises in the agreement. ********************************************************************************************* Wisconsin Rep Asks Perdue for More Support Wisconsin Representative Ron Kind sent a letter of Ag Secretary Sonny Perdue demanding that he have a plan to provide certainty and support for family farms amidst the trade talks with China. Kind points out in the letter that the secretary refers to farmers as “casualties” of the trade war. Kind sent the letter as a deadline for new tariffs on Chinese goods is set to take effect on December 15th and after Trump suggested that waiting to settle the dispute until after the 2020 elections is an option. Kind’s home state of Wisconsin loses an average of two farms a day and is on top of the nation in terms of the number of family farmers who’ve declared bankruptcy. It’s the second-straight year that Wisconsin has led the U.S. in that dubious category. As U.S. farmers face sometimes overwhelming challenges, they’re finding export markets increasingly closed off. In the first four months of this year, Wisconsin agriculture exports dropped nearly five percent compared to the previous year. Ag exports to China dropped by 31 percent. Kind says Wisconsin taxpayers have forked over $743 million in additional tariffs since the trade war began in March of 2018. ********************************************************************************************* Settlement on Cooperatives Working Together Lifts Cloud over Dairy The National Milk Producers Federation announced a settlement agreement that would end a class-action lawsuit concerning the Herd Retirement Program that ended back in 2010. The program was administered through the federation’s Cooperatives Working Together initiative. The settlement will safeguard ongoing efforts to aid U.S. dairy producers, lift a cloud over the industry that’s lasted years, and it allows NMPF member cooperatives and the current CWT program to move forward with more certainty. The plaintiffs consisted of larger retailers and companies who directly buy butter and cheese from CWT member cooperatives. The settlement amount is $220 million in exchange for a release of all claims. Neither the NMPF nor any of its member cooperatives admit any wrongdoing as a result of the settlement. “There is no way to sugarcoat a settlement of this size, especially given that the Herd Retirement Program was a well-publicized effort designed to serve dairy producers in difficult times,” says Jim Mulhern, President and CEO of the NMPF. “It was praised by two Secretaries of Agriculture and a number of the leading members of Congress.” The plaintiffs sought damages relating to the Herd Retirement Program, which offered dairy farmers financial incentives to market their milking herds for beef. It operated between 2003 and 2010. ********************************************************************************************** USDA Opening CRP Signup on December 9th The USDA’s Farm Service Agency announced that signup for the Conservation Reserve Program will begin on December ninth. The signup period ends on February 28th for general CRP, while the signup for continuous CRP is ongoing. Farmers and ranchers who enroll in CRP get a yearly payment for voluntarily establishing long-term, resource-conserving plant species like approved grasses or trees that help control erosion. The practices also improve water quality and develop wildlife habitat on marginally productive agricultural lands. “The Conservation Reserve Program is one of our nation’s largest conservation efforts and a critical tool to help producers better manage their operations while they conserve natural resources,” says Ag Secretary Sonny Perdue. CRP currently has 22 million acres enrolled in the program. However, the 2018 Farm Bill lifts the cap on acres up to 27 million. That means many farmers and ranchers have the chance to enroll for the first time or continue their participation for another term. CRP was first signed into law in 1985 and is one of the largest private-lands conservation programs in the United States. The program has evolved over the years and provides a variety of conservation and economic benefits across the country. ********************************************************************************************** USDA will Take Seven Trade Mission Trips in 2020 The U.S. Ag Department announced it will sponsor seven agribusiness trade missions in 2020. The goal will be to diversify and grow export opportunities around the world for American farmers and ranchers. “I cannot overstate the immense value trade missions provide to the U.S. agriculture industry and our customers,” says USDA Undersecretary for Trade and Foreign Agricultural Affairs Ted McKinney. He says trade missions help agribusinesses big and small to get their foot in the door to new markets, build strong relationships with existing and potential customers, and expand their global footprint and sales of U.S. farm and food products. “I’ve had the pleasure of leading numerous trade missions at USDA and the results overwhelmingly speak for themselves,” he adds. “In 2019 alone, six USDA trade missions enabled more than 170 U.S. companies and organizations to engage in more than 3,000 face-to-face meetings with foreign buyers.” Those engagements generated more than $78 million in projected 12-month sales. Destinations in 2020 include North Africa, the Philippines, Spain and Portugal, the United Kingdom, Australia and New Zealand, Peru, and the United Arab Emirates. ********************************************************************************************** Sheep Industry gets Predator Control Approval from EPA Environmental Protection Agency Administrator Andrew Wheeler announced the final interim decision on the registered use of sodium cyanide for predator control. The EPA worked in conjunction with the USDA’s Wildlife Services to put out a label for the predator control tool. The label will include three additional use restrictions to promote public awareness and decrease non-target impacts. Benny Cox, President of the American Sheep Industry Association, says the nation’s sheep producers welcome the decision. “We sincerely appreciate the USDA and EPA working together to ensure livestock producers will have access to effective predator control, while also increasing public awareness and transparency,” he says. “Livestock producers face heavy losses from predators, with those losses totaling more than $232 million every year.” He says producers are especially vulnerable to losses during lambing and calving. Sodium cyanide is only used under the oversight of federal or state wildlife officials.

| Rural Advocate News | Friday December 6, 2019 |


Washington Insider: Banks Can Loan to Support Hemp Production The press is fascinated by the fact that last year, Congress chose to authorize farmers to produce and market hemp — sort of. However, the process of moving that industry into the mainstream has been fraught with difficulty but that may be changing. For example, the Wall Street Journal this week wrote that banks are no longer required to report hemp growers as suspicious and cited a group of financial regulators who said “lenders are no longer required to file reports on customers who produce hemp for commercial purposes.” The Journal noted, as have many others, that “until recently, hemp production largely was banned under federal law.” Then, last year’s farm bill removed hemp from a list of federally controlled substances and directed USDA to regulate domestic production. However, there are still some controls on hemp production and banks are still required to file reports on customers in the hemp business if they suspect “suspicious” activity, regulators said. The Treasury’s Financial Crimes Enforcement Network says it will issue additional guidance after further evaluation of the USDA’s rules governing hemp production. This week, the American Bankers Association, a trade association, praised the release of the industry guidance. Even after last year’s farm bill, access to banking services has been “an ongoing problem,” according to Erica McBride Stark, the executive director of the National Hemp Association, a trade group for growers. “So, this actually should be quite helpful.” Even after hemp production became legal, it took USDA most of a year to devise rules for the industry and bank regulators were even slower to change. The restrictions on the industry had held back even Stark’s organization, a nonprofit that does not actually produce hemp. The trade group had problems getting basic services because banks were worried that they it could be receiving proceeds from a crime when it collected its members’ dues, the New York Times said. The report charged that Stark said that USDA’s rule change “had not helped. They understood that hemp was removed from the federal Controlled Substances Act but because of the paperwork that was involved, a lot of producers were just like, ‘yeah, it’s just not worth it,’” she said. Rob Nichols, the president of the American Bankers Association, a trade group, said his members had been pushing for the change for some time, and was also interested in changing rules for marijuana production. Last month, the association surveyed 1,800 agriculture-focused banks in the country and found that almost half had gotten questions from their farmer-customers about whether they would still do business with them if they started growing hemp. “We appreciate the steps regulators have taken to clarify regulatory expectations for banks, and we look forward to working with them as they develop additional guidance,” Nichols said. While the change will help businesses making clothes and other hemp products, it does not affect even the legal marijuana businesses dealing with the same problems. The federal government still considers marijuana to be illegal and even local banks have been too worried about getting in trouble to deal with them. But banks large and small have come together to support a bill in Congress, the SAFE Banking Act, that would legalize marijuana banking by stipulating that the proceeds of a state-sanctioned marijuana business would not be considered illegal under federal anti-money-laundering laws. The House of Representatives passed a version of the bill, and the banking industry is pushing the Senate to take it up. If it were to become law, it would let banks dive into a lucrative new industry that has been plagued by security concerns and is desperate for even the most basic services, like checking accounts and credit card processing. Still, it wasn’t clear on Tuesday that the change to hemp regulations would immediately influence bankers’ attitudes. Bankers say they are still reviewing the complicated licensing requirements that states and USDA have devised for hemp growers. In the meantime, growers’ hopes might still be threatened. Stark said she had heard Wells Fargo was considering offering banking services to hemp businesses, but a Wells Fargo spokesman said the bank was taking no such steps. So, we will see. It clearly has been difficult for a staid old business like agriculture to shift to support what many believed, and believe, is an illegal activity. However, if hemp production proves to be profitable, even that reluctance likely will fade into the sunset, Washington Insider believes.

| Rural Advocate News | Friday December 6, 2019 |


USDA Opens General CRP Signup And Enrollments Could Be Sizable USDA will open a general Conservation Reserve Program (CRP) signup December 9 through February 28, 2020. At the end of October, there were 21.967 million acres in the CRP, including contracts that were to expire September 30 but were given a one-year extension. Contracts on around 970,000 acres were extended, about 81 percent of acres that were eligible to be in the program for another year. Continuous CRP signup in Fiscal Year (FY) 2019 enrolled about 245,000 acres. USDA also pledged that the general signups will be held annually. That has not been the case for several years as acres enrolled in the program were very close to the maximum level allowed via the 2014 Farm Bill. Under the 2018 Farm Bill, the CRP acreage cap is increased from the current cap of 24 million acres in FY 2019, to 24.5 million in FY 2020, 25 million in FY 2021, 25.5 million in FY 2022 and 27 million in FY 2023. The decision to hold annual general signups reflects the level of CRP contracts that will expire ahead. There are contracts on 5.36 million acres set to mature September 30, 2020. That could allow for a very robust general signup given the current level of CRP acres and the contracts maturing in September 2020.

| Rural Advocate News | Friday December 6, 2019 |


China Continues to Insist on Tariff Rollbacks in Phase One Deal As close communications between the U.S. and China continue, China is making clear it wants tariffs lowered as part of any Phase 1 trade deal. "The Chinese side believes that if the two sides reach a Phase 1 deal, tariffs should be lowered accordingly," Commerce ministry spokesman Gao Feng told reporters. In Washington, China’s Ambassador to the U.S., Cui Tiankai, said the two sides are trying to resolve their differences over trade, but warned some are trying to undermine those efforts. "At the same time, we must be alert that some destructive forces are taking advantage of the ongoing trade friction (through) extreme rhetoric such as 'decoupling,' the 'new Cold War,' and ‘clash of civilizations,'" Cui said in remarks at a U.S.-China Business dinner. He said some are trying to “rebuild the Berlin Wall between China and the United States in the economic, technological and ideological fields.” He called on U.S. and Chinese companies to withstand efforts he said were aimed at spreading “hostility and even create conflict between us," as well as "fake news" about the situations in both Hong Kong and Xinjiang. Cui did not specifically talk about the status of the trade talks, but said China remains committed to expanding bilateral trade and investment between the two nations.

| Rural Advocate News | Friday December 6, 2019 |


Friday Watch List Markets Weekly jobless claims will be out in the morning, along with the Trade Deficit and Factory orders. We will also be watching for any news regarding the U.S. and China trade negotiations. DTN will also be looking at U.S. export sales to see if corn sales pick up and whether soybeans can maintain the positive sales pace. Weather Showers may occur through west-central and southeast Plains areas later Thursday and in the Delta at night. Snow may develop through the upper peninsula of Michigan during this time. Mainly dry elsewhere in the key U.S. crop areas. In areas without a snow cover this should allow for some harvesting of corn and soybeans. In South America rainfall moves north through Brazil's corn and soybean belt maintaining favorable conditions. Drier weather returns to the central Argentina corn and soybean belt. Dryness remains a significant concern in key growing areas of Argentina.

| Rural Advocate News | Thursday December 5, 2019 |


USDA Announces Final SNAP Rule A final rule making changes to the Supplemental Nutrition Assistance Program restores intent of the program, according to the Department of Agriculture. However, critics say the rule could cut benefits to hundreds of thousands of recipients, and charge that the rule ignores a bipartisan agreement in the 2018 farm bill. The change tightens work requirements for able-bodied SNAP participants without dependents. Agriculture Secretary Sonny Perdue says amid the strongest economy in a generation, the rule "lays the groundwork for the expectation that able-bodied Americans re-enter the workforce where there are currently more job openings than people to fill them." Senate Agriculture Committee Ranking Democrat Debbie Stabenow of Michigan, counters, "this rule could cause one million people to lose their food assistance, while doing nothing to help them find jobs.” The National Farmers Union says the rule “will erode food security in rural and urban communities alike.” In the announcement, Secretary Perdue says, “Government can be a powerful force for good, but government dependency has never been the American dream.” ************************************************************************************* Japan Approves Partial Trade Agreement with U.S. Japan’s Upper House of Parliament Wednesday ratified a partial trade agreement with the United States, which will go into effect on January 1, 2020. Ryan LeGrand, President and CEO of the U.S. Grains Council, notes that the agreement “solidifies trade with our second-largest corn market." The agreement immediately reduces U.S. corn and sorghum imports for all purposes to a zero-tariff level, reduces the U.S. barley mark up and includes a staged tariff reduction for U.S. ethanol and U.S. corn, barley and sorghum flour. Also, U.S. feed and food corn, corn gluten feed, and DDGS will continue to receive duty-free market access. Meanwhile, the U.S. Meat Export Federation called the agreement “one of the biggest developments in the history of red meat trade.” With tariff rates mirroring those imposed on major competitors, USMEF's forecast for 2020 is for U.S. beef and pork exports to Japan to reach $2.3 billion and $1.7 billion, respectively. Export volumes are projected to be roughly 360,000 metric tons for beef and 410,000 metric tons for pork. ************************************************************************************* Trump: USMCA Action up to Pelosi President Donald Trump told reporters Wednesday the U.S.-Mexico-Canada Agreement is on the desk of House Speaker Nancy Pelosi. Trump says Pelosi, “doesn’t have to talk to anybody,” adding she “has to put it out for a vote.” The President made the comments to the White House press pool on the sidelines of the NATO summit in London. Talk of getting USMCA on the House floor this week brought optimism the agreement could be completed yet this year. However, it seems more likely to be finalized in early 2020, as the trade pact faces several procedural hurdles. Although, some fear the agreement could get lost in the shuffle of election-year politics next year. Mexico must first approve changes to the agreement before the House of Representatives can hold a vote on the agreement. A trade official from Mexico met with U.S. Trade Representative Robert Lighthizer Wednesday, as both sides are working towards a speedy compromise. Agriculture groups continue to urge the agreement be finalized as quickly as possible. ************************************************************************************* AFBF: Trade Progress Can’t Wait The American Farm Bureau Federation says farmers can’t wait for progress on trade deals, including the U.S.-Mexico-Canada agreement and a deal with China. President Donald Trump earlier this week suggested there was no deadline to reach a final agreement with China, and that an agreement could wait until after the 2020 elections. However, a phase one agreement including agriculture provisions could still come this month. In his comments, Trump said trade aid to help farmers cope with tariffs “got them whole.” AFBF President Zippy Duvall said in a statement that while the payments to farmers provide critical support, "trade aid payments are not making farmers whole." Duvall says a trade agreement with China's must be a priority, adding further delay in reaching an agreement "would make it hard for struggling farmers to hold on in the face of rising bankruptcy rates." Duvall also says passing USMCA would “send a message to the rest of the world that we are back in the game” of global trade. ************************************************************************************ Bankers Association Welcomes Hemp Banking Regulations The federal government this week released banking guidance for the finance industry related to hemp producers. The American Bankers Association says the guidance makes clear that banks are not required to file Suspicious Activity Reports on hemp producers operating under an approved federal, state or tribal license or plan. The guidance also states bank customers are responsible for complying with regulatory requirements, not the banks. The guidance came following an interim final rule in October from the Department of Agriculture, which provided a framework for how USDA will approve regulatory plans from states and tribes that wish to oversee hemp production, as well as a federal plan to license producers in areas without approved local plans. Federal regulators said they would issue further guidance after reviewing the USDA rule. While the 2018 farm bill reclassified hemp as a legal agricultural commodity, significant questions remained, and ABA encouraged regulators to provide additional clarity on banks' ability to serve hemp producers and hemp-related businesses. ************************************************************************************ Grain Elevators Facing Tighter Margins, Revenue Pressures in 2020 Grain elevators face significant challenges in the year ahead as they buy basis on corn, soybeans and wheat at the highest levels seen in years, according to a new report. CoBank reports basis for the three major grains is significantly tighter across the country from strong end-user bids, limited pipeline supplies, and lack of farmer selling amid an uncertain fall harvest. A CoBank researcher says, “grain elevators are being compelled to offer farmers a range of incentives to sell bushels,” including lower rates on storage, free delayed pricing and free grain drying, all cutting into elevator margins. Grain quality issues resulting from high moisture at harvest and frost damage on immature crops will also raise management costs for elevators, potentially resulting in greater losses to shrinkage and spoilage. A propane supply shortage in some regions is also driving up the cost of drying grain. However, grain elevators also have an opportunity to improve margins in an otherwise stressful year, as basis will likely soften as more bushels come to market as harvest operations conclude.

| Rural Advocate News | Thursday December 5, 2019 |


Washington Insider: Technical Basis for Ag Trade Aid Criticized The fact that efforts to compensate producers for the impacts of the trade wars with China and others are controversial likely is no surprise to most observers — the 1980 efforts to compensate producers for the Carter administration’s embargo on shipments of commodities to Russia were a political disaster. So it likely was expected to be a challenge to find a “just right” level for such payments this time. That appears to be the case, Bloomberg is reporting. It says that the President’s $28 billion farm bailout “may be paying many growers more than the trade war with China has cost them.” Bloomberg says it has found “six academic studies that conclude that the USDA’s calculations “overshot the impact of the trade conflict on American soybean prices.” The result likely will add to criticism that the bailout has generated distortions and inequalities in the farm economy. The dispute is involving big names in ag economics. For example, “it’s clear that the payment rates overstate the damage suffered by soybean growers,” Joseph Glauber said. He is USDA’s former chief economist and published a review of the research in late November. “Based on what the studies show, the damages were about half that.” The academic research has focused on soybeans in part because the crop has been the most visible target of Chinese retaliation and overall received the most trade aid. But USDA’s calculation method likely overstates the conflict’s financial impact on most other farm products, as well Glauber, now a senior fellow at the International Food Policy Research Institute, told Bloomberg. The divergence doesn’t necessarily mean a bonanza for American farmers, who are being financially squeezed on other fronts, including a global commodity glut that is depressing prices and a year of wild weather that is damaging crop yields. Also, the trade conflict risks long-term loss of market share for U.S. producers as overseas customers build relationships with replacement suppliers. Neither the academic nor the USDA estimates take potential future market losses into account. “You’re ruining a huge export market,” said Yuqing Zheng, an agricultural economist at the University of Kentucky. “Longer term, we don’t know for sure what the impact will be.” Still, a team Zheng led estimated the trade conflict depressed U.S. soybean prices by only 36 cents per bushel in its first year, a period in which the bailout program paid soybean growers more than four times that: $1.65 per bushel, Bloomberg said. The program is encountering other flak, as well. For example, Senate Democrats reported in November that the trade aid program favors large producers over smaller ones. And an advocacy group, the Environmental Working Group, released a study that asserted big farms so far have been the main beneficiaries of the billions of dollars in aid payments. Still, USDA appears willing to emphasize the current program’s positive impacts. It said last week that it expects net farm income to rise more than 10% this year to $92.5 billion “with government aid accounting for all of the increase in profits.” The trade aid, particularly for soybeans, largely goes to the president’s political supporters, Bloomberg said and notes that he has maintained overwhelming backing from them. Glauber estimates more than half of the direct payments under the USDA’s market facilitation program cover soybeans. The apparent over-payment stems from the method the USDA uses to compute trade damages. The department forecast the overall price impact of punitive tariffs China and other nations imposed on U.S. farm products without considering potential sales in alternative markets. For example, as China bought more soybeans from Brazil, other buyers stepped in to purchase more soybeans from the U.S. in some cases, replacing product they had previously bought from Brazil. “A broader analysis like some of these show the beans go elsewhere,” Glauber said. “They don’t just go into storage. Some of them go to Europe. Some of them go to other uses. We ended up crushing a lot more soybeans in 2018 than expected. We exported more vegetable oil, more protein meal. All of that mitigates the price impact.” Robert Johannson, the USDA’s chief economist, said the department decided to base trade aid on a projection of “gross” trade losses rather “net” losses primarily for consistent treatment of producers of diverse farm products affected. It’s harder to isolate net trade impact for specialty crops such as pecans or almonds than for major commodities such as soybeans, he said. “We need to be pretty sure whatever method we use is consistent across all commodities,” Johannson said. USDA officials also concluded after consulting with U.S. trade negotiators that there was an advantage to using the gross damages method because it is the basis the country uses for its negotiations. The USDA has boosted its trade damage estimate for soybeans in this year’s aid program, at $2.05 per bushel, a figure a number of analysts say still exceeds their estimates of impact in the period. This year’s payment is higher because the USDA decided to calculate the damage based on export sales over the past 10 years; last year’s payment was based on a comparison with the prior year. So, we will see. Glauber and several of the other critics of the program’s management are high-profile professionals and their criticism certainly will attract attention, although the current “fog” of the policy wars makes it very hard to focus on criticisms, let alone for advocates to react to them. Whether or not the economists’ views now emerging have much impact on the program’s technical design is difficult to anticipate, especially amid so many tough economic and political controversies. However, the amounts involved are significant and will be watched closely by budget hawks — and should be followed closely by producers as program decisions are debated, Washington Insider believes.

| Rural Advocate News | Thursday December 5, 2019 |


Government Bank Regulators Give Approval For Banks To Serve Hemp Companies Federal regulators gave banks the go-ahead to serve industrial hemp customers without any enhanced anti-money laundering reporting requirements. The Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency and the Financial Crimes Enforcement Network said in guidance that banks would no longer have to file suspicious activity reports just because they conduct transactions or other services for hemp-related businesses. Banks had been slow to serve industrial hemp-related businesses despite the cousin to marijuana being removed from federal controlled substance scheduling in the 2018 Farm Bill. There was uncertainty over whether hemp would be subject to the same types of robust reporting requirements as marijuana.

| Rural Advocate News | Thursday December 5, 2019 |


Approval by Japanese Diet Clears Way for January Implementation of Trade Deal with US Japan’s Diet, their upper house of parliament, has approved the limited trade deal reached with the U.S. that will cut tariff levels on farm and industrial goods. The lower house of parliament cleared the plan last month. No U.S. congressional approval of the deal is required. This now paves the way for the deal to be implemented starting in January. Agricultural provisions in the pact are the highlight for the U.S. side, while Japan insists that the U.S. has committed to remove tariffs it has in place on Japanese autos and auto parts, with the two sides to embark on negotiations on the time frame for such an action. As for the economic impacts of the deal, Japan’s Cabinet Secretariat indicated it would boost real GDP by 0.8%, with that expectation based on the assumption that existing tariffs on Japanese car exports to the U.S. would be removed. Japan’s agricultural production was forecast to fall between 60 billion-110 billion yen ($552 million-$1 billion), according to the estimate. For the U.S., the deal will result in tariffs being either lowered or removed on $7.2 billion in U.S. agricultural products like beef, pork, wine and cheese. The accord largely sets the tariff levels for U.S. market access in Japan at those that would have been put in place had the U.S. remained in the Trans-Pacific Partnership (TPP) agreement that has since been finalized between the 11 countries that were part of the TPP. That pact is now the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

| Rural Advocate News | Wednesday December 4, 2019 |


Trump: No Deadline for Final China Trade Deal In a flurry of meeting with reporters Tuesday in London, President Donald Trump says he has no deadline for finalizing a complete trade deal with China. China and the U.S. are still working to reach a phase one agreement, with an unofficial deadline of December 15, but an overall agreement may extend beyond the 2020 elections. Trump told reporters, "In some ways, I think it's better to wait until after the election.” Trump says China wants to reach an agreement, adding, “the China trade deal is dependent on one thing: Do I want to make it?” Trump claims he is doing “very well” in the talks with China. The President also pointed out the $28 billion in trade aid given to U.S. farmers, with "many billions" leftover, adding about the funds, “that got them whole.” China wants Trump to remove tariffs in reaching a phase one agreement that also includes $40-$50 billion in purchases of U.S. agricultural products over two years. ************************************************************************************* November Ag Economy Barometer Released The Purdue/CME Group Ag Economy Barometer rose in November for the second month in a row, climbing to 153, 17 points higher than in October when the index stood at 136. This month’s rise in the ag economy sentiment index left the barometer tied with July for the highest reading of 2019. Once again, the rise was driven by improvements in farmers’ perceptions of both current economic conditions, and their belief that conditions will improve in the future, with the biggest boost coming from improved views of current conditions. Producers in November became much more confident that the trade dispute with China will be settled soon. On the November survey, 57 percent of respondents said they expect a resolution soon, up from 42 percent in October. Additionally, 80 percent of respondents now say they believe the trade dispute will end in a beneficial outcome for U.S. farmers. The index is based on a survey of 400 agricultural producers on economic sentiment each month. ************************************************************************************* NCBA Staff Directed to Work With USDA to Verify Beef Origin Labeling Claims The National Cattlemen’s Beef Association executive committee unanimously approved efforts to work with the Department of Agriculture to address geographic origin statements. NCBA is firmly opposed to mandatory Country-of-Origin labeling and is seeking solutions which “will resolve the concerns of beef producers,” while protecting commerce and meet trade obligations. Specifically, NCBA is Looking at Food Safety and Inspection Service labeling requirements and verification procedures in place for beef products labeled as “Product of the U.S.A.,” “Made in the U.S.A.,” or similar origin claims. NCBA CEO Colin Woodall says that while many beef products currently advertised, marketed, or labeled as ‘Product of the U.S.A.' are “likely compliant with current FSIS regulations, the potential for consumer confusion exists.” NCBA believes that beef labels with voluntary country-of-origin labeling marketing claims should be verified through existing USDA framework that is market-based and respects international trade commitments. The organization says it is critically important that any changes not trigger retaliatory tariffs from Mexico or Canada that have already been approved by the WTO. ************************************************************************************* FDA Nomination Heads to Senate Floor With NMPF Hopeful for Progress on Fake Milk The Senate Health Committee Tuesday advanced President Donald Trump’s nomination to lead the Food and Drug Administration to the full Senate. The committee sent the nomination of Stephen Hahn as FDA commissioner to the full Senate for final confirmation, which the dairy industry says represents another step towards greater transparency in the use of dairy terms in the marketplace. The National Milk Producers Federation is eager to see Hahn take the FDA role, as Hahn voiced his support in his confirmation hearing last month for "clear, transparent, and understandable labeling for the American people," when asked about dairy imitating products using dairy terms. Jim Mulhern, President and CEO of NMPF, says, "It is long past time for the FDA to begin enforcing its own standards." Current FDA standards make "clear that dairy terms are reserved for real dairy products, not plant-based imitators,” according to Mulhern. The organization, which has been speaking out on plant-based imitators for four decades, noted encouragement by recent FDA attention to the issue. ************************************************************************************ USCA Urges Review of Marfrig Global Foods' Acquisition of National Beef The United States Cattlemen's Association Tuesday submitted a request seeking an investigation of Marfrig Global Foods' “near-acquisition” of the U.S.-based National Beef Packing Company. The organization sent the request to U.S. Treasury Secretary Steven Mnuchin (Muh-noo’-chin). The Brazilian-owned Marfrig Global Foods announced last week that it raised its stake in the U.S.-based National Beef Packing Company from 51 percent to 81.7 percent. In 2018, Marfrig acquired a majority stake in National Beef Packing Company, but USCA says this recent announcement means that Brazilian interests will almost wholly own the U.S.-based company. The association is "firmly opposed to the increasing consolidation of the meat-packing sector and foreign ownership of U.S. agricultural interests." USCA wants the Committee on Foreign Investment in the United States to investigate the matter, and demands a full review of Marfrig Global Foods’ acquisition of U.S. companies, and calls for those outcomes to be explicitly written out and publicly published. ************************************************************************************ USDA to Conduct the 2019 Census of Horticultural Specialties The Department of Agriculture’s National Agricultural Statistics Service will conduct the 2019 Census of Horticultural Specialties this winter. USDA says the report will provide a comprehensive picture of the U.S. horticulture industry. Survey codes will be mailed this month to more than 40,000 horticulture producers to respond online. Collected just once every five years, the Census of Horticultural Specialties is the only source of detailed production and sales data for U.S. floriculture, nursery, and specialty crop industries, including greenhouse food crops. NASS Administrator Hubert Hamer (hay-mer) says, “Responding to this census is the best way for growers to help associations, businesses, and policymakers advocate for their industry.” The 2019 Census of Horticultural Specialties results will expand the 2017 Census of Agriculture data with information on horticultural crop production, value of products, square footage used for growing crops, production expenses, and more. The deadline for response is February 5, 2020. Results will be available December 2020. For more information about the 2019 Census of Horticultural Specialties, visit www.nass.usda.gov.

| Rural Advocate News | Wednesday December 4, 2019 |


Washington Insider: More Spending Fights While there are more and more trade policy issues emerging almost every day and the president appears to be actively downplaying expectations for a deal with China in the near future, concerns about next year’s spending bills are re-emerging and attracting more attention. To no one’s surprise, progress on funding the government for the year just beginning seems to be once again bogged down on the issue of funding for the border wall. For example, Bloomberg is reporting this week that lawmakers and the president may need a deal on border wall funding before any of the 12 fiscal 2020 spending bills can become law. This is widely seen as a “tall task” as the Dec. 20 deadline to fund the government approaches. President Donald Trump’s request for $8.6 billion in border wall funding remains the key sticking point in negotiations, lawmakers told Bloomberg — although appropriators have made progress recently, as the House and Senate Appropriations chairs agreed to top-line spending figures for the 12 bills. And appropriators have started work on bicameral versions of the bills, but it is seen as unlikely that the President will sign anything into law before there’s an agreement on the border wall, Senate Appropriations Military Construction-VA Subcommittee Chairman John Boozman, R-Ark., said Monday. “The wall funding has to be resolved before I think anything much gets moved,” Boozman said. A pairing of the two largest spending measures, covering Defense and Labor-HHS-Education appropriations, is possible “but I think they get held hostage” until border wall funding is settled, Boozman said. The President requested $5 billion for border fencing in the Homeland Security spending bill and $3.6 billion in the Military Construction-VA bill. Lawmakers will also need to come to an agreement on limitations to the president’s ability to reprogram additional funds. Because of the difficulty of those debates, those bills will likely be among the last completed, Boozman said. It’s one of the relatively few hot-button issues that subcommittee leaders won’t negotiate, instead kicking it up to either full committee leaders or members of congressional leadership to sort out with the administration, he added. He expressed hopes those discussions start this week. Senate Appropriations Chair Richard Shelby, R-Ala., also raised the prospect of a Defense and Labor-HHS-Education package, but said there needs to be “some understanding” on the border wall. “I think we’d have to have some kind of agreement or Trump wouldn’t sign it,” Shelby said. Senate Appropriations Homeland Security Subcommittee Ranking Member Jon Tester, D-Mont., said the border wall talks probably should be completed before lawmakers send a spending package to the president’s desk, but he’s not sure if it’s an absolute necessity. Sen. Brian Schatz, D-Hawaii, ranking member of the Military Construction-VA Subcommittee, said that depends on the president. Senate Appropriations Vice Chairman Patrick Leahy, D-Vermont, said he’d like to finish all the bills by December 20 but criticized the White House for being inconsistent about what they want, a complaint he’s repeated for months as spending talks have dragged on at a slow pace. White House Legislative Affairs Director Eric Ueland was in the Capitol Monday to meet with lawmakers on topics that included appropriations, he said. While Democrats oppose any funding for the border wall, they are pursuing their top priorities in the appropriations bills. Senate Minority Leader Chuck Schumer, D-N.Y., said his caucus’s top priorities include “significant resources to combat the opioid and gun violence epidemics, significant investment in infrastructure, significant investment in child care,” Violence Against Women Act funding, and “funding to secure next year’s presidential elections.” Senate Democrats also “strongly oppose the president stealing money from our military families to pay for this border wall,” Schumer said on the Senate floor yesterday. While there are other pressures, many of these seem to be resolved within committees. For example, the Senate Appropriations Committee approved a Commerce, Justice, Science bill that included $70.8 billion in discretionary spending, the same amount as proposed by the Senate Democrats for those programs. However, the House Democrats proposed $73.9 billion. In response, Sen. Jeanne Shaheen, D-N.H., said that while program funds “are low and while the bicameral allocations agreement provides less for them than many Democrats wanted, “she’s happy we have an agreement. Obviously I would like to have more money in it. I think it gives us a place to continue to go forward. We are in discussions now over what is going to have to come off, given the change in the number.” So, we will see. There have been whispers for some time about negative impacts of the ongoing and threatened trade fights on economic activity, and at least some of these appear to be resurfacing once again this week—and they are increasing pressure on the Fed to “do something” to bolster growth,” and to make sure that government operations can continue without interruption. These increasingly appear to be broadening, high stakes fights that producers should watch closely as they emerge, Washington Insider believes.

| Rural Advocate News | Wednesday December 4, 2019 |


House Extends Schedule By A Week House Majority Leader Steny Hoyer, D-Md., announced Monday that the House will be in session the week of December 16. Previously the chamber was to be in session only portions of the first two weeks of December. First votes of the week are expected to occur early in the day on Tuesday, December 17, with last votes of the week expected on Friday, December 20, Hoyer said in a message to House members. "Exact timing of last votes for the week will be announced at a later date.” The move is not a surprise given that there is now a December 20 deadline for lawmakers to take action to keep the government funded and this also opens the door for action on the U.S.-Mexico-Canada Agreement (USMCA) to see action in the House. Hoyer mentioned several weeks ago the chamber could be in session longer than the original departure date of Dec. 12.

| Rural Advocate News | Wednesday December 4, 2019 |


Grassley: USMCA Deal Needed This Week For Year-End Ratification If a deal on the U.S.-Mexico-Canada Agreement (USMCA) is not reached by the end of this week, “I do not see how the USMCA can be ratified in the year we are in,” Sen. Chuck Grassley, R-Iowa, said on AgriTalk radio and on the Senate floor. “By all accounts, the deal is close,” Grassley said. “I urge House Democrats to act quickly and be reasonable so that we can finally deliver certainty on this issue to the American people.” Grassley said he has recently been in touch with both House lawmakers and members of the Trump administration. He said once the agreement is in place between House Democrats and the administration, the process of getting the legislative language to Congress and consideration of the pact in both the House and Senate could happen in a relatively short timeframe.

| Rural Advocate News | Wednesday December 4, 2019 |


Wednesday Watch List Markets A private estimate of U.S. job growth is due out at 7:15 a.m. CST Wednesday, a warmup for Friday's unemployment report. The U.S. Department of Energy releases weekly energy inventories at 9:30 a.m., including ethanol. Weather remains of interest with unharvested corn still in fields and trade comments provide daily entertainment with no agreement yet. Weather Dry conditions will again be in place over all primary crop areas Wednesday. Temperatures will be seasonal north and seasonal to above normal south. This combination favors transportation and livestock and late harvest.

| Rural Advocate News | Tuesday December 3, 2019 |


Hints of El Nino in Early Winter Just a couple weeks ago, it was noted how the Pacific Ocean was officially absent of either El Nino (warm) or La Nina (cool) sea surface temperature and barometric pressure conditions. And, the prospects for the winter 2019-20 season would more likely be dependent on more intermediate-term features. That scenario may indeed play out. However, recent measurements of both temperature and barometric pressure in the Pacific basin are at least worth noting for strong resemblances to a weak El Nino event. Sea surface temperatures at the equator in the Pacific Ocean show several pools of water with between 1 degree Celsius and 2 degrees Celsius above normal, going across the ocean from the coast of Ecuador and Peru in South America to the East Indies. When the water temperature is a sustained 0.8 degree C above normal, an El Nino event is indicated. At the same time, the atmospheric fingerprint of either El Nino or La Nina, the Southern Oscillation Index (SOI), is around a minus 10.0 reading on the 30-day moving average, and has a 90-day moving average of around minus 9.0. A value of the SOI at minus 8.0 is the threshold for El Nino on this measurement -- and research done on the influence of El Nino on weather patterns in the U.S. Midwest by Iowa State University shows that the 90-day SOI reading of minus 8.0 or lower indicates that a given El Nino event is robust enough to affect the U.S. Midwest weather pattern. This set of conditions will be interesting to keep track of through the winter season. When El Nino is in effect during the winter, the weather pattern over the northern U.S., Western Canada, and Alaska, tends to be warm and dry. In contrast, the southern tier of the U.S. has a cooler and wetter pattern. If the northern warmer and drier trend indeed develops, even for at least part of the season, there may be an opportunity for the final leg of the much-delayed 2019 corn harvest to get done. It would also, perhaps, dial back the prospect of winter moisture loading up to the point of enhancing spring flood threat quite as much as feared during the late-fall time frame. At the same time, higher chances for precipitation in the southern U.S. could improve drought conditions in the Southwest, along with offering better moisture for crop areas of the southwestern Plains ahead of spring 2020. So far, the winter forecast setup of a warm first segment of the season is verifying. There, of course, are still 11 weeks to go through the rest of the season.

| Rural Advocate News | Tuesday December 3, 2019 |


USMCA Deal Could Emerge This Week A final agreement on the U.S.-Mexico-Canada Agreement is within days, according to some in Washington. A Mexican trade official last week told reporters Mexico was expected to approve changes to the agreement this week, which could then set up a vote in Congress. The official said, “maybe days, so maybe sometime next week,” regarding timing, according to Politico. The comments followed a meeting with Canada’s Prime Minister, Justin Trudeau (true-doh), and Deputy Prime Minister Chrystia Freeland. A vote doesn’t mean the deal can be completed still in 2019, but would mark significant progress to finalizing the trade pact within the next few months. USMCA is one of many legislative items on the agenda this month, as Congress must also yet again work towards funding the federal government. Lawmakers may also consider two farm labor bills, and provisions regarding biodiesel tax credits, as part of a broader energy bill. Meanwhile, the House of Representatives continues its impeachment investigation this week in the House Judiciary Committee. ************************************************************************************* Ross: Ball in China’s Court on Trade Trade negotiations with China continue as the U.S. and China seek to wrap up a phase one agreement, promised two weeks ago. U.S. Commerce Secretary Wilbur Ross told Fox Business News, "the ball is in China's court," in an interview Monday. He says the talks are making progress, but described the negotiations as "one step forward, one step backward." If nothing happens before December 15, President Donald Trump plans to move forward with a round of tariffs on China, as Ross called the date a "logical deadline." China wants the U.S. to roll back tariffs in making the agreement. Meanwhile, Ross again confirmed China promised $40-$50 billion of purchases of U.S. ag products as part of the agreement. China was a near $20 billion market for U.S. agriculture before the trade war began. However, that market has dropped roughly 50 percent since the trade war began, as retaliatory tariffs by China focused on U.S. agricultural products. ************************************************************************************* Trump Imposing Tariffs on Brazil, Argentina President Donald Trump Monday announced new tariffs on Brazil and Argentina, citing harm to U.S. farmers. Trump says the tariffs on steel from Brazil and Argentina are in response to the “devaluation of their currencies.” Speaking to reporters on the White House lawn before departing for the NATO gathering in London, President Trump stated, “Our steel companies will be very happy, and our farmers will be very happy.” Trump says the currency devaluation is "very unfair" to U.S. farmers and manufacturers. Brazil and Argentina are serving as alternative markets of soybeans for China, allowing China to avoid tariffs on U.S. agricultural products stemming from the tit-for-tat trade war between China and the United States. The United States is the top soybean-producing country in the world, followed by Brazil, Argentina and China. President Trump also called on the Federal Reserve to "likewise act " against all countries that are takin advantage of a strong U.S. dollar. ************************************************************************************* BP, Bunge, Merge Brazil Sugar and Ethanol Operations British oil company BP and U.S. commodities group Bunge Monday announced the completion of a deal to combine sugar and ethanol operations in Brazil. The partners call BP Bunge Bioenergia a leading company in the sugar, ethanol and low carbon bioelectricity market in Brazil. The deal creates the world's second-largest cane processor, according to Reuters. The 50-50 joint venture will manage 11 plants in five Brazilian states, and include capacity to crush 32 million metric tons of sugar cane annually. First announced in July, the Monday announcement indicates the partnership obtained all needed regulatory approvals. The sugar processing season in Brazil is coming to an end, with many mills stopping processing efforts. The new joint venture between BP and Bunge will target joint operations to begin during the next sugarcane season, which starts in April. The joint venture also focuses on ethanol, as demand in brazil is growing ahead of a new federal program next year to boost the use of biofuels in Brazil. ************************************************************************************* Canada Ag, Propane, Seeks Priority in Resuming Normal Rail Operations Amid the fallout of an eight-day CN Rail strike, Canada is facing similar propane woes as seen in the Midwest United States. Agriculture groups, along with the Canadian Propane Association, are asking for their products to take priority above other shipments as the railway works to get trains moving. However, the rail operator has stated no product would take priority. The Canadian Propane Association in a recent statement said, “the propane industry is now facing significant logistical challenges of getting the supply chain back to normal.” The strike occurred as harvest season ended and farmers, along with grain companies, seek to ship products. The Canadian Federation of Agriculture last week said the delays in rail service have resulted in significant costs for farmers. The group says the strike came at “the worst possible time” for farmers. However, the organization says, “we can express relief that a resolution was found, and these delays and losses are not continuing to mount.” ************************************************************************************ USDA Announces Fellowships to Develop the Next Generation of Agriculture The Department of Agriculture Monday announced fellowship opportunities connecting agency resources with faculty and staff at land grant and other universities. The USDA Office of Partnerships and Public Engagement made the announcement, which seeks to connect participants to USDA and other federal resources while focusing on student development. The fellowship is available for faculty and staff at Hispanic Serving Institutions, 1994 Tribal Colleges and Universities, and 1890 Land-Grant Universities. Participants in the program will receive access to long-term collaboration opportunities, and then share what they learned with students and colleagues at their home institutions. Each program offers opportunities for Education Fellows and Science Fellows. Education Fellows participate in a week-long program in Washington, D.C. scheduled to start June 15 and end on June 19, 2020. Science Fellows participate in a two-week program, consisting of one week in Washington, D.C. and a second week at a USDA research location, ending on June 26, 2020.

| Rural Advocate News | Tuesday December 3, 2019 |


Tuesday Watch List Markets There are no official reports on Tuesday's docket. With snow in the northern Corn Belt and dry weather expected across the central U.S. this week, attention will be given to the remaining row crop harvest. Any trade news concerning China will also be noticed, but prices may not show much response until an actual agreement is at hand. Weather Dry conditions will cover all primary crop areas Tuesday. Temperatures will be near to below normal north, central and southeast, and above normal southwest. This combination is favorable for livestock and transportation, along with offering some prospects for late harvest progress.

| Rural Advocate News | Monday December 2, 2019 |


EU Parliament Approves Increased U.S. Beef Access It was a happy Thanksgiving for U.S. beef producers. The European Parliament voted last Thursday to approve a plan that grants the U.S. a country-specific share of the European Union’s duty-free, high-quality beef quota. The agreement was originally signed back in August. The U.S. Meat Export Federation was pleased to hear of the approval. “Approval by the European Parliament keeps this agreement on track to be implemented early next year,” says USMEF President and CEO Dan Halstrom. “That’s outstanding news for the U.S. beef industry and our customers in Europe. Lack of capacity in the duty-free quota has been a source of frustration on both sides of the Atlantic.” He says a U.S.-specific share of the quota will help to make sure that U.S. beef can enter the European Market 52 weeks a year, without any delays or interruptions. The EU is one of the highest-value destinations in the world for American beef. Consistent access will not only benefit U.S. beef producers and exporters but also European importers and their clients. USMEF says in a release that it “thanks the U.S. Trade Representative and the USDA for negotiating the agreement and securing its approval.” ********************************************************************************************* USMCA, U.S.-China Deal Pushing Forward Both the U.S.-Mexico-Canada Agreement and a phase one agreement of a deal between the U.S. and China appear to be slowly edging forward. The Hagstrom Report quotes House Speaker Nancy Pelosi as saying, “We are within range of a substantially improved agreement for America’s workers. Now, we need to see our progress in writing from the trade representative for a final review.” The Trump Administration says that U.S. Trade Representative Robert Lighthizer will provide a written agreement to Congress this week. Trump is continuing to push House Democrats to bring the agreement up for a vote. “House Democrats have insisted that hard-working Americans need more from the USMCA than just the same broken NAFTA with better language but no real enforcement,” Pelosi says. “It still left American workers exposed to losing their jobs to Mexico.” Meanwhile, President Trump says the phase one deal with China is “close.” At the same time, he also says the U.S. is monitoring the situation in Hong Kong. “We’re in the final throes of a very important deal,” Trump says. “It’s going very well, but at the same time we want to see things go well in Hong Kong.” Trump’s comments last week came just hours after a phone call between the Chinese Vice-Premier, USTR Robert Lighthizer, and Treasury Secretary Steven Mnuchin (Muh-NOO-chin). ********************************************************************************************* Farmers for Free Trade Launches New USMCA Ad Campaign Farmers for Free Trade, a bipartisan coalition supported by America’s top ag and business groups, announced a new ad campaign promoting quick passage of the U.S.-Mexico-Canada Agreement. The ad campaign launched with a $300,000 advertising blitz in more than 20 Congressional Districts. The ads focus specifically on why the USMCA is a badly needed victory for American agriculture. The 30-second radio spots feature American farmers who personally advocate for passing the agreement. The campaign also includes digital ads as well. The initial ad campaign will focus specifically on the home districts of many Democratic members of the House of Representatives. Those Democrats represent districts that have a high concentration of farmers and ranchers that would benefit from the USMCA. Farmers for Free Trade says those legislators are a very important part of making the case for the agreement and getting it to the finish line. Former Arkansas Senator Blanche Lincoln is a spokesperson for Farmers for Free Trade. She says, “With so many new Democratic members of Congress from districts with agricultural roots, they’ll have to be the ones to make the case that the agreement is vital for their farmers.” Farmers for Free Trade Co-Executive Director Angela Hoffmann says farmers are growing more and more frustrated by the delay in approving USMCA. ********************************************************************************************** Farm Income Rising in Part Because of Aid In spite of a challenging 2019, farm earnings are expected to rise this year by 10 percent. However, nearly one-third of producers’ net farm income is a result of crop insurance and direct government payments, which does include President Trump’s trade aid. An Agri-Pulse report says net farm income this year is projected to jump by $8.5 billion compared to last year, coming in at $92.5 billion. The USDA’s Economic Research Service says approximately 31 percent of that income is due to crop insurance benefits and government payments. Net cash farm income, which is another way to measure a farm’s profitability, is projected to reach $119 billion in 2019. That’s a jump of 15 percent compared to 2018. Commercial farms at which corn is the primary crop are projected to have net cash farm income around $206,000 this year, a 20 percent increase from 2018. Poultry is the only agricultural sector that’s projected to have a net decrease in cash income during 2019. The average income is projected at around $97,200, which is down from just over $105,000 last year. ********************************************************************************************** USDA Improves Crop Insurance for Sugar Beet Producers The U.S. Department of Agriculture announced it’s made changes to crop insurance for sugar beets in 2020. The Risk Management Agency made changes that will start in 2020 for some policies and 2021 for others. The agency says the changes will better protect sugar beet producers who may get a bumper crop in future years, as well as provide other flexibilities. “We continually listen to producers and stakeholders in developing our crop insurance policies,” says RMA Administrator Martin Barbre. “We also make adjustments to the policies when necessary to better support sugar beet producers and ensure the early harvest adjustment more accurately matches their current year production.” Key changes include revising the maximum early harvest adjustment to better reflect a unit’s production capabilities, especially in the case of a bumper crop. They’re also adding procedures to allow third-party testing of sugar beets for raw sugar content. Changes are further outlined in a final rule, now available at regulations.gov. Interested parties can comment on the final rule for 60 days. ********************************************************************************************** Hemp Innovation Challenge Coming to World Ag Expo in 2020 Something new is coming to the World Ag Expo. The Hemp Innovation Challenge is designed to kickstart the future of the hemp industry by supporting entrepreneurs, researchers, and students, who are launching some of the world’s biggest hemp industry innovations. Submissions are invited from hemp innovators in universities, companies, research institutes, barns, and government agencies. Finalists will be invited to the World Ag Expo in Tulare, California, in February of 2020 to take part in the Fast Pitch competition. Prizes will be awarded for ideas that include technology, software, and services driving growth and innovation in food, fuel, medicine, health, fiber, and sustainable development. The winners will receive strategic feedback about their innovation, business model, and go-to-market strategy. Event level highlights will include networking with executives, investors, and mentorship support for launching their innovations. Entering its 53rd year of existence, the World Ag Expo is the largest annual outdoor ag trade show in the world. The show had 102,800 people from 48 states and 65 countries enter the event in 2019 alone.

| Rural Advocate News | Monday December 2, 2019 |


Washington Insider: Hong Kong and the Trade Fight with China Trade observers are watching carefully following last week’s decision by President Donald Trump to sign legislation expressing support for Hong Kong protesters. In response, China threatened retaliation just as the two nations seemed close to signing a “phase one” agreement, Bloomberg reported. China summoned U.S. Ambassador Terry Branstad for a formal meeting in which Vice Foreign Minister Le Yucheng told the U.S. to “stop meddling in Hong Kong affairs.” He warned that such actions would strain ties and risk affecting “cooperation in important areas.” Earlier, the foreign ministry reiterated threats of retaliation with no specifics, Bloomberg said. Hu Xijin, the editor-in-chief of state-run Global Times, said Thursday in a tweet that China was considering putting the U.S. drafters of the law on a no-entry list. The new law requires annual reviews of Hong Kong’s special trade status as well as sanctions against any officials deemed responsible for human rights abuses or undermining the city’s autonomy. A second Hong Kong measure also bans the export of crowd-control items such as tear gas and rubber bullets to the city’s police. While signing the bills, President Trump signaled that he “didn’t want the broader relationship with China to veer off track.” He expressed concerns with unspecified portions of the new law, saying they risked interfering with his constitutional authority to carry out American foreign policy. “I signed these bills out of respect for President Xi, China, and the people of Hong Kong,” Trump said. “They are being enacted in the hope that leaders and representatives of China and Hong Kong will be able to amicably settle their differences leading to long term peace and prosperity for all.” Investors are watching closely for signs that the new measures might derail the proposed deal being counted on to de-escalate a trade war that’s dragged on for 20 months. President Trump would like the agreement finished in order to ease economic uncertainty for his campaign in 2020. China also is looking to avoid further damage to an economy growing at the slowest pace in decades. China is irked that the bill will bolster Hong Kong protesters who have become increasingly violent in their bid to secure demands including an independent inquiry into police abuses and meaningful elections, but it probably won’t affect trade talks much, said David Zweig, an emeritus professor at the Hong Kong University of Science and Technology and director of Transnational China Consulting Ltd. Hong Kong’s protesters cheered the bill’s passage and lauded President Trump for signing it into law. President Trump actually had little choice but to sign the bill, since the House cleared it 417-1 on Nov. 20 after the Senate passed it without opposition – majorities that would allow an override of any veto by the president, Bloomberg said. While many members of Congress in both parties had voiced strong support for the protesters who are demanding greater autonomy for the city, President Trump stayed largely silent, even as the demonstrations have been met by rising police violence. Last week, Senate Majority Leader Mitch McConnell, a Kentucky Republican, called on the president to speak out, saying that “the world should hear from him directly that the United States stands with” the protesters. China’s foreign ministry had repeatedly urged Trump to prevent the legislation from becoming law, warning the Americans not to underestimate China’s determination to defend its “sovereignty, security and development interests.” Chinese foreign ministry spokesman Geng Shuang dodged questions on whether trade talks would be affected as he briefed reporters in Beijing late last week. “We strongly urge the U.S. to refrain from implementing this law or it will undermine our bilateral relations and cooperation in important areas,” he said in response to a question on how the bill’s signing would impact the negotiations. Before a speech at the recent Bloomberg New Economy Forum in Beijing, China’s Vice Premier Liu He – the country’s chief trade negotiator – said that he was “cautiously optimistic” about reaching the phase one accord. Relations with China appear to be particularly fragile just now, although both sides are quick to say they are still working toward the “beginning” of a major deal – in spite of continued questions of what, exactly, might be included. Certainly, these continuing talks are enormously important and should be watched closely by producers as they proceed, Washington Insider believes.

| Rural Advocate News | Monday December 2, 2019 |


EU Approves US Beef Import Increase The European Parliament voted by 457-140, with 71 abstentions, in favor of a plan to permit U.S. farmers a larger share of an existing 45,000-ton quota from 2020. It came with a resolution that urges the removal of U.S. tariffs on EU steel and aluminum, and the withdrawal of a threat to raise tariffs on EU cars. "The message of this agreement is clear: we would like to de-escalate trade tensions with the U.S., but we want to see the same efforts of de-escalation on the other side of the Atlantic," said Bernd Lange, head of parliament's trade committee.

| Rural Advocate News | Monday December 2, 2019 |


Government Payments Key Contributor to Rise in 2019 Farm Income Forecast U.S. net farm income is now forecast at $92.5 billion for 2019, up $8.5 billion (10.2%) from the 2018 level, according to USDA’s November 2019 Farm Income Forecast. In inflation-adjusted terms, net farm income is seen up $7 billion, down 32.3% from $136.6 billion in 2013. In August, USDA forecast net farm income at $88 billion. Net cash farm income is seen at $119 billion, a rise of $15.5 billion (15%) from 2018, and up from the August forecast of $112.6 billion. Feeding the increase is a rise in cash receipts for all commodities of $2.2 billion, reaching $374.2 billion for 2019. With total animal/animal product receipts basically unchanged, there is a $1.9 billion rise forecast for total crop receipts compared with 2018. Key in the improved farm income outlook? Direct government farm payments are forecast to increase $8.8 billion (64%) to $22.4 billion in 2019, USDA said, “with the increase due to higher anticipated payments from the Market Facilitation Program” (MFP 2). USDA in August said those direct government payments were to be $19.5 billion, an increase of $5.8 billion from 2018. The 2019 forecast includes payments from the program first implemented in 2018 but received by producers in calendar year 2019, plus the expected payments from the first and second tranches of the program announced in 2019. “We assume producers will receive 75% of the announced 2019 payment total of $14.5 billion,” USDA stated.”

| Rural Advocate News | Monday December 2, 2019 |


Monday Watch List Markets Updated weather forecasts are probably the first things traders will check the first Monday of December, along with any trade news that might have come out over the weekend. USDA's weekly export inspections are due out at 10:00 a.m. CST. In the afternoon, the monthly Fats and Oils report is at 2 p.m., CFTC's Commitments of Traders report is at 2:30 p.m. and a USDA update on harvest progress follows at 3 p.m. CST. Weather Most primary crop areas will be dry Monday. Moderate to heavy snow cover in the Dakotas, Wisconsin, and Michigan -- where corn harvest is the most delayed -- will impede additional harvest progress. Dry conditions in the 10-day forecast offer some improvement for late harvest.

| Rural Advocate News | Friday November 29, 2019 |


No Final RFS Rule Friday Today (Friday) is when historically the Environmental Protection Agency would release it’s final Renewable Fuel Standard proposal. However, thanks to other changes pending in the rule, the EPA said earlier this week that the agency would review comments, and will seek to finish the rule this winter. The comment period for the proposed changes regarding small refinery exemptions closes today (Friday), which effectively puts the final rule on hold until the proposal is finalized. Corn and ethanol groups were busy earlier this week submitting comments to the EPA. Many say the proposal breaks a promise by President Donald Trump to make up for all lost demand created by the exemptions. The industry says more than four billion gallons of demand for biofuels has been lost due to retroactive small refinery exemptions for compliance years 2015 through 2018. National Corn Growers Association President Kevin Ross of Iowa states, “The proposed rule fails to provide the assurance needed that EPA’s practices for granting waivers will change going forward.” ************************************************************************************* Hoeven, Peterson, Meet with Sugar Growers Regarding Assistance Lawmakers recently met with sugar producers to discuss needed relief efforts after a challenging growing season. North Dakota Senator John Hoeven, a Republican from North Dakota and chairman of the Senate Agriculture Appropriations Committee, along with House Agriculture Committee Chair Collin Peterson, a Minnesota Democrat, met with sugar producers earlier this week. They are working with Department of Agriculture undersecretary Bill Northey to secure disaster assistance funding for sugarbeet growers, while urging USDA to avoid any premature actions, including increasing sugar imports. Sugarbeet growers, who were impacted by severe weather, are facing unique circumstances as they work to recover, including the inability to complete harvest and budgeting constraints faced by the cooperative. The current disaster programs do not account for these constraints, which is why Hoeven and Peterson are working with USDA to secure disaster assistance. Hoeven says producers “have faced real challenges this harvest,” while Peterson says, “we’ll continue having conversations to see what can be done to address the concerns.” ************************************************************************************* Committee to Vote on FDA Nominee Next Week The Senate Health Committee will vote on Stephen Hahn’s nomination to serve as Commissioner of the Food and Drug Administration next week. Tuesday, the committee will consider the nomination, among three others. If approved, the nominations would head for the full Senate for a final confirmation vote. During a hearing by the committee examining the nomination, Hahn briefly voiced his support for “clear, transparent, and understandable labeling” for dairy and dairy imitation products. The comments were welcomed by the National Milk Producers Federation, as NMPF CEO Jim Mulhern stated, “It’s heartening to hear” Hahn would “immediately examine this crucial unfinished business.” NMPF and others are seeking a labeling system that prohibits plant-based dairy imitators from using dairy marketing terms. Rules already do so, but FDA has not enforced them. Committee Chairman Lamar Alexander, a Republican from Tennessee, called Hahn an “impressive choice” to lead the FDA. Ranking member Patty Murray, a Democrat from Washington, demanded Hahn commit to putting science, data and families first. ************************************************************************************* Deere Reports 2019 Sales Increase Deere & Company reports worldwide net sales and revenues increased five percent in both the fourth quarter and full year of 2019 to $9.8 billion and $39.2 billion. Deere reported fourth-quarter net income of $722 million, compared with net income of $785 million, in 2018. Agriculture and Turf sales increased for the quarter and full year of 2019 due to price realization and higher shipment volumes, partially offset by the unfavorable effects of currency translation. However, operating profit decreased for the quarter and year. Deere CEO John May says the performance “reflected continued uncertainties in the agricultural sector,” adding “trade tensions coupled with a year of difficult growing and harvesting conditions have caused many farmers to become cautious about making major investments in new equipment.” Deere's worldwide sales of agriculture and turf equipment are forecast to decline between five and ten percent for fiscal-year 2020. Industry sales of agricultural equipment in the U.S. and Canada are forecast to be down about five percent, driven by lower demand for large equipment. ************************************************************************************* Online Cheese Sales Set to Surpass Half a Billion Dollars in 2020 Online cheese sales are experiencing major growth. By the end of 2019, data shows that e-commerce sales will surge past $440 million. The 54 percent annual growth in online sales over the past four years signals that shoppers are embracing the convenience and variety available when ordering cheese online. Suzanne Fanning, Senior Vice President at Dairy Farmers of Wisconsin, says, "Consumer research shows that cheese aligns with on-trend food preferences because it is packed with protein and good fat." With the holidays being the peak shopping season for cheese, it is poised to be one of the hottest gifts this holiday season. The organization is encouraging consumers to buy Wisconsin cheese. A list of holiday gift baskets is available on the organization’s website. The collection includes twelve unique gift baskets that offer a variety of cheeses from top specialty retailers. Get free shipping nationwide on the entire collection from Black Friday to Cyber Monday at WisconsinCheese.com/gift-basket. ************************************************************************************ USDA ERS: Potatoes Top U.S. Vegetable Consumption Potatoes rank number one among vegetables in terms of consumption, according to Department of Agriculture data. USDA’s Economic Research Service says that in 2017, 49.2 pounds of fresh and processed potatoes per person were available for Americans to eat after adjusting for losses. The loss-adjusted food availability data series takes per capita supplies of food available for human consumption and more closely approximates actual consumption by adjusting for some of the spoilage, plate waste, and other losses in restaurants and grocery stores, as well as at home. Loss-adjusted availability of fresh potatoes was 22.9 pounds per person in 2017, followed by frozen potatoes at 20.5 pounds per person, while canned and dehydrated potatoes, along with potato chips and shoestrings, totaled 5.9 pounds per person in 2017. Tomatoes came in second. While loss-adjusted canned tomato availability, at 16.1 pounds, leads fresh tomatoes, total tomato loss-adjusted availability, fresh and canned, came in second, at 28.7 pounds per person. Onions, lettuce, carrots and sweet corn finish the list of America’s top seven vegetable choices.

| Rural Advocate News | Friday November 29, 2019 |


Washington Insider: Potential Digital Sales Tax Fight You could be excused if you thought that the U.S., China trade fight was the main trade policy uncertainty these days, especially after Bloomberg reported this week that President Donald Trump told the press that “he’s holding up” the phase one deal. “We can’t make a deal that’s like, even,” Trump said, adding that he said as much to China’s President Xi Jinping. “We have to make a deal where we do much better, because we have to catch up,” he said. Still, the report said that the president thinks a China deal is in the “final throes.” However uncertain the China deal may be, it is not the only trade concern now bubbling up. The New York Times said on Wednesday that the “90-day pause in the taxation of technology companies and other corners of the digital economy had ended.” The report raised questions of whether the president would revive threats against French wine and other products. The Times focused on the potential for an escalating battle between the U.S. and France over taxing digital services. It noted that President Trump “gave no indication this week” whether he planned to return to his threats to impose new tariffs on imported wine and other French products as a result. French leaders voted earlier this year to impose a new tax on economic activity that takes place online and “crafted it in such a way that it would largely hit large American tech companies like Amazon and Facebook.” In response, the administration opened an investigation into whether “the tax posed a threat to national security and should be met with American tariffs on French products.” The President made that threat in July. Soon after, the countries reached a 90-day agreement that paused the American retaliation, while leaders from wealthy countries including France and the United States pursued negotiations toward an international agreement on digital taxation. The French tax was an effort to capture revenue from activities of companies that sell or advertise online to its citizens — an effort being considered by a growing number of countries outside America, including Britain, Italy and Canada, the Times said. The Organization for Economic Cooperation and Development is spearheading negotiations between the countries as it tries to avoid “an arms race of sorts” over digital sales revenue that crosses borders. Participants have set an ambitious goal to reach an agreement in principle sometime next year and key negotiators will meet next month in Paris to continue the process. A final global agreement has the potential to expand to cover large automakers and other multinational companies — not just tech firms — the Times said. Some tax experts predict that the administration will extend the truce period, perhaps unofficially, until at least January when the OECD is expected to update the status of the negotiations. Others say the administration is likely to hold off as long as negotiations remain fruitful. “Absent some sort of intervention from the president, it seems very unlikely that the U.S. will act on its investigation before seeing whether there is a satisfactory agreement at the OECD this coming January, and if such an agreement is reached, whether the French keep their promise and repeal their digital services tax,” said Itai Grinberg, an international tax policy professor at Georgetown University Law Center. The President has made it known that he is unhappy with the French tax even though he has separate concerns about the tech companies that are threatened by it. “I’m not a fan of those companies, but if anybody is going to tax those companies, it should be the USA,” the President said. “It shouldn’t be France and the European Union, who have really taken advantage of the United States.” David Kautter, the Treasury Department’s assistant secretary for tax policy, said last week that any countermeasures against France would be determined by the U.S. Trade Representative. He said that discussions between the United States and France had been “substantive” and “meaningful,” but it was not clear when the two countries would resolve their differences over the matter. “The administration adamantly opposes unilateral digital services taxes that are focused primarily on U.S. companies,” Kautter said. “We think the best way to resolve this issue is through multilateral discussions in the OECD. We are actively engaged in those discussions.” Still, Kautter cautioned that the target date for reaching a broader agreement was not until the end of next year and that there were many complicated matters to address in that time. So, we will see. This potential fight appears likely to be one more hot button trade issue to add to the several that concern other products in other areas, and which have the potential to become increasingly important, and which producers should watch closely as they evolve, Washington Insider believes.

| Rural Advocate News | Friday November 29, 2019 |


Comment Period on EPA Supplemental RFS Plan Ends Today As 2019 SREs Are On File The Environment Protection Agency (EPA) signaled last week via the unified agenda released November 20 that they would not be finalizing the 2020 biofuel and 2021 biodiesel levels under the Renewable Fuel Standard (RFS) by the November 30 deadline. Rather, the agency said they intended to file a final rule in December. An EPA spokesman is now telling media outlets that the agency would finalize the plan “this winter.” The Winter Solstice arrives December 21, so EPA’s guidance in the regulatory agenda of issuing a final rule in December would certainly match what the EPA is telling media outlets. Meanwhile, EPA has updated their data on small refinery exemptions (SREs). For the 2018 compliance year, EPA data shows 42 were submitted, 31 were approved and six were rejected. EPA data had previously shown three to have been withdrawn or declared ineligible. In late August, EPA data showed two were still labeled as pending. As of November 21, EPA now shows 42 were requested, 31 were approved, six were denied, and now it has separated the declared ineligible or withdrawn categories. Those figures now show that two have been declared ineligible and three have been withdrawn and no petitions are shown as pending for the 2018 compliance year. For the 2019 compliance year, EPA now lists 10 petitions for SREs having been received as of November 21, and all 10 are still shown as pending.

| Rural Advocate News | Friday November 29, 2019 |


Fed Says US Agriculture Conditions Remain Strained Conditions facing U.S. agriculture were “little changed overall” compared with late October, according to the Fed’s Beige Book, but conditions remain “strained by weather and low crop prices.” The report, issued two weeks prior to the next rate-setting meeting for the Federal Reserve, also offers comments from individual Fed Districts. The Chicago Fed indicated that “early frost and snow further delayed this year’s harvest and diminished yields.” Plus, there were concerns about crop quality. “Contacts noted that demand for pork from China had grown despite U.S. tariffs because African swine fever had decimated China's hog herd,” the Chicago Fed noted. “More generally, contacts reported a pickup in overall agricultural exports, with some noting that news on trade negotiations sounded promising for future exports. Farm incomes generally are expected to be down from last year, although government payments from the Market Facilitation Program will provide some support.” The St. Louis Fed reported conditions were basically unchanged from the October report. “Production levels for corn, rice, and soybeans are expected to be significantly lower than in 2018, while that for cotton is expected to increase modestly,” the bank said. “District contacts continued to express concerns over depressed agriculture commodity prices.” The Minneapolis Fed noted difficult conditions for the ag sector. “District agricultural conditions declined from an already weak position,” the report noted. “Roughly three in five lenders responding to the Minneapolis Fed's third-quarter (October) survey of agricultural credit conditions reported that farm incomes decreased in the third quarter relative to a year earlier, with a similar proportion reporting decreased capital spending.” Similarly, the Kansas City fed noted conditions in ag remained “weak” and “agricultural credit conditions deteriorated slightly.”

| Rural Advocate News | Friday November 29, 2019 |


Friday Watch List Markets Back from the Thanksgiving holiday, USDA will release its weekly report of grain export sales at 7:30 a.m. CST. Friday's grain and livestock futures open at 8:30 a.m. CST. Most U.S. grain futures close at 12:05 p.m. CST and livestock futures close at 12:15 p.m. CST. There are no other official reports, but traders will be interested in weather and any trade news. Weather Snow, ice and rain develops through the north-central U.S. region early Friday. This will become mostly snow later Friday or during Friday night into Saturday. Strong winds, heavy snow and ice tonight and Saturday will likely affect travel, transport, field activities and livestock in this area. Blizzard conditions may develop during this time. Some ice may also occur through the northwest Midwest later Friday or during Friday night. Mostly rain or showers through the eastern Plains, the southwest and central Midwest during this time frame. Strong winds but little rainfall through the west-central Plains winter wheat areas Friday, possible a risk to winter wheat. Drier through the eastern U.S. areas Friday.

| Rural Advocate News | Wednesday November 27, 2019 |


2019 Trade Aid May Violate WTO Commitments A recent independent report suggests U.S. trade aid in 2019 for farmers may surpass limits set in World Trade Organization commitments. The report for the American Enterprise Institute by Joe Glauber, a former Department of Agriculture Chief Economist, suggests the size of payments made to producers in 2019 may encourage other WTO members to challenge the payments. Glauber writes, a long-term concern is "how trade compensation comports with U.S. obligations in the WTO and, more generally, how it will affect future U.S. efforts to seek further reforms in the WTO.” President Donald Trump and his administration have approved the payments, roughly $28 billion, to offset any harm by other countries retaliating against the Trump trade agenda. Glauber says current WTO rules require that annual U.S. domestic supports that distort trade flows not exceed a maximum of $19.1 billion. Since the WTO disciplines went into effect in 1995, United States levels of support have remained in that annual limit. ************************************************************************************* NPPC: Improved Pork Trade with China can Lower Trade Deficit Securing zero-tariff access to China for U.S. pork would be an economic boon for American agriculture, according to the National Pork Producers Council. Based on an analysis by Iowa State University Economist Dermot (Der-Muht) Hayes, NPPC says unrestricted access to the Chinese chilled and frozen market would reduce the overall trade deficit with China by nearly six percent, and generate 184,000 new U.S. jobs in the next decade. NPPC Tuesday launched a digital campaign to spotlight the importance of opening the Chinese market to U.S. pork as trade negotiations continue. According to Dr. Hayes’ analysis, U.S. pork would generate $24.5 billion in sales if U.S. pork gained unrestricted access to the world’s largest pork-producing nation over ten years. NPPC President David Herring says the analysis shows, "The U.S. pork industry is missing out on an unprecedented sales opportunity in China when it most needs an affordable, safe and reliable supply of its favored protein." ************************************************************************************* Canada Rail Strike Prompts Potash Mine Shutdown Nutrien Ag Solutions says it will be forced to curtail production at its largest potash mine in Canada due to the CN Rail strike. Employees were sent notices this week, indicating the mine will be shut down for two weeks starting on December 2. The company says, "It is extremely disappointing that in a year when the agricultural sector has been severely impacted by poor weather and trade disputes, the CN strike will add further hardship to the Canadian agriculture industry.” The shutdown will continue despite the fact workers and CN Rail reached an agreement Tuesday. Nutrien is the world's largest provider of crop inputs and services, producing and distributing 27 million metric tons of potash, nitrogen and phosphate products worldwide. More than 3,000 CN rail employees are on strike, impacting agricultural shipments of grains, fertilizers and even propane for grain drying. A Fertilizer Canada official says an estimated $200 million to $300 million worth of fertilizer shipments will be impacted by the strike. ************************************************************************************* Organic Valley Unaffected by Dean Foods Bankruptcy When Dean Foods filed for bankruptcy this month, questions surfaced regarding the status of partnerships with the company and the health of the dairy industry. However, Organic Valley, a Wisconsin-based organic cooperative, says it’s Organic Valley Fresh LLC joint venture, which represents a small fraction of its milk processing and distribution, falls outside of the Dean Foods filing. The cooperative says its members are "disheartened by Dean Foods' bankruptcy as it represents the many challenges dairy farmers face in getting their products to market." Organic Valley officials say the cooperative remains strong and innovations have bolstered the business overall. Dean Foods this month announced the chapter 11 bankruptcy filing, adding the company was in advanced talks with Dairy Farmers of America regarding a potential sale. The National Milk Producers Federation says Dean's bankruptcy is creating uncertainty for some producers, but "seen from another angle, it's just another disruption this sector will be able to withstand,” due to the strength of cooperatives and their dairy farmer-owners. ************************************************************************************* Ag Innovation Necessary to Address Climate Change The American Seed Trade Association says agriculture innovation will help combat and mitigate the impacts of climate change. In comments submitted to the House Select Committee on the Climate Crisis, ASTA says, "The development and commercialization of innovative plant products is already playing a significant role in helping U.S. agriculture reduce greenhouse gas emissions. For U.S. agriculture to maximize its potential to reduce greenhouse gas emissions and increase carbon sequestration, several things are needed, according to ASTA, including additional private and public sector investment in agriculture research. The organization says agriculture also needs rational government policies regarding evolving innovation in the agriculture space, and programs that incentivize farmers to adopt conservation practices. The comments note plant breeders are helping through developing better and higher-yielding crop varieties. ASTA says, "It's critical we continue moving forward, through robust investment in agriculture research and development, to drive forward the next generation of innovative solutions to meet the new and emerging challenges of tomorrow." ************************************************************************************ USDA Announces Broadband Investments in Wyoming, Kansas The Department of Agriculture this week announced two more investments as part of its new rural broadband effort. Natural Resources Conservation Service chief Matthew Lohr announced the $5.2 million investment for broadband infrastructure in Kansas as part of the Reconnect Pilot Program, while USDA also announced a $4.79 million investment in Wyoming. In Kansas, Wave Wireless, LLC will use the funding to deploy a fiber broadband network servicing more than 1,300 households. In Wyoming, the funds will improve and create broadband connections in the county of Sweetwater, benefiting roughly 320 homes. USDA received 146 applications this year requesting $1.4 billion in funding through the ReConnect Program. The funds enable the federal government to partner with the private sector and rural communities to build modern broadband infrastructure in areas with insufficient Internet service. Insufficient service is defined as connection speeds of less than ten Megabit download and one Megabit per second upload speeds. Additional investments will be made in the coming weeks.

| Rural Advocate News | Wednesday November 27, 2019 |


Washington Insider: More Trouble With Romaine Lettuce Amid all the alarms about the trade war, another threat is being highlighted this week by federal health and regulatory officials who are cautioning about romaine lettuce “of any kind harvested from the Salinas Valley.” The danger is that the lettuce “may be contaminated with a particularly dangerous type of E. coli bacteria that has sickened 40 people in 16 states.” The warnings were highlighted by an unusual range of urban media, including the Washington Post and the New York Times, among others. The warnings were stark — the Centers for Disease Control and Prevention and the Food and Drug Administration told consumers to throw away any romaine lettuce they may already have purchased. To be clear, they said “restaurants should not serve it, stores should not sell it, and people should not buy it, if it came from Salinas, a growing area in Northern California.” The warning covered products marketed in many forms, including “chopped, whole head, precut or part of a mix.” Most romaine lettuce products are now labeled with a harvest location showing where they were grown, the Washington Post said and reported that “officials said to throw out lettuce if it doesn’t have a label specifying where it’s from.” No deaths have been reported in this E. coli outbreak, but the strain is the same one that caused outbreaks linked to leafy greens and romaine lettuce in the last two years. Just two days before Thanksgiving last year, CDC issued an unusually broad alert, warning consumers to avoid eating romaine lettuce of any kind in response to an outbreak. Of those who have been sickened in this outbreak by E. coli O157: H7, 28 people have been hospitalized, including five who have developed a type of kidney failure. This E. coli strain produces a Shiga toxin that can enter a person’s bloodstream and wreak havoc on kidney function. Symptoms of infection include vomiting, painful cramps and diarrhea that is often bloody. The largest number of cases reported so far has been in Wisconsin, with 10 cases, the Post said. Other cases have been reported in Arizona, California, Colorado, Idaho, Illinois, Maryland, Michigan, Minnesota, Montana, New Jersey, New Mexico, Ohio, Pennsylvania, Virginia, and Washington. The report said that FDA and states are tracing the source of the romaine lettuce eaten by the ill consumers, but that “no common grower, supplier, distributor, or brand of romaine lettuce has been identified.” The Post also said that “whole genome sequencing shows the strain in romaine lettuce tested by the Maryland Health Department is closely related genetically to the E. coli found in sick people from several locations. And it noted that USDA has a list of 35 recalled products sold under different brand names and “use by” dates from Oct. 29, 2019 to Nov. 1, 2019. At this time, there is no recommendation for consumers or retailers to avoid using or selling romaine harvested from places other than Salinas, or labeled as indoor, or hydroponically- or greenhouse-grown, FDA officials said. Convenience salads, from tubs of prewashed baby spinach to bags of chopped romaine, are regularly implicated in foodborne illness outbreaks, the Post said. Last year, an outbreak that began in March from chopped, bagged, as well as whole heads of romaine was the largest E. coli outbreak in more than a decade, killing five people and sickening more than 200 others in three dozen states. Food safety experts have said those convenience greens carry an extra risk because they come in contact with more people and machinery before they arrive on your plate. Contamination can occur on the farm from birds flying overhead or when low-lying fields flood with contaminated water. E. coli can also be spread by farmworkers who don’t wash their hands or via farm equipment that has manure on it. Once the greens are picked, they move to packaging plants where they may be exposed to more workers and more equipment. Products from multiple farms is often bagged in the same facility, which further increases the odds of cross-contamination. The problem with lettuce is that it is usually consumed fresh without being cooked or otherwise prepared in ways that can kill bacteria. In addition special testing ahead of distribution is both difficult and costly since the amounts of produce involved can be very large. At the same time, food borne illness outbreaks are extremely damaging to the fresh food industry as well as to the credibility of the entire food supply system. Regulators have recently been given new authorities to take steps to insure the safety of the food supply and need to take extraordinary steps as necessary to carry out those directions, Washington Insider believes.

| Rural Advocate News | Wednesday November 27, 2019 |


Big Impact If China Cuts Its Tariff On US Pork A trade agreement that eliminates China’s 72% tariff on U.S. pork could reduce the bilateral trade deficit by nearly 6% and generate 184,000 new American jobs over the next decade, according to Iowa State University economist Dermot Hayes for the National Pork Producers Council. U.S. pork producers see a potential $24.5 billion market in China within 10 years if the Trump administration can gain unrestricted trade access after the Asian country’s hog herd has been devastated by African swine fever. The projection was based on a “best-case scenario” in which China drops all tariffs and barriers to pork imports, including speeding up customs processing to allow for imports of chilled pork. Hayes projected that without tariffs, China would import 35% of its pork — a level similar to Mexico and Australia after they concluded free-trade agreements — and U.S. producers would capture half that market.

| Rural Advocate News | Wednesday November 27, 2019 |


US Ag Exports Seen Rebounding While Another Import Record Forecast By USDA Increased values for U.S. pork, soybean and dairy exports helped fuel an increase in the forecast for U.S. agricultural exports for Fiscal Year (FY) 2020 with another record seen for U.S. ag imports, according to USDA. China remains a prominent factor in the U.S. agricultural export outlook. U.S. soybean exports are forecast to total $18 billion in FY 2020, up from USDA’s prior forecast they would be valued at $16.8 billion. The updated FY 2020 outlook is above the FY 2019 level of $16.9 billion, but shy of the FY 2018 mark of $21.7 billion. However, soybean export volumes for FY 2020 are seen holding at 48.3 million metric tons, down from 56.9 million metric tons in FY 2019. The value of U.S. pork exports is seen at $6.7 billion, up $400 million from the prior outlook at sharply higher than the FY 2019 result of $5.5 billion. China is also a factor in that outlook, with USDA noting the rise is “largely due to demand from China.” U.S. ag imports are now put at $132 billion, up from $129 billion and above the record of $131 billion in FY 2019. Imports also set new records in FY 2017 ($119.1 billion) and FY 2018 ($127.5 billion). Much of the increase is seen for fresh fruits and vegetables and grain products, USDA said. “Fresh fruit imports are raised $1.7 billion to $15 billion, largely due to increased deliveries of avocados, berries, and melons from Mexico,” USDA detailed. The aforementioned export and import forecasts would result in a trade balance of $7 billion, one billion less than USDA expected in August, but up from the $4.5 billion mark in FY 2019, the smallest U.S. ag trade black ink since FY 2006.

| Rural Advocate News | Wednesday November 27, 2019 |


Wednesday Watch List Markets Wednesday before Thanksgiving is loaded with reports, starting with U.S. GDP, weekly jobless claims and durable goods orders at 7:30 a.m. CST. U.S. personal incomes and pending home sales are out at 9 a.m. The U.S. Energy Department releases weekly energy inventories at 9:30 a.m., including ethanol. Natural gas inventory is set for later in the morning, followed by the Fed's Beige Book at 1 p.m. CST. U.S. grain and livestock futures close at normal times on Wednesday and open again Friday at 8:30 a.m. CST. Weather Snow, ice and rain along with strong winds lingers over the northern Midwest early Wednesday while later in the day it should be drier. A new storm is taking shape over the western U.S. with widespread rain and snow expected mainly west of the Rockies. A minor disturbance will bring rain and mixed precipitation to New Mexico and west Texas mainly this afternoon. Drier elsewhere in the key U.S. growing areas. Impacts to travel, transport and harvesting today the Midwest due to recent and current snow, rain and wind. Impacts to travel and harvesting due to yesterday's snow through the northern portion of the central Plains region. Impacts to travel in many areas west of the Rockies.

| Rural Advocate News | Tuesday November 26, 2019 |


Trump Twitter Tirade on USMCA Inaction The president once again took to Twitter to lash out at House Democrats over their inaction on the U.S.-Mexico-Canada Trade Agreement. President Trump placed the blame for leaving USMCA squarely on Speaker Nancy Pelosi and House Democrats for leaving USMCA “dead in the water.” USMCA isn’t the only legislation that’s awaiting action as the House and Senate are both out of session for the Thanksgiving break. There aren’t many days left on the congressional schedule in 2019. Politico says Democrats are expected to conduct negotiations with U.S. Trade Representative Robert Lighthizer by phone this week. However, the House’s impeachment process and yet another government shutdown deadline looming will likely take up a lot of that remaining time on Capitol Hill through December. The good news for USMCA proponents is Mexico passed a budget for 2020 that includes more money for overhauling its labor laws. That could give some reassurance to House Democrats and U.S. labor groups, who’ve been worried that Mexico wouldn’t follow through on its labor commitments under the three-nation trade agreement. It’s been one of the biggest sticking points that’s held up Congressional ratification. ********************************************************************************************* Commission says Mexican Tomato Imports Threaten Domestic Production The U.S. International Trade Commission ruled Friday that Mexican tomato imports threaten local production. That decision comes after the U.S. Commerce Department had already determined that Mexican tomatoes were likely to be sold at an unfairly low price as they were dumped into the U.S. market. The Florida Tomato Exchange asked for a dumping investigation shortly after the U.S. and Mexico signed a new trade deal. The Florida group says the ITC’s decision gives credibility to its long-standing concerns about Mexican imports. The Mexican-based Fresh Produce Association of the Americas says it is disappointed in the decision, saying that rising Mexican imports simply reflects growing demand by U.S. consumers for Mexico’s produce. Mexican officials say, “Consumers prefer vine-ripened tomatoes, and this is why (U.S.) domestic gassed-green tomatoes continue to lose market share in the U.S.” The ITC ruling means that the recently negotiated tomato suspension agreement is still in effect. The deal will bring much-heavier inspection requirements for tomatoes entering the U.S. If the deal is ended for any reason, the U.S. will then impose a 21-percent duty on Mexican tomatoes, which account for nearly half the tomatoes sold in the U.S. ******************************************************************************************** “Phase Two” U.S. and China Agreement not Imminent U.S. and Beijing officials, lawyers, and other trade experts all tell Reuters that a “phase two” trade deal between the U.S. and China is nowhere near imminent. The two largest economies in the world are still having trouble getting the phase one deal signed. Back in October, U.S. President Trump said he expects to quickly start on phase two negotiations after the phase one deal is completed. The phase two trade deal would focus on the U.S. accusations that China steals U.S. intellectual property by forcing U.S. companies to transfer technology to Chinese rivals. Reuters says things like the 2020 presidential election, phase one deal difficulties, combined with the president’s reluctance to work with other countries to pressure China into playing by World Trade Organization rules are starting to dampen hopes for a more ambitious agreement in the future. Officials in Beijing have already commented publicly that they won’t start discussions on a phase two agreement until after the 2020 election because they want to see if Trump wins a second term. Reuters reported last week that signing the phase one agreement has the potential to slide into 2020. ********************************************************************************************** Rural Mainstreet Index Rises Again The Creighton University Rural Mainstreet Index for October climbed above growth-neutral. The index is a monthly survey of bank CEOs in rural areas of a 10-state region that depends on agriculture and/or energy. The index rose to 51.4 in October, up from 50.1 in September. While the reading is still weak, it’s the highest reading since last June. It’s the third time in the last four months that the index came in above growth neutral. Doctor Ernie Goss of Creighton says, “Federal agriculture crop support payments and somewhat higher grain prices have boosted the Rural Mainstreet Index slightly above growth neutral for the month. Even with that said, almost three of four bank CEOs reported continuing negative impacts from the trade war.” By way of comparison, the farmland and ranchland price index for October slumped to a weak 40.3 from September’s 43.1. It’s the lowest reading since last March and the 71st-straight month that the index has been below growth neutral. The October farm equipment-sales index improved to 39.7 in October, up from 35.9 in September. ********************************************************************************************** Bill will Help Preserve Family Farms A bill introduced in the House of Representatives last week will help more farm families continue operating their farms after the death of a loved one. The Preserving Family Farms Act of 2019 is sponsored by Jimmy Panetta of California and Jackie Warlorski of Indiana and has the full support of the American Farm Bureau Federation. “Farm and ranch families often face a significant financial burden when they have to pay estate taxes,” says AFB President Zippy Duvall. “Farm families should be able to pay based on how their land is used, rather than its potential value as commercial property, such as a shopping center.” The legislation will give more families hope they can hold onto their farm when a loved one passes away. The bill modernizes the special use valuation provision of the estate tax. This valuation allows the property to be appraised as farmland rather than its development value when determining estate taxes. Increasing the amount of farmland or ranchland that can be valued at agriculture value rather than development value would help protect family-owned farm and ranch businesses by assessing estate taxes on the actual value of the businesses they’ve spent decades building. “We strongly urge members of the House to co-sponsor this important bill,” Duvall says. ********************************************************************************************** Brazil says the U.S. will Open to Beef Imports Soon Brazilian officials tell Bloomberg it’s a matter of “if, not when,” the U.S. will reopen its market to Brazil’s meat exports. The trade and foreign relations secretary for Brazil’s Agriculture Ministry says, “We are 100 percent confident that it will happen. Our meat has the necessary quality to be exported to the U.S. Our meat’s quality is not an issue.” No date has been set in stone yet as to when the U.S. will begin accepting imports from Brazil. The U.S. has several questions about the current state of Brazil’s beef industry. Brazil provided additional answers and is now waiting for the U.S. to finish its analysis of those answers. As recently as October, the U.S. informed Brazil it would keep the ban on fresh-beef imports in place. The U.S. suspended imports from the largest economy in Latin America back in 2017. American inspectors found Brazilian beef to contain blood clots and lymph nodes. Brazil said the findings were abscesses that came about from a reaction to components of a foot-and-mouth disease vaccine. Because of that incident, Brazil reduced the vaccine dosage and made changes to the product’s compound.

| Rural Advocate News | Tuesday November 26, 2019 |


Washington Insider: Phase Two China Trade Prospects Fading Tea leaf reading has always been both difficult and dangerous during times of political turmoil and the current moment is no exception, Reuters said earlier this week. At a time when most pundits are focused on the likelihood of a “phase one” deal that avoids more and bigger tariffs along with continued pressure on the economy from trade uncertainty, Reuters is suggesting that an ambitious “phase two” trade deal between the United States and China is looking less likely as the two countries struggle to complete a phase one agreement. Although in October, President Donald Trump told the press in a joint conference with Chinese vice premier Liu He that he “expected to quickly dive into a second phase” once phase one had been completed. But hold-ups in getting the first-stage done along with “the White House’s reluctance to work with other countries to pressure Beijing” are dimming hopes for anything more ambitious in the near future, Reuters said. The 16-month trade war with China has thrown U.S. businesses and farmers into turmoil, disrupted global supply chains and been a drag on economies worldwide. Failure to address a key reason it was started is already raising questions about whether the sacrifice has been worth it — especially as many of Beijing’s trade practices widely seen as unfair remain unaddressed, Reuters said. In addition, last week Reuters reported that the signing of a phase one deal could slide into next year as the two countries tussle over Beijing’s demand for more extensive tariff rollbacks. Representative Jim Costa, D-Calif., who sits on two key agricultural committees, also reported to the Congress last week that “pragmatic” Chinese sources had described significant hurdles to the agreements and a lack of focus by the administration. White House spokesmen say the administration’s main priority is to secure a “big phase one announcement,” locking in big-ticket Chinese purchases of U.S. ag goods that can be touted as an important win during the coming re-election campaign. After that, China could recede somewhat on the president’s policy agenda as he turns to domestic issues, the official said. “As soon as we finish phase one we’re going to start negotiating phase two,” a second administration official said. “As far as timing around when a phase two deal could be completed, that’s not something I can speculate on.” Reuters said that the White House initially laid out ambitious plans to restructure the United States’ relationship with China. But many of these critical concerns will not be addressed in the phase one agreement, which focuses on China agricultural product buys, tariff roll backs, and includes some intellectual property pledges. “That’s the easy stuff,” said Costa. The harder issues are “industrial espionage, copyrights, privacy and security issues.” Further complicating the issue, the administration’s economic advisers are split: some are pushing for a quick phase one deal to appease markets and business executives, others want the focus to be “a more comprehensive agreement,” Reuters said. Beijing officials, meanwhile, are balking at pursuing larger structural changes to managing China’s economy and are anxious not to appear to be kowtowing to U.S. interests. Both China and the United States have a clear interest in getting a phase one deal completed relatively soon to soothe markets and assuage domestic policy concerns, said Matthew Goodman, a former U.S. government official and trade expert at the Center for Strategic and International Studies. “I think phase one probably will happen because both presidents want it,” Goodman said at a Congressional briefing last week. But he said China was less willing now to make structural changes that might have been possible in the spring. “They’re not going to do those things,” he said. The United States needs better coordination with its allies to pressure China to make urgently needed structural changes, including ending the forced transfer of technology and better intellectual property protections, trade experts and former officials say. Europe and other U.S. allies have been reluctant to join Washington’s pressure campaign on Beijing, partly due to frustration with the administration’s focus on unilateral action and in part due to their reliance on Chinese investment. “We need an international coalition to successfully attack phase two,” said Kellie Meiman Hock, managing partner at McLarty Associates, a trade consulting group in Washington. So, we will see. Clearly the trade talks with China are a major priority for the administration and for many industry groups including agriculture. However, the administration has set high goals for containing trade practices that are seen as unfair—and can expect substantial criticism if it does not focus systematically in those areas — efforts producers should watch closely as they emerge, Washington Insider believes.

| Rural Advocate News | Tuesday November 26, 2019 |


China Clears Large Number of US Poultry Facilities For Import USDA has released a list of 172 facilities that are now approved to export poultry to China, continuing the process of reopening the Chinese market to U.S. poultry. U.S. facilities approved by FSIS for export to China must be listed on the General Administration of Customs of the People’s Republic of China (GACC) website, FSIS noted, “before slaughtering and processing poultry and poultry products for export to China. U.S. facilities can only export to China poultry that are slaughtered and further processed after the facility has been added to the GACC website.”

| Rural Advocate News | Tuesday November 26, 2019 |


USDA Releases Clarification On Definitions For Export Sales Rules On Pork, Beef USDA Monday published its final rule on clarifications to the Export Sales reporting system in the Federal Register, after the Foreign Agricultural Service (FAS) “received informal inquiries whether exports of different types of beef and pork carcasses must be reported under the regulations.” The final rule notes now there is a footnote to the appendix of items covered under the systems relative to “fresh, chilled or frozen muscle cuts/whether or not boxed” for beef and pork. “For greater clarity, ‘muscle cuts’ includes carcasses, whether whole, divided in half or further sub-divided into individual primals, sub-primals, or fabricated cuts, with or without bone,” the footnote explains. “Carcasses which are broken down, boxed, and sold as a complete unit are muscle cuts. Total weight of carcasses reported may include minor non-reportable items attached to carcasses (e.g., hooves attached to carcasses). Meats removed during the conversion of an animal to a carcass (e.g., variety meats such as beef/pork hearts, beef tongues, etc.) are not muscle cuts nor are items sold as bones practically free of meat (e.g., beef femur bones) or fat practically free of meat (e.g., pork clear plate) removed from a carcass.” The rule was effective when published as it is “a final rule without prior notice and opportunity for comment.” USDA had signaled the update was coming in the regulatory agenda released last week and FAS had previously indicated it was going to update guidance to the trade on pork and beef reporting requirements under the export sales reporting system.

| Rural Advocate News | Tuesday November 26, 2019 |


Tuesday Watch List Markets Financial traders will pay attention to a report on U.S. new home sales and an index of U.S. consumer confidence, both due out at 9 a.m. CST Tuesday. Any news about a possible limited trade agreement with China gets traders' attention as do the latest weather forecasts with U.S. corn still in the fields. Weather Moderate to heavy snow and wind spread from northeast Colorado and northwest Kansas across much of Nebraska, through the northwest portion of the Midwest region Tuesday into Wednesday. This is likely to greatly affect travel, transport and any late-season field work. Winter storm warnings have been issued for much of this area. A high wind warning is also in effect for the southwest Plains region today. Rain or showers will occur through the balance of the Midwest and in the Delta associated with this storm. Drier weather through East Coast states and also in the Northern Plains region. Snow, ice and rain in the western U.S. and the central Rockies region. In South America, rain yesterday in Argentina and today in Brazil will maintain favorable growing conditions for corn and soybeans. Temporary planting delays.

| Rural Advocate News | Monday November 25, 2019 |


Phase One Trade Agreement may be Heading to 2020 U.S. legislation supporting Hong Kong protesters didn’t stop China’s trade chief from making a phone call recently to invite U.S. negotiators to a new round of trade talks. The Wall Street Journal says U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin (Muh-NOO-chin) were invited to Beijing for more face-to-face trade negotiations. While it wasn’t immediately clear if U.S. officials said yes to the invitation, the Wall Street Journal says U.S. trade officials were willing to meet with their Chinese counterparts. The U.S. Trade Representative’s office has yet to respond to requests for comment. The report on the Chinese invitation comes shortly after U.S. legislation on Hong Kong had threatened to push trade talks between the world’s biggest economies off track. Last week, the U.S. House of Representatives passed two bills intended to show support for protesters in Hong Kong. Beijing then accused the U.S. of interfering in its domestic affairs. Trade experts and people close to the Trump Administration say the limited trade agreement could be pushed into next year, news which is not good for U.S. agriculture. The U.S. and China have both imposed tariffs totaling billions of dollars on each other’s goods. ********************************************************************************************* Doubt Growing on USMCA Passing in 2019 Speaker of the House Nancy Pelosi appears doubtful that the U.S.-Mexico-Canada Trade Agreement will be passed this year. After she met with U.S. Trade Representative Robert Lighthizer and House Ways and Means Committee Chair Richard Neal last week, there was no deal and not much time left on the legislative clock. “We’ve made progress,” she said after leaving the 90-minute meeting. “I think we’re narrowing our differences.” She said earlier in the day that they’ll still have several steps to take even after they finally reach an agreement. The clock is ticking. Last Thursday was the last day before the House takes its Thanksgiving break. The Trump Administration and some Democrats hoped to strike a deal before the week-long recess to give lawmakers time in December to take up the pact. The House only has eight days of official session left in the 2019 calendar year. Lawmakers will stay on for an extra week in December to resolve budget issues and avoid a government shutdown. ********************************************************************************************* Michigan Joins Four Other States as Cage-Free A new law says the 15 million egg-laying hens in Michigan’s poultry flocks will have to lay their eggs in cage-free housing systems before 2025. An Associated Press report says Michigan Lt. Governor Garlin Gilchrist (GILL-krist) signed the legislation last week as Governor Gretchen Whitmer is on a trade trip to Israel. The law also prohibits non-cage-free eggs from being sold in Michigan starting in 2025. Gilchrist says the measure ensures Michigan standards for animal welfare are among the strongest in the U.S. At the same time, he says the law ensures egg producers can thrive. Under an older law, each hen was going to have to be confined in a one-square-foot space by April. The new law says each hen has to be housed in a cage-free system by the end of 2024. Michigan is the fifth state and the largest egg-producing state to adopt a cage-free law. The bill is part of a broader update of the state’s animal industry laws. Large restaurant and grocery chains like McDonald’s, Walmart, and Kroger have said they’ll only buy eggs from cage-free farms by 2025. ********************************************************************************************** Farmers Employing More Farm Workers, Paying Higher Wages than in 2018 U.S. farmers are hiring more laborers than they were a year ago and they’re paying higher wages too. The U.S. Department of Agriculture issued a new report saying that farm operators directly employed 809,000 workers during the week of October sixth. That’s three percent higher than the same time last year. The USDA says farmers paid an average gross wage of $15.02 per hour during the same week in October, four percent more than last year. Field laborers averaged $14.38 per hour, which is five percent higher than last year. Livestock workers earned an average of $13.77 per hour, which is three percent higher than last year. The combined livestock and field worker wages average $14.21 per hour, four percent higher than last year. The report says the 2019 all-hired worker annual average gross wage rate comes in at $14.91 per hour, five percent higher than in 2018. The 2019 field worker’s annual average gross wage rate was at $14.11 per hour, six percent higher than the annual average in 2018. Field workers in Oregon and Washington were among the highest-paid this year, averaging $16.56 per hour, up from $15.62 last year. ********************************************************************************************** Feed Industry says China still has Partial U.S. Poultry Ban in Place The American Feed Industry Association says China’s lifting of its ban on U.S poultry imports is only a “partial” lifting. The association has received official confirmation from USDA’s Animal and Plant Health Inspection Service that the announcement only includes poultry imports for human consumption. It doesn’t include other poultry products, such as those used in pet foods. At this time, the import restriction for pet foods with poultry products is still in effect. The association says there’s no difference in the risk of introducing poultry diseases between importing poultry for human or animal consumption. AFIA says it is “extremely disappointed to learn that China is implementing only a partial lifting of the ban and we look forward to working with APHIS and the Office of the U.S. Trade Representative to rectify the situation.” AFIA’s President and CEO, Constance Cullman, says, “China is a valuable market for the entire U.S. animal food industry, for exports of feed, feed ingredients, and value-added products such as meat and poultry.” ********************************************************************************************** Hoeven, Peterson Ask USDA to Help Sugar Growers Senate Ag Appropriations Chair John Hoeven (HOH-vehn) of North Dakota and House Ag Committee Chair Collin Peterson of Minnesota asked the USDA to assist to sugar growers in the Red River Valley. Producers in both states were unable to harvest their crops because of severe weather. The Hagstrom Report says USDA Undersecretary Bill Northey recently made a trip to those areas to see how producers were hit by a wet fall and early snowstorm. Hoeven says, “This has been an unprecedented year of challenges in farm country and we’re working to do all we can to support our producers.” He says sugar growers in the Red River Valley left 118,000 acres of sugar beets unharvested, which is one-third of their entire planted crop. Peterson says, “A tough harvest season has challenged sugar beet growers more than anyone would have anticipated. We’re committed to working with USDA to see if they have a way to access help.” USDA recently announced that the domestic sugar crop was smaller than anticipated due to weather problems. That means the agency expects it will allow an increase in imports.

| Rural Advocate News | Monday November 25, 2019 |


Washington Insider: Edging Closer to Spending Bills The Hill is reporting this week that top negotiators from the House and Senate have reached a long-stalled deal on top-line spending levels for the fiscal 2020 bills. The report cited House Appropriations Committee Chairwoman Nita Lowey, D-N.Y., and Senate Appropriations Committee Chairman Richard Shelby, R-Ala., who say they have settled on “302(b)s,” which set the top-line number for each of the 12 government funding bills. The Friday night agreement marks a “breakthrough” for the government funding negotiations and comes after days of behind-the-scenes horse trading, including back-and-forth funding offers, between Senate Republicans and House Democrats as they hunted for a path to a deal. In the meantime, Congress passed another very short-term spending bill last week, giving lawmakers until Dec. 20 to prevent a shutdown. To do that, they'll either need to pass the fiscal 2020 bills or another continuing resolution. Although the House has passed 10 of the 12 Fiscal Year (FY) 2020 bills and the Senate has passed four, lawmakers hadn't been able to reach a final deal on any of them “as they awaited the deal on the top-line numbers.” Shelby and Lowey said they want to pass each of the 12 funding bills by Dec. 20. That gives them less than a month — roughly 15 session days — to iron out the details of the bills and get them through both chambers. "The subcommittees are getting to work immediately in an effort to pass all 12 bills before the CR expires on Dec. 20," The Hill reported. The deal on subcommittee allocations adheres to the defense and nondefense caps agreed to as part of a two-year budget deal announced in July. Under that agreement, overall defense spending was $738 billion for fiscal 2020, while nondefense spending was $632 billion. The agreement between Shelby and Lowey does not resolve all of the remaining issues, including the “looming fight over the border wall, The Hill said. The House included no money for new border barriers in its Department of Homeland Security bill, while the Senate included $5 billion for the border in DHS as well as an additional $3.6 billion that could be reprogrammed from military projects to the border,” The Hill said. Democrats are also eager to block President Trump from reprogramming funds for the wall under emergency powers, a major sticking point with Republicans. Now it is up to the subcommittees to try to work out several tough policy differences, including the wall. "Individual funding items are being left to the subcommittees in keeping with long-standing committee practice," The Hill reported. In addition, other policy fights — including policies related to abortion and the number of Immigration and Customs Enforcement beds—are significant potential roadblocks for negotiators as they draft the FY 2020 bills. While many members have been skeptical that it would be possible to pass 12 appropriations bills by the new December deadline, The Hill says its sources expressed optimism that the timeline was achievable. Lowey and Shelby’s ability to strike a deal on the allocations had been a major stumbling block for weeks. Appropriators had noted that without a deal before Thanksgiving, the new deadline was “ambitious.” “If they can get those numbers done, I still think we have time to get those bills done before the end of the year when we get back,” Rep. Tom Cole, R-Okla., an appropriator, said ahead of the announcement of the deal last week. Senate Minority Leader Charles Schumer, D-N.Y., warned the President to stay out of the funding negotiations as lawmakers head toward the Dec. 20 deadline. "On the first path, President Trump stays out of our way and gives Congress the space to work together and find an agreement," he said. "On the second path, President Trump stomps his feet, makes impossible demands and prevents his party, the Republicans, from coming to a fair arrangement." So, we will see. It appears now that numerous members prefer the newly proposed budget levels to those that would be used if another CR is required. At the same time, the remaining time is very short and several of the potential remaining issues are highly contentious. These talks include very high stakes and should be watched closely by producers as they proceed, Washington Insider believes.

| Rural Advocate News | Monday November 25, 2019 |


Grassley Waiting On EPA’s Next Move On Ethanol Targets Sen. Chuck Grassley, R-Iowa, again met with President Donald Trump on the issue of biofuel policy, but said he wants to see EPA’s final plan before he is willing to say that the agency will live up the pledge on making sure that 15 billion gallons of conventional ethanol get used. “I left the meeting satisfied that the president was saying the same thing — and [EPA Administrator Andrew] Wheeler heard him say it — said we got to produce 15 billion gallons,” Grassley said. Grassley said he told Trump that EPA’s actions since a September meeting on the topic “leaves a lot of questions whether or not we are going to get the 15 billion gallons that we said we were going to get.”

| Rural Advocate News | Monday November 25, 2019 |


China’s Xi Insists Country Wants Phase One Deal With US Chinese President Xi Jinping said the country wants to reach an initial trade deal with the U.S. but also was not afraid to retaliate if need be. "We want to work for a 'phase one' agreement on the basis of mutual respect and equality," Xi said at an international forum in Beijing organized by Bloomberg. "When necessary we will fight back, but we have been working actively to try not to have a trade war. We did not initiate this trade war and this is not something we want." He also commented that China has a “positive attitude” on the trade talks. Xi met with former U.S. Secretary of State Henry Kissinger Friday, with Xinhua reporting Xi stated that the two sides need to boost communications when it comes to strategic issues so as to avoid misunderstandings. Chinese diplomat Wang Yi Wang Yi said on Friday the U.S. needs to meet China halfway and should promote healthy and stable development of bilateral relations. Meanwhile, the South China Morning Post quoted Ian Bremmer of the Eurasia Group political consulting firm as saying the Hong Kong issue will not impact the trade deal provided things do not escalate. “I was with Liu He two nights ago, it was very clear to me in his level of, not confidence but certainly hopefulness, and cautious optimism that we will move to a phase one deal and that Hong Kong was not going to play into that,” Bremmer stated. "President Trump has made it clear that he is not going to talk about Hong Kong, and not allow it to interfere as long as they are discussing trade." President Donald Trump today told Fox Business News that “We have a deal potentially, very close, he [Chinese President Xi Jinping] wants to make it much more than I want to make it, I am not anxious to make it,” As for Hong Kong, Trump said the U.S. has to “stand with Hong Kong, but I am also standing with President Xi.”

| Rural Advocate News | Monday November 25, 2019 |


Monday Watch List Markets USDA's weekly report of grain export inspections will be released at 10 a.m. CST Monday, as usual, but don't be surprised if trade is quiet ahead of Thursday's Thanksgiving holiday. With corn still in the fields, USDA announced Monday's 3 p.m. Crop Progress report will not be the final one in 2019, as originally scheduled. More Monday reports will follow until harvest gets closer to finishing. Weather Snow and some mixed precipitation from eastern North Dakota through northern Minnesota during Monday. Snow and rain through the Pacific Northwest with snow through the north and central Rockies region into western Nebraska. Little of note elsewhere in the key U.S. crop and livestock areas Monday . Favorable for the delayed harvests of corn and soybeans and mostly favorable for winter wheat. In South America, rain and thunderstorms have developed in the central Argentina corn and soybean belt while in Brazil it will be drier and warmer Monday. Mostly favorable conditions for planting and developing crops at this time.

| Rural Advocate News | Friday November 22, 2019 |


Ag Exports Projected to fall $5.2 Billion in 2019 The Department of Agriculture projects the fiscal year 2019 U.S. agricultural trade balance to fall to $5.2 billion. USDA’s Economic Research Service projects exports at $134.5 billion, and imports at $129.3 billion, leaving a $5.2 billion surplus, the lowest since fiscal year 2006. Unlike overall U.S. trade in goods and services, U.S. trade in the agricultural sector consistently runs at a surplus. Although agricultural exports have increased in value since 2016, the value of imports has risen at a slightly faster rate, leading to a declining trade balance. Compared to the previous outlook in May 2019, exports were revised down by $2.5 billion, while imports were raised by $0.3 billion. The decline in expected export value was primarily due to lowered expectations for corn and soybean exports. For imports, the increase in the forecast was due in part to an increase in the expected value of horticultural imports, such as fruits and vegetables. Initial projections for fiscal year 2020 suggest a small recovery in the agricultural trade balance to $8.0 billion. ************************************************************************************* China Phase One Delays Continue, China Claims Talks on Track Promised for mid-November, reports this week suggest an agreement and signing of the so-called phase one trade deal with China faces delays until mid-December. However, China maintains that the talks are on track. A Chinese government spokesperson told reporters this week “China is willing to work with the United States to resolve each other’s core concerns," adding the "external rumors" regarding the unraveling of the agreement are not true. China has invited the United States to Beijing for talks, possibly next week before the Thanksgiving holiday. Chinese officials suggested the deal could be signed in early December. Despite the claims by China, markets appear to sluggish on any trade news, seemingly growing tired of delayed promises of agreements and little progress. President Donald Trump says the phase-one agreement would include $40-50 billion worth of U.S. ag trade to China over a two-year period. U.S. farm exports to China reached nearly $20 billion before the trade war began, but since fell roughly 50 percent. ************************************************************************************* Farm Bureau Calls for Improvements to Ag Labor Bill While many farm groups seem pleased with the House labor bill, the American Farm Bureau Federation says it falls short of a long-term solution. AFBF President Zippy Duvall says that "While welcome, these changes unfortunately fall short of assuring that American producers will be able to keep their farms going." Changes made to the Farm Workforce Modernization Act before introduction improve the ability of farmers to retain H-2A workers, take a small step toward protecting farmers from frivolous litigation, and add a study to examine whether the H-2A program affects U.S. farmers’ ability to compete with foreign ag imports. However, AFBF says the key amendments not included in the bill would ensure a fair and competitive wage rate and limitations on the use of federal courts to solve workplace grievances. Duvall says that “once Congress passes legislation, no one will have an appetite to revisit the issue and simply put, this bill’s approach is not yet good enough.” ************************************************************************************* Hahn Pledges Transparent Dairy Labeling in Confirmation Hearing The National Milk Producers Federation welcomed comments made during a confirmation hearing of President Donald Trump’s nominee to lead the Food and Drug Administration. The hearing briefly touched on dairy labeling transparency. NMPF and others are seeking a labeling system that prohibits plant-based dairy imitators from using dairy marketing terms. Rules already do so, but FDA has not enforced them. Hahn voiced his support for “clear, transparent, and understandable labeling for the American people.” Hahn says, “people need this so that they can make the appropriate decisions for their health and for their nutrition.” NMPF President and CEO Jim Mulhern says, “It’s heartening to hear the nominee pledge that an FDA under his leadership will immediately examine this crucial unfinished business.” The comments by Hahn came before the Senate Health Committee. Committee Chairman Lamar Alexander, a Republican from Tennessee, called Hahn an “impressive choice” to lead the FDA. Ranking member Patty Murray, a Democrat from Washington, demanded Hahn commit to putting science, data and families first. ************************************************************************************* New Motor Oil Made with High Oleic Soybean Oil Now Available on Amazon America’s drivers have a new choice that unites performance and sustainability at a competitive cost, according to the United Soybean Board. Biosynthetic® Technologies’ biobased synthetic motor oil, using high oleic soybean oil from U.S. soybeans, is now on commercial shelves. USB Director Mike Korth, a Nebraska Farmer, says, “Soy-based motor oil is another great opportunity to drive demand for U.S. soybeans" and meet consumer sustainability demands. Biosynthetic Technologies’ motor oil is also recognized as a USDA Certified Biobased Product in the United States Department of Agriculture’s BioPreferred Program. The company will market both 5W-20 and 5W-30 through Amazon.com and direct from their website. The product is available for purchase and use immediately. Biosynthetic is also offering farmers a limited-time 20 percent discount to purchase the synthetic oil. They can use code BioTrialFarm available only at motoroil.biosynthetic.com through January 31. USB and USDA have supported the soy-based, drop-in synthetic alternative to petroleum-based motor oil, calling the oils well-suited for high-temperature automotive and industrial applications. ************************************************************************************* Farm Bureau Survey: Thanksgiving Dinner Cost Rises Only a Penny An annual survey finds the Thanksgiving Day dinner average cost this year for ten is $48.91, less than $5.00 per person. The American Farm Bureau Federation’s 34th annual survey on Thanksgiving Day meal items increased just once cent from last year. The centerpiece on most Thanksgiving tables, the turkey, costs slightly less than last year, at $20.80 for a 16-pound bird. That’s roughly $1.30 per pound, down four percent from last year. Survey results show retail turkey prices are the lowest since 2010. Although the overall average cost of the meal was about the same this year, there were some price changes for individual items. In addition to turkey, foods that showed slight price declines include cubed bread stuffing and canned pumpkin pie mix. Foods showing modest increases this year included dinner rolls, sweet potatoes and milk. Meanwhile, despite the growing popularity of prepared foods, 92 percent of Americans celebrate Thanksgiving at home or at a family member’s home and most cook their entire meal at home, according to the survey.

| Rural Advocate News | Friday November 22, 2019 |


Washington Insider: Cautious Optimism on China Deal Bloomberg is reporting this week that China’s chief trade negotiator indicated he was “cautiously optimistic” about reaching a phase one deal with the U.S. in spite of “warnings of the dangers of escalating the tariff war” by experts. Vice Premier Liu He commented in a speech in Beijing on Wednesday ahead of the Bloomberg New Economy Forum. He also said he had invited his U.S. counterpart, U.S. Trade Representative Robert Lighthizer, to travel to China for talks this month but noted that “the invitation hasn’t yet been accepted.” On Thursday, former U.S. Secretary of State Henry Kissinger said America and China were in the “foothills of a Cold War,” and warned that the conflict could be worse than World War I if left to run unconstrained. Later in the day, former Treasury Secretary Henry Paulson also warned of the perils of decoupling the world’s two largest economies. President Donald Trump announced a “phase one” deal a month ago, but since that time, markets have been whipsawed by comments from both sides, first indicating progress, and then the opposite. The latest potential hurdle came after Liu made his dinner-time comments, when the U.S. House voted 417-1 for legislation supporting Hong Kong protesters that has already been unanimously approved by the Senate. The President said earlier that he plans to sign the bill, Bloomberg said. Liu also explained China’s plans for reforming state enterprises, opening up the financial sector, and enforcing intellectual property rights, issues at the core of U.S. demands for change in China’s economic system. However, in a separate comment, he told one of the attendees that he was “confused” about the U.S. demands but was confident the first phase of an agreement could be completed nevertheless. Liu’s remarks cushioned declines in stocks in Asia, Europe and the U.S. as investors weighed the impact of the House bill on relations between the world’s two largest economies. U.S. and Chinese trade negotiators will continue communicating closely and work toward a phase one deal, Ministry of Commerce spokesman Gao Feng said at a briefing in Beijing on Thursday. Responding to questions including whether the two sides agreed on agricultural purchases and tariff removal, as well as a media report on the timetable for a deal, Gao said related rumors were not accurate. It was unclear exactly what he was referring to. If efforts to reach a phase one deal fail before Dec. 15, the White House has threatened to impose 15% tariffs on some $160 billion in imports from China. While the Hong Kong bill is a negative factor for the phase one deal, China still may be able to reach an agreement with the U.S. this year, said Zhang Yansheng, who previously worked at the National Development and Reform Commission, the country’s top economic planning body. “The optimistic view is that the phase-one deal can be reached within this year – but a more pessimistic one is that the first phase will be dragged to some point next year,” said Zhang, who is now chief researcher at the China Center for International Economic Exchanges. Kissinger, 96, said he hoped trade negotiations would provide an opening to political discussions between the two countries. “Everybody knows that trade negotiations, which I hope will succeed and whose success I support, can only be a small beginning to a political discussion that I hope will take place,” he said. Kissinger spoke hours after Chinese Vice President Wang Qishan addressed the NEF, saying his country was committed to peace and would follow through on policy changes despite facing challenges at home and abroad. “Between war and peace, the Chinese people firmly choose peace,” he said. “We should abandon the zero-sum thinking and Cold War mentality.” The Forum is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News. Meantime, Paulson called on China to open more and said the U.S. should resist the temptation to delist Chinese firms from U.S. exchanges, calling it a “terrible idea.” Both countries should determine the rules of the road for high-end technology such as 5G, he said. “There will be some natural decoupling,” Paulson said. “But the delusions of a wholesale, comprehensive decoupling and an economic iron curtain will leave our countries, and the world, worse off. We need to avoid that outcome.” After almost two years of negotiations and escalations – and plenty of false dawns – trade negotiators from the U.S. and China are making progress in key areas, Bloomberg said. The negotiating teams are using their failed May proposal as a benchmark for how much a phase-one deal covers of the once-near agreement and how much tariffs will be removed as part of the initial deal. There’s been signs of a thawing on other fronts. The U.S. Commerce Department has started approving some suppliers’ applications for licenses to do business with China’s Huawei Technologies Co., partially reopening access to one of the biggest buyers of U.S. technology. However, Charlene Barshefsky, who negotiated China’s entry into the WTO, said that “No outcome is inevitable but two decades of careful management of the relations between China and the West have run its course.” So, we will see. The positive signals from China are certainly welcome in spite of the remaining large areas of uncertainty to be addressed. These are very important fights that producers should watch closely as they emerge, Washington Insider believes.

| Rural Advocate News | Friday November 22, 2019 |


USDA To Issue Final Rule On Export Sales Reporting Of Pork, Beef The fall 2019 regulatory agenda released by the Trump administration Wednesday included a notice that USDA intends to issue a final rule in December, which will clarify export sales reporting requirements. “The final rule would amend the Export Sales Reporting Requirements Regulation to clarify certain definitions as they relate to beef and pork, which are subject to this regulation to ensure accuracy of the weekly U.S. Export Sales report,” the notice said. This appears to be aimed at addressing details on things like the specific cuts that are to be reported to USDA and the timeline for making those reports to USDA. The most-recent sales data did show that nearly one half of the total for U.S. pork sales to foreign buyers were “late reported” sales.

| Rural Advocate News | Friday November 22, 2019 |


McConnell Chides House Democrats For Giving AFL-CIO Big Role In USMCA Process Senate Majority Leader Mitch McConnell, R-Ky., on Wednesday argued that Democrats are giving AFL-CIO President Richard Trumka too much sway in talks on the U.S.-Mexico-Canada Agreement (USMCA). “How ironic. We are talking about a trade deal that would create more American jobs, and Democrats are considering outsourcing their judgment to Big Labor special interests — who, to my recollection, have not supported a single major trade deal in living memory,” McConnell said on the Senate floor. This comes after Trumka met with House Democrats on USMCA, noting that changes are still needed in the trade deal to get his union to back the deal. Meanwhile, Mexico’s Congress delayed the government’s 2020 spending bill, which includes proposed funds to implement the labor reforms required under the USMC

| Rural Advocate News | Friday November 22, 2019 |


Friday Watch List Markets On the Friday before Thanksgiving, it is reasonable to expect quiet trade in ag futures, but there are a few items to note. An index of U.S. consumer sentiment is due out at 9 a.m. CST, followed by USDA's monthly cattle on-feed and cold storage reports at 2 p.m. A possible trade meeting is brewing with China and any comments or related news will get attention. Weather Rain and snow are in the Southern Plains, and rain from the far Southern Plains to the eastern Great Lakes, will be the areas of precipitation Friday. Drier conditions will be in place elsewhere.

| Rural Advocate News | Thursday November 21, 2019 |


GREEN Act Would Extend Renewable Energy Tax Incentives A renewable energy bill includes biodiesel tax extenders, although the legislation’s future is uncertain. This week, California Democrat Mike Thompson introduced the Growing Renewable Energy and Efficiency Now, or GREEN Act, in the House of Representatives. Thompson says the bill will “build on existing tax incentives that promote renewable energy and increase efficiency.” The bill would extend the currently expired biodiesel tax credits through a multiyear extension. The legislation would keep the credit at its current rate of $1.00 per gallon for 2018 through 2021 but gradually reduce it to $0.33 per gallon by 2024. The National Biodiesel Board supports the legislation, as the industry seeks certainty. Since the start of the year, ten biodiesel plants have been forced to cut production or close and lay off workers due to policy uncertainty. However, the fate of the bill is unclear, as Democrats and Republicans clash over so-called “green” legislation and climate issues. Among other things, the bill would promote green energy technologies, increase energy efficiency, and support use of zero-emission transportation and infrastructure. ************************************************************************************* Growth Energy Celebrates New York’s Move to E15 Growth Energy calls New York's move to E15 a "major regulatory victory" that will open the nation's fourth-largest fuel market to E15 Under a rule finalized Wednesday by the New York Department of Agriculture. New York will become the newest state to allow the sale of E15, which is approved for all vehicles model year 2001 and newer. Growth Energy CEO Emily Skor says the organization “looks forward to working with retailers across the state to quickly get E15 into the market.” Over the last five years, Growth Energy has worked together with community leaders, retailers, farm advocates, and biofuel supporters across New York to push for an update to the state’s fuel regulations. Western New York Energy President and CEO Timothy Winters says the update “will allow more New York motorists to make their own decisions about purchasing renewable fuel blends.” Last month, American drivers topped 11 billion miles on E15, and adoption rates continue to rise following recent regulatory changes by the EPA to permit year-round sales of the fuel. ************************************************************************************* Farmers Receive 12 Cents of the Thanksgiving Food Dollar Farmers and ranchers take home just 12.1 cents from every dollar that consumers spend on their Thanksgiving dinner meals, according to the National Farmers Union. NFU’s annual Farmer’s Share publication compares the retail food price of traditional holiday dinner items to the amount the farmer receives for each item they grow or raise. On average, farmers receive 14.6 cents of every food dollar consumers spend throughout the year, more than the recent study finds. NFU President Roger Johnson says, “We’re in the midst of the worst farm economic downturn in generations, and we’re hopeful the Farmer’s Share can help illustrate that fact to the general public.” Wheat farmers averaged a meager $0.03 on 12 dinner rolls that retail for $2.69. Dairy producers received only $1.66 from a $4.59 gallon of milk. And turkey growers, who raise the staple Thanksgiving dish, received just $0.06 per pound retailing at $1.49. Johnson says that $0.06 figure—while striking on its own—is particularly shocking when considering the fact that poultry integrators received $0.62 per pound. ************************************************************************************* Plant Response Biotech, Koch Biological Solutions Merge Plant Response Biotech and Koch Biological Solutions, LLC. have combined operations to form Plant Response Biotech, Inc. The new venture will leverage both companies' complementary capabilities, assets and product offerings. Plant Response Biotech is a plant biotechnology company specializing in plant innate immunity, plant physiology and nutrient use efficiency. It has developed several product candidates which are approaching commercial launch status in the areas of drought tolerance and plant health. Koch Biological Solutions focuses on developing science-based, live microbial and biologically derived chemistries that improve plant performance at every stage of growth. Through various modes of action, their biological solutions perform directly on the plant or its environment to improve crop efficiency and nutrient uptake, maximizing yield potential. Tom Warner, chairman of the board for the new Plant Response Biotech, says of the move, "These companies are naturally complementary, and it made tremendous sense to bring the two together.” The new company will be headquartered in Raleigh, North Carolina, with operations in California and Spain. ************************************************************************************* USDA Invests in the Expansion of Rural Education and Health Care Access The Department of Agriculture Wednesday announced a $42.5 million investment for education and telemedicine projects in parts of rural America. The effort will fund 133 projects in 37 states and two U.S. territories through the Distance Learning and Telemedicine grant program, benefiting 5.4 million rural residents. DJ LaVoy, USDA Deputy Under Secretary for Rural Development, says the program helps “rural residents to take advantage of economic, health care and educational opportunities without having to travel long distances.” The funded projects include $488,000 for Mississippi State University to update video conferencing equipment in 93 counties. USDA’s investment will enable participants in extension offices and experiment stations to deliver educational programming to interactive audiences. In Ohio, the Lisbon Exempted Village School District is receiving a $323,000 grant to create a distance learning network at eight sites within one county. The district will offer classes and behavioral health services to 850 students. Information on additional projects funded by the effort is online at www.rd.usda.gov.

| Rural Advocate News | Thursday November 21, 2019 |


Washington Insider: Pressure to Complete the New NAFTA Pressures are building on Democrats from rural areas, many of whom face tough re-elections in 2020, Bloomberg is reporting this week. This group is “pushing their party leaders to complete the U.S., Mexico, Canada trade pact before the end of the year to give them a solid legislative achievement—but also to “undercut GOP criticism that they are doing nothing but impeachment.” “It’s only going to get harder to make a good deal as we get closer and closer to the presidential election,” said Rep. Ben McAdams, D-Utah. “There’s a window right now to get it done.” An agreement between House leaders and U.S. Trade Representative Robert Lighthizer is close to being done with enforcement provisions on labor and environment still being ironed out, Bloomberg said. AFL-CIO President Richard Trumka met with freshman Democrats on Tuesday morning to convey the message that it’s important to strengthen labor enforcement in the final deal. Rep. Cindy Axne, D-Iowa, said she told Trumka that while she supported the enforcement of labor regulations, farmers and manufacturers in her district were hurting due to the trade war and tariffs, which a new trade agreement would alleviate. “The longer we wait, [the more] it increases the pain the folks in Iowa like our farmers are getting right now,” she said. Several lawmakers alluded to criticism that they were doing little besides impeachment. President Trump has branded them “Do-Nothing Democrats” despite the 100-plus bills the House passed this year, Bloomberg said. “I was sent here by the people of my district to get things done and one of those big-ticket items is a solid trade deal with Mexico and Canada,” Rep. Anthony Brindisi, D-N.Y., said, leaving the meeting with Trumka. “That’s what my district wants and that’s what I’m trying to get towards.” McAdams said an agreement might be “even more important now, in light of the impeachment inquiry, that we show our constituents that we are still moving forward legislation that is good for the public.” Other lawmakers are working to calm the anxieties of the freshmen by emphasizing the need for not merely a good deal but one they can stand behind for decades. Rep. Elissa Slotkin, D-Mich., said veteran House members warned her they were still facing negative reaction from their 1993 vote on NAFTA. “The senior members are making it very clear that we all understand the stakes,” she said. Rep. Jimmy Gomez, D-Calif., a member of the group of Democrats meeting with Lighthizer, said the freshmen haven’t been shy about making their needs known. “They’re feeling a lot of pressure,” he said. “But in the end, they still need a good agreement to vote for and something they don’t have to run away from.” The trade deal still could get done before the end of the year, although it’s competing for attention and floor time with the impeachment inquiry and with work on an agreement on how to fund the government for the rest of Fiscal Year (FY) 2020. The House passed another continuing resolution Tuesday to fund the government until Dec. 20. Draft language for the trade agreement is being exchanged, Gomez said, and added that the final language could be complete a few days after a final agreement is reached. “Anything is possible, to be honest with you,” he said. So, we will see. Observers argue that work is progressing steadily on the new NAFTA, even though they say they recognize that pressure for speed is often the “enemy of a thoroughly vetted and refined final product.” Nevertheless, there seems to be growing optimism regarding the evolving deal, so the process is one producers should continue to watch closely as it progresses, Washington Insider believes.

| Rural Advocate News | Thursday November 21, 2019 |


Farm Credit System Weathering Farm Income Situation Officials from the Farm Credit System testified before a House Ag subcommittee Tuesday, telling the panel the ag lender is so far weathering the farm income difficulties. Large payouts to farmers under the Market Facilitation Program (MFP) are providing help, officials said, but they noted that farm debt has grown some $41 billion in the last three years. The farm bill safety net programs are working as they should, officials said. USDA next week will update its farm income forecast for 2019 and issue its outlook for 2020 and that is expected to continue to show that government payments are making up a greater share of U.S. farm income. But, conditions remain better than those seen in the 1980s.

| Rural Advocate News | Thursday November 21, 2019 |


FERC Approves Temporary Emergency Shipment of Propane to Midwest Temporary emergency shipment of propane from Texas to the Midwest has been approved by the Federal Energy Regulatory Commission (FERC). The pipeline company asking for the action said “record demand for propane is due to an unusual coincident increase in heating demand, resulting from unseasonably cold weather in the region, and crop drying demand.” There were no comments or protests filed on the request and FERC determined the matter is accepted effective November 13. In addition, FERC announced it will “initiate an alternative dispute resolution (ADR) process with pipeline companies, shippers and their representatives to explore actions FERC and industry can take to alleviate propane pipeline constraints in the Midwest.”

| Rural Advocate News | Thursday November 21, 2019 |


Thursday Watch List Markets As usual, 7:30 a.m. CST is a busy time Thursday with weekly grain export sales, weekly jobless claims and the U.S. Drought Monitor set for release. Early Thursday, the National Weather Service will have new forecast for December, in addition to its usual forecasts. U.S. existing home sales and leading index of U.S. indicators are out at 9 a.m., followed by natural gas storage at 9:30 a.m. and an update of U.S. propane supplies Thursday afternoon. Weather Thursday features rain and snow in the Midwest, disrupting harvest and transportation. Rain is also in store for portions of the Southern Plains, offering some moisture for winter wheat. In South America, rain is indicated over northeastern crop areas of Brazil.

| Rural Advocate News | Wednesday November 20, 2019 |


USMCA 2019 Deadline Nears Fewer and fewer days remain for Congress to pass the U.S.-Mexico-Canada Agreement in 2019. Washington is sending mixed signals on whether the deal can be completed this year. Some lawmakers have suggested the House stay in session an extra week, adding time to the calendar to wrap up business before Christmas. Meanwhile, last week, House Speaker Nancy Pelosi said a labor deal in USMCA was "imminent." However, President Donald Trump claimed this week Pelosi was holding up the trade deal to gather more votes in favor of impeaching Trump. Representative Richard Neal, who chairs the Democrats USMCA working group, last week suggested union support was within reach, adding “we need it.” AFL-CIO President Richard Trumka met with Pelosi and other Democrats Tuesday, while also vowing during an unrelated speech to not allow Democrats to fold on core issues. Trumka stated that until USMCA includes stronger labor standards, “there is still more work to be done,” according to Reuters. Democrats leaving the meeting were skeptical that an agreement could be reached this year. ************************************************************************************* U.S., South Korea Reach Agreement on Guaranteed Market Access for American Rice The Trump administration Tuesday announced an agreement to allow U.S. rice more market access in South Korea. Under the agreement