Agriculture got two wins on Thursday, one in the U.S. House of Representatives with passage of the USMCA, and the other in the Senate, with ag appropriations.
USMCA — the replacement deal for NAFTA — passed the House chamber 385 to 41. It now goes to the Senate for consideration.
Senate Majority Leader Mitch McConnell, however, has said USMCA will not be considered until after the Senate impeachment trial, which is itself not likely to happen until after the holiday recess.
USMCA will increase U.S. agricultural and food exports to Canada and Mexico by $2.2 billion when fully implemented, Sen. John Hoeven, R-N.D., said, and eliminate Canada’s downgrade of U.S. wheat.
• Expands access to the Canadian market for U.S. poultry, eggs, and dairy and eliminates Canada’s Class 6 and 7 dairy program
• Requires 75 percent of auto content to be produced in North America to be exempt from tariffs, up from 62.5 percent
• Modernizes intellectual property, digital trade, and financial services
“While the USMCA had to start in the House, and the agreement was held up there for too long, we’re glad USMCA is finally making its way to the U.S. Senate,” he said. “USMCA will provide much needed certainty for our agriculture, energy and other industries and we will now work to approve the agreement as quickly as possible in the Senate.”
Sen. Kevin Cramer, meanwhile, on CNBC’s Squawk Box Thursday morning, said passing the deal could help create momentum for a China trade deal.
“I don’t think you can underestimate the value of momentum,” Cramer said. “Good things follow good things.”
North Dakota Farmers Union President Mark Watne said the agreement is important given that Mexico and Canada are the nation’s two largest trading partners. They are also large trading partners for North Dakota.
“As I understand it, the agreement maintains our access to Canadian and Mexican markets and makes some modest improvements over NAFTA,” he said. “We’ll be able to tap into the Canadian market on a few varieties of wheat grown here in North Dakota and it gives us a bit more access to sell dairy and poultry products into Canada.”
However, the deal missed a big opportunity, he added, when it comes to restoring Country-of-Origin Labeling.
“Without that, consumers still don’t know where their meat comes from and U.S. ranchers can’t take credit, or earn the income they deserve, for the high-quality meat they produce,” he said.
USMCA, he added, is just the first step of many that need to be taken quickly to bring stability to agricultural markets.
“The loss of export markets over the last 18 months has really hurt us on the farm,” he said. “We urge the administration to keep making progress on China and to repair the damage caused by trade wars.”
The American Soybean Growers Association called it a win, pointing out that Mexico is the No. 2 market for whole beans, meal, and oil and that Canada is the No. 4 market for meal and the No. 7 market for soybean oil.
“Their efforts to pass a free trade deal that can restore certainty and stability to an important export market for our farmers demonstrates that they can accomplish great things working in unison,” said Bill Gordon, soy grower from Worthington, Minn., and ASA president. “We express our thanks to the House of Representatives for this momentous act. We now look to the Senate to take up and pass USMCA in early 2020.”
Ag appropriations for double win
The Senate on Thursday took up two spending bills passed by the House on Tuesday, Dec. 17 that will fund the government through the rest of the fiscal year, which started Oct. 1.
The first spending measure totaled $534.4 billion, of which $23.4 billion is for discretionary agricultural spending. That bill passed 71 to 23.
Hoeven, who is chairman of the agriculture appropriations committee, said he was able to secure an additional $1.5 billion in funding in the agricultural funding for disaster assistance to help producers affected by severe weather. That amount is in addition to $3 billion approved earlier this year.
Hoeven was also able to secure a provision that directs Secretary of Agriculture Sonny Perdue to make disaster payments to eligible sugar growers and to expand program eligibility to cover quality losses for qualifying crops. Another provision further clarifies that eligible disaster events do include loss related to excess moisture and D3 level drought.
“Our producers are facing real challenges right now, which is why this additional $1.5 billion in disaster assistance funding is vital,” Hoeven said. “Our farmers and ranchers need relief given the unprecedented weather they’ve endured this year.”
Other Hoeven priorities included in the measure include funding for:
• Crop insurance
• 2018 Farm Bill implementation
• Fully funding direct, guaranteed and emergency loans
• Water Bank initiative
• Agricultural research funding for wheat, barley, pulse crops, sugar beet, alfalfa, potatoes, small grains, livestock and fo development of drones for precision agriculture
• Grant funding to support development of rural broadband and precision agriculture
Cramer, meanwhile, said he is glad Congress has “ditched” short-term continuing resolutions at last.
“I’m not pleased with everything included in today’s deal,” he added. “Especially extension of the wind production tax credit, which was supposed to phase out. However, this package prioritizes our most fundamental constitutional duty to provide for our national defense, and it supports the people who keep our country safe and free. It also advances important domestic policies and greatly benefits North Dakota.”
The priorities he listed as important were:
• The longest Export-Import Bank reauthorization in history, an issue Cramer first introduced in July.
• The renaming of “Sullys Hill” National Game Preserve in North Dakota to “White Horse Hill,” which Cramer first introduced in July.
• Full defense funding to accompany this year’s National Defense Authorization Act, which Cramer helped pass earlier this month.
• The Affordable Insulin Approvals Now Act, which Cramer introduced in July.
• Continued funding for border wall construction without placing limits on the President’s transfer authority.
• Increased funding for more Customs and Border Protections (CBP) law enforcement officers.
• President Trump’s Title X regulations, which have virtually eliminated federal funds being given to abortion providers like Planned Parenthood.
• Full repeal of the three main Obamacare taxes: Cadillac Tax, Medical Device Tax and Health Insurance Tax. Cramer cosponsored all three repeal provisions.
• The Manufactured Housing Modernization Act, which Cramer first introduced in June.
• The Protecting Access to Biosimilars Act, which Cramer cosponsored in May.
• ELD exemption for livestock and insects.
• Extension of the short line railroad track maintenance tax credit.
• Protection for electric cooperatives’ tax-exempt status with the inclusion of the RURAL Act, which Cramer cosponsored in May.