Did you know that Giant Panda cubs can be as small as a stick of butter? A panda mother is approximately 900 times bigger than her newborn cub, which can weigh less than 5 ounces. This is like an 8-pound human baby having a mother that weighed 7,200 pounds – this size difference may explain why so many panda cubs die from accidentally being crushed by their mothers. However, not everything is doom and gloom for the Giant Panda. Chinese officials have officially downgraded pandas from “endangered” to “vulnerable.” Although the International Union for Conservation of Nature re-labelled, the Panda as “vulnerable” in 2016, China wanted to make sure that the population of its national treasure continued to grow before downgrading the panda’s classification.
Although it seems as though pandas are thriving thanks to conservation efforts in China, not all animal species in China are so lucky. This week’s Ag Law Harvest takes a trip around the world to bring you domestic and international agricultural and resource issues. We take a look at court decisions, Congress’ latest actions, China’s struggle with African Swine Fever, and President Biden’s latest executive order.
Iowa Supreme Court Dismisses Raccoon River Lawsuit. Environmental organizations (“Plaintiffs”) filed a lawsuit against the state of Iowa and its agencies (“Defendants”) asking the court to compel Defendants to adopt legislation that would require Iowa farmers to implement practices that would help reduce the levels of nitrogen and phosphorus in Raccoon River. The Plaintiffs argued that Defendants violated their duty under the Public Trust Doctrine (“PTD”), which is a legal doctrine that requires states to hold certain natural resources in trust for the benefit of the state’s citizens. Defendants argued that Plaintiffs lacked standing to bring the lawsuit. The Iowa Supreme Court agreed with Defendants and found that a ruling in Plaintiffs’ favor would not necessarily remediate Plaintiffs’ alleged injuries, and therefore the Plaintiffs lacked standing to bring the lawsuit. The Iowa Supreme Court also found that Plaintiffs’ issue was a nonjusticiable political question. The political question doctrine is a principle that helps prevent upsetting the balance of power between the branches of government. Under the doctrine, courts will not decide certain issues because they are better suited to be decided by another branch of government. In this case, the court reasoned that Plaintiffs’ issue was better suited to be resolved through the legislative branch of government, not the judicial branch. The Iowa Supreme Court decision is significant because, as it stands, agricultural producers in the Raccoon River Watershed will not be required to adopt any new practices but the decision leaves it up to Iowa’s legislature to determine whether farmers should be required to adopt new practices under the PTD to help reduce nitrogen and phosphorus in Raccoon River.
U.S. House of Representatives’ spending bill increases focuses on climate action and environmental protection. Before the July 4th break, the United States House Appropriations Committee approved the first of its Fiscal Year 2022 (“FY22”) funding bills. Included in these bills is the agriculture funding bill, which will be sent to the House floor for full consideration. The bill provides $26.55 billion in the discretionary funding of agencies and programs within the USDA, FDA, the Commodity Futures Trading Commission, and the Farm Credit Administration – an increase of $2.851 billion from 2021. In total, the agriculture funding bill includes $196.7 billion for both mandatory and discretionary programs. The bill focuses on: (1) rural development and infrastructure – including rural broadband; (2) food and nutrition programs to help combat hunger and food insecurity; (3) international food assistance to promote U.S. agricultural exports; (4) conservation programs to help farmers, ranchers, and other landowners protect their land; (5) ag lending; (6) climate-related work to help research and remedy the climate crisis; and (7) enforcement of environmental programs. The agriculture spending bill will, however, have to be reconciled with any spending bill produced by the U.S. Senate.
U.S. House Agriculture Committee advances rural broadband bill. The House Agriculture Committee (the “Committee”) unanimously voted to advance the Broadband Internet Connections for Rural America Act (the “Act”), which would authorize $4.5 billion in annual funding, starting in fiscal year 2022, for the Broadband ReConnect Program (the “Program”) through fiscal year 2029. The existing Program is set to expire on June 30, 2022. To demonstrate Congress’ commitment to expanding rural broadband, the Program was only given $742 million in 2021. It is unclear whether the Act will be included in the infrastructure package that is currently being negotiated between Congress and the White House. Under the Act, the USDA must give the highest priority to projects that seek to provide broadband service to unserved communities that do not have any residential broadband service with speeds of at least 10/1 Mbps. The USDA will then prioritize communities with less than 10,000 permanent residents and areas with a high percentage of low-income families.
Small hog farmers in China no longer required to seek environmental approval. China is the world’s largest pork producer and over the past few years, its hog herds have been decimated. A deadly African Swine Fever (“ASF”) has wiped out about half of China’s hog herds, especially affecting small farmers. According to Reuters, China relies heavily on small farmers for its pork output, but because of ASF, small farmers have been left with little to no product and mass amounts of debts. Further, Chinese farmers are hesitant to rebuild their herds because ASF is an ongoing risk and farmers stand to lose everything if they continue to raise diseased hogs. Addressing these concerns, China’s agriculture ministry will no longer require small hog farmers to get environmental approval from the government before breeding their hogs. China hopes to reduce the costs and red tape for small farmers as China tries to incentivize small farmers to rebuild their hog herds. African Swine Fever is a highly contagious and deadly viral disease affecting both domestic and feral swine. The ASF poses no threat to human health but can decimate domestic hog populations. Germany has recently reported its first two cases of ASF in domestic hogs. Currently, ASF has not been found within the United States, and the USDA hopes to keep it that way. To learn more about ASF, visit the USDA’s Animal and Plant Health Inspection Service website.
President Biden signs executive order to reduce consolidation in agriculture. President Biden’s recent Executive Order on Promoting Competition in the American Economy seeks to address inadequate competition within the U.S. economy that the administration believes holds back economic growth and innovation. The Order includes more than 70 initiatives by more than a dozen federal agencies to promote competition. With respect to agriculture, the Order seeks to break up agricultural markets “that have become more concentrated and less competitive.” The Biden Administration believes that the markets for seeds, equipment, feed, and fertilizer are dominated by a few large companies which negatively impacts family farmers and ranchers. The Biden Administration believes that the lack of competition increases the costs of inputs for family farmers all while decreasing the revenue a family farmer receives. The Order directs the USDA to consider issuing new rules: (1) making it easier for farmers to bring and win lawsuits under the Packers and Stockyards Act; (2) prohibiting chicken processors from exploiting and underpaying chicken farmers; (3) adopting anti-retaliation protections for farmers who speak out about a company’s bad practices; and (4) defining when meat producers can promote and label their products as a “Product of the USA.” The Order also requires the USDA to develop a plan to increase opportunities for small farmers to access markets and receive a fair return and encourages the Federal Trade Commission to limit when equipment companies can restrict farmers from repairing their own farm machinery. Follow this link to learn more about President Biden’s recent Executive Order.
The 2020 elections will likely be historically significant for U.S. agriculture, but what can we expect? Our partner, the National Agricultural Law Center, will try to answer that question with a webinar on January 13 at noon. The webinar will feature Hunt Shipman, principal and director at Cornerstone Government Affairs in Washington, DC. Mr. Shipman will share his predictions on what's in store for agriculture, including:
- Key appointments at USDA
- Congressional committees positions
- Implications for the next Farm Bill
- International trade impacts
- Changes in the federal and state regulatory environments
With nearly three decades of experience in Washington, Hunt Shipman has held a variety of positions in government and the private sector. Prior to joining Cornerstone, Hunt was a senior executive for the largest trade association serving the food and beverage industry, where he led the association’s government affairs and communications programs. From 2001 to 2003, Hunt was Deputy Under Secretary for Farm and Foreign Agricultural Services and served as the acting Deputy Under Secretary for Marketing and Regulatory Programs at the United States Department of Agriculture. In this capacity, he led three agencies with over 18,000 employees stationed around the world, and administered over $31 billion in programs. Hunt was the Department of Agriculture’s principal negotiator with the Congress for the 2002 Farm Bill. Hunt also served as the staff director of the Senate Agriculture Committee, Professional Staff Member at the Senate Appropriations Committee, and on the personal staff of Senator Thad Cochran.
The webinar is free, but limited to the first 500 registrants. To register, visit here.
Just in time for Christmas, Congress delivered quite a package this morning by passing new COVID-19 relief legislation. President Trump is expected to sign the bill soon. Buried in the 5,593 pages of the legislation is an allocation of nearly $11.2 billion dollars to the USDA. A large portion of the USDA funds will provide additional payments for agricultural producers under the Coronavirus Food Assistance Program (CFAP). Benefits for food processors, energy producers and timber harvesters are also in the bill, as well as funding for several other USDA programs and studies. We’ve categorized, compiled and summarized where the USDA funds are to go below.
- Supplemental CFAP payments of $20 per eligible acre for the 2020 crop year, for eligible “price trigger crops,” which includes barley, corn, sorghum, soybeans, sunflowers, upland cotton and wheat, and eligible “flat rate crops,” which includes alfalfa, amaranth grain, buckwheat, canola, cotton, crambe, einkorn, emmer, flax, guar, hemp, indigo, industrial rice, kenaf, khorasan, millet, mustard, oats, peanuts, quinoa, rapeseed, rice, rice, sweet, rice, wild, rye, safflower, sesame, speltz, sugar beets, sugarcane, teff, and triticale but excludes hay, except alfalfa, and crops intended for grazing, green manure, or left standing.
- $100 million in additional funding for the Specialty Crop Block Grant Program.
Livestock, poultry and dairy
- Supplemental CFAP payments to livestock or poultry producers (excluding packers and live poultry dealers) for losses from depopulation that occurred due to insufficient processing access, based on 80% of the fair market value of depopulated livestock and poultry and including depopulation costs not already compensated under EQIP or state programs.
- Supplemental CFAP payments to cattle producers for cattle in inventory from April 16 to May 14, 2020 according to different payment formulas for slaughter cattle, feeder cattle and all other cattle.
- Supplemental Dairy Margin Coverage payments for eligible operations with a production history of less than 5 million pounds whenever the average actual dairy production margin for a month is less than the selected coverage level threshold, according to a specified formula.
- $1 billion for payments to contract growers of livestock and poultry to cover not more than 80% of revenue losses from January 1 to December 22, 2020.
- $20 million for the USDA to improve animal disease prevention and response capacity.
- Establishment of a statutory trust via the Packers and Stockyards Act that requires a dealer with average annual purchases above $100,000 to hold cash purchases of livestock by the dealer in trust until full payment has been received by the cash seller of the livestock.
General payment provisions
- In determining the amount of eligible sales for CFAP, USDA must include a producer’s crop insurance indemnities, non-insured crop disaster assistance payment and WHIP payments, and may allow a producer to substitute 2018 sales for 2019 sales.
- USDA shall make additional payments under CFAP 1 and CFAP 2 to ensure that payments closely align with the calculated gross payment or revenue loses, but not to exceed the calculated gross payment or 80% of the loss. For income determination, USDA shall consider income from agricultural sales, including gains, agricultural services, the sale of agricultural real estate, and prior year net operating loss carryforward.
- USDA may take into account when making direct support payments price differentiation factors based on specialized varieties, local markets and farm practices such as certified organic production.
Marketing and processing
- $100 million for grants under the Local Agriculture Market Program for COVID-19 impacts on local agriculture markets. USDA may reduce and allow in-kind contributions for grant matching requirements.USDA may provide support to processors for losses of crops due to insufficient processing access.
- $60 million for a grant program for meat and poultry slaughter and processing facilities seeking federal inspection status or eligibility for the Cooperative Interstate Shipment program to modernize facilities or equipment, comply with packaging, labeling, and safety requirements and develop food safety processes.
- USDA must deliver a report on possible improvements to the Cooperative Interstate Shipment program that allows interstate shipments of meat and poultry products and on the availability and effectiveness of federal loan and grant programs for meat and poultry processing facilities and support for increasing processing capacity.
- USDA may make recourse loans available to dairy product processors, packagers or merchandisers impacted by COVID-19.
- Until September 30, 2021, USDA may extend the term of marketing assistance loans to 12 months.
- $1.5 billion to purchase and distribute food and agricultural products to individuals in need, and for grants and loans to small and midsized food processors or distributors, seafood processing facilities, farmers’ markets, producers or other organizations for the purpose of responding to COVID, including for worker protections. USDA must conduct a preliminary review to improve COVID-19 food purchasing, including the fairness of purchases and distribution.
- $400 million for a Dairy Donation Program to reimburse dairy processors for purchasing and processing milk and partnering with non-profit organizations to develop donation and distribution plans for the processed dairy products.
Timber and energy
- $200 million for relief to timber harvesting and hauling businesses that experienced a loss of 10 percent or more in gross revenue from January 1 to December 1, 2020, as compared to the same period in 2019.
- USDA may make payments for producers of advanced biofuel, biomass-based diesel, cellulosic biofuel, conventional biofuel or renewable fuel produced in the U.S. for unexpected market losses resulting from COVID-19.
Training and outreach
- $75 million for the Farming Opportunities Training and Outreach Program for grants for beginning, socially disadvantaged and veteran farmers and ranchers impacted by COVID-19. USDA may reduce and allow in-kind contributions for grant matching requirements and waive maximum grant amounts.
- $28 million for grants to State departments of agriculture to expand or support stress assistance programs for agriculture-related occupations, not to exceed $500,000 per state.
- $75 million for the Gus Schumacher Nutrition Incentive Program, and USDA may reduce matching grant requirements.
We’ll keep digging through the legislation to report on other agricultural provisions. Or readers may take a look at H.R. 133 here. The USDA allocations we summarized are in Subtitle B, beginning on page 2,352.