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Ag Not Included in New Stimulus Package

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The new $2 trillion coronavirus package does not include any significant assistance for agriculture. There is one provision to provide assistance to minority farms, focused primarily on Black, Hispanic and Native American colleges and universities.

Dry Conditions Weakening in the Northern Plains

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Dry conditions are dwindling in the Northern Plains, according to the latest U.S. Drought Monitor. In North Dakota, the extreme drought once seen in central and south-central part of the state has disappeared. Fifty-six percent of the state is in severe drought, while the Red River Valley and south-central and south-eastern portions are abnormally dry or in moderate drought. Most of Minnesota either abnormally dry, with the northwestern and west-central areas being the exception.  

Coalition Asks Pres. Biden to Improves Relations with Cuba

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The United States Agriculture Coalition for Cuba is asking the Biden Administration to improve relations between the U.S. and Cuba. In a letter to President Biden, the group said the current sanctions “hurt the Cuban people.” Normalized trade relations are also touted as an opportunity for U.S. farmers. The letter was signed by more than 20 groups, including the U.S. Dry Bean Council.

USDA, USTR Name Agricultural Trade Advisors

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Agriculture Secretary Sonny Perdue and U.S. Trade Representative Robert Lighthizer have announced the appointment of 67 members to serve on seven agricultural trade advisory committees. The Agricultural Policy Advisory Committee is comprised of senior representatives from across the U.S. agricultural community who provide advice to the U.S. Department of Agriculture and the Office of the U.S. Trade Representative on trade policy matters including the operation of existing trade agreements and the negotiation of new agreements. View the appointments.

Mexico Proposes Gradual Phase Out of Glyphosate

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Source: U.S. Dry Bean Council
 
Over the past months, we have reported on our concerns regarding a global surge in movements to ban to use of glyphosate and other herbicides/pesticides. Our biggest concern is that this will translate into the imposition of very low or zero tolerances for herbicide use in imported agricultural products, including dry beans. This would create a major disruption of trade. This is happening in many countries, but as our largest single nation export market, we have kept a close eye on developments in Mexico in this regard and in particular, the use of the Precautionary Principle. The Precautionary Principle would ban the use of any product without absolute certainty that it won’t cause health problems at some point. This is not a science based risk assessment, which is why there is so much concern.
 
Earlier this month, as reported in the Mexican daily, Reforma, and many other news publications, President Andres Manuel Lopez Obrador (AMLO) has ordered the gradual phase out of the use of glyphosate by 2024. While this does not translate into import restrictions at this time, it is of concern as it is not inconceivable that things could evolve that way. This concern goes beyond Mexico and applies to many of our other important export markets as well, including our largest regional market, the European Union. This is an issue of critical importance to USDBC. While CODEX has been the scientific standard for acceptable MRLs (maximum residue limits), that protect both human health and don’t disrupt trade, many countries are moving away from this and becoming more restrictive. We will be putting time and resources into this issue moving into the fall with the goal of preventing any disruption of trade.

U.S. Imposes Tariffs, Canada Retaliates

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The Trump Administration has placed tariffs on certain types of aluminum from Canada. This decision comes about a month after the implementation of the U.S.-Mexico-Canada Agreement. Canadian Deputy Prime Minister Chrystia Freeland said the tariffs are “unwarranted and unacceptable.” The Canadian government plans to impose $3.6 billion in retaliatory tariffs against the U.S. Over the next 30 days, the country will determine what U.S. products will face the tariffs. There are no agriculture commodities on the preliminary list. Agricultural interests are monitoring this skirmish for possible trade retaliation.

USMCA Overwhelmingly Passes in the Senate

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The U.S.-Mexico-Canada Agreement passed out of the U.S. Senate by an overwhelming vote of 89-10 Thursday. For agriculture, USMCA is estimated 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 ag exports by tens of billions of dollars. President Trump took to Twitter after the passage, saying “the farmers are really happy with the new China trade deal and the soon to be signed deal with Mexico and Canada.”
 
Now, the deal heads to President Trump for a signature. The president is expected to sign the agreement sometime next week during a formal ceremony. Mexico’s legislature approved the trade deal last month, and all eyes are on Canada to ratify USMCA. The Canadian parliament isn’t scheduled to return until January 27.
 

U.S. and China Sign Phase One of Trade Agreement

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The U.S. and China have signed phase one of a trade agreement. President Donald Trump was joined by Chinese Vice Premier Liu He at the White House ceremony on Wednesday. “Today, we take a momentous step, one that has never been taken before with China, toward future fair and reciprocal trade,” said President Trump in opening remarks. After the signing, the text of the agreement was released. All details are public expect for specific purchase amounts.
 
During the address, Trump verified the phase one agreement includes over $200 billion in Chinese purchases of American goods and services over the next two years. That includes at least $40 billion in food, agricultural and seafood products annually for a total of $80 billion in the next two years. The president also said he would remove all U.S. tariffs on Chinese imports as soon as the two countries completed phase two of the agreement, adding “I do no expect there to be a phase three.”
 

Trade Agreement is Closer to Signing

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A phase one trade deal between the U.S. and China is expected to be signed within a matter of days. While President Trump and Chinese President Xi are expected to participate in a signing ceremony, details have not been announced. The South China Morning Post says Chinese Vice Premier Liu He will be in Washington, D.C. this Saturday and the trip is expected to continue into the middle of next week. In an interview with Chinese state television, China’s ambassador to the United States, Cui Tiankai, said China will honor its commitments in the phase one trade agreement. However, the ambassador said the U.S. must respect China’s sovereignty over Taiwan.

Senate Approves FY2020 Budget

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The Senate approved a fiscal year 2020 budget on Thursday, sending a $1.43 trillion spending bill to President Donald Trump and avoiding a government shutdown. The 2,300 page deal includes 13 appropriation bills.