Trade Agreements, Access To Foreign Markets Debated In U.S. Senate Farm Bill Hearing

“The success of our agricultural economy requires continued investments in markets and opportunities for farmers,” said Sen. Debbie Stabenow, a Michigan Democrat and chairwoman of the committee. “The farm bill helps farmers put food on tables here and around the world.”

The farm bill is an “omnibus, multiyear law that governs an array of agricultural and food programs,” according to the Congressional Research Service.

The legislation provides funding for federal crop insurance, SNAP benefits, international food aid, and farm resource conservation, among other programs. The bill is renewed about every five years, and includes mandatory spending that must be in line with previous farm bills.

The current baseline expenditures for the 2023 farm bill are at roughly $648 billion over the next five years.

In the last farm bill, projected spending under the horticulture title was roughly $1 billion over five years, and projected spending under the trade title was roughly $1.375 billion over five years.

Stabenow credited the programs under both titles in helping to generate a record $191 billion in U.S. agricultural exports in 2022, amid a war in Ukraine and supply chain challenges.

“These titles represent the breadth of American agriculture,” Stabenow said. “Supporting our specialty crop and organic farmers, strengthening our local food systems, building new markets abroad for all of our commodities and products, and delivering critical food aid across the globe.”

MIXED PICTURE ON TRADE

The Senate committee received a mixed update on the state of U.S. agricultural trade from Department of Agriculture officials.

Under Secretary of Trade and Foreign Agricultural Affairs Alexis Taylor spoke to the economic activity driven by last year’s record-high agricultural exports, which represented a 14% increase from the previous year. She said that 1 million jobs were supported last year by the agricultural export industry.

Yet despite these sizable numbers and record farm income, USDA Under Secretary of Marketing and Regulatory Programs Jenny Lester Moffitt pointed out 89% of American farmers are supplementing their income with off-farm jobs.

“Over the past few years, we have seen the challenges that farmers and ranchers face, particularly in accessing markets to capture their fair share of the food dollar,” Moffitt said.

The under secretary added that strengthening local food systems remains an ongoing priority for the farm bill and broader USDA.

She highlighted the work of Eastern Market in Detroit and an Alabama farm-to-school initiative in combining state and federal funding to build local food systems.

“Leveraging resources in support of better and more competitive markets for us farmers, ranchers and consumers is in the best interest of our nation’s economy, our nation’s food system and the environment,” Moffitt said.

ELIMINATING TRADE BARRIERS

During the hearing, a bipartisan group of senators highlighted problems with uncontested barriers to trade, including Mexico’s potential blockade of genetically modified corn.

In December 2020, the president of Mexico issued a decree calling for GMO corn to be phased out of human consumption nationwide by 2024.

Ninety percent of U.S. corn is grown with GMO seeds, and Mexico is the largest importer of American corn, comprising 27% of all U.S. exports.

Republican Sens. Chuck Grassley and Joni Ernst of Iowa, Roger Marshall of Kansas, John Thune of South Dakota, and Deb Fischer of Nebraska voiced concerns over the ban. They asked that the USDA commit to rejecting Mexico’s position, and file for legal remedies via the US-Mexico-Canada Agreement.

“Our farmers feel like that this administration is putting Mexican assembly workers ahead of farmers,” Marshall said. “What are we waiting for, to trigger this mechanism? I’m tired of talking about it. We think there’s time for action.”

In response, Taylor said that the USDA is “urgently negotiating” with Mexico, and that the department will assert its “science-based rights” to GMO corn exports.

Democratic Sens. Amy Klobuchar and Tina Smith of Minnesota spoke to the challenge of geo-indicators that put barriers on dairy exports to the European Union.

A geo-indicator on food is a name that reflects place of origin, like Asiago or Parmesan cheese. U.S. farmers can’t label an exported product as “Parmesan cheese,” for example, since it is not from Parma, Italy.

Taylor committed to fighting for the rights of U.S. dairy producers in the face of these restrictions. She said the Department is negotiating with the World Trade Organization, Asia Pacific Economic Cooperative Forum, and European Union to reduce stringency for the dairy industry.

“I have yet to see feta on a map,” Taylor said. “We are engaging to make sure that intellectual property rights are being respected, but that these generic names that we use do not become a barrier for our trade.”

DIVERSIFYING INTERNATIONAL MARKETS

Several committee members articulated national security interests in developing new markets for U.S. agricultural goods, especially given international competition and disagreements over biotechnology.

“I’m concerned about this administration’s lack of attention to expanding market access for US agricultural products,” said Thune.

Taylor said that the USDA believes Southeast Asia is a target sector for exports, noting that the region has the highest rate of economic growth globally. She added that Vietnam will have more than five million middle-class households in the next five years.

“We have an opportunity today and early on to create consumers, lifelong consumers of American agricultural products,” Taylor said. She added that ongoing work in the Indo-Pacific Economic Agreement will be key to maximizing opportunities.

Taylor also pointed to Africa as a developing market for American agricultural goods, noting that Kenya is an “exciting market,” and continued U.S. technical support in the African Continental Free Trade Act.

HELPING SMALL FARMERS

Other committee members also pointed to challenges for small and underrepresented farmers to take advantage of USDA programs in the last farm bill.

Sen. Sherrod Brown, D-Ohio, said that the USDA and legislators needed to fix the Local Agriculture Market Program.

“I’ve heard concerns from organizations in Ohio about the application process,” Brown said. “The program can be too difficult to access for lower-resourced and underserved communities. I know we can fix that.”

The horticulture title of the 2018 farm bill created the program, which combined and expanded existing USDA farmers’ market, local food marketing, and value-added processing grant programs. It was allocated $50 million in annual mandatory spending in the 2018 law.

Taylor responded that in 2023, the application process will be more streamlined. She added that the USDA has worked with universities and producers to create guidebooks to help communities access the resources.

Senator Michael Bennet, a Colorado Democrat, asked Moffitt about the status of the burgeoning hemp industry, and steps being taken to guide farmers through the process of starting up an operation.

“Farmers in Colorado were eager to plant and grow it,” Bennett said. “Unfortunately, burdensome testing requirements and lack of processing facilities have stunted the potential for this versatile crop that people all over the country are interested in growing.”

Moffitt responded that the USDA has taken steps to streamline and simplify the regulatory process for upstart hemp producers, and released the first National Hemp Report last week to provide market information to producers.

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