As the work of the Farm Bill conference committee progresses, two issues, SNAP and conservation, have been singled out as key to the committee's success. Today's update looks briefly at recent news items that contain lawmaker perspective on these two issues.
U.S. farmers are anxious for details on the trade assistance package the administration announced in July. Press reports indicate that program guidelines could be issued by August 24th. Meanwhile, business news articles and USDA data continue to shed light on agricultural export variables as the ongoing trade dispute with China continues.
In its August Grain: World Markets and Trade report on Friday, USDA's Foreign Agricultural Service (FAS) stated that, "Combined wheat production in the European Union, Russia, and Ukraine is forecast down 12 percent from last year to the lowest level in 5 years. The EU wheat crop is down 9 percent from last year on hot, dry weather in the northern Member States, while production in Russia and Ukraine is down from recent bumper crops on a return to normal yields."
The U.S. Department of Agriculture painted a clearer picture of soybean and corn production prospects for this year's harvest on Friday. In addition, recent USDA trade data, along with business news articles, have provided further perspective on U.S. soybean exports, particularly as it relates to China. Today's update explores a few of these issues in more detail.
On Thursday, the Federal Reserve Banks of Chicago, St. Louis and Kansas City released updates regarding farm income, farmland values and agricultural credit conditions from the second quarter of 2018. Recall that the Federal Reserve Bank of Dallas issued a similar update last month. Today’s update highlights core findings from Thursday’s reports.
Last week, Financial Times writer Emiko Terazono reported that, "The wheat market is feeling the heat, with key global producers sweating over a drought that has curbed output. After several years of bumper harvests, the wheat market is poised to tighten sharply as Russia, Australia and EU countries contend with scorching temperatures."
Keith Bradsher and Cao Li reported in Saturday's New York Times that, "China threatened on Friday to tax an additional $60 billion a year worth of imports from the United States if the Trump administration imposes its own new levies on Chinese goods. The threat comes just two days after President Trump ordered his administration to consider increasing the rate of tariffs it has already proposed on $200 billion a year of Chinese goods — everything from chemicals to handbags — to 25 percent from 10 percent." Although news reports indicate that the new Chinese duties "is leaving the farm largely unscathed," ongoing concerns about the trade war persist, particularly as it relates to U.S. soybean exports.
On Thursday, USDA’s National Agricultural Statistics Service (NASS) released three updates that provide current insight into the state of the U.S. agricultural economy. The releases focused on land values, cash rents, and production expenditures.
Reuters writer Hugh Bronstein reported on Saturday that, "U.S. farmers could receive cash payments from a planned $12 billion aid package as soon as late September, U.S. Agriculture Secretary Sonny Perdue told Reuters on Saturday, warning that the program will not make tariff-hit farmers whole."
Agricultural trade issues continue to garner a substantial amount of media attention. The Commerce Department noted on Friday that surging U.S. soybean exports, spurred by the anticipation of Chinese tariffs, contributed to strong second quarter GDP growth. Meanwhile, President Trump touted an agreement with the EU to purchase more U.S. soybeans, although a subsequent report pointed out that the accord fell short of addressing broader agricultural trade disputes. Nonetheless, on Sunday's "Face the Nation" television program, Larry Kudlow, President Trump's economic advisor, indicated that broad discussions on agriculture will be part of the bilateral talks wth the EU.