Epidemic Essentials: Agriculture


by Kayla Sargent

The COVID-19 outbreak has made one thing certain — Americans need the agriculture industry to remain fully functional in order to survive.  But the pandemic has come with its own set of challenges that has made it difficult to for ag operators to continue “business as usual.”

Fortunately, while producers are out on the ground continuing their calving, lambing, harvesting, or planting duties, national ag organizations have flooded the White House’s mailbox with letters to address the industry’s concerns.  The three major cattle organizations as well as National Farmers Union and American Farm Bureau Federation (AFBF) all lined out their memberships’ main issues when it comes to working through the pandemic.

“As the country reels both economically and emotionally from the spread of COVID-19, NCBA has been hard at work ensuring that cattle producers remain able to focus on the national infrastructure priority of keeping high-quality beef available to consumers,” National Cattlemen’s Beef Association (NCBA) Vice President of Government Affairs Ethan Lane said.

Lane said it is critical for federal officials to fully understand the story of how beef gets “from pasture to plate” so adequate assistance can be offered to the nation’s beef supply chain participants.

“In these challenging times, that story is about the strength of our cattle-producing families and what they need to weather this storm.  COVID-19 has dealt a tremendously challenging hand to producers across the country.  These highly volatile markets cannot be allowed to force our ranching families out of business just when consumers need them most.”

 

Financial Aid for Unprecedented Prices…

 

In a letter to Congressional leaders, NCBA requested that any future phases of COVID-19 funding packages “include a meaningful safeguard for our nation’s farm and ranch families during this public health emergency.”  Specifically, the organization suggested an increase in the USDA Commodity Credit Corporation’s (CCC) borrowing authority from $30- to $50-billion, full funding for the replenishment of the CCC, and assurance that livestock producers will be eligible for assistance.

Similarly, United States Cattlemen’s Association (USCA) penned a letter to Secretary of Agriculture Sonny Perdue asking for “immediate action through the utilization of your authority under the Commodity Credit Corporation.”  The group wrote that funds and programs are needed to aid cattle producers and feeders during this time of “excessive price loss.”

“This is a unique market disruption and we trust that you and your staff will present a customized, timely and effective program for the U.S. cattle industry,” USCA President Dr. Brooke Miller said.

In a letter written to President Trump and Secretary Perdue, R-CALF USA urged the leaders to direct lenders to grant “emergency extensions of loan repayment deadlines and provide essential emergency operating funds.”  The group also suggested federal capital gains tax relief for producers selling land, cattle, or equipment to make ends meet in the challenging time.

“America’s largest segment of agriculture – the U.S. cattle industry is in a catastrophic crisis already, and has been since 2015,” R-CALF USA CEO Bill Bullard wrote.  “Now, the coronavirus upheaval has intensely worsened the financial and economic conditions of America’s cattle farmers and ranchers.  Many will not make loan payment deadlines and many of those will not survive without immediate intervention.”

 

Stocking the Supply Chain…

 

USCA also urged extensive measures to ensure meat packing facilities remain operational throughout the course of the pandemic.  The group requested the USDA Food Safety Inspection Service (FSIS) to issue a statement offering “certainty as it links to ensuring federal inspection of meat packing facilities.”  The group suggested personnel be deemed “essential,” so they continue their roles despite changing federal work force guidelines.

Additionally, USCA urged that protocols be put in place to “ensure that plants do not get immediately shut down should an employee test positive for Coronavirus.”  Finally, USCA wrote that “if needed on an emergency basis, plants should be able to continue operating even if there is not a complete USDA staff available.  For a short period of time, self-regulation can suffice.”

“Ensuring that meat processing facilities and the ports remain open during the days ahead is most critical,” Miller wrote.

AFBF also expressed concern about the operation of critical processing facilities.  In their letter to Secretary Perdue, AFBF President Zippy Duvall wrote, “as companies adopt social distancing policies in keeping with health directives, this mode of work could also have a significant impact on the processing plants that drive America’s supply chain.”

AFBF called for close monitoring of meat packing plants, dairy processors, ethanol plants, and other processing facilities.  In regard to the food supply, the group also called for the current FMSCA Emergency Declaration waiver to hours of service for food transportation to be expanded to the full agricultural supply chain.

In a letter written to President Trump and Secretary Perdue, R-CALF USA suggested that in order to combat beef supply concerns “the red tape that prevents state-inspected beef pants from selling beef across state lines” be eliminated.  R-CALF USA CEO Bill Bullard wrote that this move would increase competition for cattle and remove the current bottleneck in beef distribution to consumers.

 

Market Manipulation Monitoring…

 

USCA, AFBF, and R-CALF USA all mentioned concerns with the market’s reaction to the Coronavirus outbreak.

USCA urged Secretary Perdue to “monitor anti-competitive buying practices” in the coming days.  The group expressed their concern with the proposed rulemaking “intended to weaken the Packers and Stockyards Act” and asked for a gathering of livestock industry leaders to “work on and improve the competitiveness and price discovery within the cattle market.”

AFBF’s Duvall also urged USDA to monitor the markets, noting that livestock producers expressed concerns with market manipulation.  He added that in the fresh produce market, growers have expressed concerns with possible dumping of product from other countries.

“USDA should work with the appropriate federal agencies in ensuring U.S. farmers are not unfairly disadvantaged during this unique period,” Duvall wrote.

Seeing the past week’s “inexplicable market volatility marked by severely depressed cattle prices and skyrocketing wholesale beef prices,” R-CALF asked President Trump to immediate direct a U.S. Department of Justice investigation into the cattle market.  The group also suggested immediate suspension of the decision to allow Brazilian beef back into the United States.

 

A Dire Situation…

 

Besides their five “Emergency Stopgap Measures,” Bullard wrote that two additional tools would bring “The Real Relief America’s Cattle Industry Needs.”  First, R-CALF urged a “limit on the percentage of cattle that packers can procure through arrangements that both circumvent and undermine the competitive cash market.”  Bullard wrote that the price discovery market is already “nearly destroyed.”  Secondly, R-CALF asked President Trump to require all beef sold in the U.S. to yield a label that distinguishes the country in which it was born, raised, and harvested.

Bullard wrote that his group has been working for “over a decade to head-off our industry’s catastrophic crisis.  Unfortunately, decisionmakers have been disinclined to support any of these important reforms.  So, here we are.  Mired in a catastrophic crisis.  Our entire industry, along with all of Rural America it supports, needs your immediate attention.”

 

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