Trump Notifies Congress of NAFTA Renegotiation Intent
The Trump Administration officially notified Congress on Thursday, of its intent to begin the renegotiation of the North American Free Trade Agreement – also known as NAFTA. In the letter, signed by newly confirmed U.S. Trade Representative (USTR) Robert Lighthizer, the President expressed his concern with an agreement that “was negotiated 25 years ago, and while our economy and businesses have changed considerably over that period, NAFTA has not”.
Lighthizer explained that the NAFTA modernization would include “new provisions to address intellectual property rights, regulatory practices, state-owned enterprises, services, customs procedures sanitary and phytosanitary measures, labor, environment and small and medium enterprises.” He also assured Congress that “where appropriate, (they would) update U.S. approaches to address the challenges faced by U.S. consumers, businesses, farmers, ranchers, and workers in an increasingly global economy.”
The notification letter now starts a 90-day countdown, whereby the Administration may begin making preparations for the renegotiation but may not actually begin the bi-lateral talks with Canada and Mexico. Talks would be expected to begin soon after the deadline of August 16, 2017.
Bob Stallman, past-President of the American Farm Bureau Federation (AFBF) and a farmer from South Texas, says “I’m sorry I am just going to have to say it. The fact the statements in the news that NAFTA has been the worst thing that’s ever happened to this country, the worst trade agreement that has ever happened, that’s fake news – I’m sorry it’s just not accurate”. Speaking recently at a Farm Foundation Forum on the Future of the North American Free Trade Agreement acknowledged that “you can argue about different sectors, regional impacts, industry impacts, particular commodity impacts, but at the end of the day NAFTA has been good for North America.”
House Ag Committee Has First Date With Perdue
Members of the House Agriculture Committee met with new confirmed Secretary of Agriculture Sonny Perdue on Wednesday in what could be described as a “first date”. Perdue speaking to the Chairman of the Committee, Mike Conaway (TX-R) said “from my perspective our first date went very well and you got my number, I hope you’ll call again.” The comment at the end of the hearing underlined the tone of the meeting where Conaway mentioned that he couldn’t recall a full committee hearing where every single member showed up for some period of time and almost every one used up their five minutes added “your stamina is well admired.”
Members of the Committee questioned Perdue on a wide-range of issues including his plans to reorganize the U.S. Department of Agriculture (USDA) and eliminate an Undersecretary for Rural Development. He quickly responded that the plan did not equate to a diminished role for rural development rather it was an increasing role and expressed regret that the media had misread the announcement.
Conaway seemed pleased overall saying “against the backdrop of a four-year, 50-percent decline in net farm income, Sec. Perdue’s comments today rightly recognized the concern of America’s farmers and ranchers and the many challenges faced by rural America. I was pleased to hear the secretary express his dedication to effectively and efficiently optimizing USDA to better see America’s farmers and ranchers through these tough times. By underscoring his commitment to work with newly-confirmed U.S. Trade Representative Lighthizer to enforce U.S. trade laws and hold our trading partners accountable to their commitments, Sec. Perdue can begin leveling the playing field for our nation’s farmers and ranchers.”
“It was also refreshing to hear Sec. Perdue acknowledge the importance of strong U.S. farm policy” the Chairman concluded. “With the farm bill upon us, it is going take all of us in the ag community working together to ensure we have an effective safety net for all farmers and ranchers, including our friends in the cotton industry who are in need of immediate assistance.”
Senate Ag Committee to Focus on Rural Economy
The Senate Committee on Agriculture is preparing for another farm bill hearing next Thursday focused on “Examining the Farm Economy: Perspectives on Rural America.”
Chairman Pat Roberts (KS-R) said “this hearing begins the Agriculture Committee’s Farm Bill hearings here in Washington. “We’ve traveled to Kansas and Michigan to hear perspectives from boots on the ground. Now, as we consider the next Farm Bill, it’s important for our Committee to examine the current economic landscape of farm country. We must remember that the 2014 Farm Bill was written and passed when times were good in farm country. A lot has changed since then, and we have a lot to consider.”
Ranking Member Debbie Stabenow (MI-D) added that “in the 2014 Farm Bill, we made responsible, bipartisan reforms that are saving taxpayers billions more than expected. As we look to the next Farm Bill, we must understand the current state of the farm and rural economy because our farmers and families are already doing more with less.”
To date, no witnesses have been confirmed for the hearing.
Export Increases for Beef, Corn, Soybeans & Wheat
The U.S. Department of Agriculture (USDA) released their Weekly Export Sales Report on Thursday morning (for the period May 5-11, 2017).
Wheat: Exports of 673,200 MT were up 13 percent from the previous week and 5 percent and from the prior 4-week average. The destinations were primarily China (129,000 MT), Thailand (84,500 MT), Saudi Arabia (56,900 MT), Yemen (52,400 MT), and Mexico (49,800 MT).
Corn: Exports of 1,543,400 MT were up noticeably from the previous week and 31 percent from the prior 4-week average. The primary destinations were Mexico (323,600 MT), Japan (300,400 MT), South Korea (201,600 MT), Taiwan (151,800 MT), and Spain (96,600 MT).
Barley: Exports of 100 MT were reported to Taiwan.
Sorghum: Exports of 83,800 MT were down 55 percent from the previous week and 21 percent from the prior 4-week average. The destinations were China (51,400 MT), Japan (20,900 MT), and Mexico (11,500 MT).
Rice: Exports of 39,600 MT were down 60 percent from the previous week and 48 percent from the prior 4-week average. The destinations were primarily Haiti (11,500 MT), Guatemala (8,200 MT), Mexico (4,400 MT), South Korea (2,200 MT), and Japan (2,200 MT).
Soybeans: Exports of 345,400 MT were up 20 percent from the previous week, but down 31 percent from the prior 4-week average. The destinations were primarily China (71,400 MT), Mexico (61,100 MT), Bangladesh (59,300 MT), Germany (57,700 MT), and South Korea (26,800 MT).
Cotton: Exports of 388,000 RB were down 6 percent from the previous week, but up 9 percent from the prior 4-week average. The primary destinations were Vietnam (67,900 RB), India (53,800 RB), China (48,900 RB), Turkey (48,300 RB), and Indonesia (32,300 RB). Net sales of Pima totaling 6,500 RB for 2016/2017 were up 95 percent from the previous week and 21 percent from the prior 4-week average. Increases were primarily for China (5,100 RB), India (500 RB), Egypt (400 RB), and Turkey (300 RB). For 2017/2018, exports of 11,300 RB were down 28 percent from the previous week and 22 percent from the prior 4-week average. The destinations were primarily India (4,400 RB), China (1,900 RB), Pakistan (1,600 RB), and Vietnam (1,300 RB).
Beef: Exports of 14,000 MT were up 9 percent from the previous week and 6 percent from the prior 4-week average. The primary destinations were Japan (4,700 MT), South Korea (3,200 MT), Mexico (1,900 MT), Hong Kong (1,600 MT), and Canada (900 MT).
Pork: Exports of 22,300 MT were down 1 percent from the previous week, but up 4 percent from the prior 4-week average. The destinations were primarily Mexico (7,100 MT), Japan (3,400 MT), China (3,000 MT), South Korea (2,200 MT), and Canada (1,400 MT).