Disaster bill a disaster in Senate | Ag groups fret about Trump threat to close border
— U.S./China trade policy update:
- Despite a growing belief that the sides may be getting closer to reaching a deal to end the trade friction, “they remain far apart on core issues such as market access, an enforcement mechanism and the protection of intellectual property rights in China,” according to the South China Morning Post.
- Chinese President Xi Jinping said on Monday that he wants the U.S. to work with China to help stabilize and reduce uncertainty in global affairs, amid negotiations aimed at ending the countries’ months-long trade war. “As big countries, our relationship with each other can have great impact on global strategic stability and we all shoulder special responsibilities [to the world],” Xi told a visiting delegation of The Elders – an international non-governmental organization of prominent public figures – during a meeting in Beijing. China is a “big developing country” but is willing to shoulder its share of international responsibilities, Xi was quoted as saying by China's state-owned Xinhua News Agency.
- Xi took a likely swipe at President Donald Trump’s “America First” strategy, emphasizing the importance of nations getting along in “a multilateral world.” Xi said China would continue to promote multilateralism by supporting initiatives such as the 2015 Paris climate accord from which the U.S. withdrew soon after Trump’s inauguration as president in 2017.
- Washington welcomed China’s move on Monday to expand the range of fentanyl-related substances it defines as controlled narcotics, after criticism from President Donald Trump for allowing the synthetic opioid to be shipped to the United States. “This significant development will eliminate Chinese drug traffickers’ ability to alter fentanyl compounds to get around the law,” the U.S. Drug Enforcement Administration (DEA) said in a statement. “We look forward to our continued collaboration with China to reduce the amount of this deadly poison coming into our country.” China said the addition of fentanyl-related substances to the supplementary list of controlled narcotic drugs would take effect on May 1, a date that some observers say could be close to a final U.S./China trade agreement. U.S. Trade Representative Bob Lighthizer, who is leading the Washington team in the talks, has said he would prefer to include a Chinese commitment to curb sales of the drug in any final trade agreement.
— The U.S. Dairy Export Council warned a southern border closure would add to the industry’s economic slump caused by retaliatory duties imposed after Trump slapped tariffs on trading partners including China and the European Union. Mexico is the largest export market for U.S. dairy, importing nearly $1.4 billion worth of dairy products in 2018. “Dairy exporters already are suffering from diminished access to export markets due to high tariffs and lack of progress on U.S. trade agreements,” Tom Vilsack, president and CEO of the group, said in a statement. “Closing the U.S. southern border to Mexico would be a gut punch that could set the industry back by a decade or two.“ Mexico is the largest customer of U.S. milk powder, cheese and butterfat, according to the dairy council. Last year was a record year for sales of nonfat dry milk/skim milk powder and butterfat, it said. For every $1 of U.S. dairy exports to Mexico, $2.50 of economic activity is generated in the United States, the release said, citing a study by an agricultural consulting company.
Meanwhile, the U.S. Chamber of Commerce noted that, "Closing the U.S.-Mexico border would inflict severe economic harm on American families, workers, farmers, and manufacturers across the United States," the business group said in a statement. "Even threatening to close the border to legitimate commerce and travel creates a degree of economic uncertainty that risks compromising the very gains in growth and productivity that policies of the Trump administration have helped achieve."
— Disaster aid stalemate continues in Senate as the chamber on Monday voted down two bills as Republicans and Democrats clashed over President Trump’s opposition to more help for Puerto Rico. The GOP substitute also included $600 million for nutrition assistance to Puerto Rico, though Democrats said that wasn't enough. Senators voted 44-49, rejecting a Republican proposal that needed 60 votes to shut off the debate, and 46-48, defeating a Democrat-led version of a bill the House passed in January.
“This is no time for our colleagues across the aisle to prioritize a political fight with the president ahead of the urgent needs of communities across our country,” said Senate Majority Leader Mitch McConnell (R-Ky.). Negotiations continue to find a compromise.
Democratic senators running for president in 2020 lined up to block a GOP disaster aid package that would support the key caucus state of Iowa. Among the declared presidential aspirants in the Senate, only Kamala Harris (D-Calif.) was absent for the Monday votes. Democratic White House hopefuls Cory Booker of New Jersey, Kirsten Gillibrand of New York, Amy Klobuchar of Minnesota, Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts voted no.
Grassley comments. “At a time when some families in Iowa have everything that they own underwater, and the people of Puerto Rico are facing a funding cliff, now is not the time to play politics with a disaster relief bill,” Sen. Chuck Grassley (R-Iowa) said on the floor. “To my colleagues across the aisle who have been spending a lot of time in Iowa lately as presidential candidates, if you vote against moving forward with the Shelby amendment, how are you going to look Iowans in the eye and justify a vote against moving this disaster aid bill ahead?”
The $13.5 billion Senate package included $3 billion in farm disaster aid, along with $150 million to rebuild rural facilities and $480 million in forest restoration funds. Senate Democrats reportedly will introduce new legislation to provide billions of dollars in new disaster funds for farm-belt states affected by the recent Midwest flooding.
The Democrats' bill (HR 268), written in the House in January before the Midwest storms, did not include funding for this year’s flooding. Senate Appropriations Committee ranking member Patrick Leahy (D-Vt.) asked unanimous consent to add funding for this year’s Midwest storms to the package, but Republicans objected.
— Other items of note:
Canada is set to continue experiencing temperature increases double the global rate, due to climate change, according to a new report commissioned by the Canadian government. The report also said that average land temperatures have already increased 1.7˚C since 1948.
Closing the U.S.-Mexico border would cause a major avocado shortage. Americans could run out of avocados in just three weeks if Trump makes good on his threats to shut the border. Link for details from Reuters.
Senate Ag panel advances CFTC nominee to full Senate. The Senate Agriculture Committee on a bipartisan voice vote Monday sent Heath P. Tarbert’s nomination to head the Commodity Futures Trading Committee (CFTC) to the full Senate.
The impact of President Trump’s trade policy is having on agriculture and labor is the topic of a hearing today by a House Small Business subcommittee. Testifying will be representatives from the dairy and pork sectors.
Farmland prices remain historically high in the Upper Midwest, reports the Minneapolis Star Tribune (link). The stability in land values is helping producers withstand a recent decline in farm income. Average land values in Minnesota rose 4.5% in 2018, according to data compiled at the University of Minnesota.
Amazon is cutting prices at its Whole Foods supermarkets this week, with the Wall Street Journal reporting that more than 500 products will see reduced prices. The paper said the price reductions will focus on produce and meat.
— Markets. The Dow on Monday added 329.74 points, 1.3%, to 26,258.42, while the S&P 500 advanced 32.79 points, 1.2%, to 2,867.19 and the Nasdaq Composite climbed 99.59 points, 1.3%, to 7,828.91.
Dow Inc. (DOW) will begin trading today on the New York Stock Exchange, following its separation from DowDupont. The materials sciences company's stock will also replace DowDupont in the Dow Jones Industrial Average as of today. A third company, Corteva Agriscience, will be separated from DowDupont on June 1, at which time DowDupont will change its name to DuPont.
Mexico cut its 2019 growth forecast, again. The finance ministry pegged growth between 1.1% to 2.1% for the year, down from a prior forecast of 1.5% to 2.5%. It is the sixth time Mexico has cut its projection for the year.
In Britain, Parliament failed to reach a majority on any one of four Brexit proposals, less than two weeks before the departure deadline. Prime Minister Theresa May is likely to seek another vote this week on her plan that has been rejected three times. By April 10, May needs to either get an agreement through Parliament or ask the European Union for a longer delay if she wants to avoid leaving without a deal. May summoned her cabinet for a five-hour meeting to try and break the deadlock before the April 12 EU departure deadline. The plan that lost most narrowly was for a customs union that would keep Britain in the same tariff system as the rest of the European Union countries, tying the country closely to the bloc. It failed 276-273. "Over the last days a no-deal scenario has become more likely, but we can still hope to avoid it," said EU chief Brexit negotiator Michel Barnier.