Trump Visits India Amid Setbacks for Trade Agreements, Including Agriculture

Posted on 02/23/2020 12:18 PM

Lawmakers return | Trump and another MFP | Coronavirus hearing


USDA's Ag Outlook Forum last week left participants with more questions than answers, even more than usual. Trade policy, especially with China, stole the limelight from what historically has been a focus on planted acres for new crop and total supply and demand forecasts. USDA's demand forecasts were seen as murky due to some assumptions or a lack of them regarding upcoming trade with China.

     This week, President Trump again takes the spotlight as he journeys to India. Prior prospects for an ag-related trade agreement were lowered when India failed to make needed concessions in some areas.

     The coronavirus remains a lingering issue, with recent events signaling it is spreading farther and faster than prior expectations. The House this week has a hearing on the topic; Senate will follow next week.

     State agriculture officials are in DC this week, meeting with USDA Sec. Sonny Perdue and other Cabinet officials, and likely some U.S. lawmakers. The state leaders will likely tell Perdue about the need for another Market Facilitation Program (MFP), especially after President Trump tweeted Friday about the topic.

 

President Donald Trump visits India where he’ll meet with Prime Minister Narendra Modi. Big crowds are expected to greet the American president, but prior expectations of a possible mini-ag agreement turned lower amid India pullbacks from making needed concessions.

     A senior administration official noted recent tariff increases as a concern to the U.S. “We want to address a bunch, a lot, of concerns, and we're not quite there yet,” the official said of the trade negotiations. “We will likely have discussion with the prime minister about these concerns and continue the discussion beyond this visit.”

Nominations continue to be the focus in the Senate. This week, a vote is expected on the nomination of Katharine MacGregor to be deputy secretary of the Interior Department. MacGregor had to be renominated by Trump in January after the Senate failed to act on her nomination in 2019. The Senate Energy and Natural Resources Committee approved the nomination on a voice vote earlier this month. She is currently serving as deputy chief of staff to Interior Secretary David Bernhardt.

In the House, climate change will be the topic as the House Natural Resources Committee holds a hearing on various approaches.

     The House will vote this week on an e-cigarette bill (HR 2339) to restrict flavors, limit advertising and impose new fees on companies.

A third Market Facilitation Program for 2020 will likely be one of the topics state agriculture officials raise with USDA Secretary Sonny Perdue this week, and likely with some lawmakers. While Perdue has repeatedly said farmers should not count on MFP 3, President Trump again surprised Perdue and other USDA officials when he suddenly on Friday tweeted the possibility of delivering more aid to American farmers as promised purchases from trade deals with China and other countries have yet to materialize.

     In an all-caps tweet on Friday, Trump said: “IF OUR FORMALLY TARGETED FARMERS NEED ADDITIONAL AID UNTIL SUCH TIME AS THE TRADE DEALS WITH CHINA, MEXICO, CANADA AND OTHERS FULLY KICK IN, PAID FOR OUT OF THE MASSIVE TARIFF MONEY COMING INTO THE USA!”

     On Friday night, Perdue in a statement said “the president’s tweet today shows that he stands prepared to do another round” of aid, “if necessary. I hope we can show that a third round is not needed for 2020 — we still believe farmers want trade rather than aid,” he added. Last Thursday, Perdue said that he didn’t anticipate another round of trade-aid payments to farmers and said he expected China to ramp up purchases later this year as disruptions from the coronavirus outbreak subside. “The president’s tweet was a surprise to us,” Ted McKinney, undersecretary of Agriculture for Trade, said at the USDA Agriculture Outlook Forum. “He will make that decision. And we will go with that decision.” (More on this topic in Sunday's Policy Updates.)

Key events and reports this week include:

Agriculture

  • Monday: State agriculture secretaries meet in Arlington, Va., for the annual winter policy conference of the National Association of State Departments of Agriculture.
  • Tuesday: Senate Energy and Natural Resources Committee hearing on the Forest Service.
  • Wednesday: State agriculture officials meet with USDA Secretary Sonny Perdue, EPA Administrator Andrew Wheeler and FDA Administrator Stephen Hahn.
  • Wednesday: House Agriculture subcommittee hearing, “Innovative Wood Products: Promoting Rural Economies and Healthy Forests.”
  • Thursday through Saturday: Commodity Classic; San Antonio, Texas.
  • Thursday: House Agriculture Appropriations Subcommittee hearing with the inspector general for the Department of Health and Human Services
  • Thursday: House Interior-Environment Appropriations Subcommittee hearing on the Forest Service.
  • Friday: USDA Sec. Sonny Perdue speaks at the Commodity Classic.

Coronavirus

  • Wednesday: HHS budget/Coronavirus outbreak hearing. House Energy and Commerce — Subcommittee on Health.
  • Thursday: Coronavirus disease U.S./international response hearing. House Foreign Affairs — Subcommittee on Asia, the Pacific, and Nonproliferation.

Defense

  • Friday: House panel will question Sec. of State Mike Pompeo on Iran strike. The secretary of state is scheduled to appear before the Foreign Affairs Committee, as lawmakers seek to learn more about the U.S. killing of Gen. Qassem Soleimani and related war-powers issues.

Economy

  • Monday: Annual National Association for Business Economics (NABE) policy conference is held in Washington. Cleveland Fed President Loretta Mester will discuss monetary policy; through Feb. 25.
  • Tuesday: World Bank President David Malpass delivers a speech titled “A View from the World Bank” at the NABE conference in Washington. Fed Vice Chairman Richard Clarida also speaks.
  • Wednesday: Former U.S. Ambassador to the United Nations Nikki Haley delivers remarks on why capitalism remains the best economic system ever created, at an event hosted by the Hudson Institute. In Washington.

Energy

  • Thursday: Energy budget hearing. House Appropriations — Subcommittee on Energy and Water Development.

Environment

  • Monday: Bipartisan Policy Center forum, “Strengthening Transparency at EPA: Growing the Data and Evidence Culture.”
  • Tuesday: Trump administration public hearing on a plan to streamline the environmental review process for federal grazing permits and projects such as pipelines. The proposal released by the White House Council on Environmental Quality would simplify the definition of environmental effects that agencies consider in evaluating the impact of a project or permit.
  • Wednesday: House Natural Resources Committee hearing on the American Public Lands and Waters Climate Solution Act and and Trillion Trees Act.
  • Thursday: EPA budget hearing. House Energy and Commerce — Subcommittee on Environment and Climate Change.
  • Thursday: Federal flood maps and climate change hearing. House Science, Space and Technology —Subcommittee on Environment.

Homeland Security

  • Thursday: House Homeland Security Appropriations Subcommittee hearing on U.S. Customs and Border Protection.

Population and Demographics

  • Thursday: The UN’s International Organization for Migration releases its annual World Migration Report. Director General Antonio Vitorino delivers the report from Washington.

Trade Policy

  • Wednesday: House Ways and Means Committee hearing on U.S./China trade.

Transportation and Infrastructure

  • Tuesday: Surface Transportation Reauthorization hearing. Senate Banking, Housing and Urban Affairs Committee.
  • Thursday: Water Resources Development Act hearing. House Transportation and Infrastructure — Subcommittee on Water Resources and Environment.
  • Thursday: Transportation budget hearing. House Appropriations —Subcommittee on Transportation, Housing and Urban Development, and Related Agencies.
  • Thursday: Improving U.S. infrastructure networks. House Small Business Committee hearing.

Economic reports and Federal Reserve appearances for the week include:

Monday:
     — NABE policy conference is held in Washington. Cleveland Fed President Loretta Mester will discuss monetary policy; through Feb. 25.
     — Chicago Fed National Activity Index
     — Dallas Fed Mfg Survey
     — Japanese bourses are closed in observance of the emperor’s birthday.
     — Bank of England Chief Economist Andrew Haldane speaks in London.

Tuesday:
     — Conference Board releases its Consumer Confidence Index for February. Consensus estimates are for a 132 reading, in line with the January figure.
     — S&P CoreLogic releases its Case-Shiller 20 City Home Price Index for December. Economists forecast a 0.5% rise, matching the November data.
     — FHFA House Price Index
     — Richmond Fed Manufacturing Index
     — Fed Vice Chairman Richard Clarida speaks at NABE annual conference.

Wednesday:
     — Census Bureau reports new residential home sales for January. Expectations are for a seasonally adjusted annual rate of 710,000 single-family homes sold, up 2.3% from December.
     — MBA Mortgage Applications
     — State Street Investor Confidence Index

Thursday:
     — Census Bureau releases the Durable Goods report for January. Consensus estimates are for a 0.9% decline, after a 2.4% jump in December.
     — National Association of Realtors reports pending home sales for January. Economists forecast a 2.2% jump, after a 4.9% drop in December.
     — GDP: The second estimate for fourth-quarter GDP is expected to be unchanged at 2.1%.
     — Jobless Claims for the week ended Feb. 22 is likely to have risen to 211,000 from 210,000 in the previous week.
     — Fed Balance Sheet
     — Money Supply
     — Kansas City Fed Manufacturing Index
     — Chicago Fed President Charles Evans takes part in a Global Interdependence Center event in Mexico City.

Friday:
     — BEA releases the Personal Income and Outlays report for January. Personal income and spending are both expected to increase 0.3%. In December, income edged up 0.2%, while spending rose 0.3%.
     — Institute for Supply Management releases its Chicago Purchasing Manager’s Index for February. Expectations are for a 45 reading, up from January’s 42.5. It would be the sixth consecutive month the index has been below the expansionary level of 50.
     — International Trade in Goods
     — Wholesale Inventories [Advance]
     — Consumer Sentiment is likely to show a final reading of 100.9 for February.
     — St. Louis Fed President James Bullard discusses the U.S. economy and monetary policy at a Chamber of Commerce breakfast in Fort Smith, Arkansas.
     — Canadian GDP data for December is expected to have risen 0.2%. The economy had shown a 0.1% growth in November.

Key USDA & international ag and energy-related reports and events:

Monday, Feb. 24

Ag reports and events:

  • Export Inspections
  • Fruit and Tree Nut Data
  • Vegetables and Pulses Data
  • Cold Storage
  • Crop Values
  • Poultry Slaughter
  • EU weekly grain, oilseed import and export data

Tuesday, Feb. 25

Ag reports and events:

  • Food Price Outlook
  • State Stories
  • Malaysia palm oil export data for Feb. 1-25

Energy reports and events:

  • API weekly U.S. oil inventory report
  • IP Week conference in London kicks off with IEA’s Fatih Birol among expected speakers

Wednesday, Feb. 26

Ag reports and events:

  • Broiler Hatchery
  • Livestock & Meat Domestic Data
  • Egg Products
  • Peanut Stocks and Processing

Energy reports and events:

  • EIA weekly U.S. oil inventory report
  • U.S. weekly ethanol inventories

Thursday, Feb. 27

Ag reports and events:

  • Weekly Export Sales
  • Chickens and Eggs, Annual
  • Trout Production
  • Port of Rouen data on French grain exports
  • International Grains Council monthly market report
  • Beyond Meat 4Q earnings
  • Buenos Aires Grain Exchange weekly crop report

Energy reports and events:

  • EIA natural gas storage change
  • EIA weekly oil inventory report

Friday, Feb. 28

Ag reports and events:

  • CFTC weekly commitments of traders report on various U.S. futures and options contracts.
  • Peanut Prices
  • Agricultural Prices
  • Chickens and Eggs
  • Cold Storage, Annual
  • Poultry Slaughter, Annual
  • FranceAgriMer weekly update on crop conditions
  • Malaysia palm oil export data for Feb. 1-28

Energy reports and events:

  • Baker Hughes weekly U.S. oil/gas rig counts
  • EIA releases Petroleum Supply Monthly

 

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