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Lower Food and Fuel Costs Act passes in House

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Package includes bills to allow year-round E15, establishes special meat investigator and incentivizes better nutrient management for farmers.

In action June 16, the U.S. House of Representatives passed by a vote of 221-204 H.R. 7606, the Lower Food and Fuel Costs Act, which lead Democrat authors say will help address supply chain risks, lower the cost of food and gas prices, strengthen the food supply chain and ensure robust competition in the meat and poultry sector.

In a statement of administration policy in support of the bill, the administration notes, “Farmers today are squeezed between concentrated market power in the agricultural input industries, be it in seed, fertilizer, feed, or equipment suppliers, and concentrated market power in the channels for selling agricultural products. As a result, American farmers’ share of the value of their agricultural products has decreased and they often struggle to make sustainable returns.”

“This legislation complements many of the actions already underway by the administration to increase transparency and ensure fair and competitive markets for American agriculture producers and consumers and support sustainable farming,” the SAP notes. 

The package also includes the Strengthening the Agriculture and Food Supply Chain Act which would create a task force dedicated to shoring up the agriculture and food supply chains in order to prevent bottlenecks and lower food costs.

In addition, H.R. 7606 would help farmers implement nutrient management practices, while also supporting more efficient use of fertilizers. It would also expand loan programs for farmers to implement precision agriculture technologies. This includes $500 million that would provide additional USDA National Resources Conservation Service payments to farmers for implementation of nutrient management practices and to increase cost share and practice payments to incentivize the purchase of precision agriculture equipment, systems, and technology. "Soy farmers appreciate these steps to leverage conservation and precision ag and reduce grower input costs," according to a statement from the American Soybean Association.

National Farmers Union President Rob Larew welcomed the passage, saying it included a host of Farmers Union priorities that will provide fairness to farmers. “Farmers Union members are in strong support of bolstering USDA’s ability to investigate consolidation in the livestock industry that has been squeezing profits away from farmers and ranchers. NFU is also supportive of the provisions to expand processing capacity that will give our members more opportunities to get their products to their communities,” Larew says.

However, in remarks on the House floor, House Agriculture Committee ranking member Glenn “GT” Thompson, R-Pa., says the bill “does nothing to lower food and fuel costs.” On Wednesday Thompson introduced H.R. 8069, the Reducing Farm Input Costs and Barriers to Domestic Production Act. The bill requires the Biden administration to reverse its regulatory barriers to domestic agriculture production by providing relief from EPA’s actions on crop protection tools, provide clarity on WOTUS regulations, rescind the SEC climate rule and require an economic analysis of the costs and benefits of the Packers and Stockyards rule updates.

Special meat investigator act

Although many of the provisions included in the package did have bipartisan support, some Republican and agricultural groups expressed disappointment that the bill contained the Meat and Poultry Special Investigator Act which when passed out of committee only received Democrat support. The special investigator section of the Lower Food and Fuel Costs Act would create a new position at USDA to investigate broad anticompetitive matters.

“The new USDA Special Investigator would focus on preventing shortages, enforcing America’s anti-trust laws, and holding bad actors in the meat industry accountable,” explains lead sponsor Rep. Abigail Spanberger, D-Va.

The National Cattlemen’s Beef Association was disappointed in the bill’s inclusion in the larger package. “Rising food, fuel, and fertilizer prices are hurting cattle producers around the country, but Congress is relentlessly focused on political posturing through this special investigator bill,” said NCBA Vice President of Government Affairs Ethan Lane. “NCBA strongly supports fairness and transparency in the market, but Congress is wasting time with legislative proposals in search of a problem while ignoring real issues impacting cattle producers.”

NCBA says the bill is also unfunded, which will divert critical resources away from the Agricultural Marketing Service of USDA at the expense of critical programs producers rely on like market data reporting, meat grading, and the Cattle Contract Library pilot program.

“We are disappointed the House voted to waste $9 million in taxpayer dollars on a redundant special investigator when that money would be much better spent helping Americans seeking assistance from record inflation,” says Julie Anna Potts, president and CEO of the Meat Institute. “This bill simply replicates the authorities already granted to USDA and the Department of Justice to enforce the Packers and Stockyards Act and creates an expensive new government office.”

However, the bill does have bipartisan support and a companion bill in the Senate. Some cattle groups have been supportive of the legislation.

“Adding USDA oversight will help our industry meet the bipartisan goal of ensuring each segment of the food supply chain is held accountable,” says Brandon Reeves, executive director of the Virginia Cattlemen’s Association, who adds VCA looks forward to working with lead sponsor Spanberger and her team on future efforts to enhance transparency and accountability.

The Butcher Block Act’s inclusion in the larger package would establish additional loan programs at USDA for new and expanding meat processors to finance investment to drive competition within the meat packing industry.

Year-round E15

Also contained in the package is the Year-Round Fuel Choice Act which would permanently allow the year-round sale of E15, a biofuel alternative that lowers the average cost of fuel and can cost as much as forty cents per gallon less than regular gasoline.

Geoff Cooper, president and CEO of the Renewable Fuels Association, says, “By expanding the availability of cleaner, more-affordable ethanol blends, this legislation will help deliver immediate economic relief to American families who are feeling unprecedented pain at the pump.”

In particular, the Lower Food and Fuel Costs Act includes a permanent legislative fix for the summertime Reid Vapor Pressure waiver, extending the 1-psi waiver to blends of 10% or more. The draft also includes $200 million in additional funding for higher blends infrastructure.

 

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