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State of the Union: Ukraine, inflation and COVID

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Legislative Watch: Lack of ocean shipping competition; Meat and Poultry Processing Expansion; Ukraine, Russia and commodities; USDA projects higher ag exports; Sen. Jim Inhofe.

President Joe Biden in his first State of the Union addressed the Russian aggression in Ukraine, soaring inflation and the ongoing fight against coronavirus.

Biden called on all members of Congress to declare the nation's resolve to support Ukraine "with an unwavering resolve that freedom will always triumph over tyranny."  Biden stated, "When dictators do not pay a price for their aggression, they cause more chaos." In a show of unity members of Congress on both sides of the aisle stood and saluted the Ukrainian ambassador, who was in attendance. 

He talked of the success of the American Rescue Plan that increased vaccination rates and efforts to combat COVID-19. Biden emphasized that ARP helped create 6.5 million new jobs and grew the economy by 5.7% in 2021.

With inflation being a major issue for voters in this year's election, Biden vowed to invest more in manufacturing, address supply chain disruptions, and ease the burdens of child care and elder care on workers.

Biden continued his attack on the big four meat packers and inflation by saying, "You play with them or you don't get to play at all. And you pay a hell of a lot more. A hell of a lot more."

He also mentioned the lack of competition in ocean shipping. Biden pointed out that ocean carriers are seeing record profits, while Americans are feeling higher prices. Biden said, "During the pandemic, these foreign-owned companies raised prices by as much as 1,000% and made record profits." According to the White House, three groups of carriers control 80% of global container ship capacity. Biden announced a new effort by the Federal Maritime Commission and Justice Department to increase competition in the industry. 

Biden highlighted the progress made battling the coronavirus pandemic. He announced plans for more COVID tests to be distributed to Americans and the "test to treat" initiative which will make antiviral pills available for free at pharmacies.

USDA announces $215 Million to expand meat and poultry processing
In an effort to increase meat and poultry processing capacity and to provide more opportunities to producers, USDA announced it was making $215 million available in grants and other support to expand meat and poultry processing options, strengthen the food supply chain and create jobs and economic opportunities in rural America. 

Secretary of Agriculture Tom Vilsack said, "The funding we're announcing today ultimately will help us give farmers and ranchers a fair shake and strengthen supply chains while developing options to deliver food produced closer to home for families."

USDA's Rural Development will make $150 million available in grants to fund startup and expansion activities in the meat and poultry processing sector. USDA's National Institute of Food and Agriculture will provide another $40 million for workforce development and training, and USDA's Agricultural Marketing Service will provide $25 million to offer technical assistance to grant applicants and others seeking resources related to meat and poultry processing.

The Meat and Poultry Processing Expansion program of $150 million will offer grants of up to $25 million each to expand processing capacity. This will include construction, expansion of existing facilities and acquisition of equipment. Applications are due April 11. For additional information, applicants and other interested parties are encouraged to visit the MPPEP website.

Ukraine, Russia and commodities
The invasion of Ukraine by Russia and its impact on the ports in the Black Sea have introduced economic concerns in agricultural markets.

Ukraine and Russia have been major producers and exporters of various agricultural products.  The following is an average for Ukraine and Russia for the period 2017-2021.

  • Wheat – Ukraine and Russia represent 14% of the global wheat production and 30% of wheat exports.
  • Corn – Ukraine has 15% of the world corn exports and Russia has 2.3%.
  • Barley – Russia and Ukraine represent 19% of world production and 32% of world exports.
  • Soybeans – 2.3% of world production and 2.1% of world exports.
  • Sunflower Oil – 60% of world production and 75% of world exports.

USDA projects higher ag exports
USDA is projecting U.S. agricultural exports will hit a new record of $183.5 billion in fiscal year 2022. The previous record was $172.2 billion in FY '21. 

According to USDA soybeans are the main reason for the increase. Higher exports are expected for livestock, poultry and dairy products and horticultural products.

Sen. Jim Inhofe
Sen. Jim Inhofe (R-OK) announced he would be retiring from the Senate with four years left in his current term. He will step down after his replacement is elected in November. Inhofe is the ranking member of the Senate Armed Services Committee and serves on the Environment and Public Works Committee and the Small Business Committee. He was first elected to the Senate in 1994.

Source: P. Scott Shearer, who is solely responsible for the information provided, and wholly owns the information. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset. The opinions of this writer are not necessarily those of Farm Progress/Informa.

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