Agricultural Policy Update

By Robert Gronski on June 5, 2018

Ethical Food and Agriculture

The month of June promises to be an interesting one on a number of policy fronts. Here is a quick run-through of some of the issues, as we work for faith-based advocacy efforts in support of family farms and families in need.

2018 Farm Bill

After the U.S. House of Representatives failed in their initial attempt last month to pass their new farm bill, the unchanged bill is expected to undergo a second vote on June 22. In collaboration with the U.S. Conference of Catholic Bishops, CRL and other Catholic organizations have reached out to members of Congress about several concerns related to food assistance and agricultural programs.

On the Senate side, the Senate Agriculture Committee continues to work behind the scenes to attempt to produce a bipartisan farm bill that will hopefully address many Church priorities. With a markup happening in the Senate Agriculture Committee any day now, we expect to see a draft bill sometime in June.

Needless to say, the clock is ticking on finishing a new farm bill by Sept. 30 when the current one expires. If a bill cannot clear both the House and Senate by that time, some type of an extension to the current bill will need to be resolved.

Rising Interest Rates

Farm Aid, an organization that raises funds to help family farms, suggests that rural America may be “on the cusp of the biggest wave of U.S. farm foreclosures since the 1980s.” Farmers are currently carrying the highest level of debt since that crisis, when interest rates soared to the high double-digits and many family operations lost their farms.

Interest rates are much lower now than they were in the 1980s, but Fed leaders are set to meet June 12-13 to decide whether to raise interest rates. According to market news reports, economists predict about an 85% chance that rates will rise this month. Another increase is expected in September or December, plus more next year.

The Fed says it is raising rates because the U.S. economy is doing so well. But raising rates too quickly could also trigger a recession as farmers and other business owners go out of business or scale back spending. Younger farmers are especially vulnerable because they tend not to have as much land in their names, so they have less to offer the bank as collateral.

Trade and Tariffs

Agricultural commodities like soybeans, pork and corn are likely to be most vulnerable to higher tariffs, if a trade war were to arise. That could mean an additional 25% price drop from today’s prices on those commodities. Wheat and dairy prices could slide an additional 10-15%.

Agriculture is experiencing tough challenges at this time, given depressed farm prices and low farm income. As trade tensions escalate, we stand with family farm organizations urging the Trump administration to engage with the Senate and House Agriculture committees to protect family farmers and ranchers from the brunt of retaliatory tariffs.

Immigration and Ag Workers

Prior to a re-vote on their version of the farm bill by June 22, the House of Representatives must resolve the highly partisan issue of immigration. The reason the original vote on the farm bill failed was due to members of the Freedom Caucus insisting that an immigration bill must pass first.

The Church is very vocal in her care for migrants, especially those fleeing from desperate situations and seeking to protect the lives of their children and family members. We are concerned about immigrants and migrant workers because our nation’s agriculture, food system, and rural economy could not function without them. Immigrants and migrant farmers and workers contribute to the sustainability of American rural communities by farming, working in the agricultural supply chain, and operating businesses in local communities.

CRL will continue to monitor and share about the farm bill and other important agricultural policy issues in the coming weeks and months, as we continue to advocate on behalf of family farms and rural communities.

Robert Gronski is a Consultant for Catholic Rural Life. He tracks policy perspectives on food, farm, environmental, and rural community issues and helps frame these within the perspective of Catholic Social Teaching.

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