Thu, 14 Jun 2018
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1. Trade Talks — China:
Trade negotiations with China continued to weigh heavily on the minds of influencers. On May 29, the National Pork Producers Council shared calculations from Iowa State University economist Dermot Hayes, who estimated that market changes (including Chinese tariffs on pork) since March 1 led to an annualised loss of $2.2 billion for pork producers.
Additionally, Biotechnology Innovation Organisation published an analysis on May 30 that found delays in Chinese regulation of biotech crops cost the U.S. agriculture industry upwards of $30 billion.
On May 31, a coalition of 18 agriculture industry organisations sent a letter to President Trump in support of trade negotiations with China. The group, which includes American Soybean Association, National Council of Farmer Cooperatives and United Fresh Produce Association, stated: “We strongly encourage negotiations leading to open and predictable trade, particularly in cooperation with other countries in the region that share our concerns about China’s mercantilist policies.”
2. Trade Talks — North America:
On May 31, the Trump administration implemented steel and aluminium tariffs on previously exempted allies — Canada, Mexico and the European Union. Mexico immediately announced retaliatory tariffs on apples, cheese and pork, among other goods, which took effect June 5 (Reuters). North American Meat Institute President and CEO Barry Carpenter remarked, “Today’s retaliation reaffirms that there are no winners in trade disputes.” National Pork Producers Council President Jim Heimerl commented, “While producers are trying to be good soldiers, we’re taking on water fast. The president has said that he would not abandon farmers. We take him at his word.”
Chris Clayton of DTN/The Progressive Farmer observed that North American Free Trade Agreement (NAFTA) negotiations have stalled, in part due to the tariffs. Drovers reported that Canadian and Mexican officials reassured their commitment to NAFTA at World Meat Congress. However, The Wall Street Journal noted (paywall) that “the tariff move is likely to strengthen Canada’s and Mexico’s resolve to not back down on unconventional U.S. demands for NAFTA.”
3. Mergers & Acquisitions:
Bayer AG completed its acquisition of Monsanto Company on June 7. The Associated Press detailed the businesses that Bayer will divest — roughly one seventh of Monsanto’s value — to BASF.
Environmental activist groups disapproved of the consolidation, but commented more frequently on Bayer’s decision to drop the Monsanto brand name. Andrew Kimbrell, executive director of Center for Food Safety warned, “Bayer should not assume that just by dropping a name they have dropped the liability.
The worldwide food and environmental movements know that Bayer is now the ‘new Monsanto.’” However, Bayer Chairman Werner Baumann vowed, “We aim to deepen our dialogue with society. We will listen to our critics and work together where we find common ground. Agriculture is too important to allow ideological differences to bring progress to a standstill.”
Although overshadowed by the Bayer-Monsanto deal, several other large food companies made business moves.
4. RFS Waivers:
This reporting period, the EPA met with several forms of resistance to its use of waivers that exempt small oil refiners from renewable fuels standard (RFS) requirements for ethanol blending if they face “economic hardship.”
On May 29, Renewable Fuels Association, American Coalition for Ethanol, National Corn Growers Association and National Farmers Union filed suit against the agency for inappropriately extending these exemptions to large facilities. On June 4, a similar coalition of industry groups petitioned the EPA to account for lost volumes of renewable fuels. National Farmers Union President Roger Johnson told Feedstuffs, “Our nation’s farm families count on the RFS to stimulate demand, and we must hold EPA accountable for its recent subversive actions to undo years of progress.”
5. WHO Soda Tax:
On June 1, a World Health Organisation (WHO) panel released a report that found slow progress in fighting noncommunicable diseases, including efforts to curb obesity. The Associated Press reported that the delegate from United States blocked the WHO panel from adding a recommendation to tax sugary beverages, despite support from the remainder of the panel.
Center for Science in the Public Interest Senior Scientist Michael Jacobson objected to the omission: “This is yet another instance of the Trump Administration placing corporate self-interest over the public health.” Meanwhile, the International Food and Beverage Alliance supported “dialogue where ‘health is the priority’ and inviting food and non-alcoholic beverage companies to focus on reformulation, labelling and responsible marketing.”