Does not matter: Farm aid keeps flowing to the Midwest — The push to hit pause on dietary guidelines report

Jun 16, 2020

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Quick Fix

— The Agriculture Department has doled out $2.9 billion to farmers under its coronavirus relief program, with much of the money going to farmers and ranchers in the Midwest.

— Dietitians, low-carb advocates and influential nutrition groups say the government needs to give the Dietary Guidelines Advisory Committee more time to finish its work.

— Farm exports to China are falling behind pre-trade war levels, casting further doubt that Beijing will fulfill its commitment to buy record amounts of U.S. ag products this year.

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Driving the Day

FARM AID KEEPS FLOWING TO THE MIDWEST: Three weeks since USDA launched its $16 billion farm aid program, the department has approved $2.9 billion in direct payments to producers whose businesses have been disrupted by the coronavirus pandemic. More than 220,000 farmers have received funding so far, according to USDA's weekly update.

Iowa farmers have received around $314 million, the most of any state. Nebraska producers got more than $207 million, followed by other Midwestern states like Illinois, Kansas and Minnesota that have each received at least $150 million as of Monday.

By sector, livestock producers have received about half of all the money dispersed so far. The sector has been one of the hardest hit by the closure of schools and restaurants, outbreaks at meatpacking plants and a wide disparity in cattle prices.

Sonny Perdue and school kids | AP Photo

Agriculture Secretary Sonny Perdue eats cheese pizza with students. | Andy Manis/AP Images for Dairy Management Inc.

THE PUSH TO HIT PAUSE ON DIETARY GUIDELINES REPORT: The Dietary Guidelines Advisory Committee will hold its final public meeting on Wednesday before releasing a sweeping report, expected in mid-July, making recommendations to USDA and HHS about the government's 2020 update on guidelines for healthy eating, federal nutrition programs and more. But critics and allies alike are calling for delays, writes Pro Ag's Helena Bottemiller Evich this a.m.

The coronavirus pandemic and last year's historic government shutdown have impeded the panel's work on their scientific recommendations that help shape the federal guidelines every five years.

"We just want to make sure the process is sufficiently rigorous," said Pepin Tuma, senior director of government and regulatory affairs at the Academy of Nutrition and Dietetics, which represents more than 100,000 registered dietitians and other nutrition professionals.

The recommendations have become increasingly political as diet-related diseases proliferate in the U.S., and Tuma said the group is concerned that the guidelines will lead to more criticism if the committee doesn't have enough time to consider all the relevant science. The panel hasn't reviewed about one-fifth of the questions it was asked to evaluate, Tuma noted.

House Ag member Dusty Johnson (R-S.D.) last week asked the Trump administration to slow down the process, citing "repeated failures" in the past to halt or reverse the worsening dietary health of Americans. Johnson said it's "time for the DGAC to stop digging the hole it's standing in."

Wouldn't be the first time: Advisory committees in previous years have taken more of the time allotted to them. The panel's charter extends until October, so the work could continue though the summer and beyond, if needed.

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AG EXPORTS TO CHINA ARE LAGGING: Under the "phase one" trade deal that took effect in February, China pledged to buy at least $36.5 billion in U.S. farm goods this year. That was seen as an ambitious goal even before the coronavirus scrambled global trade. Nearly halfway through 2020, the likelihood of Beijing hitting its target appears to be shrinking.

Trade with China has been "disappointing" so far, writes David Widmar of Agricultural Economic Insights. For example, soybean sales to China through April were the lowest in five years, and they're well behind pre-trade war levels (e.g. 2016 and 2017). As for total U.S. ag products, exports to China through April were similar to 2019 but lagged the previous three years.

Hurdles ahead: Widmar said that recent positive chatter about China's purchase commitments for later in 2020 "often overlooks the big picture." For one thing, low commodity prices will make it even harder for China to reach the dollar targets in the phase one deal.

"If you're considering the possibility of China purchasing record levels of U.S. ag products in 2020, one has to concede the hurdle is greater after four months of activity in the books," he wrote.

The official forecast: USDA last month dialed back its fiscal 2020 export projections by $3 billion in part because of weaker Chinese demand.

STEERING STIMULUS LOANS TO RURAL, UNDERSERVED BUSINESSES: Jovita Carranza, head of the Small Business Administration, is asking financial lenders to focus on helping the neediest employers and communities, including rural businesses, apply for Paycheck Protection Program loans before the June 30 deadline, reports Pro Financial Services' Zachary Warmbrodt.

The agency wants to "ensure that entities in underserved and rural markets" can benefit from the program, including new businesses and those owned by veterans, women or "economically disadvantaged individuals," Carranza wrote in a message to lenders on Monday.

By the numbers: Banks and other institutions have issued $512 billion in forgivable loans to more than 4.5 million borrowers, but there's still nearly $130 billion left on the table.

Small farms initially struggled to apply for PPP loans because of delays by SBA in approving farm lenders to participate in the program. As of last week, businesses in agriculture, forestry, hunting and fishing had received about $7.6 billion in loans, according to the agency.

Where's the money going? House Democrats are asking lenders to turn over records of which businesses received loans through the program, after Treasury Secretary Steven Mnuchin last week said the administration wouldn't reveal the names of the borrowers.

HAPPENING TODAY at 12 p.m. EDT/9 a.m. PDT: A VIRTUAL INTERVIEW WITH LOS ANGELES MAYOR ERIC GARCETTI: Los Angeles is grappling with a rising number of Covid-19 cases and a wave of protests for racial justice after the killing of George Floyd. California Playbook authors Carla Marinucci and Jeremy White will find out how Los Angeles Mayor Eric Garcetti is dealing with these twin crises during a virtual interview TODAY. REGISTER HERE.

Row Crops

— Rep. Gerry Connolly (D-Va.) is asking 24 inspectors general to monitor safety precautions for federal workers as agencies prepare to gradually reopen offices. Connolly sent letters to the watchdogs, including USDA Inspector General Phyllis Fong, raising concerns about "premature or misguided efforts to return to offices" and calling for a formal "assessment plan" of the reopening process. Pro Financial Services' Kellie Mejdrich has more.

— Sales of cow's milk at supermarkets have increased by 7 percent since the beginning of March, by volume, and they're up 2 percent compared to last year, after declining for a decade. But higher sales at the grocery store aren't enough to offset the lost demand from restaurants and other markets during the pandemic, and dairy farmers are still struggling after years of low prices and trade headwinds, The Wall Street Journal reports.

— Pilgrim's Pride CEO Jayson Penn is taking a leave of absence after he was indicted by federal prosecutors for allegedly rigging the prices of broiler chickens. Chief Financial Officer Fabio Sandri will serve as interim CEO while Penn focuses on the upcoming trial, which is scheduled to begin in August. More from WSJ.

— The San Antonio Food Bank is racking up extra costs to cover gaps in USDA's $3 billion food box program, like delivering boxes from its warehouse to distribution sites because federal contractors tapped by USDA didn't do so, the San Antonio Express-News writes. It's one of several shortfalls that have hampered the largely popular program over the last month, as POLITICO has reported.

— Democratic presidential candidate Joe Biden's tax policies would raise taxes by $3.8 trillion, according to a new estimate from the American Enterprise Institute. Like other analysts, AEI found that the increase would mostly come from the top 1 percent of earners, per Pro Tax's Brian Faler.

— Black food makers say they've repeatedly been denied spots at the Dupont Circle farmers market, one of the most profitable markets in Washington, D.C. Forbes has the story.