Month: November 2024

The shock waves from Donald Trump’s surprisingly big victory in the presidential election were still rippling across Washington when speculation began about what the change in administrations will mean for agriculture.

Change is in the Air

No matter how many of the rumors prove to be true, it’s certain the changes at the White House — and on Capitol Hill — will usher in a new and somewhat different approach to policies and programs for farmers and everyone else along the food chain from dirt to dinner.

The most immediate effect when the 119th Congress now set to convene January 2, 2025, will be a shift in committee chairs from Democrat to Republican in the U.S. Senate. The Agriculture Committee, now with Sen. Debbie Stabenow (D-Michigan) as chair, will see the top spot likely pass to the current ranking Republican committee member, Sen. John Boozman (R-Arkansas).

Rep. Glenn Thompson (R-Pennsylvania) is expected to retain the chair. Thompson’s long family history in the dairy industry has been highly valuable in his more than a decade as an agriculture committee member, and as ranking minority member.

Nonetheless, efforts to enact the long-overdue Farm Bill in the lame-duck session planned for the final weeks of 2024 aren’t expected to produce legislation. Key legislative issues with higher political priorities – such as continuing government funding and hurricane relief – will make strong demands on the limited time remaining this year.

Just as important, the two parties remain divided on several key Farm Bill issues, mostly on where and how to spend the enormous amounts of money involved in the omnibus legislation, including funding for the increasingly expensive Supplemental Nutrition Assistance Program (SNAP, now at about $113 billion per year) and ambitious green-oriented programs.

Who Will Be Secretary of Agriculture?

Several well-known names have been floated as possible replacements for current Secretary of Agriculture. But few if any observers are ready to place a big bet on any individual as the Trump team evaluates and begins to fill all cabinet positions — including State, Treasury, Defense, Attorney General, Interior, Agriculture, Commerce, Labor, Health and Human Services, Housing and Urban Development, Transportation, Energy, Education, Veterans Affairs, and Homeland Security.

At the top of the Ag Secretary speculation list is Rep. Thomas Massie (R-Kentucky). Massie has commented publicly that he is “open” to taking the top USDA spot in the next Trump Administration. Massie’s growing close relationship with Trump supporter Robert F. Kennedy, Jr., also has been carefully noted by observers of the Washington political jungle.

“President Trump’s resounding victory secured a mandate for big ideas like reversing chronic disease, conserving our land and empowering farmers,” Massie said in post-election comments cited by the Lexington Herald-Leader. He went on to note that no offer had been made from the Trump team as yet, despite suggestions of his leading candidacy from another prominent name in agricultural circles – Joel Salatin.

“I’ve been contacted by the Trump transition team to hold some sort of position within the USDA and have accepted one of the six Advisor to the Secretary spots,” Salatin wrote in his blog.  “My favorite congressman, Thomas Massie from Kentucky, has agreed to go in as Secretary of Agriculture.”

Salatin has gained fame – some say notoriety – for his maverick approach to farming and farm policy in general.  He is a prolific author on food issues, an active farmer and self-professed “Christian libertarian environmentalist capitalist lunatic farmer.”

His family cleared land and set up successful diversified farming operations in Venezuela before coming to America, where they began farming in 1961 in Virginia. As a high school student, Salatin began his own business enterprise, selling a variety of farm products in local markets.

Salatin today operates Polyface Farm in the Shenandoah Valley of Virginia, raising livestock and selling meat, and generally promoting a “totally free market… without government regulations.”  His works champion policies designed to give farmers more control, allowing individual leadership in conservation and responsible environmental stewardship. His outspoken views and energy seem to resonate strongly with the Trump camp, regardless of his future official or unofficial role within the new administration.

Another contender may be former Rep. Mike Conaway, the former chair and ranking member of the House Agriculture Committee, who left Congress in 2021. His supporters cite two important advantages for the former West Texas legislator.  One is his robust experience in dealing with the last Farm Bill and all its political machinations.

Perhaps equally important, Conaway served as chair of the House Ethics Committee and the House Intelligence Committee during its investigation of Russian interference in Trump’s 2016 campaign. His leadership in presenting a finding of no collusion between Russia and the Trump campaign was noted then – and no doubt remembered by a President who values and rewards loyalty.

Southerners note that in his last Administration, Trump tapped former Governor George “Sonny” Perdue as USDA Secretary. Perdue served just as loyally through the tumultuous period of trade relations between the United States and China, even as the rising tensions cut deeply into exports of U.S commodities to China. USDA estimated that the tariff wars accounted for 95 percent of the $27 billion decline in farm exports between mid-2018 and late 2019. USDA also noted that soybeans made up 71 percent of the lost trade.

Perdue moved on to become chancellor of the University System of his home state of Georgia. But another Georgia name also has surfaced in the leadership discussions – Vincent Mearl Duvall – know far and wide in national agricultural circles as “Zippy” Duvall. (The noteworthy nickname allegedly is linked to his Caesarian birth.)

Duval is a third-generation farmer, beginning in dairy and expanding into production of beef cows, broilers, hay and other commodities. In his spare time, he also is President of the American Farm Bureau Federation – the largest general farm organization in the United States. He comes from a major agricultural state producing 40 different commodities and has traveled extensively across all parts of the U.S. farming system.

His supporters also note that his professed strong religious faith is very much in line with the values espoused by the President-elect. “I’m going to get up every day and do that, for you. We are the strength and the hope for this country and all around the world because we will provide the nourishment. There’s no human right more precious than the right to eat,” he told Farm Progress. “I believe we’re here as farmers to be stewards to God’s great works.”

What Challenges Will the New Ag Leadership Face?

Whoever wins the leadership derby will face a daunting list of challenges.

Farmers worry about soft commodity prices and tough competition for foreign sales. Most also point to the uncertainties created by the failure to pass the omnibus Farm Bill, and the continuing deadlock on spending priorities and decision-making authorities for remaining unspent “green” dollars authorized by the Inflation Reduction Act of 2022.

The President-elect repeatedly stated his intention to impose tariffs on imported goods — including a possible blanket 60 percent tariff on imports from China.

In 2022, China was sending $536 billion in exports to the United States; last year it had dropped to $427 billion. U.S. exports to China totaled about $150 billion.

Lower-level tariffs for other imports also have been reported, but regardless of the final level of any such new tariffs, the farm community fears resumption of another disruptive and costly trade war with the world, and in particular China. The lingering effects of trade conflicts with China in the first Trump Administration are still with farmers, particularly soybean farmers. With higher tariffs on sales to the United States, China simply turned to other suppliers.

Brazil has emerged rapidly as a major competitor for the United States in international markets, including the important China market. Brazil in 2022 passed the United States as the world’s largest soybean producer, with 120.7 million tons of bean production, compared with 116.4 million for the United States. Brazil’s soybean acreage is projected to grow to 117 million acres in the coming year. The United States is projected to harvest 86.1 million acres, according to USDA.

The United States and Brazil supply over 80 percent of soybean global exports, while China accounts for about 60 percent of total soybean imports. Soybeans are the largest agricultural commodity exported to China by both the United States and Brazil. Over the last five years, Brazil has come to depend on the China market, with almost 75 percent of their exported soybeans headed to China.  For the United States, that figure is more like 50 percent.

Biofuels: The other elephant in the room

The nomination of former New York Rep. Lee Zelden as head of the Environmental Protection Agency (EPA) adds to the evidence of a much stronger focus on strengthening U.S. energy production through expanded oil and gas production. Zelden has publicly noted President-elect Trump’s desire for EPA to play a significant role in re-establishing what he called “energy dominance.”

Zelden was among many Republicans voting against the 2022 Inflation Reduction Act and previous green-focused Biden legislative initiatives. Environmental advocacy groups have given him very low approval ratings – unlike President-elect Trump’s high opinion of him.

Agriculture’s greatest stake in Zelden’s role as EPA head may be his approach to the standing focus on biofuels as a key element of Biden’s green agenda.  Currently, roughly 40 percent of U.S. corn goes into production of ethanol and other biofuels, and as much as 46% of the U.S. soybean crop.

Any shift toward greater reliance on traditional fossil fuels as a cornerstone of U.S. energy policy has the potential to create significant bearish pressure on commodity prices – at a time farmers already cite the adverse effects of soft commodity prices on their economic vitality.

Added to the possibility of economic fallout from renewed trade tensions with China under a new Trump administration, the farm community is closely watching the growing roster of policy leaders sharing Trump’s views and priorities – and perhaps holding its collective breath.