U.S. House Ag panel hears industry complaints on regulations, scant crop insurance

WASHINGTON — Members of the U.S. House Agriculture Committee listened to agribusiness executives on Tuesday rail against federal regulations, and lobby for new markets and reinforced crop insurance programs in the panel’s first hearing of the new Congress. 

With the 2018 farm bill expiring this fall, lawmakers who will shape the next version of the bill indicated they would seek to address challenges facing U.S. farmers: high costs, industry consolidation and a safety net that is insufficient to cover intensifying natural disasters. 

“It is time to retire our dress shoes and put on our work boots,” said Republican Rep. G.T. Thompson of Pennsylvania, the House Agriculture Committee chair. “I will need every one of you at the table to help us deliver a farm bill for the backbone of this country: the American producer.”

Industry witnesses – including representatives from the National Farmers’ Union, American Farm Bureau and the National Chicken Council – pushed committee members to consider hikes in commodity crop insurance reference prices, along with increased federal spending on market development and agricultural research. 

They also requested clarity and consistency on environmental rules that impact agricultural business, like U.S. Department of Agriculture rules under the Packers and Stockyards Act and the Environmental Protection Agency’s controversial definition of Waters of the United States, or WOTUS, for regulation under the Clean Water Act. 

The farm bill is a multiyear law authorizing an array of agricultural and food programs, including federal crop insurance, food stamp benefits, international food aid and farm resource conservation. The bill is renewed close to every five years, and includes mandatory spending that must be in line with previous farm bills. 

Reducing regulations

The industry witnesses said farmers were burdened by undue and unclear regulation on the farming communities, and they asked for friendlier federal oversight. 

“We need a supportive regulatory environment,” said Zippy Duvall, president of the American Farm Bureau Federation. “Federal regulations have a direct impact on farmers and ranchers. So it becomes more and more important for farmers to have clarity on rules that impact their business and ability to operate.” 

Duvall decried the updated Waters of the United States rule from the EPA, which he said would represent the “largest land grab of the federal government in history.” 

Rob Larew, president of the National Farmers’ Union, added that the expanded definitions of waters covered in the rewritten rule means that streams and farm ponds can now be regulated by the EPA, and increases the difficulty for farms to abide by the Clean Water Act. 

Environmental advocates have said a robust interpretation of the rule is needed to maintain clean water.

Duvall said that several rewrites of the rule in different presidential administrations have farmers feeling “like a ping-pong ball going back and forth, not being able to make long-term decisions.”

Iowa Republican Rep. Randy Feenstra asked Mike Twining, vice president of sales and marketing of Willard Agri-Service in Maryland, about the detrimental impacts of an unclear WOTUS rule on producers of all sizes. 

“To not have that clear definition creates tremendous uncertainty that really just paralyzes our ability to do business and to produce food in an efficient manner,” Twining said.

Packers and Stockyards

Industry witnesses and Republican lawmakers also took aim at proposed Biden Administration rules under the 1921 Packers and Stockyards Act that aim to protect producers from market manipulation by meatpackers and large commercial farms, and offer other protections in the agriculture industry.

Mike Brown, president of the National Chicken Council, said rules the Biden administration is considering under the Packers and Stockyards Act would create a “financially ruinous” set of regulations, which would collectively cost the chicken industry more than $1 billion as processing speeds and holding capacity are reduced, he said.

“The American consumers and farmers have faced a lot over the past several years,” Brown said. “Now is not the time to be layering on additional regulations that further drain consumers, farmers and the chicken industry.”

Republican Rep. Tracey Mann of Kansas asked Brown about what changes to the law would mean for producers. 

“Basically, what these rules would do is turn any interaction between a processor and a grower into a litigation flash point,” Brown said. “It’s going to add cost.”

Crop insurance, research, and consolidation

Other members, including several of the panel’s Democrats, inquired about reducing consolidation in the agricultural industry, and bolstering federal crop insurance programs amid increasingly extreme weather.  

Republican Rep. Austin Scott of Georgia asked Duvall whether he felt reference prices on crop insurance plans were sufficient to reduce risk for commodity farmers, even if it meant an increase in spending. 

“We’re looked at as a very conservative organization,” Duvall said. “(But) it’s time to broaden the baseline. Because those targets that we use in the commodity programs, and the cost that we have to grow a crop, is nowhere near what it was when those targets were set. It needs to be modernized, and it needs to be a true safety net based on the cost of production today.”

Georgia Rep. David Scott, the committee’s ranking Democrat, asked Larew and Duvall how to increase the farmer’s share of the consumer dollar in the upcoming farm bill and reduce the effects of market consolidation. 

Larew pointed to the need to develop new market infrastructure for rural communities, especially regarding sustainable and locally produced products. But that change won’t happen overnight, he said. 

“You’ve got to create that opportunity for new markets, so investment in biofuels infrastructure is a huge thing for those rural communities,” Larew said. “The investment in more local and regional processing is critical to make sure that that infrastructure is there.”

Rep. Andrea Salinas of Oregon, a Democrat, asked Duvall if there would be value in expanding margin protection insurance to specialty crop producers in the next farm bill. 

“In our organization, our policy supports updating and broadening the safety net for farmers,” Duvall said. “Regardless of what you’re farming, you deserve to have the same safety net as the others do.” 

Responding to a question from Democrat Rep. Alma Adams of North Carolina, Larew called for greater antitrust enforcement in processing and grocery supply chains.

“The fewer there are, and the more pressure there is further down the stream, that puts even greater pressure on farmers and ranchers out there,” Larew said. “Right now we don’t see anything stopping that (consolidation), so we need greater enforcement for antitrust, greater oversight of the marketplace.”