Agriculture Secretary Tom Vilsack is releasing $2.3 billion in funds from the Commodity Credit Corporation (CCC) to bolster trade promotion and international food aid programs.
The funds and temporary programs created with it are in response to a request from Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) and Sen. John Boozman (R-AR), the committee ranking member. Stabenow and Boozman asked Vilsack to release the funds as a way to ease pressure on demands for the next farm bill.
USDA will use $1.3 billion for the Regional Agricultural Promotion Program (RAPP) and support for specialty crop industries to diversify export markets. Another $1 billion to help address global hunger.
The United States Agricultural Export Council, (USAEDC) called the infusion of funds “a necessary and welcome development.” The council cited that every dollar invested in trade programs generates more than $24 in net export revenue.
“I’ve experienced firsthand the immense positive impact on consumers, companies, and countries around the world, and on our U.S. agricultural economy from this type of sustained investment. This funding helps American producers compete in established overseas markets and expand into new ones,” said Jim Sutter, chairman of USAEDC and CEO of the U.S. Soybean Export Council.
The funding comes as commodity groups have repeatedly called on Congress to increase funding in the next farm bill for USDA’s two major trade-promotion programs, the Market Access Program (MAP) and the Foreign Market Development Program (FMD).
In a news release, USDA noted releasing the money is “consistent with a bipartisan request from the Senate Agriculture Committee.”
Vilsack said in a news release, “The Commodity Credit Corporation continues to address the needs of American producers as significant and unpredictable challenges arise, including impacts to international commodities markets and global food insecurity in the wake of ongoing conflict and a changing climate.
“The Commodity Credit Corporation and USDA’s market development and aid programs are critically important at this time, and with this additional support we can strengthen U.S agriculture’s presence in existing markets, open up new market opportunities, and build on our relationships and connections to ensure that high-quality American agriculture and food products reach where they are needed in the world.”
Vilsack, who has opposed congressional efforts to curb his authority to use the CCC, also noted the announcement “comes on the heels of the 90th anniversary of the CCC, which was incorporated on Oct. 17, 1933, in response to the Great Depression and the Dust Bowl’s devastation on producers and their operations.”
Vilsack added, “For 90 years, the CCC has stabilized markets, supported farm income and prices, and enhanced the ability of farmers to market their commodities.”
USDA also pointed out, “The FY23 agricultural trade deficit is $19 billion, and USDA has projected that it will grow to $27.5 billion in FY24. There is also increased competition in our export markets in Asia and Africa.
“Therefore, additional investments in market development need to be made to keep ahead of the competition. Further, investing in non-traditional markets will help the United States diversify away from dependence on a handful of large markets,” USDA said.
The new trade and aid programs will not be part of the traditional trade and international food aid programs. Agriculture Undersecretary for Trade and Foreign Agricultural Affairs Alexis Taylor told reporters recently the CCC cannot be used to provide additional funds for appropriated programs.
Instead, $1.3 billion in CCC money will be put into RAPP, which USDA said, “will enable exporters to break into new markets and increase market share in growth markets.”
There will also be “targeted technical assistance to the specialty crops industry that will help it enter and expand markets that often impose onerous non-tariff barriers on their products,” USDA said.
As if anticipating some criticism for using the CCC for trade and food aid purposes, USDA noted that five years ago “in reaction to the trade war with China,” the Trump administration had developed the Agricultural Trade Promotion Program (ATP) to help exporters diversify their markets.
USDA said, “The funds from ATP will expire next year and with that, many exporters are already curtailing their activities. Without being on the ground in markets, it is nearly impossible to build the trust and relationships needed to create opportunities. The RAPP will address this critical loss and ensure continuity of the relationships key to market development.”
On food aid, USDA said, “Recent challenges to supply chains and ongoing conflicts have exacerbated what was already a dire situation of increased numbers of people experiencing food insecurity globally.
“An estimated 205 million people need life-saving food assistance, and some 768 million people are facing chronic hunger, according to the Global Report on Food Crises and the United Nations Food and Agriculture Organization.
“American agriculture is well positioned to help fill these gaps,” USDA added. “The United States produces more commodities than are consumed, and therefore has the opportunity to extend this food, via a USDA donation, to those who are in need,” USDA said.
USDA said it will purchase commodities and work with the U.S. Agency for International Development the lead federal agency on international emergency food aid programs, “to ensure they reach those most in need around the world.”
“The $1 billion donation will bolster ongoing efforts to address global hunger, as well as support U.S. agriculture through the purchase of surplus commodities,” USDA said.
In their letter last month, Stabenow and Boozman noted, “As Congress works toward reauthorizing critical programs in the farm bill, we continue to hear from organizations representing the vast majority of U.S. agriculture about the need to strengthen trade opportunities, increase revenue streams, and help producers grow and thrive in a global economy.
“Farm bill trade promotion programs help address these needs and build new markets,” they said. “We believe that resources available under the CCC can support similar efforts to open access to markets and promote American-grown products abroad.” — Chris Clayton, DTN Ag policy editor, and Jerry Hagstrom, DTN political correspondent
