Government Relations & Washington Update
December 2024
Congress Preparing Farm Bill Extension
As Congress enters the last few weeks of the year, leaders are working to address a number of “must pass” issues. Farm Bill authority expired at the end of September and without action by the end of the year, farm subsidies will revert to permanent authority. With Congress unable to reach resolution on a new Farm Bill in 2024, they are now preparing to extend the 2018 Farm Bill for another year. This will move deliberations into 2025 when Republicans will control the White House, Senate and House. While Republicans will have the “trifecta” of control, the policy agenda will be very full, potentially making it challenging to navigate a Farm Bill through competing priorities. The delay in new farm policy comes at a time when farm income is projected to decline and many are expressing concerns that the 2018 Farm Bill does not adequately address the challenges currently facing producers. Seventeen Republican governors recently sent a letter urging Congress to move a new Farm Bill now and not push the process into 2025.
In addition to the Farm Bill, Congress also has not finalized appropriations for fiscal year 2025. Action is needed by December 20th to avoid a government shutdown. It is expected that Congress will pass a continuing resolution that will fund the government at current levels until sometime in March. The one-year Farm Bill extension is likely to be attached to the funding package. Congress is also considering the inclusion of disaster funding in the package. The Biden Administration has requested $98 billion in disaster aid, including $21 billion for producers impacted by hurricanes, droughts, and wildfires in 2023 and 2024. While there is bipartisan interest in providing disaster relief, the House Freedom Caucus has expressed its opposition to the amount requested by the administration creating some uncertainty on how disaster funding will ultimately be handled.
USDA Releases December 2024 Farm Income Forecast
The USDA Economic Research Service's latest farm income forecast for 2024 projects a challenging year for American agriculture. Net farm income is expected to decline by 18.4% to $128.3 billion, marking a sharp drop from the record-high levels seen in 2022. This reflects declining crop cash receipts, lower government payments, and rising production expenses, despite a modest increase in animal product receipts.
House Agriculture Committee Chairman Glenn “GT” Thompson called the USDA's forecast a wake-up call, emphasizing the importance of policies that enable producers to weather volatile markets. He stated, "This report further underscores the urgency for a strong, bipartisan Farm Bill that ensures farmers and ranchers have the tools needed to succeed. It's critical that we address the real challenges facing rural America."
Senate Agriculture Committee Ranking Member John Boozman expressed concern over the economic strain on farmers, especially those reliant on crops forecasted to experience sharp price declines. He highlighted the need for robust safety nets, stating, "Farmers face mounting pressures from rising input costs and declining market prices. A comprehensive Farm Bill must deliver certainty and support for the men and women who feed and clothe us."
With net farm income expected to fall below the five-year average, the ongoing Farm Bill discussions will be pivotal in addressing these economic challenges. Strengthening federal safety nets and addressing rising production costs will be central themes as lawmakers navigate solutions to support the agriculture sector.
Rollins Nominated for Agriculture Secretary
On November 23rd, President-Elect Trump announced Brooke Rollins as his selection to serve as Secretary of Agriculture. Rollins is a native of Texas who grew up on a farm and was active in 4-H and FFA. She got a degree in Agricultural Development from Texas A&M University. Rollins served in the first Trump Administration as Director of the Domestic Policy Council in the White House. She has is currently President and CEO of the America First Policy Institute (AFPI). Rollins has begun meeting with key Congressional leaders as she prepares for confirmation hearings. If confirmed, Rollins will be faced with a number of challenges and opportunities early in her tenure. With Congress unable to complete a Farm Bill this year, she will be in a key position to play a role on behalf of the Trump Administration. In addition, with Trump already stating plans for significant tariffs, retaliations on American agricultural products are expected.
Trump Signals Tariff Plans
President-Elect Trump stated his intention to impose a series of tariffs on day one of his administration. Trump would place a 25 percent tariff on all imports from Canada and Mexico and an additional 10 percent tariff on Chinese imports. He connected the tariffs to these countries role in illegal immigration and stopping the flow of illegal drugs such as fentanyl into the United States. The move is seen by some as a negotiating tactic to push action by the countries to address their policies on drugs and immigration. Trump has also proposed 100 percent tariffs on BRICS countries should they move away from the US dollar to a new currency of choice. Agricultural products are usual targets for retaliations when the US institutes tariffs. This was the case under the first Trump Administration, which resulted in the creation of a trade mitigation program to help producers impacted by retaliatory tariffs.
Port Labor Negotiations Stalled
Negotiations between the United States Maritime Alliance (USMX) and the International Longshoremen’s Association (ILA) have halted after the ILA walked away from the bargaining table. The parties are operating under a temporary agreement until January 15th after they failed to agree on a new contract earlier this year. The threat of another work stoppage could result in additional disruptions and shifts in the supply chain early in 2025.
In a statement, USMX expressed disappointment over the ILA's decision, describing it as an abrupt move that disrupts months of progress. The organization emphasized its commitment to resolving key issues through negotiation and noted that its latest proposal included "significant economic enhancements and protections for ILA members." Despite these efforts, USMX stated that the ILA declined to continue discussions and walked away from the table.
ILA maintains that USMX’s proposals failed to address the union’s core concerns, particularly those related to job security and workplace safety. Automation remains a top concern for the ILA. The ILA has accused USMX of presenting offers that would compromise the livelihoods of dockworkers. In a message to members, the union described the negotiations as one-sided and called for solidarity among its ranks as it seeks better terms. Both sides have signaled an interest in returning to the bargaining table, but no timeline has been set for resuming talks.