HOUSE AGRICULTURE COMMITTEE HEARING
Overview
For questions on the note below, please contact the Delta Strategy Group team.
On March 4, the House Agriculture Committee Subcommittee on Livestock, Dairy, and Poultry held a hearing entitled “The State of the Livestock Industry: Producer Perspectives.” Witnesses in the hearing were:
- John Zimmerman, Immediate Past Chairman, National Turkey Federation
- Lori Stevermer, President, National Pork Producers Council
- Mike West, Chairman, United Egg Producers
- Larry Hopkins, Region III Director, Executive Board, American Sheep Industry Association
- Walter Schweitzer, President, Montana Farmers Union
- Troy Sander, Past Chairman of the Live Cattle Marketing Committee, National Cattlemen’s Beef Association
Below is a summary of the hearing prepared by Delta Strategy Group. It includes several high-level takeaways, followed by summaries of opening statements.
Key Takeaways
The following is a summary of the main topics explored in the hearing, with further details in the Discussion section below.
- The hearing showed support for a new Farm Bill and bipartisan solutions in addressing high input costs, export market effects from tariff measures, USDA program funding, and risk management tools to ensure agriculture’s long-term competitiveness in global markets. Representatives and witnesses emphasized the need to address whether countries, like Canada, are upholding the U.S. Mexico-Canada Agreement (USMCA) in the review process.
- There was bipartisan agreement on the need to continue expanding and opening international markets for value-added U.S. agricultural products, with exploration of new markets and support of current exports. Committee Chair GT Thompson raised the need for doubled funding for the Market Access Program (MAP) and Foreign Market Development Program (FMD).
- Witnesses discussed why producers fear a “patchwork of regulation,” highlighting that burdensome government overreach and overregulation works against reducing production costs to stay profitable and manage producer margins.
- Representative Baird (R-IN) raised the need to address U.S. reliance on Chinese imports for agricultural inputs. Stevermer noted there are certain inputs that producers can only get from China, and that if prices increase significantly, it will impact producers’ bottom lines.
- Democrats raised the importance of continued USDA funding and cited the negative impacts of cuts to risk management research and ongoing response programs, noting the importance of precision in any cuts.
Opening Statements and Testimony
Subcommittee Chairman Tracey Mann (R-KS)
Producers need a five-year Farm Bill that is long enough to provide certainty and short enough to respond to market changes. Those issues were directly addressed in last year’s Farm Bill. That legislation would have maintained American food independence, invested tax dollars with a recognizable return, protected crop insurance, promoted trade programs that helped America remain competitive and secure, conducted rigorous oversight of the executive branch, and more. The past four years under the Biden Administration demonstrates what can happen when the government gets in the way. We must learn from these mistakes and not hamstring America’s farmers, ranchers, and agricultural producers as we work to craft the next Farm Bill.
Subcommittee Ranking Member Jim Costa (D-CA)
I have never been a fan of tariffs, regardless of the Administration, because they are a tax on American consumers and producers that is leverage for everyone else. Food production is a national and international security issue. Producers are facing challenges based on terminations of U.S. Department of Agriculture (USDA) programs and services. There have also been delays in payments for conservation services, leaving farmers and questioners whether or not USCA can move forward with key projects to sustain operations and equip programs.
Committee Chairman Glenn “GT” Thompson (R-PA)
The timing of this hearing is critical, as our producers are dealing with a historic high path avian influenza outbreak, harmful state mandates like Proposition 12, and difficult market conditions, among a slew of other issues. The Farm Bill passed out of Committee on a bipartisan basis last year increased funding for the three-legged stool, included language on negotiating animal disease regionalization agreements, improved investment opportunities for livestock auction owners, doubled funding for the MAP and FMD programs, and provided a fix for Prop 12. We cannot let this year be a repeat of the last.
Committee Ranking Member Angie Craig (D-MN)
I am concerned about the state of the industry, with animal disease outbreaks, high input costs, a hold up of USDA cost-share payments, and a destabilized trade environment. Some of this uncertainty could be reduced by a bipartisan Farm Bill that invests in the research and infrastructure needed to effectively combat harmful factors such as animal disease outbreaks. We need to navigate through a partisan reconciliation bill to achieve a bipartisan Farm Bill this year because producers need it. Farmers are worried that trade fights and continued consolidation will hurt their bottom line. The last time this Administration started a similar trade war, it cost U.S. farmers nearly $30 billion. At a time when family farms across the country are disappearing, policymakers should be focused on facilitating access to reliable markets and making food more affordable.
John Zimmerman, Immediate Past Chairman, National Turkey Federation
The current Highly Pathogenic Avian Influenza (HPAI) outbreak is a prime example of how important the Farm Bill is to our industry and the animal agriculture community. The new Farm Bill must strengthen U.S. animal agriculture’s long-term competitiveness in the global market, ensuring a safe, wholesome, and affordable food supply produced sustainably.
Lori Stevermer, President, National Pork Producers Council
Pork producers used roughly 1.7 billion bushels of corn and the soybean meal from 462 million bushels of soybeans in 2023, as well as roughly 40 billion pounds of other feed ingredients, including distillers dried grains with solubles (DDGS), a major byproduct of corn ethanol production. Trade is vital. The primary cause for U.S. pork export growth over the past two decades has been trade initiatives, whether free trade agreements (FTAs), less-formal trade and investment framework agreements, or one-off market access deals. Policies that foster the free flow of goods and expand export markets, primarily through trade agreements, are critical to the continued economic success of producers and consumers. The U.S. needs more comprehensive trade agreements that eliminate or significantly reduce tariffs and nontariff barriers to U.S. exports.
Larry Hopkins, Region III Director, Executive Board, American Sheep Industry Association
ASI is concerned that the orphan programs were not included in the recent Farm Bill extension attached to December’s continuing resolution (CR), with a need to include the programs in this month’s federal funding actions. The reauthorization of a new Farm Bill is paramount as these programs are relied on for infrastructure support, particularly for wool textile infrastructure. We support the Chairman’s 2024 version of the Farm Bill which includes the Agricultural Fiber Products Trust, serving both wool and cotton. We encourage the increase ASI has requested in the wool marketing loan rate in the next Farm Bill, as the current rates were set nearly 25 years ago. We encourage support of the USDA FAS programs, helping in aggressively applying and implementing exploration of new markets and support of current exports to drive sales of American wool. To underscore the importance of securing markets, China has more wool textile processing equipment than the balance of the world combined. Producers are dealing with record high input prices and non-existent, depressed, or flat markets. Importers are taking full advantage of the U.S. currency exchange that favors imports, hurting our domestic prices and exports.
Walter Schweitzer, President, Montana Farmers Union
We need fair, open, and competitive markets, with a more resilient food system and additional production, markets, and infrastructure. During COVID-19, we saw how fragile our highly consolidated food system had become. We are concerned that reducing the federal workforce will only exacerbate issues already faced within federal programs, such as EQIP. The Farm Bill can help protect farmers and ranchers against natural disasters and lower prices, necessitating continued efforts to improve disaster programs and insurance options for producers to be able to manage their risk effectively. These programs help keep ranch families in business but need careful review to make sure the next round of assistance is as effective and equitable as possible. The Farm Bill is overdue, and it is time to make improvements to these risk management programs and policies. Recent spending levels set in the House budget reconciliation bill would eliminate a very large portion of the funding the agriculture Committees need to build support for farm, conservation, and food policy legislation.
Troy Sander, Past Chairman of the Live Cattle Marketing Committee, National Cattlemen’s Beef Association
Producers continue to battle high interest rates, transportation expenses, feed prices, labor costs, and the increasing costs of regulatory compliance, directly impacting profitability. It is critical to restore common sense to regulatory decision-making, with President Trump’s commitment to cutting unnecessary red tape that stifles industry growth and profitability. The Farm Bill is essential to providing stability for producers, and NCBA strongly supports the progress made by Chairman Thompson. A modern Farm Bill requires stronger risk management tools, ensuring producers have access to programs that help them navigate market volatility. It needs conservation programs that work, including improvements to the Environmental Quality Incentives Program (EQIP) and the Conservation Stewardship Program (CSP), keeping them voluntary, incentive-based, and beneficial for working lands. Congress must act now to ensure that producers have the tools they need to succeed through a tax system that supports their entrepreneurial endeavors and encourages multi-generational growth, with one of the most significant threats as estate taxes that are not conducive to growth and needs to be repealed. Producers rely on vital tax tools such as Section 199A Small Business Deduction, Section 179 deduction, and Bonus Depreciation. Labor shortages highlight the needs for reforms to the H2A visa program, including year-round worker availability, expanded access for processors, and shifting oversight from the Department of Labor to the USDA. While competitors have aggressively pursued and secured new trade agreements, the U.S. government has done little in the past four years to expand market access. To maintain a competitive edge, the U.S. must re-engage in trade negotiations and secure preferential access in fast-growing markets across Asia, Africa, and the Middle East.
Discussion
Subcommittee Ranking Member Costa (D-CA): Do you have any comments or concerns on the impacts of potential tariffs on trading partners, such as Canada and Mexico? Stevermer: For exporters, any type of disruption is of concern, especially retaliatory tariffs; Schweitzer: We are one of the largest exporters, but also one of the largest importers. I agree tariffs are a tax on American consumers and producers.
Representative Bacon (R-NE): Is Canada living up to the USMCA agreement? Schweitzer: They have been, but they can dump their grains into the U.S. market, but we are not allowed to export wheat into Canadian markets, which is an important addition to the USMCA; Stevermer: We have an integrated industry, which is why we need to continue to work together.
Representative Bacon (R-NE): What is the importance of our U.S. research efforts to agriculture? Stevermer: Agriculture wants to continue to see research drive innovation and support industry in facing emerging challenges; Sander: Our ability to respond is paramount and we support continued funding.
Representative Baird (R-IN): What recommendations do you have for addressing U.S. reliance on Chinese imports for agricultural inputs? Stevermer: There are certain inputs that we can only get from China. If prices increase significantly, it will impact producers’ bottom lines. If there were any plants that were going to be built, it is going to take time to get those built and then need permitting.
Representative Feenstra (R-IA): Is trade going to be a big issue, and what can we do to move forward? Zimmerman: It can be an issue as we weigh production levels versus export markets. We need to concentrate on solutions as our path forward; West: There are lots of solutions and there needs to be research at every level to work through issues, such as the USDA Working Group. We also must recognize operational limitations in applying solutions;
Representative Miller (R-IL): Do you have concerns about regulatory standards of imports, such as those from Brazil? Sander: We spend time talking about the value of exports to our business and need to also spend as much time talking about imports. Brazil enjoys access to the U.S. market, but this needs to be immediately ceased because they have proven they are either unable or unwilling to adhere to global standards that we are held to in the U.S.
Representative Miller (R-IL): What can be done to support producers’ margins and markets? Sander: Producers are margin managers, with three ways to protect your margins: pay less for input costs, produce your product more efficiently, or sell it for more. Keeping burdensome government overreach out and helping reduce costs in the production process is what we need to stay profitable and manage our margins; Stevermer: Year-round access to H-2A workers is key; Zimmerman: Solutions needs to have a holistic approach.
Representative Davis (D-NC): Do you have concerns about retaliatory tariffs? Zimmerman: Mexico is our largest trading partner. We cannot afford to lose exports and have import price increases; Stevermer: Any retaliatory tariff that disrupts markets and affects producer profitability is concerning; Schweitzer: Commodity prices are low in large part due to the last trade. War. Our largest customers were impacted, and they looked for alternative markets. It has a long-range impact because our customers have built ports, rail and other distribution networks to purchase their products from our competitors; Sander: We hope the Administration looks for possible export opportunities and markets as they negotiate equitable trade agreements.
Representative Messemer (R-IN): Where have our trade partners most abused current trade agreements? Sander: We allowed Australian market access for years but have not been able to send even a dollar of our product. That export market needs to be held accountable; Hopkins: When unfair trade practices are occurring, tariffs are definitely warranted. It is important to level the playing field through tariffs in the face of unfairness.