Currently browsing posts about: Food-trade

I saw this is a tweet from @WesternGrowers, the trade association that represents “local and regional family farmers growing fresh produce in Arizona, California, Colorado and New Mexico…We grow the best medicine in the world.®”

High marks to the Western Growers Association for producing this ad.

• It has interesting facts.  I did not know all this.
• It does not have misleading health claims about superfoods.

My one quibble: the confusing denominator.  The percentages can’t be of all of the vegetables consumed in the US; they have to be the percentages of US grown vegetables.

Take garlic, for example.  According to the USDA, we imported $19 million worth of dried garlic in 2020, and $185 million worth of fresh or chilled garlic.  Much of imported garlic comes from China.

According to Rural Migration News, the US imports almost two-thirds of its fresh fruit and one-third of its fresh vegetables.

Even so, I like the ad.

This tweet makes me think it’s time to talk about supply chains.

Supply chains are a big problem right now, particularly for anything that has to be transported.

How come?  Pandemic-induced buying sprees, coupled with shortages of:

• Truck drivers.
• Shipping crates.
• Longshoremen.

Your local grocery store is out of items?  Join the crowd.

Around 18% of beverages, 15% of frozen foods, 16% of snacks, 15% of candy and 18% of bakery items were out of stock at stores during the week ending on October 3, according to the latest data from IRI, which tracks in-stock levels at leading US grocery chains, big box stores, pharmacies and wholesale clubs.

Before the pandemic, 7% to 10% of products were typically out of stock on shelves, according to IRI.

Nobody expects this situation to get better soon.

The UK newsletter, FoodManufacture, has done a special edition on supply chains (subscribe free at this link).

• Perfect storm hits the food and drink supply chain:  The food and drink supply chain has taken a beating over the past 18 months, with each new crisis piling on a new concern for business to worry about. But above all else, the main concern is how to get the supply chain moving again in spite of the recent heavy goods vehicle (HGV) driver shortage… Read  
• Food supply chain fragility: what can be done?  Events over the past 18 months have shown how fragile our global food system is. Fotis Fotiadis, chief executive officer and co-founder of Better Origin, discusses what can be done in this opinion piece… Read
• UK beef ban by China risks damaging future trade:  China’s latest ban of British beef imports over a case of bovine spongiform encephalopathy (BSE) could damage future trade with the country, according to the Agriculture and Horticulture Development Board (AHDB)… Read
• Fuel shortages create challenges for food and drink:  As queues over the weekend left forecourts empty, members of the food and drink industry weighed in on how the fuel crisis has affected them… Read
• EVCL Chill enters administration placing jobs at risk:  Chilled food logistics business EVCL Chill Ltd – including EVCL One, EVCL Two and EVCL Three – has entered into administration after struggling with challenges created by the heavy goods vehicle (HGV) driver shortage, placing more than 400 jobs at risk… Read
• PepsiCo completes £14m distribution centre investment:  PepsiCo has completed a £14m upgrade of its Southern Region Distribution Centre (SRDC) based in Leicester… Read

Addition

10/22: An article I missed from Forbes in August.

I’ve been collecting items about China’s food system as well as that country’s role in ours.

Podcast: The scientist whose hybrid rice helped feed billions: A historian reflects on the life of Chinese crop scientist Yuan Longping, and the possible influence of geothermal energy production on earthquake aftershocks.

BMI and obesity trends in China:  Limin Wang and colleagues use data from six representative surveys in China…The authors report that standardised mean BMI increased from 22·7 kg/m² (95% CI 22·5–22·9) in 2004 to 24·4 kg/m² (24·3–24·6) in 2018, and obesity prevalence from 3·1% (2·5–3·7) in 2014 to 8·1% (7·6–8·7)…in 2018, an estimated 85 million adults (95% CI 70 million–100 million; 48 million men [95% CI 39 million–57 million] and 37 million women [31 million–43 million]) aged 18–69 years in China were obese.

China says it will buy US farm products: Bloomberg News reported on Friday that, “China plans to accelerate purchases of American farm goods to comply with the phase one trade deal with the U.S. following talks in Hawaii this week.

Chinese holdings of US agricultural land:  According to USDA’s data on foreign ownership of US land, China owns about 192,000 agricultural acres, worth $1.9 billion.  This includes land used for farming, ranching and forestry,.

The House introduces legislation to prevent China from buying U.S. farmland: Texas representative Chip Roy has introduced the “Securing America’s Land from Foreign Interference Act” to “ensure that Texas’s land never comes under the control of the CCP [Chinese Communist Party] by prohibiting the purchase of U.S. public or private real estate by any members of the CCP.  [Comment: I’m guessing this won’t get very far, in part because China is an important trading partner].

Balance of trade with China:  U.S. exports of agricultural products to China totaled $14 billion in 2019, largely from soybeans ($8.0 billion); pork and pork products ($1.3 billion); cotton ($706 million); tree nuts ($606 million); and hides and skins ($412 million).  U.S. imports of agricultural products from China totaled $3.6 billion in 2019, mainly from processed fruit and vegetables ($787 million); snack foods ($172 million); spices ($170 million); fresh vegetables ($136 million); and tea, including herbal tea ($131 million).  [Comment: we were way ahead on the balance in 2019].

China Focus: Yeyo’s Tmall launch, Chinese dietary spending trends, local cultivated meat developments and more feature in our round-up:  China’s first coconut yoghurt brand Yeyo’s Tmall launch, Chinese dietary spending trends, local cultivated meat developments and more feature in this edition of China Focus…. Read more

‘Follow, not lead’: China likely to be world’s largest cultivated meat consumer – but long, challenging journey ahead: China looks likely to be the world’s largest consumer market of cultivated meat due its population size and government support, but a long, arduous journey lies ahead before this becomes a reality, according to an industry expert…. Read more

Deliciou-s bite: Shark Tank alumni sets sights on China with first shelf-stable plant-based meats after cross-country supermarket success:  Australia-based Deliciou has its eye on China and other Asian markets with its market-first shelf-stable plant-based meat products after successful launches in both Australia’s Coles and Woolworths and US’ Whole Foods supermarkets…. Read more

Comment: I visited Beijing in 2019 and was surprised by the emphasis on dairy foods (never part of traditional Asian diets) and snack foods, especially for children.  Weight gain is only to be expected.  Current political tensions must be understood in the context of trade relations.   Although we export more agricultural goods to China than we import, our overall trade balance is to import about $300 billion a year more in products made in China than we export.

I learned about this from a tweet.

I recognized the clip.  It was from an interview I did in January in Toronto: TVO’s The Agenda: Battling bias in nutrition research (slso on YouTube, and in transcript).  Nam was the terrific interviewer.

But do not miss Minhaj’s last Patriot Act episode of 2019, “How America is Causing Global Obesity.”  This is a brilliantly researched account of obesity politics, from food industry influence to trade policy.

I couldn’t have done better myself and dearly wish I had his production team (and his performance ability).

Food trade is a mess right now, but I keep trying to keep up with it.  Here are some recent items that caught my attention..

Trade deals dump U.S. junk foods in Central America.  The University of Buffalo sent out a press release about a study of the effects of the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) on dietary practices in that country.

Our analysis demonstrates that low-income consumers face increasing household food expenditures in a context of overall food price inflation, in addition to relatively higher price increases for healthy versus ultraprocessed foods. Neoliberal policies not only contribute to restructuring the availability and pricing of healthy food for low-income consumers, but they also exacerbate social inequality in the food system through corporate-controlled supply chains and farmer displacement.

Current tariff policies threaten nearly 1.5 million jobs and raise prices.   This is the conclusion of a 75-page report conducted by economic consulting firm BST Associates .

A new study commissioned by the Port of Los Angeles finds that U.S. tariffs put nearly 1.5 million American jobs and more than $185 billion in economic activity at risk nationwide – based solely on the impact of tariffs on cargo handled in the San Pedro Bay port complex….China is the primary target of the Trump administration’s tariff policy, and Chinese producers account for about half of the imports passing through San Pedro Bay. Chinese retaliatory tariffs affect China-bound American exports, and Chinese buyers account for nearly a third of the American products headed overseas out of LA and Long Beach…“With 25 percent fewer ship calls, 12 consecutive months of declining exports and now decreasing imports, we’re beginning to feel the far-reaching effects of the U.S.-China trade war…With the holiday season upon us, less cargo means fewer jobs for American workers.”

The USDA has released the second collection of payments compensating agriculture for losses due to the trade war with China.  This comes to more than $14 billion on this round.  This is on top of the previous $9 billion already paid.  All of this is way beyond what the Farm Bill authorizes in agricultural support.  Supporting Big Ag this way sets an expensive precedent.  And guess where the payments are going.  To “a bundle of states that are essential to his re-election chances,” according to the Los Angeles Times.

As for why those payments are needed:  USDA’s complicated-to-read economic report explains how farm debt is increasing and income decreasing.  As the Des Moines Register reports, Iowa’s farm debt reached $18.9 billion in the second quarter of 2019—the highest level in the nation.  USDA’s farm income and wealth statistics are here.

In the meantime, what’s happening to small farms?  They face extinction, according to Time Magazine.

A mess indeed.  Fixable?  Only with political will.  It’s hard to be optimistic at this point.

I’m catching up on posts put on hold for quieter times.  Here’s one that’s worth a look.

The Environmental Working Group’s analysis finds that more than half of the $8.4 billion aid meant to compensate farmers for the loss of export sales went to the top 10% of farmers.  Check this for yourself in the EWG Farm Subsidy Database.

The  Farm Bill Law Enterprise points out that almost all of it went to white farmers.

Nearly 250 farms received more than $375,000 — the highest amount permitted — out of a total of more than 550,000 recipients.

Politico wrote about the second round of trade aid:

USDA last week rolled out details of the new $16 billion package, an estimated $14.5 billion of which will be sent to farmers in the form of direct payments…under trade aid 2.0, it will be easier for farmers to collect more money. USDA raised the payment limit to $500,000 per person or legal entity, and also loosened a means test that had disqualified farmers earning more than $900,000 a year in adjusted gross income from receiving assistance under the 2018 program. Those earning above that threshold can collect trade aid this year as long as 75 percent of their income comes from agriculture, a change Congress directed in recently enacted disaster-aid legislation.

The Politico article notes that farms are legally allowed to get around payment caps.  Multiple family members or business partners can receive subsidies as long as they appear to be “actively engaged” in the operation.

Politico cites one example from the EWG database: “The top recipient of 2018 trade assistance, DeLine Farms, registered three partnerships at the same address and collected $2.8 million.”

Comment: This is a rigged system that could not be better designed to put small farms out of business.

As I may have mentioned previously, I have trouble understanding the ins and outs of trade policy.  Fortunately, I subscribe to Politico Morning Agriculture, whose writers are diligent in sorting out the complexities of what our government is doing with respect to trade and what it means.

Here’s what Politico is saying about our current trade dispute with the People’s Republic of China.

In a recent article,  Politico  reports a steady decline in American agricultural exports to China.  The figures are startling:

• 2019: $6.5 billion
• 2018: $16.8 billion
• 2017: $21.8 billion

These figures are from USDA’s latest Outlook for Agricultural trade.

Much of the drop is in soybean exports:  US farmers shipped $17 billion worth of soybeans worldwide in 2019, down from $21.6 billion last year.  Shipments to China accounted for much of the difference.

The US usually runs an agricultural trade surplus (we sell more abroad than we import).  The USDA says the trade surplus is $8 billion in 2019, down from $15.8 billion in fiscal 2018 and $21.1 billion in fiscal 2017.

Politico also reports that the Trump Administration is doing what it can to relieve the pain experienced by US soybean producers [pain that the administration’s policies caused in the first place].  It has promised between $15 billion and $20 billion in bailouts.

The real burden will fall on taxpayers and heartland farmers.

If the president moves ahead with 25 percent tariffs on everything China exports to the United States, it could amount to a tax hike of more than $2,000 on the average American family, swamping the reduction they won from Trump’s signature legislative achievement — the 2017 tax law.

The pain will be felt most acutely by lower-income voters who rely on cheap imports and Midwestern farmers who make up critical slices of Trump’s political base and will help decide the outcome of the 2020 election.

As to who is responsible for this mess?  According to Politico again, “China says U.S. ‘solely to blame’ for collapse of trade talks.”

How will this end?  Badly for U.S. agriculture, I’m guessing.

We need a rational food policy in this country, big time.

Reference: Agricultural Economic Insights on implications of the trade war with China

One of the daily newsletters I subscribe to is Chuck Abbott’s Ag Insider, sponsored by the Food and Environment Reporting Network (FERN), which covers and analyzes agricultural policies otherwise unknown or incomprehensible to readers like me.  You can subscribe to it here.

The particular article that caught my eye is about how Trump’s program of compensating farmers for the losses caused by his trade war with China has gotten the government much deeper into supporting Big Ag than some congressional representatives think is appropriate.

The USDA has stated that it will spend $15 to $20 billion on trade mitigation payments this year.  This will pay $2 a bushel for soybeans, 63 cents a bushel for wheat, and 4 cents a bushel for corn.

If you were a farmer, which would you plant?

The promised new payments will

double the $8.5 billion that has been paid so far on 2018 production of almonds, cotton, corn, dairy, pork, soybeans, sorghum, sweet cherries, and wheat. And the $15-$20 billion would be on top of $11.5 billion previously forecast for federal payments this year. Last year, direct farm payments totaled $13.8 billion, largest in 12 years, because of trade mitigation aid.

This is big money, at taxpayers’ expense.

Abbott’s point is that the “Freedom to farm” act of 1996 encouraged farmers to make planting decisions based on market prices rather than expectation of subsidies, and to reserve part of their land for conservation purposes.  Farmers were able to sell their crops for market prices rather than have the government buy them.

But the USDA says

Farmers should continue to make their planting and production decisions with the current market signals in mind, rather than some expectation of what a farming support program might or might not look like, based on inaccurate media stories.

And guess what: The National Corn Growers Association wants higher payments.

In other articles in this series, Abbott reports that “more than a third of net farm income for Kansas farmers comes from Trump tariff payments, but that won’t make up for lost export sales.”