by Marion Nestle

Currently browsing posts about: Food-trade

Dec 13 2018

Bakery & Snacks looks at Brexit

While Brexit—Britain’s leaving of the European Union—is in turmoil, the industry newsletter, BakeryAndSnacks.com has a few articles on its effects on this industry.  Complicated, no?

Dec 5 2018

The effects of our trade war with China

President Trump has just announced a truce in our trade war with China.  We need one.

In August, the Trump Administration said it would provide $12 billion to farmers to make up for the losses in income caused by the dispute.

I’ve been collecting items about what’s actually happening with the bailout payments.

  • Not much has been paid out: The New York Times reports that the USDA has paid out just $838 million of the $6 billion that became available in September. Another pool of up to $6 billion is expected to become available next month.
  • They are not helping Wisconsin dairy farmers: According to the Milwaukee Sentinal Journal, about 4,800 dairy farms are collectively getting about 80 percent of the $10.4 million coming to the state, with an average payment of $2,390.  But the Wisconsin Farmers Union says a 55-cow dairy farm would receive a one-time payment of $725 from the Trump bailout program, but would lose between $36,000 and $48,000 this year due to low milk prices.
  • They are not doing much for Iowa farmers either:  According to the Des Moines Register, the 4300 payments total nearly $31 million, with an average payment of $7,236.  But 100 payments are less than $25, 24 are less than $10, and 11 are $5 or less.
  • Payments are going to 1,100 city residents; these average $881.  According to the Environmental Working Group, the recipients may or may not actually be involved in farming.  The EWG got the data from the USDA.
  • The National Corn Growers Association wants more money for corn farmers.  Its letter to USDA says the agency does not understand the how badly the trade disruptions are affecting its members. Its own study estimates corn growers losses at $6.3 billion.
  • North Dakota soybean growers have a storage problem, says the New York Times,  because they can’t sell the beans to China.
  • Kansas soybean farmers are also in trouble, writes the New York Times.
  • Overall farm income is declining, says USDA.

I think it’s fair to conclude at this point that current trade policies are tough on US agribusiness.

Oct 23 2018

Trump’s trade policies hurt the heartland

I am ever surprised by the extent to which Trump Administration’s policies directly harm its core supporters.  Two recent reports tell the story.

One comes from a group called Tariffs Hurt the Heartland, which has produced an accounting of the losses to businesses in Texas as a result of Republican trade policies—$424 million gone, just in August. 

Some of this affects farmers:

Scott Frazier, a south Texas farmer and Secretary-Treasurer of the Texas Farm Bureau, warned that tariffs will have long-term consequences for agriculture by shuttering the foreign markets that farmers in Texas and across the country depend on.  One quarter of our agricultural products grown in the U.S. are exported to other countries. The economic well-being of American agriculture depends on maintaining and strengthening our export markets, and farm and ranch families depend on this to survive.

This group also has produced an interactive, searchable map at TariffsHurt.com that let’s you find stories of how tariffs are affecting local communities, state by state, and you can learn more about the campaign here.

The second report comes from the Brookings Institute.  It analyzes the effects of Trump’s trade wars on his base.

The report comes with a spreadsheet where you can look up the data for yourself.

Trade wars have consequences, in this case for U.S. agriculture, which according to this report accounts for 15% of the retaliatory tariff burden:

The retaliatory tariffs differ by trading partner, but there are some commonly targeted industries. All four markets focused tariffs on agricultural products. Agriculture cuts a very specific geography across the United States, particularly implicating metro areas in California’s Central Valley as well as rural areas and small towns in states like Illinois, Iowa, and Nebraska.

Ouch.

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Oct 16 2018

Connecting the dots: The trade war with China and feeding America’s poor

I was struck last week by an article in the Wall Street Journal with this intriguing title: “Food Banks Reap Unexpected Bounty From Trade Disputes.”

I thought this was an especially poignant example of food politics from a food systems perspective—looking at the big picture context of what we eat, from production to consumption to waste.

Image result for food systems

Our current trade war with China is having a series of effects:

  • China has retaliated by putting import tariffs on US food products, reducing their sales in that country.
  • Because we greatly overproduce food, and depend on exports to sell it, we now have a glut of products that can’t be sold—soybeans mainly, but also pork, apples, cheese, figs, peanut butter, orange juice, and others.
  • The Trump Administration says it will help farmers hurt by the trade dispute by buying their products to the tune of $1.2 billion so far.
  • Food banks have no idea how they can handle all of what will be dumped on them—950 million pounds on top of the 700 million pounds they usually get—because they do not have the money to process and store the donations (one organization says this costs 23 cents per pound of food).
  • The food bank trade association, Feeding America, is calling for $200 to $300 million to pay for distributing the excess burden of food donations.

None of this makes sense to me.

Wouldn’t it be a whole lot better to

  • Prevent or end this trade dispute?
  • Ensure that food banks are unnecessary?
Oct 5 2018

Weekend Reading: Eating NAFTA

Alyshia Gálvez.  Eating NAFTA: Trade, Food Policies, and the Destruction of Mexico.  University of California Press, 2018.

Image result for eating nafta

This compelling book, by a Lehman College professor of Latin American Studies, links US trade policies to the destruction of Mexico’s corn economy and consequent destruction of Mexico’s traditional food culture, and shows how that destruction affected immigration, the border wall, drug wars, and, ultimately, public health.

Mexican food—real Mexican food—“is falling out of reach for many Mexican people,” she says.

Trade policies, in this case the North American Free Trade Agreement (just signed), not only affect what people eat, but also their health.

Gálvez starts by explaining

Using a Latin American studies frame, we can see that ever since the European conquest, ideas about citizenship, responsibility, and capability in the hemisphere have been viewed through the lenses of racialization, calss, and gender.  The same social groups viewed in the colonial and early independence periods as incapable of assuming the responsibilities of citizenship happen to be the same people now blamed for their own susceptibility to diet-related illness.

Gálvez gave a talk at NYU earlier this week at which she passed around a basket of traditional corn tortillas, obtained for $7 at Whole Foods.  They were delicious.   These, she pointed out, are almost impossible to get here or in Mexico, having been almost entirely replaced by commercial tortillas, having nothing like the original flavor and texture.

NAFTA dumped underpriced US corn on the Mexican market, undercut local prices, and put farmers out of business.  Without local corn, mills went out of business.

The other speakers at her session, Mireya Loza and Krishnendu Ray of my NYU department, emphasized how NAFTA has induced irreparable losses, not only of small-scale farming and the livelihoods of small farmers and corn millers, but also of the food habits that used to define Mexico’s indigenous foodways.

They will be using Eating NAFTA in the courses they teach.  Lucky students.

If you want to understand what “free trade” is really about—on the personal as well as the political level—this is the book to read.

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Sep 25 2018

A glimmer into the stunning effects of our trade war with China

I find the details of trade policy almost impossible to understand (so many arcane rules, so many countries), and am grateful whenever I read something crystal clear.

Politico explains (behind a paywall, alas) how our trade war with China is hurting US soybean farmers, beginning with:

The good news: The European Union is buying lots more US soybeans than it used to.  Purchases are up 133% over last year, and now account for 52% of EU soybean imports.

The bad news: The EU is buying US soybeans because they are cheap.  Because China is not buying US soybeans, there is a glut; prices have fallen by 20%.

Estimates are that the EU will buy $2.5 billion this year.  But last year, China bought $12.3 billion in soybeans.  That’s nearly a $10 billion loss unless other buyers can be found (the estimate is a $7 billion loss).

China is now buying soybeans from Brazil, and at premium prices.

Here’s what the American Soybean Association has to say about all this.

One more indicator:  Politico also mentions an article in the Milwaukee Journal Sentinal detailing how more than 2,500 US dairy farmers have resorted to GoFundMe campaigns to save their farms.

I wish we grew more food for people instead of food for animals or fuel for cars, and that our agricultural policy linked to health policy.

Maybe if we did that, we wouldn’t be in this situation.  But GoFundMe campaigns?

Maybe we just need real agricultural policies.

Aug 29 2018

The $12 billion trade mitigation promised to farmers: who gets how much?

Recall that to mitigate the damage to U.S. agriculture caused by our current tariff disputes, President Trump promised to give affected farmers $12 billion.

The USDA has now set up its Trade Mitigation Programs.  As seems invariably to be the case, these are not simple; they involve three separate programs:

  • The Food Purchase and Distribution Program
  • The Market Facilitation Program
  • The Agricultural Trade Promotion Program

Food Purchase and Distribution Program

The government (taxpayers) will purchase up to $1.2 billion in commodities and then distribute them to food assistance programs.

USDA issued a list.  Here are some selected examples, to which you must add three zeros (amounts are in $1000s):

Apples $93,400
Apricots $200
Beef $14,800
Blueberries $1,700
Hazelnuts $2,100
Kidney Beans $14,200
Pork $558,800
Potatoes $44,500
Strawberries $1,500

The big winner here is pork, hit badly by the trade disputes.

The Market Facilitation Program

This one gets a bigger slice—$4.7 billion.

Here, the big winner is soybeans — $3.6 of the $4.7 billion in payments.  Corn producers are lpretty much left out.  I can’t imagine tht they are pleased.

The Agricultural Trade Promotion Program

All I’ve seen about it is that USDA will spend $200 million on foreign market development.

What are we to make of this?

Whether trade groups are for or against this depends on how much of this pie they get.  Overall agricultural losses will be greater than $12 billion, so everyone loses, but some more than others.  The Environmental Working Group has filed a FOIA request for information about how USDA made these decisions.  Can’t wait to see what they get.

Only half of that has been distributed so far.

Let’s hope the lobbying is transparent so we can see who is doing what.

The Documents 

 

Jul 26 2018

Trump’s $12 billion “gold crutches” to deal with trade retaliation against US agriculture

President Trump says he will fix the retaliation damage his trade policy has caused for agriculture with $12 billion added to USDA programs.

The New York Times quote of the day:  “This trade war is cutting the legs out from under farmers and the White House’s “plan” is to spend $12 billion on gold crutches.”  –Sen. Ben Sasse, R-Nebraska

The USDA explains that

These programs will assist agricultural producers to meet the costs of disrupted markets. This is a short-term solution to allow President Trump time to work on long-term trade deals to benefit agriculture and the entire U.S. economy.

Politico (behind paywall) quotes USDA Secretary Perdue: “”The programs we are announcing today are a firm statement that other nations cannot bully our agricultural producers to force the United States to cave in.”  It explains that the 3-part plan will:

  1. Provide direct payments to growers and producers of soybeans, sorghum, corn, wheat, cotton, pork and dairy.
  2. Purchase fruit, nuts, rice, beef, pork and dairy products from U.S. producers for redistribution to federal nutrition assistance programs.
  3. Put resources toward finding new markets for U.S. farmers to sell their products abroad.

Not everyone loves this idea.  Politico quotes Senator Ron Johnson (R-Wisconsin):

This is becoming more and more like a Soviet-type of economy here: Commissars deciding who’s going to be granted waivers, commissars in the administration figuring out how they’re going to sprinkle around benefits…I’m very exasperated. This is serious.

It also quotes Rep. Dave Reichert (R-Wash.) observing that the bailout does nothing to preserve market access lost as a result of the tariff policies.

Some in the ag community, they say, ‘That’s great, thank you for the help’ — except that the problem then becomes we’ve lost the market, so how do we get the market back?…That’s the question.

In general, agricultural groups view this as an inadequate short-term fix for a problem that won’t go away until Trump ends the trade war.

Former USDA Secretary Dan Glickman tweeted a link to a longer statement:

Rep. Chellie Pingree (D-Maine) is introducing legislation to ensure a fairer distribution of the bailouts.  How about some trade relief for fishermen?

In the meantime, The Street reports the effect of this plan on the market: Soybean futures for November delivery settled more than 1% higher; Deere & Co. and other farm equipment stocks also went up.  CBS News also notes the rise in ag stock prices.

Analysts generally view this as a move to maintain Trump’s base of support among soy and corn producers in the lead up to the midterm elections.  It solves a short-term political problem, but does nothing to protect US agricultural markets.  See, for example, accounts from