AgNet DEMO

Category: Trade

  • Secretary of Ag Discusses Timely Issues Facing Southeast Vegetable Producers

    Tom Vilsack

    Two issues at the forefront of vegetable and specialty crop producers in the Southeast is H-2A and imports from countries like Mexico. Secretary of Agriculture Tom Vilsack discussed both issues and sympathizes with growers in the Southeast.

    “We’re looking at ways in which we’re able to provide some help and assistance to them under the COVID relief packages that were not specifically targeted to them. No. 2, in terms of labor, no question, serious issues, serious challenges that agriculture faces,” Vilsack said. “That’s why I’m certainly happy to see the House of Representatives pass the Farmer Worker Modernization Act, which essentially creates an avenue for a stable, mature and predictable workforce that makes improvements to the H-2A program that makes it easier for farmers to have that stable workforce, dependable workforce. At the same time, it allows those workers the opportunity to basically come out from the shadows.”

    Vilsack said he hopes the Senate will take the legislation up, noting it is a bi-partisan issue.

    “These are the workers that folks in the Southeast are depending upon. These are folks that are essentially responsible for picking a lot of our fruits and vegetables in a number of different areas across the country. It just makes sense that farmers have that stable and secure workforce,” Vilsack added.

    Increasing Imports

    As for imports, it’s an issue that seems to worsen daily. Southeast farmers accuse Mexico of dumping produce and creating a competitive disadvantage that growers can’t compete with.

    “On the issue of imports, look, it’s always a delicate balance. We want to make sure that we are able to ensure that our producers have market opportunities. But at the same time, part of what we do, obviously, is to export. We want to make sure that there’s a balance relationship there,” Vilsack said.

  • Voice of Leadership: Congressman Scott Sounds Off on Mexican Imports

    Austin Scott

    How can you stay in business by selling a commodity for less than the inputs required to produce it? While it may sound like simple economics, it’s a financial game that’s just not adding up for many Southeast vegetable and specialty crop producers?

    What’s the ‘X’ factor? Imports from foreign countries like Mexico, Peru and Chile. If they continue to keep bringing in produce like strawberries, blueberries, tomatoes and squash at their current rate, Southeast farmers will continue to suffer.

    “The primary issue is if you can’t sell your crop for more than you’ve got in it, then obviously you’re backing up,” said Congressman Austin Scott (R-GA-08). “It doesn’t cost as much to farm in Mexico as it does in the United States. Our producers are losing significant portions of the market share. It is predominantly coming from the imports from Mexico. As Mexico has set aside more protected acres for agriculture, it makes it easier for their farmers to do business.

    “We as a country have been flooded by imports who have a lower cost of production than U.S. producers. It’s been moving in the wrong direction for a while. I think now it’s just moving further faster with COVID because your fresh fruits and vegetables; the restaurants that were serving them are at half capacity if they’re open at all.”

    Mexico Government Provides Support

    According to University of Florida Associate Professor Zhengfei Guan, approximately 95% of Mexico’s protected acreage (those in macro-tunnels, shade houses and greenhouses) is for fruits and vegetables. The Mexican government also subsidizes its fruit and vegetable industry. From 2006 to 2016, the average annual budget for subsidies was $4.5 billion.

    “Agriculture has significantly more support in Mexico than we have in the United States right now, unfortunately. When I say more support, I mean at the national level,” Scott said.

    It has created a concern that other farmers have voiced: Where will our children and grandchildren get their food one day? As more and more producers are forced to quit because of an inability to stay in business, who will produce food in America?

    “I don’t want to be dependent on any section of the world for our food and our nutrition. We do very little in this country to help our Ag producers. We’re competing with other countries that do a lot and have a lower cost of production. Every time the federal government passes a rule and regulation that increases the cost of production within the United States, it’s done at the expense of U.S. food security,” Scott said.

  • FFVA President: (Food Security’s) a National Security Issue

    Feb. 11, 2021 could be a date that lives in infamy for Florida’s vegetable and specialty crop growers. At least that’s the way Mike Joyner views the U.S. International Trade Commission’s (USITC) unanimous verdict regarding blueberry imports.

    “As a result of that 5-0 ruling, I would completely agree with you, it was a gut punch for our growers,” said Joyner, president of the Florida Fruit and Vegetable Association (FFVA). The five USITC members voted on the Section 201 investigation into serious injury regarding blueberry imports. It deemed that imports of fresh, chilled or frozen blueberries are not a serious injury to the domestic industry.

    Joyner

    Joyner worries what the ramifications like that ruling can have on other commodities that Mexico exports.

    “One of the biggest concerns we had before the blueberry 201 vote was that if we lose, it’s a green light to unfair imports. We’re seeing that,” Joyner said.

    Imports from countries are overflowing markets with various commodities, including strawberries, blueberries, squash and cucumbers.

    “I worry that as a country, a decision is going to be made, whether it’s intentional or unintentional, that we’re okay to rely on foreign produce during certain times of the year. I personally think that’s a bad public policy. But if it keeps going like it’s going, that’s what’s going to happen,” Joyner said. “These winter months where Florida feeds the U.S., if it keeps going like it’s going, we’re going to be relying on foreign imports to feed the U.S. I just don’t think that’s good public policy.”

    New U.S. Trade Representative

    The fight continues for Florida farmers who are hoping Katherine Tai, the new U.S. Trade Representative, will become a much-needed ally.

    “We’re going to continue to work with Ambassador Tai. I can tell you that the Florida delegation which has just been so solid on this issue. Senators (Marco) Rubio and (Rick) Scott both interviewed her individually as she was being confirmed. She understands this issue, she knows it,” Joyner said. “She made no commitments but we’re hoping Ambassador Katherine Tai will take this issue on and make it a priority.”

    Joyner and Florida farmers will have another chance to voice their concerns during a virtual hearing with the USITC on Thursday, April 8. It will focus on imports of cucumbers and squash on seasonal markets.

    “Our growers like Paul Allen have said so many times, it’s a national security issue. They’ll argue every day it’s a national security issue,” Joyner said. “It is a national security issue; food security, national security.”

  • Overwhelming: Challenges Mounting for Producers to Stay Afloat

    Challenges continue to mount for Southeast produce farmers. There is a fear among producers in Florida and Georgia that one day obstacles like Mexican imports and rising costs will be too much for growers to overcome. It will lead to producers going out of business and this country becoming reliant on foreign countries for food.

    “An older guy told me this, whether you’re the biggest produce outfit on the block or the smallest, because of the way this industry goes, the big guys aren’t but about two seasons behind the little guys as far as going out,” said Georgia vegetable farmer Jason Tyrone. “The amount of money you could lose at one time, one season or one year is very serious.”

    While last year was profitable for Tyrone and Tycor Farms in Lake Park, Georgia – even then he is still not sure how that happened amid the coronavirus pandemic – domestic producers are always going to be vulnerable to going out of business when compared to rising imports from Mexico.

    “If something doesn’t change, it could happen sooner rather than later,” Tyrone said. “I know it can happen and I try to prepare for it, financially and mentally, of what would I do?”

    Lack of Support

    What is really frustrating for farmers like Tyrone is the lack of support being shown their way. Back in February, the U.S. International Trade Commission voted 5-0 against farmers claiming that imports were having serious injury to the domestic market.

    And, according to Tyrone, local grocery store chains are not backing their local producers, either.

    “I’ve seen in my own grocery store in Lake Park in Winn-Dixie, a big old bin full of, I don’t even remember what commodity it was; they have to put the country of origin up there on the bin; it says, grown in the U.S. Then you look at the actual stickers on the fruit, like on the pepper, and it’s from Mexico,” Tyrone said. “They’re just dumping boxes of Mexican pepper in there in the bin that says, grown in the U.S. The grocery stores are definitely not doing their part.”

    The lack of support is reflective in the financial margins of today’s vegetable and specialty crop producer.

    “My in-laws started the operation we’re in now in the late 80s. They’ve got books with numbers all the way back. Most of our input costs, labor, seed are up anywhere from 200% to 500% over that timeframe. If you look across the board at the average box price, it’s the same,” Tyrone said. “They had great margins back then. That’s how they built what they built. There was only two packing houses in Lake Park, now there’s six. And they weren’t battling Mexico.”

  • Vegetable Farmer: We’re Going to Start Dropping Like Flies Eventually

    What would it look and feel like for the United States to be totally dependent on foreign countries for food? While it’s a scenario that might seem unfathomable for some, it’s a proposition that keeps inching closer to reality.

    “If things don’t change and they keep going the course they’re going, people are going to look up one day and say, ‘Why can’t I find anything from the U.S.?’ Because of the costs that we’re paying and what we’re battling, we’re going to start dropping like flies eventually,” said Georgia farmer Jason Tyrone.

    More and more farmers are calling it quits because it is unsustainable to compete against imports from other countries. Cheap labor costs and the subsidization of Mexican farmers allow produce like blueberries, strawberries, squash, tomatoes and cucumbers to be imported into the U.S. at staggeringly low prices. Markets react, and the American farmers suffer.

    How can they compete? They can’t.

    “You just think we got into trouble when were waiting on medications and stuff from China for a pandemic. You just wait and see what happens when we have to ask Mexico for food to eat,” Georgia farmer Ricky Powe said. “To break even on a box of pepper is probably $10 or $11. That’s just to break even, no profit, just to get your money back. When they’re allowing this pepper in at $6, we’re losing $5 or $6 a box on pepper, there’s nobody that’s going to stay in business.

    Future Generations

    Vegetable farmers like Powe and Tyrone cringe at the thought of future generations being totally dependent on other countries for food.

    “The American consumer says we want to buy our food as cheap as we can get it. If Mexico sends it over here at $4, we can buy it cheaper. I say, you’re exactly right. But you don’t know what you’re buying. If you put everybody out of business in the United States, then you’re going to be totally dependent upon a foreign country for your food,” Powe said.

    The problem is not slowing down, either. Imports are increasing at a rate that producers from Georgia and Florida can’t keep pace.

    “The scary part of this, say we do get to where the U.S. farmer can’t afford to do produce because of the labor costs differences, input costs differences, that’s kind of scary from a national security standpoint. Do you want to depend on stuff from other countries to totally feed our country? It’s scary if you think about it,” Tyrone said.

  • Letter Highlights ‘Deteriorating Trade Relationship’ with Mexico

    The vegetable and specialty crop sector was highlighted this week in a letter sent by several organizations, including American Farm Bureau Federation, to Agriculture Secretary Tom Vilsack and U.S. Trade Representative Katherine Tai.

    The organizations spoke of a “trade relationship with Mexico that has declined markedly, a trend USMCA’s implementation has not reversed.”

    Among the concerns brought forth include organic export certification requirement. The letter states that the Organic Trade Association was informed by a U.S. accredited organic certifying agency that Mexico’s Health, Food Safety and Quality Agency (SENASICA) would require all U.S. organic exports to Mexico be certified to Mexico’s organic standards.

    The U.S. was granted an extension until June 26. But if the policy enforced, there is concern that trade disruptions will occur. It can take more than a year for organic companies to become certified to these new standards. This will increase export costs to Mexico and bring losses for organic exporters.

    The potato import ban is another issue. Despite an agreement almost two decades ago that the U.S. would expand market access to Mexican avocados and Mexico would open its market to U.S. fresh potatoes, the potato market remains almost closed. This despite the U.S. importing $2 billion worth of avocados.

    Then of course there’s the situation regarding Mexico imports and their impact on the domestic market, pertaining to strawberries, bell peppers, squash and cucumbers and blueberries.

    “Renewal of a healthy bilateral trade relationship requires prudent actions by both parties. Until the U.S. International Trade Commission (USITC) voted on Feb. 11 to find there is not serious injury to U.S. blueberry producers from imports, 44% of Mexico’s fresh produce exports to the U.S. were investigation,” the letter read. “Monitoring investigations continue regarding imports of strawberries, bell peppers, squash and cucumbers, respectively, and blueberry producers are seeking protection through political intervention. As you address the struggles of U.S. seasonal produce farmers, we respectfully urge you to explore a variety of other means of enhancing their competitiveness.”

  • War of Deception: Consumer Awareness Key in Support of American Farmers

    In the ongoing war between supporting local farmers against the influx of imports, American farmers need consumers to fight back.

    The significance of where food originates may never be more important than it is right now. With imports continuing to flood markets for various commodities, the end result is farmers contemplating selling their land. Others are wondering what else can be done to slow the decline of the American farmer.

    “As long as the decision of what’s in the grocery store is based on the consumer, I think we’ll be okay,” said Wade Purvis, who farms in Immokalee, Florida and is part of the Farmers Alliance. “But the problem is the decision that’s being made is, there’s an intermediate group of marketers that stand between the growers and the chain stores. They may have ‘family farms’ in their name or ‘something farms’ in their name, and the chain stores either don’t bother exploring it and figuring it out or are just too lazy to even worry about it.”

    The deception continues to have a negative impact on local producers.

    “The country-of-origin labeling is so adulterated in the grocery stores. It’s basically piled up in there with domestic stuff and there’s a little bitty captioning at the bottom back of the bag that says product of Mexico. It’s placed on a shelf under ‘Jimmy John and his family farms’ in Cairo, Georgia, and it’s clearly giving the perception that’s his stuff there when it absolutely isn’t,” Purvis said.

    Year-Round Service

    Chain stores need produce year-round, so the problem is exacerbated. Purvis said most farmers can’t invest millions of dollars into producing a crop 12 months out of the year. These deceivers are able to take advantage.

    “Most farmers are regional. They have crops in Immokalee (Fla.), they have crops in South Georgia, they have crops in Central Florida. There’s just a small handful that have the wherewithal to have product 12 months out of the year,” Purvis said. “That being said, these marketers that I’m describing, they’ve got ‘x-y’ farms in their name and they have solved a problem for the chain stores. They’ve got a number they can call 12 months out of the year. They’ve got the product. They source it from anywhere and everywhere. That’s how that evolved.”

    Consumers Asking Questions

    Purvis believes that one positive from the ongoing pandemic is the consumer awareness of where their food originates. Now more than ever, they are asking about where their vegetables and specialty crops are coming from.

    “I think you would find unanimous feedback from the chain stores that the consumer is becoming very much aware. They’re asking questions and putting pressure on them. ‘Why have I got Honduran watermelons in my supermarket in Naples when there’s watermelons in Immokalee that they can’t get rid of,’” Purvis said. “If we keep the heat on and the awareness out there, I think the consumer will put enough pressure on the retailer that it’ll make the difference.”

  • Presidential Authority: Final Decision Regarding Blueberry Imports Rests with Biden Administration

    File photo shows blueberries.

    The American Blueberry Growers Alliance’s (ABGA) stance on imports has not changed over the years: serious injury has been inflicted on American farmers, especially those in Florida and Georgia.

    But where does President Biden stand on this issue? That’s the stance that will ultimately decide the Section 201 investigation regarding blueberry imports. Even if the International Trade Commission (ITC) decides in the ABGA’s favor with its vote on Thursday, the final decision rests with Biden and his administration.

    “When people asked me about this from the get-go, I felt like we’re going to win in the ITC, but does the president sign it or not? That’s a 50-50 coin flip maybe, I don’t know. People smarter than me can figure that out,” said Ryan Atwood, who lives in Mount Dora, Florida and farms 56 acres of blueberries, manages another 350 acres and is part-owner of the largest packing house in the Southeast United States.

    Virtual Hearing with ITC

    The ITC’s decision on Thursday comes a month after ABGA members and industry and congressional leaders testified in a virtual hearing before the ITC about the negative impact blueberry imports from Mexico, Peru, Chile, Argentina and Canada have had on the domestic market.

    If serious injury is found, the ITC will formulate a recommendation. But the president will make the final decision.

    “The ultimate decision will come from the desk of the president. Regardless of what side of the aisle you sit on, we all like to eat. We all like to eat blueberries,” said Jerome Crosby, Georgia blueberry grower and chairman of the American Blueberry Growers Alliance. “Food is probably the most partisan issue in America when it comes down to it. No matter what walk of life you come from, you like to eat something. That makes the farmer a friend to every human being. I think anyone who fits that category of consuming food is going to have an interest in the American farmer staying in place.”

  • Will 2021 Be Any Different?

    Mexican imports still a problem for Southeast producers.

    This year was a season unlike any other for produce farmers in the Southeast.

    Not only did COVID-19 strike at the worst time, but lingering international trade issues with Mexico resulted in diminished market prices for producers like Tifton, Georgia farmer Bill Brim.

    If something isn’t done soon, 2021 will be no different than 2020.

    “We’ve been fighting Mexico since probably the last week of October through now. It’s just been one battle after another with squash prices dipping down to $3, $2, whatever you can get for it to cucumbers at $9 when it ought to be $20. Squash at $3 or $2 should be $12 or $14,” Brim said.

    “It’s hard when you don’t make any money. It’s one of those things where farmers are resilient thinking, they’re going to make a million dollars next year instead of losing a million. We’re kind of stupid, I guess. We think we can outsmart them, but I don’t think we’re smart enough to do that anymore.”

    Virtual Hearings

    Brim and fellow farmers testified in August during virtual hearings with the U.S. Trade Representative’s Office regarding unfair trade practices with Mexico. The hearings provided the U.S. Department of Commerce and Trump Administration an opportunity to hear from growers in Georgia about the urgent need for federal action regarding unfair trade.

    Federal agencies responded in September by outlining the Trump Administration’s plan to address the threat posed by increased imports. The plan included a request to the International Trade Commission to initiate a Section 201 global safeguard investigation into imports of blueberries.

    In November, Georgia Congressmen requested a Section 332 Investigation on squash and cucumbers which was already being done for strawberries and bell pepper.

    Cucumbers, Squash Included

    On Dec. 4, U.S. Trade Representative Robert Lighthizer requested that the U.S. ITC include in its investigations the import of cucumbers and squash and the effect on the domestic seasonal markets.

    Hopefully, a long-term solution is in the works and will be imminent. It will not be a moment too soon.

    “The last four seasons have been the toughest. We did benefit in the fall, early a little bit, so that helped us. In the spring late, in the last week of May and the first week or two of June, we did fairly well because Mexico wasn’t in. Of course, they weren’t in early on the fall deal. But as soon as they open that door, it’s like somebody just shut the lights off,” Brim said.

    “Pepper undoubtedly must have been a little later in Mexico because they didn’t hit in our market until right at the tail end of it. It went from like $22 to like $14 overnight. It doesn’t seem to change. People just don’t get it.

    “We’ve got to have something, or we won’t survive. I just don’t know how they can continue to think we can survive when (Mexico is) paying their people down there 81 cents an hour and we’re paying $11.77 plus free housing, free transportation and everything else. We’ve got about $15 an hour in it by the time we finish up doing everything for them.”

  • China ‘Behind’ in Phase One Trade Agreement Responsibilities

    China is on the clock with regards to the Phase One Trade Agreement, which was signed earlier this year between China and the U.S. Veronica Nigh, American Farm Bureau economist, said China has fallen behind in its initial purchasing goal and questions linger about the country’s ability to fulfill its initial obligation.

    Nigh

    “Thus far, both the U.S. and China have remained committed to fulfilling the Phase One agreement, which covers both 2020 and 2021. I think there’s some concerns that China won’t be able to import the dollar amount that was agreed to for 2020,” Nigh said. “Thus far, they’ve been continuing to make some fairly sizable purchases. All of the language that is coming out of China is, ‘Yeah, hey, we’re still committed to this thing.’”

    Telling Three Months

    Nigh believes the last few months of this calendar year will go a long way in seeing if China can and will fulfill its initial goal.

    “I think we all know that China makes the big percentage of their sales in the last three months of the year; somewhere upwards of over 50% of their purchases have been those last three months. We’ve certainly seen some big commitments on commodities of late for deliveries later in the year. I think anything can happen at this point,” Nigh said.

    “For January through July, China has imported almost $8 billion of Ag products. Which means to reach their commitment, they’re going to need to import about $23 billion in that August through December time period. It’s a big number, about twice what we’ve ever done in recent history. There’s a lot of lifting left to do. It’s a big country with a pretty deep pocketbook. I think anything can happen at this point.”

    Impact in Pecans

    China’s renewed interest in U.S. pecans could be pivotal this year to American producers enjoying a profitable harvest season. Southeast farmers are expecting a bumper crop this year but need China to remain a loyal buyer.

    “If that Phase One Agreement were to go away, you’d have to be concerned about China’s desire to purchase commodities products from the U.S. if they can get it from somewhere else. There’s certain crops that maybe they have to have. Maybe they have a specific taste for pecans from the Southeast U.S. and they say, there’s no reason for us to punish our own citizens for this. We’ll go ahead and keep buying these,” Nigh said.