House spending panel approves Flake farm subsidy amendments

The House Appropriations Committee approved by voice vote on Tuesday evening a Rep. Jeff Flake, R-Ariz., amendment that effectively bans payment of crop subsidies to anyone making more than $250,000 per year. The current limit is $500,000 in adjusted gross income (AGI) from off-farm sources or $750,000 in on-farm AGI. The $750,000 limit is an extravagance that only makes sense to people inside the Beltway, Flake said. The savings generated by tighter payment limits, a change that has also been proposed by the Obama Administration, would be dedicated to debt retirement, Flake said.

The committee also approved another Flake amendment to shift more than $140 million in cotton subsidies from U.S. farmers to Brazilian interests. Rep. Flake confirmed in a break in the action that the funds would come from direct payments to upland cotton farmers. Committee members voted later on Tuesday to shift $147 million originally designated for payment to Brazil to the Women’s Infants and Children’s feeding program.

As he did at his Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Subcommittee’s markup on May 24, chairman Jack Kingston (R-Ga.) introduced the bill – $17.25 billion in discretionary spending and $108.2 billion in mandatory spending, for a total of $125.5 billion – as vital to reining in the federal deficit. The $17.25 billion figure is $2.7 billion, or 14%, below the FY 2011 enacted level, and $5.0 billion, or 23%, below President Obama’s request. The full committee approved the spending bill by voice vote just before 9:00 p.m. The measure now moves to the full House, where it is expected to pass with little change.

Many farm groups oppose the bill, generally saying it cuts too much too quickly, and are already working on an “improved” version of the funding measure in the U.S. Senate. The National Farmers Union noted May 27 that agriculture’s budget will have been cut 26% in two years if the House bill is enacted. The group further decried language preventing implementation of the proposed Grain Inspection Packers and Stockyards Administration rule, which it says is necessary to restore competition to the livestock and poultry industry per the 2008 Farm Bill.

The National Sustainable Agriculture Coalition has decried the bill’s treatment of conservation programs, which it says will be cut by more than $1 billion. That follows the $500 million cut made by the continuing resolution passed in April. “The cuts would be further magnified in the multi-year base funding Congress has to work with for the 2012 Farm Bill, making passage of such a bill difficult if not impossible,” the group said.

Of his first amendment, Flake said farm subsidies entered “the realm of the absurd” after the World Trade Organization ruled against U.S. cotton subsidies. Rather than cut domestic payments, the U.S. government decided to pay Brazil $147 million annually to subsidize its own cotton. The payment has come from accounts outside the domestic cotton subsidy program, but that would change and come from direct payments under Flake’s amendment.

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China Policy and Market Update

January 29th, 2021

In December, China imported 1,629,083 bales (354,691 MT) of cotton, representing an increase of 80.43% month-on-month (m/m), and an increase of 130.9% year-on-year (y/y). The total value was USD $588.82 million, representing an increase of 89.33% m/m, an increase of 117.21% y/y. In 2020, Chinese cotton imports totaled 9,912,346 bales (2,158,159 MT), an increase of […]

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