December 16, 2019
New insights into California landowners who lease to farmers
American Farmland Trust (AFT) recently surveyed landowners who lease land to farmers but do not farm themselves. It is a poorly understood demographic that carries an outsized influence in California.
More than 60% of farmland in some California counties is leased, nearly double the national average. The state also has some of the highest rental rates in the country.
The survey also found that 70% of those owners reside elsewhere, typically about 30 miles away. Their average age is 70, and 59% have farmed in the past. They have owned the land for decades and are likely to keep it in the family. Just over half lease to someone outside of their friends and family network. It is typically just 200 acres they rent out.
Nearly all trust the farmer to make good conservation practices.
Pre-Christmas rush faces Capitol Hill
Fresh off the historic “phase one” trade deal with China, Congress faces a critical week to fund the government for fiscal 2020 and advance the U.S.-Mexico-Canada Agreement.
USMCA complication arises
It was looking like clear sailing for the U.S.-Mexico-Canada Agreement, but a complication has arisen and Mexico’s top North American negotiator is airing new grievances with the pact. Jesús Seade is expected to confront lawmakers and the Trump administration as early as today.
A provision that was added to USMCA after U.S., Canadian and Mexican leaders signed the pact about a year ago is creating fresh objections in Mexico. The U.S. wants to install five labor attachés in Mexico to monitor the progress of labor reform in the country. But Mexico won’t allow that to happen, Seade said in a video posted this weekend.
Read the USMCA implementing bill here.
Details emerge on China deal, but questions remain
China, according to the Trump administration, is in complete agreement on a partial trade pact that isn’t expected to be signed and implemented until early next year. More details have been released than the first time a deal was announced in October, but questions remain, including the biggest one: Will the so-called phase one pact actually come through?
According to the White House, China has agreed to buy $40 billion to $50 billion in U.S. agricultural commodities annually for two years. China has not confirmed this, saying details will be released “in a timely manner.”
China will lift a wide variety of non-tariff barriers on U.S. ag commodities, including reform of the country’s difficult and lengthy biotech trait approval process.
China and the U.S. also have agreed to scrap plans to increase tariffs that would have gone into effect yesterday. China says the U.S. has promised to gradually reduce its existing tariffs on Chinese goods.
We don’t know exactly which U.S. ag commodities China will be buying more of for the next two years. At the stated levels, China will have to be buying a lot of just about everything U.S. farmers and ranchers produce. But a senior administration official said details on specific commitments will be kept secret to protect information that could skew markets.
We also don’t know how China will address its tariff and non-tariff barriers to ag products and how permanent those fixes will be.
Read a USTR fact sheet about the deal.
Wage rates could swing Senate vote on ag labor bill
There’s little indication the Senate will do anything with the landmark H-2A reform bill the House passed last week. House Speaker Nancy Pelosi seemed to concede as much when she said the bill had been sent to the Senate’s “Grim Reaper,” a reference to Majority Leader Mitch McConnell and his penchant for burying House-passed bills.
But Dennis Nuxoll, the Western Growers vice president of federal government affairs, tells Agri-Pulse the 2020 wage rates are likely to get the attention of the Senate and could put some pressure on Republicans to deal with the issue. Nuxoll expects another round of big increases in wage rates in many states. The rates are due out from the Labor Department in early January.
This year, several western states saw H-2A wage increases of 15% to 23%. The House-passed Farm Workforce Modernization Act would freeze the wage rates in 2020 and cap the annual increases after that.
Don’t miss our Agri-Pulse Open Mic interview with California Rep. Zoe Lofgren, the Democratic co-author of the ag labor bill.
He said it:
“You can only cut expenses so far, and we’ve already seen family living expenses get cut a lot, which is a big thing for a lot of people. The cost of healthcare for them is really brutal right now.” – Todd Van Hoose, President and CEO of the Farm Credit Council, in telling Agri-Pulse on how farmers are coping with the economic squeeze.
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