March 18, 2020
USDA grapples with H-2A concerns
USDA is trying to reassure farm groups that producers will have the H-2A workers they need this year despite delays in processing their applications. USDA issued a statement Tuesday afternoon to Agri-Pulse saying it is “directly engaged with the State Department and working diligently to ensure minimal disruption in H-2A visa applications during these uncertain times.”
Chuck Conner, president and CEO of the National Council of Farmer Cooperatives, said a key concern has been the closure of consulate offices that are critical to interviewing potential H-2A workers. He said the industry has been “working feverishly” this week on emergency procedures.
Also of concern: Because of the outbreak, the U.S. will suspend routine immigrant and nonimmigrant processing visa services in Mexico, starting today.
Why it matters: 258,000 workers were approved under the H-2A program in 2019.
In a letter to Secretary of State Mike Pompeo, Georgia lawmakers warn that “crops may die in the field” if there is a lapse in H-2A processing, “diminishing our domestic supply and potentially increasing our reliance on imports.”
By the way: Industry groups are working on several other issues as well, including border inspections. The industry wants to ensure that Customs and Border Protection prioritizes entry of food products and provides for expedited screening of drivers and trucks.
To address meat industry concerns, USDA’s Food Safety and Inspection Service says it’s closely tracking absentees among its inspection force to ensure that packing plants are adequately staffed. The plants can’t operate without FSIS inspectors on site.
With schools closing, USDA has announced a partnership with PepsiCo as well as Baylor University’s Collaborative on Hunger and Poverty and McLane Global to provide nearly 1,000,000 meals per week to some rural students. The shelf-stable foods will meet USDA’s nutrition standards for the department’s summer feeding program.
For more on the potential impact of the pandemic on the ag sector, be sure and read this week’s Agri-Pulse newsletter.
State issues guidance to prevent coronavirus spread in restaurants
The California Department of Public Health has issued guidance on protecting consumers at restaurants, farmers markets, food trucks and other food and beverage establishments.
The recommendations include reducing occupancy by half, limiting lines and cleaning everything often. Similarly, farmers markets should space out booths, pre-bag items and cut out food sampling.
Keep in mind: Gov. Newsom recommended on Sunday that all bars, wineries and breweries be closed. The governor later clarified that by wineries and breweries, he meant tasting and drinking rooms. Wine and beer production will continue (and retail sales may even rise to meet what is likely a growing market in at-home consumption).
Family Winemakers of California has asked the administration to instead keep tasting rooms open for reduced capacity, as restaurants are doing. FWC is also recommending a software tool for setting up an appointment-only system for wineries. Silicon Valley Bank has also posted its advice on how wineries can “meet the customers where they are.”
Remember: The wine industry is already dealing with an oversupply issue, along with major market loss in China. Tasting rooms and related tourism have played an increasing role in the business models for Napa wineries, a region that also faces the state’s highest ag land values.
Food safety inspections will also continue throughout the crisis. The Leafy Greens Marketing Agreement is assuring retail customers and consumers its members are already meeting strict hygiene standards that are enforced through routine government audits. LGMA CEO Scott Horsfall said: “It’s important that people understand what happens on our farms each and every day.”
United Farm Workers is also asking ag groups to ensure consumer and farmworker safety. In a letter to farmers, UFW also wants 40 hours or more of sick pay for farmworkers, the end of a 90-day wait period for claiming sick time and the removal of caps on accruing sick pay, among other requests.
Coronavirus ‘hangover’ stalls a rise in dairy prices
Global dairy prices were on an upward trajectory by the end of 2019. That stalled in the first quarter of 2020, as the coronavirus outbreak in China left buyers and sellers scrambling to assess the market impact, according to a new Rabo Research report.
With a reduction in exports and domestic demand, the U.S. industry could divert more milk into butter and powder for longer shelf life. “As a result, butter and milk powder prices, as well as the corresponding Class IV prices, could retreat further from the current forecast,” the report’s authors note.
Economy is now in a recession
On Monday, Daybreak reported on a UCLA study forecasting a 50% chance of recession. Yesterday, the forecast was updated to show the nation is already in the midst of a recession that is projected to last through the end of September. More than a decade of expansion has now ended.
Remember: Under the last recession, then-Gov. Jerry Brown had to slash CDFA’s budget significantly, leading to staff cuts. Agencies reoriented their regulatory programs to instead draw revenues from user fees, such as for water rights and water quality. CDFA Sec. Karen Ross said those years “were extremely challenging.” Brown’s austerity measures, however, led to a California rainy day fund that is now worth about $20 billion.
Newsom signs emergency legislation on coronavirus
IN NATIONAL NEWS:
Key senator eyes boosting USDA aid authority
The Senate is working on a huge stimulus package, possibly as much as $1 trillion, as Washington grapples with the impact of the COVID-19 epidemic. And it’s possible the package could include a provision to refresh the Commodity Credit Corp. spending authority that USDA has used to make Market Facilitation Program payments.
Sen. John Hoeven, who chairs the Senate Ag Appropriations Subcommittee, tells Agri-Pulse the CCC account could be refreshed either through the stimulus package or later through the appropriations process.
Hoeven, R-N.D. is waiting for an answer from USDA on whether it has sufficient authority to make another round of MFP payments this year.
Keep in mind: The pandemic and the potential for a recession this year are adding to the stress on the U.S. farm economy, and calls for more direct aid are only going to grow in the coming weeks and months.
USDA extends comment period for school meals proposals
The COVID-19 pandemic has prompted USDA to extend its comment period for 30 days on two school meals proposals. Originally scheduled to end March 23, the comment period now will run until April 22.
In the proposals, which deal with school breakfast and lunch programs as well as the summer meals program, USDA says it’s trying to reduce administrative costs and give schools more flexibility in their menu options. For example, one of the proposals “would make it easier for menu planners to offer meats/meat alternates and grains interchangeably (without offering a minimum grains requirement daily)” for breakfast.
Not everyone likes the proposals: The announcement coincides with the release of a new report from Healthy Eating Research that says the proposed changes “could increase food insecurity and have a detrimental impact on kids’ health and academic performance.”
She said it:
"We need to make sure food is produced here domestically, so that we can continue to not be dependent on other nations for food products when we desperately need them." – Senate Republican Leader Shannon Grove, in a floor speech Monday evening as the Senate passed emergency coronavirus bills. Gov. Newsom signed the measures late yesterday.
Ben Nuelle, Bill Tomson and Steve Davies contributed to this report.
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