Corn, pork leaders to Trump: Only more exports can raise farm income
February 23, 2017
SAN DIEGO — Only increased exports can raise farm incomes significantly, and President Donald Trump's actions on trade will determine trends in U.S. farm exports, key corn and pork industry leaders told attendees at the Renewable Fuels Association here on Wednesday.
"The farm program will help with some other issues, but the real promise that our farmers see is growth in demand, and we know that growth in demand will come from [exports]," said Chris Novak, CEO of the National Corn Growers Association.
"The vast majority of potential is in the export markets," added Randy Spronk, a Minnesota farmer and hog producer who is a past president of the National Pork Producers Council.
Novak and Spronk spoke in a discussion titled "Agriculture Working Together to Move Rural America Forward." It was moderated by RFA President and CEO Bob Dinneen.
“The farm program will help with some other issues, but the real promise that our farmers see is growth in demand, and we know that growth in demand will come from [exports].” Chris Novak, CEO of the National Corn Growers Association
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Asked by Dinneen how concerned he is about the "bellicose rhetoric" about trade in Washington, Novak said, "We know that President Trump is committed to improving trade. We have talked to his transition team. … The commitment of the president to growing markets and trade is solid. Obviously, what he doesn't like is the multilateral deals because he feels they were not good for American workers."
But Novak added that his "frustration" is that those multilateral deals have been good for American agriculture.
Spronk said that if Trump is going to pursue bilateral deals, the No. 1 priority is a deal with Japan, which is the No. 1 U.S. pork market in dollar value but that still has trade restrictions. Mexico, he noted, is a "huge volume market," particularly for hams.
China is a "complex" issue for the corn industry because there are questions about import access and biotechnology policy, Novak said. The U.S. industry is "challenged" by Chinese slowness to accept biotech crops while it is working on its own biotech platforms.
"President Obama put a lot of effort in communicating with the Chinese government," Novak said. "We need President Trump to pick up and push even harder to make sure we have a fair and workable set of regulations that will continue to allow the free flow of corn and corn products."
Spronk and Novak said that the future of the Waters of the United States rule that Trump has promised to pull back is important to both the corn and the livestock industry.
Novak noted that the rule came about because the Supreme Court had issued conflicting decisions, and said that there is still is a need for clarifying the Supreme Court decisions. But Novak added that the Environmental Protection Agency "went well beyond what their own scientists were recommending and what the Army Corps said was necessary."
Dinneen, Spronk and Novak also engaged in a long conversation about how the corn, ethanol and livestock industries could avoid future conflicts such as the ones that occurred when corn prices were at their highest and the livestock industries called for an end to the Renewable Fuel Standard.
Spronk noted that the pork producers are not lobbying on either side of that argument now.
Novak, who was chief executive officer of the National Pork Board from 2008 until he joined the corn growers in 2014, noted that when feed prices were at their highest, there was a bigger contraction in the pork industry than when pork went down to 10 cents per pound.
The rapid change in market prices and the difficulty of the industry in adjusting to higher prices "still underpins the feelings," Novak said.
Spronk noted that pork producers who raised their own corn fared better in that period than those who had to buy corn.
Corn growers said they "were raising everybody's ship," but not everybody "had the ability to rise together," Spronk said.
Pork producers who had to buy corn promoted the food-versus-fuel debate, Spronk said. "There was a very severe sense of unfairness," he added.
Both Dinneen and Novak concluded that they need to address the "canards," such as food-versus-fuel, that affect consumer thinking.
"I feel like a mouse between a tiger and a lion," Spronk concluded.
–The Hagstrom Report