Laying the groundwork for the next Farm Bill

by Courtney Llewellyn

The powerful locomotive that will be the 2023 Farm Bill is finally picking up steam. That’s what House Ag Committee Ranking Member G.T. Thompson (R-PA) told attendees at this spring’s Ag & Food Policy Summit, organized by Agri-Pulse.

“The Farm Bill is incredibly important … You never get it absolutely perfect, but 2018 rated pretty high in the world of Farm Bills,” Thompson said, and that’s what this next bill needs to live up to. That bill utilized USDA data, key stakeholder input and resulted from the input of over 130 different hearings. For 2023, however, “we’ve got a lot of work to do,” he said. Hearings are picking up pace, but the government is “way behind at this point.” The House and Senate ag committees need to find out what needs to be refined, from both USDA and the farmers the bill will impact.

Top Political & Economic Factors Influencing the Next Farm Bill

There are three pillars that every Farm Bill is structured on, according to Randy Russell, president of the Russell Group. The first is the state of the farm economy (and we’ve never seen a period with higher prices, so that will have a major impact; even with record exports projected, we need to keep our eye on input prices). The second is the bill’s budget (which will likely be a zero baseline Farm Bill – any new money in one place means it’s going to be cut from somewhere else). The third is the nation’s political situation (with an election on Nov. 8; following the vast majority of historical trends, the party in the White House will lose seats, so the House will flip – but it still takes 60 votes to get a Farm Bill done in the Senate).

The Farm Bill needs 218 votes in the House – but only 35 districts are primarily rural. Russell noted we’ll “see a sea change” on the House Ag Committee thanks to retirements, seat changes, redistricting, etc. Six members of the Senate Ag Committee are up for reelection in 2022, but he thinks the Senate will pretty much stay the way that it is.

Russell was part of panel discussing political and economic factors influencing the 2023 bill, along with Chuck Conner, CEO, National Council of Farmer Cooperatives, and Kathryn Unger, vice president North America government relations, Cargill.

“We need to make an initial assessment of the farm economy, of whether producers are content or looking for change” – whether this is an evolutionary or a revolutionary Farm Bill, Conner said, “and we generally don’t see revolutionary.” With high prices today and exports at record levels, pundits would say we’re on track for an evolutionary farm bill, but with the market uncertainty of today, especially with input prices and uncertainty in international marketplace, Conner thinks “everything will be on the table.”

Unger stated that what we’re looking for is bipartisanship. The Farm Bill will have fewer dollars, and food that’s going to be more expensive. “I can’t remember ‘climate’ ever featuring so highly in any previous Farm Bill,” she added. “How do we balance the climate with the need to feed so many people?” Additionally, the bill will need to help attract and retain good talent to rural communities as well as support what those communities need to thrive, such as broadband internet, healthcare, etc.

Russell said the 10-year cost for the 2018 Farm Bill is $867 million, with 76% of the cost going to the nutrition program, 9% to crop insurance, 7% to conservation and 7% to farm programs. “It’s critically important that the climate side of all this is voluntary,” he stated. For the climate-smart programs to become more successful, we need to change their value proposition – they need to be revenue generators rather than production costs.

Russell and Unger were also in favor of significantly increasing the funding for research, if possible, since that helps agriculture become more sustainable and meet climate goals.

“We shouldn’t be shy about educating people about what’s in the bill,” Russell concluded. The goal of the Farm Bill is to preserve and protect family farms, but he believes the 2023 bill has a much higher calling: it should state that “U.S. food security is national security – period.”

What Do Food Companies Want in the Next Farm Bill?

“I think we’re going to see a much broader group of companies also promoting sustainability this time around,” predicted Chris Adamo, vice president, governmental affairs, policy and partnerships, Danone North America, during this panel. He was joined by Matt Dillon, chief sustainability officer, Farmer Focus; Aubrey Bettencourt, president and CEO, Almond Alliance of California; and Dan Christenson, senior director for government affairs, PepsiCo.

Christenson pointed out a key difference when talking about sales: customers are grocery stores; consumers are those who actually enjoy a product. And those consumers want a positive value chain, they want local, they want sustainable – their but tolerance for paying more doesn’t always play out.

Dillon added that companies are being shocked by the range of things consumers care about. It’s starting to expand to include regenerative practices and social issues (how workers are treated) – things that weren’t on consumers’ radars 10 years ago. And their opinions may change faster than companies’ research.

“Consumers may not want to hear about climate change, per se,” Adamo noted, and it’s not so much about mitigating the bad anymore, but being a force for good.

What do these particular companies want to see in the next Farm Bill? Bettencourt said businesses will always push for market access, and Adamo said partnership programs, especially for conservation, are key. (Dillon added that there are 300 million acres with the potential for conservation crop rotation practices.)

And as for food labeling: Does there need to be a “climate-smart” label? “I’m not sure marketers are looking for more labels,” Adamo said. It’s more about the stuff before that – how we’re measuring the impacts of farming practices and the quality of the data. It needs to be made more uniform, or the public and investors can get confused about what they’re actually spending their money on.

Rep. Thompson, sharing his perspective on the upcoming bill, said, “American agriculture are climate champions, and should be recognized and rewarded as such.” He noted the nation has seen a 287% increase in productivity since 1940s, and there’s a goal of reaching 300% by 2035.

Ultimately, though, “it’s the margin that matters at the end of the day,” he said. “Yes, we have record commodity prices, but we also have record input prices. I challenge commodity organizations to get creative to support their members.”

Look for announcements for upcoming Farm Bill hearings in future editions of Country Folks so that your voice is heard.

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