Agricultural Exporters Push Congress to Double Funding for Trade Promotion Programs
Agricultural export stakeholders before a congressional panel on Feb. 28 requested that the expected 2018 Farm Bill double the current authorized funding levels for two government food export assistance programs. During a hearing of the House Agriculture Livestock and Foreign Agriculture Subcommittee on the next farm bill’s addressment of international development programs, industry members requested twofold growth of the $200 million yearly authorization for governmental food export assistance under the Foreign Agricultural Service’s (FAS) Market Access Program (MAP) and the current $34.5 million annual authorization for export financing under FAS’s Foreign Market Development (FMD) program.
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The 2014 Farm Bill, or Agricultural Act of 2014, which maintains that $200 million annually allowed funding level, expires in 2018. American Soybean Association Director Joe Steinkamp (here) called for any authorized increases to be phased in over the course of the next farm bill, as such legislation typically remains active for about four years.
Inflation and depreciation of the U.S. dollar have “steadily eroded” the purchasing power of agricultural cooperators utilizing MAP and FMD, as the promotional power of the programs has decreased by about 30 percent, Steinkamp said. “Agricultural exports, for years, have been the strongest positive contributor to our nation’s trade balance,” he said. “FMD and MAP programs have been critical to that success.” Multiple witnesses, including Tim Hamilton, executive director of regional trade groups Food Export-Midwest and Food Export-Northeast, noted (here) that the EU allocates $255 million per year for wine alone. He added that increased financing would help the 95 percent of U.S. companies that don’t export to branch out to other countries.
The MAP helps U.S. companies gain a foothold in foreign markets, and the marketing skills that the program engenders set the stage for trade deals, U.S. Meat Export Federation CEO Philip Seng said during the hearing (here). He pointed to the Korea-U.S. Free Trade Agreement and the successful U.S.-Japan bilateral agricultural negotiations in the Trans-Pacific Partnership as examples. U.S. export promotion activities and FTAs have allowed the U.S. to turn meat trade deficits into trade surpluses, he said. U.S. meat exports have suffered as Australia and China deny access to U.S. beef, and Russia’s 2014 ban of EU agricultural imports has deflected European exports to the Asia-Pacific region, with agricultural products from Europe displacing U.S., Canadian and other countries’ exports to the region, Seng said. Steinkamp, Seng and Hamilton all called for Congress to increase funding for governmental agricultural export assistance programs.
Subcommittee ranking member Jim Costa, D-Calif., told the witnesses they were “preaching to the choir” in pushing the necessity to increase funding for export programs, and called for them to take their efforts outside of the subcommittee and broadcast how U.S. agricultural exports are important to the entire economy. Subcommittee Chairman David Rouzer, R-N.C., during the hearing pledged to fight against any slashes to the programs, saying his panel’s goal is to reverse the usual course of congressional consideration of farm bills and appropriations legislation, which regularly target those programs for cuts. “Given the uncertainty of the future of our existing trade agreements, and the blatant disregard of WTO commitments by a handful of our global competitors, I see tremendous value in these effective and proven methods of gaining new access for U.S. goods abroad and developing those market relationships,” Rouzer said in his opening statement (here). “These programs truly embody an 'America first' policy.”