Disaster aid for states hit by flooding is more uncertain as Congress nears recess and ag lawmakers seem at odds over what producers need. Politico reports negotiations to pass a disaster relief package have collapsed just as another storm hits the Midwest and Great Plains, prompting blizzard warnings from Colorado to Minnesota.

Midwest Senators are pushing for a disaster bill that includes $3 billion for flooding in 2019 but, House Agriculture Committee Chairman Collin Peterson told reporters the Midwest doesn’t need billions in disaster aid like farmers in Southern states do. Peterson says the majority of crops or livestock damaged by flooding in Nebraska and Iowa were covered by crop insurance or are eligible for farm bill disaster programs, which isn’t the case for many Southern crops like pecan trees and peaches hit by last year’s hurricanes. Peterson says the only thing not covered in the Midwest is the stored grain that was damaged.

Agriculture Secretary Sonny Perdue told lawmakers this week USDA can assist in crafting language that would allow those farmers help. However, time to provide immediate assistance is running out as both chambers begin a two-week recess on Friday.

The U.S. Food and Drug Administration has announced guidelines regarding grain that has come into contact with flood waters. Affected grain is considered adulterated and must be destroyed or receive diversion approval by FDA due to the potential for contaminants from flood waters.

While there are few, if any, crops growing right now, previously harvested crops or siloed feed materials may be contaminated and no longer suitable for feeding.

For more information, please contact the FDA’s Kansas City District Office at (913) 495-5110.
Guidance on flooded grain disposal can be found here: https://www.extension.iastate.edu/…/management_of_flooded_g…
https://dnr.mo.gov/pubs/pub189.htm

March flooding throughout the Midwest caused shortages of ethanol as production was reduced, with threats of more flooding on the way. The decreased ethanol production is also fueling the increase seen in gas prices, according to Reuters, as ethanol prices on the coasts spiked due to shortages. Midwest producers have been unable to take advantage of the price increase because of washed-out rail lines.

In Southern California, including Los Angeles, the ethanol shortages are one of the factors that are pushing gas prices towards $4 a gallon, a level not seen since 2014. The multi-billion dollar damages in March impacted farms, homes and infrastructure, as well as cutting ethanol production by 13 percent.

The biggest problem facing the industry, getting ethanol to market, will continue as repairs are made to railways and U.S. ethanol inventories rise to near record levels. Additionally, storms across the Midwest and Great Plains threaten further flooding, further impacting plants and the transportation systems they rely on.

Canada is refreshing a list of tariffs on the U.S. as section 232 steel and aluminum tariffs remain against Canada. Politico reports the effort is part of Canada pressuring President Donald Trump to remove the tariffs he imposed last year.

Removing the tariffs, though separate, were thought to be part of reaching an agreement on the U.S.-Mexico-Canada Agreement that will replace the North American Free Trade Agreement. But Trump has yet to remove the tariffs and Agriculture Secretary Sonny Perdue had previously said would negate any benefits on the updated trade agreement.

Canada has also stated it would not implement the agreement if the tariffs are not removed. David MacNaughton, Canada’s ambassador to the United States, said this week the refreshed list of tariffs is not yet complete, and he expects “a significant number” of agricultural products to be on the new list. While it’s too early to name specific products, he noted some in Canada have called for including apples, pork and ethanol.

Pressure on farm finances appears likely to continue, according to the 2019 U.S. Baseline Outlook from the Food and Agriculture Policy Research Institute at the University of Missouri. The report finds projected net farm income will increase in 2019 but remains below the 2014-17 average. Longer-term projections suggest little change in real net farm income over the next decade, resulting in continued increases in the farm sector’s debt-to-asset ratio.

Projected prices for U.S. soybeans and other products affected by current trade disputes remain below levels that would prevail if foreign tariffs were removed. Marketing-year-average soybean prices are projected to stay below $9.00 per bushel for a second straight year in 2019/2020, and corn prices are estimated to increase from averaging $3.53 in the current marketing year, up to $3.81.

Further recovery in wheat prices could be limited by continued large global supplies, while cotton prices could fall in response to increased U.S. production. The estimates were prepared before the March 29 USDA planting intentions report was released, which suggests slightly more acres of corn and fewer acres of wheat and cotton than included in the outlook.

Significant work remains in trade talks with China, according to a statement from U.S. Trade Representative Robert Lighthizer’s office. President Trump has indicated a deal could be reached in the next four weeks, but the two sides offered little details regarding last week’s meetings, according to Reuters.

Lighthizer says negotiation team members “will be in continuous contact to resolve outstanding issues.” The most recent negotiations included intellectual property, or IP, forced technology transfer, non-tariff barriers, agriculture, services, purchases and enforcement.

Agriculture Secretary Sonny Perdue has previously said the negotiations could conclude with a doubling or tripling of U.S. ag exports to China. U.S. agriculture is impatiently waiting for the results of the talks which stem from the trade war enacted last year between the U.S. and China. The talks are now expected to conclude sometime within the next few months, well beyond the original deadline set by President Trump of March first. However, Trump extended the deadline because the talks were making progress.

Farmers appears set for a familiar weather event this week as forecasters say another bomb cyclone, or similar event, will hit parts of the Great Plains and Midwest. Numerous weather forecasters now say models are showing one to two feet of snow, if not more, in the northern reaches of the Missouri River basin, the same area that flooded in March from a bomb cyclone event.

The storm this week overlaps areas hit last month, but the bulk of the predicted heavy snowfall is expected further north, into South Dakota and Minnesota. The so-called cyclone, which presents a unique shape clearly defined on weather maps, is expected to form Wednesday afternoon. The storm creates a swirling air pattern and includes conditions that allow for significant precipitation.

However, forecasters say round two should not be as disastrous as the first bomb cyclone in March, as spring seasonal conditions are limiting the potential of the storm. Still, the storm signals more flooding along the Missouri and Mississippi Rivers. The National Weather Service last month predicted flooding to last into July.