By Randy Gordon, President and CEO
The NGFA has identified a host of major policy and program priorities for 2020-21, which were reviewed by its Executive Committee in early January and will be reviewed with and officially affirmed by its Board of Directors during NGFA’s 124th Annual Convention, to be conducted March 8-10.
The following are what’s on NGFA’s radar during the coming year:
Trade: NGFA’s focus will turn to providing information to the U.S. Trade Representative’s Office (USTR) concerning successfully implementing the two major trade agreements that will take effect this spring – the U.S.-Mexico-Canada Agreement (USMCA) and the China Phase One trade accord.
- USMCA: NGFA mobilized its membership and State/Regional Affiliate Associations to help secure the overwhelmingly bipartisan ratification of the USMCA accord by Congress. Mexico’s legislature approved USMCA in 2018, and the Canadian Parliament is expected approve the accord this spring. The agreement takes effect 90 days after all three countries approve it. Of particular benefit to the U.S. grain, feed and processing industry, USMCA significantly would reduce non-tariff trade barriers between the three countries. It includes a concept proposed by NGFA and the North American Export Grain Association (NAEGA) that obligates parties to provide notice and begin the process of resolving sanitary and phytosanitary issues associated with agricultural imports within five calendar days, as well as improved dispute-settlement procedures. The accord also contains comprehensive agricultural biotechnology provisions that should enhance the development of coordinated regulatory policies toward all forms of biotech, including emerging gene-editing techniques, as well as development of low-level presence policies to facilitate trade in situations where a biotech trait has been approved by the exporting country, but not yet by the importing nation.
- China: The Phase One trade agreement with China signed on Jan. 15 at a White House ceremony attended by NGFA Chairman Eric Wilkey contains very significant commitments, time deadlines and enforcement metrics designed to foster more predictable trade between the two countries, as well as Chinese commitments to purchase major volumes of U.S. agricultural products by the end of 2021. NGFA will be working with its member companies to monitor China’s compliance with the agreement, including its highly significant provisions to eliminate non-tariff trade barriers (such as non-science or non-risk-based sanitary and phytosanitary actions), reforming its biotechnology regulatory safety-approval process so that it’s more transparent, predictable, efficient, and science- and risk-based, and ending on-site audits and implementing a facility registration process for companies exporting feed, pet food and feed ingredients to China. Among NGFA’s highest priorities is to secure removal of the additional declaration for foreign material on phytosanitary certificates on U.S. soybean shipments to China, and to amend the U.S. Grain Standards Act to prohibit future misuse of grain quality factors on Animal and Plant Health Inspection Service (APHIS) phytosanitary certificates reserved solely for conveying plant health/pest risk information. As part of Phase Two negotiations with China concerning its structural support of state-trading enterprises, NGFA will be seeking to restore normalized trade between U.S. exporters and Chinese importers and end “managed” government-to-government trade.
- Japan: With a “phase one” U.S.-Japan trade accord consummated in 2019, the NGFA is turning its attention to an anticipated second round of negotiations focusing on continued opening of Japan’s market to U.S. agricultural products and the resolution of non-tariff trade barriers, such as sanitary and phytosanitary issues and improved biotechnology provisions similar to those addressed in USMCA. Under the phase one agreement, Japan cut tariffs and mark-ups on many U.S. agricultural products, notably beef, pork, wheat and barley so that exports of these U.S. products to Japan will not be disadvantaged compared to competitor countries that are part of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Japan-European Union Economic Partnership Agreement.
- United Kingdom: With the upcoming exit of the United Kingdom (UK) from the European Union, the NGFA will be advising USTR on agricultural provisions to negotiate in a potential trade agreement with the UK, including incorporating the more science- and risk-based approaches contained in USMCA and the U.S.-China Phase One agreement.
Barge Digital Transformation Project: In January 2020, NGFA announced its partnership with essDOCS, a company that provides an electronic framework to enable secure paperless trade, to implement digitization of barge trading documents, such as bills of lading, so that they may be transmitted electronically – a huge cost savings to the industry. NGFA will finalize the formation in early 2020 of a non-profit National Grain and Feed Digital Solutions entity as the governing body to oversee successful implementation of the Barge Digital Transformation Project and administration of the new electronic platform.
Rail Issues: As always, NGFA will devote considerable time and effort in 2020 to addressing rail policy issues. The Association will continue to pursue and prioritize initiatives at the Surface Transportation Board (STB) to: 1) reform and streamline the process for challenging unreasonable freight rail rates; and 2) require rail carriers to amend their egregious demurrage and accessorial practices and charges to be commercially fair, commercially achievable and reciprocal. NGFA also will examine opportunities to petition the STB to reopen its proceeding to develop rules or guidelines on the common-carrier obligation of railroads to provide service upon reasonable request.
Here are other major priorities on which the NGFA will be spending considerable time and effort in the coming year:
- Biotechnology: NGFA will continue to advocate transparency – both domestically and internationally – for genome-editing techniques being utilized in crop production, as well as international regulatory consistency and adoption of low-level presence policies to reduce potential trade disruptions associated with such traits. NGFA also will continue to urge the U.S. Food and Drug Administration (FDA) to retain and encourage use of its voluntary consultation process for genome-edited crops with continued public disclosure of letters of no concern.
- Inland Waterways/Ports: The NGFA will urge that necessary funding be provided to the U.S. Army Corps of Engineers to conduct “preconstruction engineering and design” that is a prerequisite before construction on seven new 1,200-foot lock chambers can begin on the Upper Mississippi and Illinois Waterway System. NGFA also will continue to advocate, as part of the next Water Resources Development Act, that the cost-share for lock-and-dam projects be changed to 75 percent federal and 25 percent user fee funding (versus 50:50 currently), as well as for continued full utilization of the Harbor Maintenance Trust Fund for port-dredging.
- Futures Markets: The Commodity Futures Trading Commission (CFTC) is expected to publish its latest proposed speculative position limit rule in early 2020. As a result of input from NGFA and others, the next version is expected to be much-improved, including an expanded list of enumerated bona fide hedging strategies compared to current CFTC rules, as well as a “carve-out” for grain and oilseed futures from CFTC “look-back” reviews of hedge exemptions for these long-used risk-management strategies. NGFA will continue advocating for reasonable and timely review procedures by the CFTC of non-enumerated hedging strategies (e.g., anticipatory merchandising hedges) when the proposed rule is published.
NGFA representatives also will continue frequent engagement with the Chicago Mercantile Exchange (CME) to provide input on potential changes as the CME Group undertakes a review of its CBOT soft wheat contract in 2020.
- Workplace Safety and Health: This continues to be a huge priority for NGFA! Through the NGFA-Occupational Safety and Health Administration (OSHA) Alliance, the Association and other safety partners will host the third annual Stand Up for Grain Safety Week on April 13-17, 2020, to emphasize grain facility hazard recognition and safety best practices.
NGFA experts also will conduct Regional Safety and Regulatory Compliance Seminars in partnership with State/Regional Affiliate Associations throughout 2020 and continue expanding the NGFA’s suite of safety videos and Safety Tip Sheets that the industry can use for employee training, which are available on ngfa.org/safety.
- Foreign Animal Diseases: NGFA will continue work with other industry stakeholders and regulatory agencies to address the potential introduction of foreign animal diseases, including the African Swine Flu (ASF) virus, into the United States via grain and feed products. NGFA advocates a science-, risk-based approach and prudent research to address information gaps concerning the potential role, if any, that feed and grain products may play in transmitting such viruses. In 2020, NGFA plans to develop enhanced facility biosecurity plans and best practices, and work with the government to develop risk-based response plans to facilitate safe and appropriate movement of feed and pork products, as well as disposal of animals, in the event ASF enters the United States.
- Food Safety Modernization Act Implementation (FSMA): In 2020, NGFA will continue to develop and advocate its positions regarding FSMA implementation to FDA on: 1) a proposed rule that would require that food/feed testing in certain situations be performed by laboratories accredited by FDA; and 2) an anticipated proposed rule that would require additional traceability records for food/feed that is designated as “high-risk.”
NGFA is working with FDA to secure the grain elevator exemption from FSMA’s human and animal food rules pertaining to compliance with current good manufacturing practices, hazard analysis, preventive controls and recordkeeping for grain-handling facilities located on the same property as a feed mill or processing plant. In addition, NGFA continues to urge FDA to broaden the exemption from FSMA-related preventive-control requirements to encompass lentils, kidney beans, pinto beans, lima beans, coffee beans, cocoa beans, peas, peanuts and tree nuts (which FDA currently defines as “fruits and vegetables”).
Finally, NGFA aims to complete negotiations with Class I railroads and the truck sector about shared responsibilities – including providing last-load hauled information to shippers and receivers – to facilitate compliance with FDA’s final rule on sanitary food transportation issued under FSMA.
- Grain Storage/Warehousing: The NGFA will seek enactment of amendments to the U.S. Warehouse Act to ensure the future integrity of its Reserve Fund so that licensing and examination fees paid by federally licensed warehouse operators are used solely to offset costs associated with such services.
Read more about NGFA’s priority issues and member services at ngfa.org. The NGFA welcomes NGFA member-companies’ comments and input on these priorities, as well as others you may wish to suggest that have an industrywide impact, as we continue to strive to serve the grain, feed, grain processing and export industry and the challenges your companies are facing. Please contact me directly at 202-888-1091 or at email@example.com with your thoughts, and thanks!