House in and Senate out | Ag markets | Vilsack on farm bill | Renewable diesel feedstock | More bird flu cases in Iowa | Chevron decision and SCOTUS | Presidential debate
June 24, 2024
Early morning look at the beginning of the week including some items on Profarmer.com, AgWeb.com or AgriTalk, or some weekend topics that will be detailed further in the mid-morning Updates or are in The Week Ahead (link).
- The House is in this week with the Senate out. Both chambers are scheduled to be out next week for the July 4 holiday and return the week of July 8. Link to The Week Ahead for details of Washington’s agenda.
- Ag markets last week (Pro Farmer): Wheat futures continued to slide seasonally amid hedge pressure tied to the rapid winter wheat harvest. Front-month SRW and HRW contracts fell to two-month lows last week, nearly retracing all of the spring rally. Corn and soybeans followed to the downside. Despite too much moisture in northern areas of the Corn Belt and heat and moisture stress in southern and eastern locations, traders haven’t shown concern. Barring any bullish surprises in USDA’s June 28 Acreage and Grain Stocks Reports, prices could continue to slide, though weather will become a greater focus once the calendar flips to July. Live cattle futures paused their recent rally last week ahead of Friday’s Cattle on Feed Report. Hog futures continued to erode technically after a failed bounce attempt early last week.
- Renewable diesel feedstock. A lot of used cooking oil is coming in from China, but some traders and analysts note the most rapidly expanding feedstock supply for renewable diesel is “international virgin Indonesian palm oil” used cooking oil imports. So much that some predict a big increase in U.S. soybean oil stocks.
- AgriTalk’s free-for-all program on Friday (link) focused on an interview late last week with USDA Secretary Tom Vilsack. He made it clear that GOP farm-state lawmakers in the. House and Senate “need to get realistic” to get a new farm bill completed. “I don’t think we’re close to getting a farm bill done until the folks who are negotiating the farm bill are realistic about what’s doable within a constrained resource environment,” Vilsack said. He added there is a way to creatively use the Commodity Credit Corporation for some funding, just not “anywhere near $53 billion” GOP proposals would require.
A recent bird flu outbreak has hit another dairy herd in Sioux County, northwest Iowa. The Iowa Department of Agriculture announced the detection of highly pathogenic avian influenza (H5N1), marking the 11th case in Iowa this year, with two other herds infected in Sioux County just a day earlier. The total cases in Sioux County now stand at nine, with initial cases also found in O’Brien County and Plymouth County.
This year, northwest Iowa has seen three poultry infections, including a flock of 4.2 million egg-laying chickens and two turkey flocks. Infected poultry flocks are typically euthanized to prevent the spread of the disease, while cows generally recover after experiencing mild symptoms.
Iowa Secretary of Agriculture Mike Naig has encouraged dairy farmers to test their cows if they suspect infection, especially if they observe reduced milk production or sick animals. He emphasized that increased testing would provide more information to the industry about the spread of the disease. The disease is believed to be carried by migrating wild birds and spread between states via cattle movement and shared equipment among farms.
USDA has emphasized the need for enhanced biosecurity practices among poultry producers and dairy farmers to protect their herds. While the U.S. food supply remains safe, federal officials advise against consuming raw milk, as it could expose consumers to the virus. Pasteurization is required to ensure milk safety.
A federal epidemiological strike team is currently conducting research in Iowa to determine the cause of the spread and aid in disease response efforts, including compensation for affected farms and updated indemnity tables for poultry.
The Chevron decision and the pending case before the Supreme Court are pivotal in the realm of administrative law and the functioning of federal agencies. We could get a SCOTUS ruling as soon as Wednesday. The Chevron decision originates from the 1984 Supreme Court case Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. In this case, the Supreme Court established a legal doctrine known as Chevron deference. This doctrine dictates that when a federal statute is ambiguous, courts should defer to the interpretation of the agency charged with administering that statute, provided the agency’s interpretation is reasonable.
The Chevron deference involves a two-step process:
Step one: The court determines whether the statute is ambiguous. If the statute is clear, the court must give effect to the unambiguously expressed intent of Congress.
Step two: If the statute is ambiguous, the court then considers whether the agency’s interpretation is a permissible construction of the statute. If it is, the court defers to the agency’s interpretation.
The Supreme Court heard oral arguments for these cases on Jan. 17, 2024, and a decision is expected as soon as this Wednesday. The central question is whether the Court should overrule Chevron or at least clarify that statutory silence on certain powers does not constitute an ambiguity requiring deference to the agency.
Overruling or significantly narrowing Chevron deference could have profound implications:
- For federal agencies: It would limit the latitude agencies have in interpreting statutes, potentially leading to less regulatory flexibility and more judicial intervention in administrative decisions.
- For the Judiciary: Courts would have more authority to interpret ambiguous statutes, which could lead to increased judicial involvement in policy decisions traditionally handled by agencies.
- For regulatory stability: The change could result in more frequent shifts in regulatory interpretations with changes in administration, as courts might not consistently defer to agency expertise.
Proponents of maintaining Chevron argue that agencies possess the necessary expertise and are better equipped to handle complex regulatory issues. They also contend that Chevron deference ensures that policy decisions are made by politically accountable entities rather than unelected judges.
Opponents, however, argue that Chevron undermines the separation of powers by allowing agencies too much discretion, which can lead to regulatory instability and lack of accountability.
Link to five key SCOTUS cases.
- Most election articles discuss how close the Nov. 5 presidential election could be, with the next potential swing factor coming this Thursday via the first of two presidential debates. If President Joe Biden shows mental acuity through the debate, he could gain some post-debate oomph, perhaps enough to be re-elected, say some debate watchers. But the Thursday debate will find Biden without a teleprompter or notes and there are legitimate questions how he will perform. Trump’s biggest tasks, say some analysts, is to avoid, well, being Trump. Unlike prior debates with Biden, Trump must not get too aggressive. His key will be to focus his comments on what’s ahead and not what has already occurred. Biden wants the contest to be a choice between him and Trump. Trump wants the election to be a referendum on the Biden presidency, especially as it pertains to inflation, immigration, and crime in cities, all topics his supporters want to hear what he do if given another chance at the White House.