Senate Ag Panel Expected to Vote Wednesday on Controversial Cattle/Meat Measures

Fed Chair Powell appears before House, Senate panels

The Week Ahead
The Week Ahead
(Farm Journal)

Fed Chair Powell appears before House, Senate panels


Washington Focus


Lawmakers are stepping up action this holiday-shortened week ahead of their next extended break for the July Fourth recess. House focus is on appropriations bills while the Senate Ag panel will vote on and likely pass two cattle-related measures. The House Ag Committee will hold another farm bill-related hearing, this one on dairy programs. And Saturday brings a House farm bill field hearing, this one in Arizona. Meanwhile, Fed Chairman Jerome Powell appears twice this week before congressional panels. With inflation, interest rates and other financial topics heading the news lately, panel members will have a lot to ask him.

Behind-the-scenes work continues on a possible new reconciliation measure that aims to fight inflation, rein in the deficit and revive parts of President Joe Biden’s stalled economic agenda. The White House for months has refused to publicly comment on any talks with centrist Sen. Joe Manchin (D-W.Va.). The package would likely include capping the price of insulin — a key medicine for diabetics — and federal investments in both clean energy and fossil fuels. It would also further reduce the budget deficit and boost taxes on the wealthy, corporations or both, reports note.

“Prices are unacceptably high right now,” National Economic Council Director Brian Deese said in an interview for CBS’s Face the Nation on Sunday. “That’s why the president has said we need to make this our top economic focus and do everything that we can to get them down.” He cited measures to lower the cost of prescription drugs, tax incentives for energy and a “long-overdue tax reform” as ways to help U.S. households deal with the fastest inflation in 40 years and signal to markets that the U.S. is “deadly serious” about curbing rising prices. Deese did not mention a federal gasoline tax holiday even though Treasury Secretary Janet Yellen (see item below) say federal policy makers should consider a temporary gasoline-tax holiday.

Biden met Wednesday with Senate Majority Leader Chuck Schumer (D-N.Y.) and House Speaker Nancy Pelosi (D-Calif.), with the trio discussing next steps on a revised bill to pass through the reconciliation process. The White House called the measure their “shared agenda of tackling inflation and lowering prices and transitioning from a historic economic recovery to stable, steady growth” in a statement on the meeting. The talks have largely narrowed to two men: Schumer and Manchin. The basis for their discussions is legislation the House passed last year that would raise federal revenue by $1.5 trillion over a decade. Manchin has insisted that at least half of the new tax revenue in the bill go to reducing the deficit. Another centrist Democrat, Sen. Kyrsten Sinema of Arizona, however, has signaled objections to many tax increases, leaving unclear which revenue measures might make a final agreement.

Timeline: While most observers predict a continued Democratic stalemate on a new budget reconciliation measure, veteran watches are not yet ready to call the effort a defeat. Any measure would likely include language extending some ObamaCare provisions slated to end early in 2023. Proponents of the legislation are aiming for a deal soon that can pass before members of Congress leave for their annual August recess. After that, lawmakers will have little time to legislate as they focus on their re-election campaigns.

Sustained high gasoline prices have the White House, Congress and state government officials’ attention. The average cost of a gallon of unleaded fuel in the U.S. “slid” to $4.98 on Sunday, according to AAA. That is up from about $3 a year ago.

Federal policy makers should consider a temporary gasoline-tax holiday to ease the burden of soaring fuel prices, Treasury Secretary Janet Yellen said on Sunday. “Gas prices have risen a great deal and it’s clearly burdening households,” she said on ABC’s This Week. “That’s an idea that’s certainly worth considering.” Yellen’s comments come as several states, including Connecticut and Maryland, have completed plans to temporarily halt gasoline taxes at the state level. But in the U.S. Congress, Democratic-led efforts to temporarily stop collecting the federal gasoline tax of 18.4 cents a gallon have yet to gain traction. But Harvard University’s Lawrence Summers, a former Treasury secretary, criticized the idea on Sunday as a “gimmick…you eventually have to reverse,” speaking on NBC’s Meet the Press. (More on Summers’ suggestions below.)

President Biden chastised the oil industry for making “well above normal” profit margins during a “time of war” and requested solutions to the ongoing oil refining crisis. “I am prepared to use all tools at my disposal, as appropriate, to address barriers to providing Americans affordable, secure energy supply,” he wrote. “The crunch that families are facing deserves immediate action. Your companies need to work with my administration to bring forward concrete, near-term solutions that address the crisis and respect the critical equities of energy workers and fence-line communities.” Biden is not only looking for help from the domestic oil industry but has confirmed a trip to once dubbed “pariah” Saudi Arabia next month to urge more production.

ExxonMobil was among the seven refiners to receive the letter from the president and was quick to outline some solutions to the fuel crunch. “In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions —such as waivers of Jones Act provisions and some fuel specifications to increase supplies. Longer-term, the government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines.”

Energy Secretary Jennifer Granholm will host an emergency meeting with refining executives this week, where she is expected to “discuss steps companies can take to increase refining capacity and output and reduce gas prices in the near-term,” an agency spokesperson told Reuters, with sources saying the meeting will take place on Thursday.

White House hits major speed bump on possible announcement of gas rebate cards: chip shortage. As the Biden administration was brainstorming ways to aid Americans at the gas pump, it considered sending out rebate cards to Americans. But there aren’t enough computer chips to make cards in the volume required, so the White House scrapped that plan a few months ago, according to the Washington Post (link). It’s apparently taking a second look now. But critics say the idea could backfire by further pushing up prices by adding to consumer demand.

Meanwhile, White House officials have urged governors to lower or waive their gas taxes. But a renewed push by Virginia GOP Gov. Glenn Youngkin to implement a gas tax holiday has come up against Democratic opposition at the state level that is far different from Democrats at the national level. Youngkin tried to push through the three-month tax suspension with a budget amendment, but it was defeated 21-18 in the state senate Friday night. “Taxes virtually have nothing to do with the price of gasoline,” Senate Majority Leader Richard Saslaw said. Democrats argued that it’s about supply and demand, and the tax break would not save Virginians much, but would instead really benefit out-of-state drivers and oil companies. They also said that the tax would hurt state transportation projects that rely on the tax revenue.

Former Treasury Secretary Larry Summers on how to address inflation, on NBC’s Meet the Press: “If at long last we can have some kind of bipartisan budget bill with three elements, with reduction of pharmaceutical prices which will help health care and will also reduce the inflation rate. That’s within our reach if we just use the government’s large purchasing power through Medicare, number one.

“Number two, put in place the partial repeal, not the full repeal, but the partial repeal of the Trump tax cuts, which would take some demand out of the economy, increase confidence and reduce pressure on the Fed.

And number three, an all-in more energy supply approach that emphasizes freeing up fossil fuels in various ways in the short run and making, with government support, the ultimate pivot to renewables.

“All of that would take pressure off the Fed, would bring down the inflation rate, would operate to restore confidence, and would I think be a very positive contribution. And I’m not privy to all the discussions and negotiations that are going on in Washington, but surely the most important thing for any public-spirited people is to try to find a deal along those lines.”

Federal Reserve Chair Jerome Powell will testify in the “The Semiannual Monetary Policy Report to Congress” hearing at the Senate Banking Committee on Wednesday (link), and again on Thursday morning in the House Financial Services Committee hearing (link) on “Monetary Policy and the State of the Economy.”

Cattle measures likely to get Senate Ag panel votes. Up for expected tallies Wednesday are S 3870, the Meat and Poultry Special Investigator Act of 2022 and S 4030, the Cattle Price Discovery and Transparency Act of 2022. Both bills are expected to clear the panel, but with some expected Republican opposition. It is unclear if the measure will have at least 60 votes on the full Senate floor to get halt any debate. It will be interesting to see the Congressional Budget Office (CBO) cost estimates if the measured reach Senate floor debate. The bills enjoy support, however, from key farm state Republicans such as Sen. Deb Fischer (R-Neb.) and Sen. Chuck Grassley (R-Iowa). “I don’t intend to stop until these bills become law,” Grassley has stated. Sen. John Boozman (R-Ark.), ranking member on the Senate Ag Committee is “opposed to both and yet each individual senator, depending on their states, is going to have to decide how they’re going to vote. When you get into agriculture, it’s not Democrats and Republicans. It’s more areas of the country and the particular product or the particular commodity” that determines a lawmaker’s actions, Boozman said.

The Cattle Price Discovery and Transparency Act includes several reforms aimed at improving transparency and price discovery in cattle markets. It would establish a cattle contract library and require the USDA secretary to set a minimum threshold for negotiated trade volumes. Sen. Boozman, whose state is home to Tyson Foods’ headquarters, said that he can’t support the bill, citing problems with the mandatory cash minimums proposed. Boozman has cited studies indicating that the measure could impose costs on producers, the very people its supporters say it aims to help. One analysis he brought up cited burdens on producers in the Southern Plains region. Boozman previously said he had spoken to lawmakers from states that could be affected, including Oklahoma and Texas. “I think there’s real concern that this bill picks winners and losers and certainly that part of the country would be dramatically affected,” he said.

The Meat and Poultry Special Investigator Act would create a new USDA office dedicated to enforcing competition rules under the Packers and Stockyards Act. Sen. Boozman also opposes Sen. Jon Tester’s (D-Mont.) special investigator bill (S 3870). But Tester’s special investigator bill has the backing of Minority Whip John Thune (R-S.D.). Boozman said a special investigator’s powers could affect not only major processors but also increase regulatory costs for smaller operators. The larger operations could adjust to new requirements, but “the smaller ones will be at a competitive disadvantage,” he said. “There will be compliance costs. It was sold as we’re going to go after the Big Four and that’s not the case.” Boozman said if the existing agencies and departments responsible for policing markets are not doing their jobs, “then let’s hold hearings and let’s get after them.” He said he doesn’t know if he will offer amendments to either bill at the June 22 markup.

Next farm bill events include:

Wednesday, June 22:

  • House Agriculture Committee hearing on dairy programs (link).

Saturday, June 25:

  • House Ag Committee will have a regional listening session (link) in College, Arizona, hosted by Rep. Tom O’Halleran (D-Ariz.) and chaired by House Agriculture General Farm Commodities and Risk Management Subcommittee Chairwoman Cheri Bustos (D-Ill.).

House appropriations markups. Focus will be on amendments during full Appropriations Committee action. Also, some initial hefty increasing in funding will very likely be scaled back by several panels.

Tuesday, June 21:

  • House Interior-Environment Appropriations Subcommittee meeting considers fiscal year (FY) 2023 spending bill (link).
  • House Energy-Water Appropriations Subcommittee FY 2023 spending bill (link).

Wednesday, June 22:

  • House State-Foreign Operations Appropriations Subcommittee FY 2023 spending bill (link).
  • House Commerce-Justice-Science Appropriations Subcommittee FY 2023 spending bill (link).

Thursday, June 23:

  • House Appropriations Committee FY 2023 Agriculture spending bill (link).
    • The subcommittee markup last Wednesday moved quickly with no amendments offered or considered. A report accompanying the bill includes 134 projects of congressionally directed spending, or earmarks, with $192 million in funding.
    • The proposed discretionary funding of $27.2 billion is $2.1 billion more than the fiscal 2022 enacted level. The bill would provide $195 billion in total discretionary and mandatory funding.
    • The spending bill would provide $3.1 billion for farm and conservation programs, including $61 million to resolve murky land titles or ownership questions that result from heirs’ property, a major challenge for many Black farmers who inherited land that has no documentation through a will or deed.
    • Mandatory funding for the Supplemental Nutrition Assistance Program, formerly known as the food stamp program, would be $111.2 billion for fiscal 2023 with “such sums” funding language for the fourth quarter of fiscal 2023 to assure that the program for low-income individuals and families does not run out of money.
    • $1.8 billion for Food for Peace II grants, an increase from $1.7 billion in fiscal 2022. $265 million for The McGovern-Dole International Food for Education and Child Nutrition program that provides school meals to children in developing countries.
    • Republicans on the House Ag Approps Subcommittee criticized the bill for its price tag, particularly relative to nutrition programs. Subcommittee Ranking Republican Member Dr. Andy Harris (R-Md.) also criticized the Biden administration for reports it is considering using the Commodity Credit Corporation (CCC) to pay for unrestricted free school lunches if Republicans block the extension of pandemic-related school meal funding. (Vilsack notified certain committees he would tap $1 billion from the CCC for school meals.) “My concern is that the USDA is using the CCC as a slush fund to circumvent congressional decisions and fund activities that have not been authorized. This is not the purpose of CCC authorities and funding,” Harris said, adding he would be watching what USDA Secretary Vilsack does and that it may be “time to reconsider” the CCC authority. Harris will chair the panel in the next Congress if Republicans regain control of the chamber.
    • Link to House Agriculture Appropriations Subcommittee markup.
  • House Transportation-HUD Appropriations Subcommittee FY 2023 spending bill (link).
  • House Labor-HHS Appropriations Subcommittee FY23 spending bill (link).

Friday, June 24

  • House Appropriations Committee FY 2023 Homeland Security, Financial Services and General Government spending bills (link).

Senate Finance Chair Ron Wyden expects to mark up new bipartisan retirement savings legislation this week (link). Wyden released an outline of the proposal on Friday (link).

A hard-to-get final agreement on a Senate bipartisan gun violence package faces additional hurdles. One issue being drafted in the Senate has become how states can use grant money in that package. The framework released called for grant money to help states implement “red flag” laws, which allow law enforcement and family members to petition courts to temporarily remove firearms from people who show signs of becoming dangerous to themselves or others. But Sen. John Cornyn (R-Texas) says states that don’t have red flag laws — and don’t want them — should be able to access the funding for other purposes like assisted outpatient treatment, which is a court-ordered treatment for those who have a history of not adhering with mental health treatment.

Another WOTUS roundtable. EPA and the Army Corps of Engineers on Tuesday will hold a virtual Northeast-focused roundtable on the Waters of the U.S. (WOTUS) rule.

Other events of note include:

  • Tuesday primaries: This week, there are primary elections in Virginia and the District of Columbia and primary runoffs in Alabama and Georgia.
  • The House select committee investigating the Jan. 6, 2021, Capitol riot will hold its fourth hearing Tuesday. Additional hearings are scheduled for later in the week.
  • Securities and Exchange Commission Chair Gary Gensler will give the keynote address at the Society for Corporate Governance Conference on Wednesday.
  • Commodity Futures Trading Commission (CFTC) Commissioner Kristin N. Johnson and former Securities Exchange Commission Chairman Jay Clayton will participate on a panel at the Goldman Sachs Summer Digital Asset Conference Wednesday. Johnson will also give the keynote address at the 2022 CCP12 Annual General Meeting in Madrid, available via livecast.
  • CFTC Commissioner Summer K. Mersinger will deliver a keynote address at the 2022 FIA Commodities Forum on Wednesday.
  • On Thursday, House Agriculture Committee hearing on “The Future of Digital Asset Regulation.” Link


Economic Reports and Events for the Week


Existing-home sales have been slipping for the past three months and data set for release Tuesday morning, is expected to show another decline. Economists expect a 3.6% decline. The housing market could be one of the first sectors of the economy to be significantly affected by the Federal Reserve’s aggressive interest-rate increases. Housing data could signal how severe the downturn will be and whether it could spill over into the rest of the economy.

Tuesday, June 21

  • Federal Reserve Bank of Chicago releases its National Activity Index for May. Consensus estimate is for a 0.41 reading, a bit lower than April’s 0.47. The index has had a positive reading every month since September of last year, which correlates with the economy expanding at a faster clip than its historical average.
  • National Association of Realtors reports existing-home sales for May. Economists forecast a seasonally adjusted annual rate of 5.37 million homes sold, 240,000 fewer than in April. The April figure was the lowest since June of 2020, as record-high home prices, and the steepest 30-year fixed mortgage rates since 2008, have sharply curtailed home sales.
  • Federal Reserve speakers: Thomas Barkin speaks twice.

Wednesday, June 22

  • MBA Mortgage Applications
  • Mortgage Bankers Association releases its weekly applications survey, a leading indicator of housing and mortgage financing activity, for the week ending on June 17. The index recently hit a 22-year low as refinancing demand plummeted as much as 75% year over year.
  • Federal Reserve speakers: Jerome Powell | Charles Evans | Patrick Harker | Thomas Barkin

Thursday, June 23

  • Jobless Claims: Initial claims for unemployment, a proxy for layoffs, are one of the earliest indications of trouble in the labor market. Claims have been slowly ticking up since March, although they remain at a historically low level. Economists expect initial claims to fall slightly to 225,000 for the week ended June 18. Claims have averaged 218,500 over the past four weeks, roughly equal to prepandemic levels after hitting a 54-year low in March. This, along with announced layoffs in the tech and housing sectors, suggest that a historically strong labor market is weakening.
  • S&P Global releases both its Manufacturing and Services Purchasing Managers’ Indexes for June. Expectations are for a 56.3 reading for the Manufacturing PMI and a 54 reading for the Services PMI. This compares with 57 and 53.4, respectively, in May.
  • Current Account
  • Fed Balance Sheet
  • Money Supply
  • Federal Reserve speaker: Jerome Powell

Friday, June 24

  • Census Bureau reports new residential sales data for May. Consensus estimate is for sales of new single-family homes to hit a seasonally adjusted annual rate of 590,000, about even with the April figure. New-home sales, which make up about 10% of the housing market, are down more than 40% from the post-financial-crisis peak reached in August 2020.
  • Consumer Sentiment: An initial reading of June consumer sentiment hit 50.2, its lowest level ever recorded, as households grappled with rising gas prices and inflation. Economists don’t expect that dismal number to change in the final reading.

Key USDA & international Ag & Energy Reports and Events


Weather forecasts and actual weather tallies (heat/rain) are now the major ag market focus as attention turns to new-crop conditions and supplies ahead. Thursday brings the International Grains Council’s monthly report. USDA on Friday reports its latest food price outlook where the trend has clearly been higher.

Monday, June 20

  • Federal Holiday for Juneteenth observed.

Tuesday, June 21

Ag reports and events:

  • Grain export inspections
  • Crop Progress
  • Fruit and Tree Nuts Data
  • Vegetables and Pulses Data
  • Milk Production
  • European Food Safety Authority’s One Conference on food safety, Brussels and online, June 21-24
  • EU weekly grain, oilseed import and export data

Energy reports and events:

  • API weekly U.S. oil inventory report

Wednesday, June 22

Ag reports and events:

  • Broiler Hatchery
  • Cost-of-Production Forecast
  • The Food and Nutrition Assistance Landscape: Fiscal Year 2021 Annual Report

Energy reports and events:

  • Genscape weekly crude inventory report for Europe’s ARA region
  • JPMorgan energy, power & renewables conference in New York

Thursday, June 23

Ag reports and events:

  • Coffee: World Markets and Trade
  • Chickens and Eggs
  • Cold Storage
  • Livestock Slaughter
  • International Grains Council’s monthly report

Energy reports and events:

  • EIA natural gas storage change
  • EIA weekly U.S. oil inventory report
  • U.S. weekly ethanol inventories
  • Insights Global weekly oil product inventories in Europe’s ARA region
  • Energy Secretary Granholm expected to meet with oil refining industry officials

Friday, June 24

Ag reports and events:

  • Weekly Export Sales
  • CFTC Commitments of Traders report
  • Peanut Prices
  • Food Price Outlook
  • Cattle on Feed
  • Poultry Slaughter
  • FranceAgriMer weekly update on crop conditions
  • Brazil’s Unica to release cane crush and sugar output data (tentative)
  • Holiday: New Zealand

Energy reports and events:

  • Baker Hughes weekly U.S. oil/gas rig counts
  • Holiday: Venezuela