Here’s a brief update on ag issues around the world.
United States In early August, the Environmental Protection Agency lowered the amount of renewable fuel refiners are required to blend into the nation’s gasoline supply this year, cutting the cellulosic component by 99.4%. The announcement reignited the debate in Washington, D.C. "This obliterates big oil’s myth that the renewable fuel standard is inflexible and unworkable," says Bob Dinneen, Renewable Fuels Association president and CEO.
China The People’s Republic of China is in talks with Venezuela about an investment partnership; however, it’s not a done deal. The country has more than 74 million acres of prime land with great potential for ag, says Venezuela’s Vice President Jorge Arreaza. With 20% of the global population and only 7% of arable land, China continues to look for partnerships to ensure a viable supply of food.
Brazil The U.S. lost a case at the World Trade Organization on cotton subsidies. Now, we’re paying Brazil $147 million per year to keep them from seeking around $800 million in retaliation. USDA Secretary Tom Vilsack recently told Brazilians the spending reductions caused by the sequester will halve the September payment and that he has no authority to make the cotton payments after Oct. 1 due to the expiration of the one-year farm bill extension. Vilsack did not mention that he can tap the Commodity Credit Corporation Charter Act to pay the money owed.
European Union Cattlemen and women producing high-quality beef without synthetic hormones will continue to have access to the EU market at zero duty, according to an announcement by U.S. Trade Representative Michael Froman and Secretary of Agriculture Tom Vilsack. The U.S. and EU plan to extend Phase 2 of the Memorandum of Understanding (MOU) signed in 2009 for two years. The MOU is about the importation of beef from animals treated with certain growth-promoting hormones.
New Zealand Milk safety problems shook New Zealand markets at the beginning of August. Fonterra’s Global Dairy Trade Price Index declined 2.4% after Clostridium botulinum had been detected in some of its whey protein concentrate that had been shipped to China, points out Dairy Today’s Jim Dickrell. China, Russia, Hong Kong and Sri Lanka banned some dairy products from New Zealand. Because dairy exports account for roughly half of the country’s export earnings, the New Zealand dollar dipped slightly.