Congress Passes Massive COVID-19 Response Bill with Relief for Livestock Producers
Today, the House of Representatives passed by voice vote – following the Senate’s unanimous passage late on Wednesday evening – the Coronavirus Aid, Relief, and Economic Security Act. While this relief bill is massive – touching nearly every aspect of American business – for America’s sheep producers there were critical components.
While the bill fell short of the American Sheep Industry Association’s request to increase the Commodity Credit Corporation by $20 billion, the bill did replenish $14 billion in funding to stabilize and support farm income and prices. In addition, $9.5 billion in funding was directed to be used for livestock and specialty crops.
Since the initial wool market disruptions in September 2018, ASI has been working with the U.S. Department of Agriculture to include wool and sheepskins under USDA relief programs. The department chose to commit purchases of $17 million in lamb meat for donation and on Feb. 19 announced lamb shanks would be considered for a solicitation of companies. With the loss of foodservice accounts for lamb, the association is encouraging urgent and aggressive use of the purchase funds.
With the additional funding directed toward livestock producers headed to President Donald J. Trump’s desk, ASI is continuing to work with USDA to develop a program for direct relief to sheep producers for losses not only to wool and sheepskins, but also to lamb prices. Given the passage of assistance for livestock specifically, ASI is optimistic about this process. As food service sales account for more than half the value of American lamb, this loss is creating dramatic changes in distribution already. Additionally, one of the largest lamb companies filed for bankruptcy shortly after food service orders were cancelled this month. As the industry heads into the period of highest American lamb consumption – Easter – this impact will only rise for our industry.
The American Lamb Board has shared additional fallout, including the lack of sales in markets around the country as smaller lamb processing facilities realize the loss of their foodservice relationships with some entirely dedicated to restaurants and foodservice. Voluntary price reporting by USDA is contracting at sale barns and objective measurement of wool is absent again due to the world-wide pandemic.
In addition, ASI continues to work with various federal agencies to ensure needed flexibility as the industry produces food and fiber for a nation in need. USDA and the Department of State are working together to continue processing H-2A cases as much as possible, as permitted by resources and government restrictions.
On the federal lands front, ASI and the Public Lands Council have been assured by both the U.S. Forest Service and the Bureau of Land Management that they have taken steps to ensure on time turnout. ASI has also requested specific flexibility to run greater band numbers to respond to a lack of H-2A guest herders, which has been specifically included in grazing management recommendations issues to regional foresters by the service.
Additionally, the Department of Transportation has released a series of waivers under its emergency declaration. This action includes waivers to Hours of Service for agriculture, including livestock, feed and fertilizer to ensure a steady stream of commerce. Many states have also relaxed state regulations on CDL, driving hours and truck weight requirements for livestock and agricultural products.
The key takeaway is that there is a tremendous appetite to ensure flexibility for sheep producers, from federal lands grazing, production and transportation. If you experience a challenge to federal lands grazing, federal transportation requirements or other federal issues, please reach out to the ASI office.
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Catch Up on Let’s Grow Webinars, ASI Resources
If you’ve got some free time on your hands in the next few weeks or if you’re looking to supplement your children’s education while they are out of school, consider watching archived versions of the 32 Let’s Grow-sponsored webinars.
Maybe you missed that one on the Seasonality of the American Lamb Industry or the most recent one on Artificial Lamb Rearing: Transitioning from Nuisance to Potential Profit Center. They’re all free and available online, complete with video and pdf copies of the presentation slides.
Click Here for the full list of webinars.
In fact, the Let’s Grow Program offers a treasure trove of sheep producer resources that you might usually be too busy to sort through. Now would be the perfect time to take a look.
Click Here for more Let’s Grow Resources.
Click Here for past issues of the Sheep Industry News if you’re looking for additional reading materials. Click on the three bars in the upper left-hand corner and choose Archive for issues dating back to May 2018.
Click Here for Sheep Industry News issues dating from April 2018 to October 2011.
NZWTA Lab Temporarily Closed
The New Zealand Wool Testing Authority Laboratory was closed on Wednesday as a result of the ongoing COVID-19 outbreak. The temporary closure is scheduled to last at least four weeks after the New Zealand government closed all non-essential business services.
The American wool industry had planned to use the NZWTA Lab for spring 2020 wool testing while a new commercial lab at Texas A&M University AgriLife in San Angelo, Texas, is developed to take over in 2021.
While the closure means it will be difficult to get American wool commercially tested in the near term, there may not be an immediate need to test wool due to so many uncertainties with the COVID-19 outbreak and the softer wool market. Although shearing season is officially underway in the United States, there has not been much activity to sell American wool. The Australian wool market has seen consistent losses in recent weeks – although it was up slightly this week. Commercial testing is especially important for exported wool, but there isn’t much wool being exported at this time.
In addition, many American wool warehouses have committed to continuing to take and prepare wool for when testing resumes in a month. Once the lab reopens, testing on submitted wool samples should be completed within a few days after the wool sample is received in New Zealand.
Australian Wool Market Sees Small Gains
After three weeks of consecutive losses, the Australian wool market steadied this week and managed to record small increases overall.
An industry working group has been meeting daily to try to minimize the impact of COVID-19 on the Australian wool industry. One of the recommendations to come from this group is to move wool auctions from enclosed rooms into more open-air environments in an effort to adhere to the strict social distancing rules dictated by the government.
This week, the auction rooms in Melbourne and Fremantle moved into open space made available on the show floors. Sydney will follow suit for the upcoming sale. Another COVID-19 driven decision made this week by the National Auction Selling Committee was to schedule a wool sale in Week 42 – which was an Easter recess – to maximize the amount of wool that can be traded before a potential shutdown.
Due to concerns over the possible disruption to supply, buyers were keen to take ownership of wool while they could. Main buyer focus was on the finer microns, pushing prices higher. The individual Micron Price Guides for 18.0 micron and finer rose by 6 to 39 cents across the country. The broader microns did not garner the same support. As a result, the MPGs for 21 micron and coarser fell by 23 to 26 cents for the series. The gains in the finer microns were enough to push the AWEX Eastern Market Indicator higher by 4 cents for the week to close at 1,442 Australian cents.
Worth noting, due to currency movement, when viewed in USD terms the gains were more considerable. The EMI rose by 53 USc for the series. Next week’s sale is slightly larger, as sellers scramble to get their wool to auction. Currently, there are 45,810 bales on offer in Sydney, Melbourne and Fremantle.
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