The end of an even-numbered year means it is a busy time on Capitol Hill, as the biennial “lame duck” session of Congress tries to wrap up legislative activities before newly elected lawmakers take office in January. NFU is making a push to get some Fairness for Farmers legislation (Cattle Price Discovery and Transparency Act and Meat and Poultry Special Investigator Act) across the finish line, as well as reforms to ag workforce and providing for year-round E15 sales.
The Biden-Harris Administration has also taken several notable actions over the last month – the Federal Trade Commission (FTC) asserted its intent to broaden its scrutiny of anticompetitive practices and the Environmental Protection Agency (EPA) released ethanol blending requirements for calendar years 2023-2025.
CONGRESS AVERTS RAIL STRIKE
On September 15, the Biden Administration facilitated a tentative agreement between the nation’s freight rail companies and the major railroad worker unions, which was believed would be enough to avoid a strike from rail workers. The deal was announced the day after Farmers Union members met with White House staff to discuss the devastating effects a rail strike could have on farmers, the food supply chain, and the economy altogether – it was estimated a rail strike could cost the U.S. economy roughly $2 billion/day.
The agreement increased worker wages by 24 percent over five years, dating back to 2020, capped worker health insurance premiums, and provided workers the right to take unpaid time off without penalty – key word, “unpaid.” When the agreement went before each union’s membership over the next several months, four of the groups rejected the tentative agreement – the sticking point being the lack of paid sick leave. The other eight unions whose members voted to ratify announced they would not cross picket lines, meaning the strike was imminent.
Congress gave itself authority to end rail strikes back in the early 20th century, and as the December 9 deadline approached, calls grew for Congress to intervene. On December 1, the U.S. House voted to ratify the tentative agreement (which makes a strike unlawful), but immediately followed up with an amendment to provide rail workers with seven days of paid sick leave. This additional provision passed the House largely along party lines, with all Democrats and three Republicans voting in favor.
The Senate acted the following day on the tentative agreement, which passed by a wide margin. The Senate also considered the paid sick leave amendment from the House, but it did not receive the 60 favorable votes needed to break the filibuster. President Biden signed the agreement shortly thereafter.
NFU OPPOSES KROGER-ALBERTSONS MEGRER; URGES FTC TO BLOCK ACTION
In October, two grocery giants – Kroger and Albertsons – announced they had reached a deal to merge, with Kroger acquiring all outstanding shares of Albertsons. The combined enterprise’s total value is estimated to be approximately $25 billion. This action represents another disturbing example of corporate consolidation in America’s food supply chain.
NFU joined a coalition letter to FTC Chair Lina Khan urging the FTC to block the merger. NFU, and our coalition partners, share deep concerns about the impacts the acquisition could have on America’s producers, retail workers, and consumers. Should the deal be allowed to proceed, it would lead to the creation of a grocery empire to rival only Walmart, providing enormous amounts of market power to just two companies. This acquisition will result in reduced market access and consumer buying power, reduced bargaining power for labor and lower wages, the driving out of independent grocers, and the continued lowering of the farmers’ and workers’ share of the food dollar, at a time when corporations are enjoying record profits.
The deal has already faced significant legal scrutiny which is expected to intensify as the merger approval process commences. On November 10, the FTC released a major policy statement renewing its commitment to fully enforce against “unfair methods of competition” under Section 5 of the FTC Act. The FTC’s statement reflects a broader and more sweeping understanding of “unfair methods of competition” under Section 5 than the agency’s prior understanding.
The statement clarifies “that Section 5 reaches beyond the Sherman and Clayton Acts to encompass various types of unfair conduct that tend to negatively affect competitive conditions.” In short, Section 5 of the FTC act extends even further than the major antitrust laws to address issues that can result in anti-competitive harm.
The policy statement affirms a significant shift in emphasis and direction at the agency, and NFU is pleased to see the FTC taking a macro-level approach to protecting competition in the economy, and we hope to see the agency act upon this policy when examining the Kroger-Albertsons acquisition.
BIOFUELS SPOTLIGHT: RFS OBLIGATIONS, CANOLA APPROVAL, YEAR-ROUND E15
The first week of December was a busy one for biofuels in Washington, with several legislative and regulatory developments that will have major implications for biofuel production for years to come. On December 1, the EPA announced their updated renewable volume obligations (RVOs) for the Renewable Fuel Standard (RFS), which will raise RVOs for ethanol blends for the 2023, 2024, and 2025 reporting years.
On the same day, the EPA also released a final rule to approve RFS pathways for canola oil for renewable diesel, jet fuel naphtha, liquified petroleum gas, and heating oil. NFU and state divisions have been working diligently to help develop a pathway for canola to be used as a feedstock for biodiesel. Canola is mostly grown in the northern Great Plains but can be grown as a spring or winter crop throughout the United States, including in the Pacific Northwest, the southern Great Plains, and in the Southeast. Canola production in the U.S. can be increased without land use impacts, as farmers continue to improve yields and can grow canola as a rotational crop, which increases crop diversity, improves soil health, and can serve as weed management.
Back in April, the EPA published a proposed rule to create the canola oil fuel pathways, which finds that the fuel pathways meet the lifecycle greenhouse gas (GHG) emissions reduction threshold of 50 percent required to generate advanced biofuels and biomass-based diesel (BBD) under the RFS. The EPA has finalized this proposal into the final rule for canola/rapeseed oil production via a hydrotreating process. This final rule announcement is further evidence the Biden-Harris Administration is committed to promoting biofuel production, which protects the environment, raises farmers’ bottom line, and reduces prices at the fuel pump. The enactment of this rule will result in greater market opportunities and much-needed regulatory certainty for farmers.
Over on Capitol Hill, NFU has been busy working with a diverse group of renewable fuel and petroleum organizations to urge Congress to provide a legislative fix that would apply the same fuel volatility limits to all conventional gasoline blends. On November 29, Sen. Deb Fischer (R-NE), introduced the Consumer and Fuel Retailer Choice Act of 2022, with 14 cosponsors. The legislation will enable the year-round, nationwide sale of E15 and permanently extend the Reid vapor pressure (RVP) volatility waiver to ethanol blends above 10 percent, providing nationwide uniformity across U.S. fuel markets. While chances of passage during lame duck are slim, Sen. Chuck Grassley (R-IA, a cosponsor) recently suggested the new Congress could take up the legislation if this Congress does not.
NFU strongly supports efforts to expand production and sale of E15, while noting use of higher-level blends of ethanol, like E30, would add additional benefits to the economy, the environment, and America’s farmers.