Newhouse, Pingree Introduce Legislation to Support Agriculture Export and Trade
WASHINGTON D.C. – Rep. Dan Newhouse (R-WA) and Rep. Chellie Pingree (D-ME) introduced H.R. 2321, the Cultivating Revitalization by Expanding American Agricultural Trade and Exports (CREAATE) Act. The CREAATE Act would reassert the importance of the U.S. Department of Agriculture's Market Access Program (MAP) and Foreign Market Development Program (FMDP) to America's agricultural producers and economy as a whole, and provide the U.S. agricultural community with the tools needed to retain its edge in an increasingly competitive global economy. The CREAATE Act would double funding for MAP and FMDP, incrementally phasing in increases over five years. This increase, while a fractional portion of the USADA and the federal budget, will provide an enormous return on investment for America's agricultural community and the U.S. economy as a whole.
"As a former state director of agriculture, I understand what it takes to market and sell American products to international buyers," said Rep. Newhouse. "Agriculture market development programs are critical tools to assist domestic farmers and agriculture producers compete in overseas markets, and I look forward to strengthening export efforts on behalf of farmers and agriculture."
"Wild blueberries and potatoes are some of the most iconic agricultural products from Maine that enter the world market," said Rep. Pingree. "The Market Access Program and the Foreign Market Development Program at USDA have been extremely successful in helping farmers maintain export markets for products such as these. Increased funding for these two programs would provide vital support to growers of these products and others that want to reach new markets abroad."
Reps. Newhouse and Pingree were joined in introducing the CREAATE Act by Reps. Cheri Bustos (D-IL), Roger Marshall (R-KS), Jimmy Panetta (D-CA), and Thomas Rooney (R-FL).
Background:
For decades, USDA export promotion programs have helped American farmers create, expand, and maintain access to foreign markets. Throughout their history, this successful public/private partnership have cultivated hundreds of billions of dollars in exports and created millions of American jobs, both in the agriculture sector and in support industries. Without these programs, it is very likely that the United States would not be the net agricultural exporter that we are today.
Two of the most impactful USDA export promotion programs are the Market Access Program (MAP) and the Foreign Market Development Program (FMDP). MAP, first created in 1985, allows agricultural trade associations, farmer cooperatives, non-profit trade groups, and small businesses to apply for either generic or brand-specific promotion funds supporting trade shows, market research, consumer product promotion, technical assistance, and other efforts vital to supporting export efforts. If generic commodity funds are sought, there is a 10-percent minimum funding match; the match is at least 50-percent for brand-specific efforts.
FMDP was first developed in 1955 and is also used for consumer promotion, technical assistance, market research, and other export-oriented activities. FMDP is largely used for promotion of generic, bulk commodities, and it helps agricultural trade associations maintain a permanent presence in consumer nations so that these commodities have full-time representation in important markets. FMDP also carries a fund match requirement.
Benefits: A 2016 study of USDA export promotion programs conducted by researchers at Texas A&M University and other universities found many benefits to the programs. A few of the findings include:
- Between 1977 and 2014, USDA export promotion programs have generated a net return of $28.30 for every dollar invested, and have added an annual average of $8.15 billion to the value of American agricultural exports, and $8.7 billion to farm cash receipts;
- Between 2002 and 2014, USDA export promotion programs have added up to 239,800 full and part-time jobs across the economy under a less than full employment scenario; and
- Doubling public funding for MAP and FMDP, coupled with increasing private contributions from 10 to 50 percent, would result in average annual gains in GDP of $4.5 to $6.0 billion under a less than full employment scenario.
The Problem: Statutory funding for MAP and FMDP has been static the 2002 Farm Bill. Practically, those funds have been eroded in recent years by inflation, administrative costs, and sequestration. The programs have only been sustained through support and resolve from the private sector partners, whose contributions have grown to 70 percent of available funds in 2014, a level that far exceeds program requirements.
Meanwhile, America's competitors have ramped up their own export promotion. For example, the European Union spends more for the promotion of wine ($255.36 million for 2017) than the U.S. spends for the promotion of all commodities through MAP and FMDP. If this trend continues, American producers will be severely disadvantaged in the global marketplace.