U.S. manufacturers appear to be racing the clock before the Trump administration tightens economic relations between the U.S. and Cuba. Over the last week, both John Deere and Caterpillar announced agreements with the Cuban government that might let the two Illinois-based companies sell farm tractors and other heavy equipment on the island. The occasion for this rush of activity was the annual Havana International Fair, Cuba’s largest commercial fair. Focus of the event is the Mariel Special Development Zone, a container ship facility near Havana and center of Cuba’s import/export businesses.In June, President Donald Trump announced that he was “cancelling the last administration’s completely one-sided deal with Cuba.” He did not give specifics, but administration officials said details would follow within 90 days. Those details have not been made public yet. With that in mind, Deere announced it would send 5000 Series tractors (between 75-115 horsepower) to Cuba this month. “This equipment is for testing and appraisal to ensure it will work with specific Cuban agricultural conditions and farming practices,” said Deere spokesman Ken Golden. A report in Manufacturer News quotes Golden as saying Deere would send “several hundred tractors and associated implements” over a four-year period.
The U.S. Food and Drug Administration is withdrawing draft Guidance for Industry (GFI) #230, “Compounding Animal Drugs from Bulk Drug Substances” in order to clarify that the agency does not plan to finalize the current draft, but instead intends to issue a new draft for public comment next year. The draft guidance issued in May 2015 proposed conditions under which the FDA generally would not intend to take action against the compounding of animal drugs from bulk drug substances, with the goal of making such animal drugs available for patient care without jeopardizing the safety of animals and humans or compromising the animal drug approval process.Current law does not permit compounding of animal drugs from bulk drug substances, but the FDA recognizes that there are circumstances where there is no approved drug that can be used or modified through compounding to treat a particular animal with a particular condition. In those limited situations, an animal drug compounded from bulk drug substances may be an appropriate treatment option.After reviewing the comments submitted to the docket, the FDA decided not to finalize the current draft guidance, and will instead develop and issue a new draft guidance. In developing the new draft, the FDA will carefully consider the issues that are specific to compounding of animal drugs, including the significance of using compounded drugs as a treatment option in various veterinary settings and animal species.
According to a new FDA report, 98% of domestic and 90% of imported foods tested in FY 2015 were compliant with federal pesticide residue limits. The report covers fiscal year 2015 (Oct. 1, 2014 through Sept. 30, 2015), during which the levels of pesticide chemical residues in or on food generally remained well below established federal tolerances, or EPA limits, the report states. Additionally, no pesticide chemical residues were found in 49.8% of the domestic and 56.8% of the imported human food samples analyzed. The agency found pesticide chemical residues in violation of federal tolerances (residue levels above the tolerance or residues for which no tolerance has been established) in less than 2.0% (15 out of 835) of domestic samples and less than 10% (444 out of 4737) of import samples.FDA also tested food intended for animals. No pesticide chemical residues were found in 51.6% of the 215 domestic animal food samples nor in 57.9% of the 202 imported animal food samples. Less than 3.0% (12 samples) of the animal food samples were found to contain violative pesticide chemical residues.
H.R. 1, the House tax bill, was publicly released last week. Of course, it’s getting a lot of attention for the rate changes for individuals and corporations and flow-through entities. However, there is an aspect that is getting relatively little focus – how the self-employment tax rules would change and impact leasing and entity structuring. Most farmers don’t like to pay self-employment tax, and utilize planning strategies to achieve that end. Such a strategy might include entity structuring, tailoring lease arrangements to avoid involvement in the activity under the lease, and equipment rentals, just to name a few. However, an examination of the text of the recently released tax bill, H.R. 1, reveals that self-employment tax planning strategy for farmers will change substantially if the bill becomes law. If enacted, many farmers would see an increase in their overall tax bill while others would get a tax break. In addition, existing business structures put in place to minimize the overall tax burden would likely need to be modified to achieve that same result.
Big Corn and Big Oil are taking their long-running fight over renewable fuels to Fox News in a bid for the attention of one of the network’s biggest fans -- President Donald Trump. Advocates of ethanol -- the corn-based fuel that is mixed with gasoline in the U.S. -- started running a television commercial Monday on Fox News using campaign footage of Trump pledging to support the government’s existing Renewable Fuel Standard and thanking the president for upholding his promise. Last week, the oil industry ran an advertisement on the Fox & Friends show saying that Trump is “caving to ethanol lobbyists” and putting thousands of manufacturing jobs at risk with his support for the program.Other industries are also banking on Fox News being the way to Trump’s heart. Fox News host and Trump friend Sean Hannity cut an ad last month advocating for the U.S. solar industry in a campaign against import tariffs.
The United States is now a party of one in its stance on climate change.Syria will join the Paris climate agreement, leaving the US as the only country in the world not signed on to the landmark climate deal.Syrian officials announced their intention to ratify the accord at the UN Climate Change Conference (COP23) in Bonn, Germany."I confirm that the Syrian Arab Republic supports the implementation of Paris climate change accord, in order to achieve the desired global goals and to reflect the principles of justice and shared responsibility, but in accordance with the capabilities of each of the signatories," Syria's Deputy Minister of Local Administration and Environment M. Wadah Katmawi said.Nicaragua was the only other hold-out, based on criticisms that it was "insufficient" in addressing climate change.However, the Central American country recently announced its intent to join the agreement.
The House Republican tax-reform bill would preserve interest expensing for most farmers and would phase out the estate tax, but some producers would lose a tax deduction that their cooperatives pass on to them. The bill also significantly expands immediate expensing and depreciation provisions that are in current law. However, tax experts say there are other provisions, including new rules for pass-through entities and self-employment taxes, that could offset some of the benefits. The bill’s focus is on slashing the corporate tax rate from 35 percent to 20 percent and on shrinking individual tax rates and simplifying the tax code. The impact of the bill on individual farmers will vary according to their situations. Most farms are pass-through businesses - sole proprietorships, partnerships and S corporations - that are taxed at individual rates. The top tax rate on some, but not all income, earned by pass-through businesses would be cut to 25 percent. Farmers currently pay an effective tax rate of about 15 percent, according to the Agriculture Department.
The GOP says its plan is an effort to “fix our broken tax code,” and there can be no doubt that the code is broken. Our fabulously wealthy nation is mysteriously plagued by poverty. More than 40 million Americans currently live in poverty, including 11.5 million children. Over 41 million people live in what the U.S. Department of Agriculture defines as “food insecure households.” Millions of Americans literally could not afford to eat at some point during 2016. Families living a little higher up the economic ladder generally have a tenuous hold on their middle-class status: 78 percent of U.S. households report living paycheck to paycheck.These economic troubles persist as Wall Street and Silicon Valley are increasingly dividing the spoils of the broader economy among themselves. The financial sector is supposed to function as a sort of utility for manufacturing, agriculture and other elements of what economists call the “real” economy. But today it accounts for nearly 30 percent of corporate profits — about triple its share from three decades ago. Since 2000, compensation in the financial sector has increased at nearly three times the overall rate in the economy. Apple, Amazon, Google and Facebook now mimic financial giants by acquiring tech startup after tech startup and then using their merged muscle to consume the profitable activity of others. Google and Facebook together take in 60 percent of the digital advertising market and collected 99 percent of all online ad revenue growth in the past year.The GOP tax plan won’t resolve any of those problems. Republicans have assembled a host of tax changes that will ensure that more and more of the nation’s wealth goes to the people who already have most of it. It’s a strategy to inflate existing fortunes, increase profits on Wall Street and enhance the social dominance of people who make their living from investments over people who make their living earning wages and salaries.
The pioneers of the sustainable farming movement are mourning what they call the downfall of the organic program, following a Wednesday night vote by a group of government farming advisers that could determine the future of the $50 billion organic industry. At issue was whether a booming generation of hydroponic, aquaponic and aeroponic farms — which grow plants in nutrients without using soil, frequently indoors — could continue to sell their produce under the “organic” label.In a series of narrow votes, an advisory board to the U.S. Department of Agriculture voted to allow the majority of these operators to remain a part of the organic program, dealing a blow to the movement's early leaders. Organic pioneers have argued that including hydroponic produce under the label has undermined the integrity of the program they fought decades to establish, and at a time when it is already under intense scrutiny. Some have said they will consider leaving the USDA-regulated program entirely.
By a vote of 8 to 7, the National Organic Standards Board on Nov. 1 rejected proposals to make hydroponic and aquaponic production methods prohibited under the U.S. Department of Agriculture’s National Organic Program.The board did vote to make aeroponics a prohibited practice by a vote of 14 in favor of the ban, with one member abstaining. That won’t have an impact on organic supply, Frankel said, as he understands there are no aeroponic operations currently certified as organic. Several firms researching aeroponic technology for organic production were waiting on the NOSB vote before attempting to become certified as organic, he said. “It is highly unlikely that people will continue to spend any more time, money or effort to figure out how to make those systems organic.