In the Perspectives guest blog series, Farm Foundation invites participants from among the varied Farm Foundation programs to share their unique viewpoint on a topic relevant to a Farm Foundation focus area.Dr. Sandro Steinbach, the 2024 Farm Foundation Agricultural Economics Fellow, and Claire Citeau, a distinguished fellow at the Canadian Agri-Food Policy Institute, contributed this guest blog. In July 2024, they attended the Global Forum on Farm Policy & Innovation‘s second workshop, held in Washington D.C. on the topic of measuring sustainability outcomes to facilitate agricultural trade. An in-depth paper summarizing the event’s key takeaways and next steps is also now available.
As climate pressures increase and sustainable practices become a priority, the agricultural sector faces a unique challenge: balancing trade policies with the need for sustainable farming. In July 2024, global experts gathered at the Global Forum for Farm Policy & Innovation (GFFPI) workshop in Washington, D.C., to tackle these pressing questions. Here, we highlight key takeaways from the workshop on aligning global trade with sustainable agriculture.
Why Integrating Sustainability into Trade Matters
Global agriculture is at a crossroads as countries strive to boost productivity and meet sustainability goals without causing unintended trade disruptions. Trade plays a vital role in food security, yet poorly coordinated policies can lead to barriers, especially as more nations adopt individual sustainability measures. To keep the agricultural sector competitive and resilient, there’s a growing need for a unified framework to guide trade and sustainability.
The Challenges of Harmonizing Trade with Sustainable Agriculture
Sustainable agriculture protects natural resources, maintains profitability, and supports community well-being. While the concept is widely understood, applying it consistently across countries and trade agreements takes time and effort. The workshop underscored that each country faces unique hurdles in integrating sustainable practices. For example, while some regions prioritize carbon reduction, others focus on reducing food insecurity or supporting local farmers. As a result, a “one-size-fits-all” approach to sustainable trade isn’t feasible.
What Role Can Trade Agreements Play?
Trade agreements hold the potential to foster sustainability, but they must be crafted carefully. Adding sustainability chapters focused on environmental and labor standards can help, as can voluntary incentive-based programs that encourage best practices without restricting farmers’ flexibility. Workshop participants agreed that trade policy can be a powerful tool, but only if it promotes shared goals while respecting local contexts.
Adopting an Outcome-Based Approach to Measure Sustainability
One key takeaway from the workshop was shifting from traditional, input-based sustainability measures (such as mandating specific farming practices) to outcome-based approaches. This shift allows farmers to adapt and innovate while focusing on measurable results like soil health, carbon sequestration, and biodiversity. Though more complex, outcome-based metrics can yield more meaningful insights and foster an environment where sustainable practices are both encouraged and achievable.
The Importance of Global Standards and Local Flexibility
Global standards are essential for assessing sustainability fairly across different countries. However, rigid frameworks may overlook local realities, particularly for smallholder farmers who face unique challenges. Workshop discussions emphasized the importance of balancing global standards and local flexibility to ensure sustainability goals are relevant and achievable worldwide. This balance is critical for creating trade policies that don’t stifle innovation or penalize farmers in resource-limited regions.
Supporting Sustainable Innovation in Agriculture
International trade enables innovation by allowing the transfer of knowledge, technology, and best practices. Golden Rice, an innovation born of global collaboration to address vitamin A deficiency, was one example discussed at the workshop. Cross-border cooperation accelerates such breakthroughs, underscoring the need for open markets that allow agricultural innovations to reach areas most needed.
Recommendations for Sustainable Trade
The workshop concluded with actionable steps for aligning trade and sustainability:
Adopt Flexible, Science-Based Policies: Avoid rigid policies and instead focus on outcome-oriented, science-based standards that allow flexibility for farmers to adopt practices locally.
Invest in Consistent Metrics and Data Management: Developing universally accepted metrics will make sustainability more transparent and achievable, especially with emerging technologies like remote sensing and real-time data tracking.
Strengthen Global Cooperation: Collaborating with institutions like the WTO and FAO can help establish frameworks integrating trade with sustainability. Global collaboration is essential to create cohesive, effective standards.
Position Sustainability as a Trade Opportunity: Rather than viewing sustainability as a trade barrier, policymakers should consider it a pathway to new markets and greater competitiveness.
Involve Farmers in Policy Development: Policies should reflect the realities on the ground, including the needs and challenges of farmers. Ensuring farmers’ participation in policy discussions helps craft practical and impactful solutions.
The Path to a Sustainable Agricultural Future
As agriculture faces mounting challenges, aligning trade with sustainable practices is essential. With thoughtful policies and collaborative efforts, global trade can support a more sustainable and food-secure world. The insights from the GFFPI workshop provide a strong foundation for future discussions, reminding us that trade policies should empower, not hinder, the transition to sustainable agriculture. With aligned policies and a shared commitment, the agricultural sector can advance toward a more resilient, sustainable future.
Claire Citeau is a distinguished fellow at the Canadian Agri-Food Policy Institute. She is also a senior fellow at the Graduate School of Public and International Affairs at the University of Ottawa. Sandro Steinbach is an associate professor in the Department of Agribusiness and Applied Economics and the director of the Center for Agricultural Policy and Trade Studies at North Dakota State University. They can be reached at cciteau@uottawa.ca and sandro.steinbach@ndsu.edu, respectively.
A new report from the Global Forum on Farm Policy & Innovation (GFFPI) highlights the complexities of balancing trade and sustainability objectives, emphasizing the pressing need to align trade rules with sustainability goals while avoiding unintended consequences.
The report, Policy and Practice for Sustainable Agriculture and Trade, is based on observations from the second workshop held by GFFPI, held in Washington D.C. in July 2024. The first workshop was hosted at the Organisation for Economic Co-operation and Development (OECD) in Paris in 2023 and focused on the ideal state of agriculture sustainability and trade.
The second workshop explored ways to integrate sustainability into global trade frameworks and develop standardized measurements to avoid unintended consequences. The workshop brought together over 70 participants representing 17 countries, including government officials, industry representatives, and trade policy experts. The discussions grappled with fundamental questions, including whose sustainability should be prioritized in trade agreements—the exporting country, the importing country, or global outcomes—and trade-offs between the environmental, social, and economic pillars of sustainability.
Key points identified in the report include:
Adopting an outcome-based approach to sustainability, starting with soil health, water, biodiversity and carbon measures as benchmarks.
Developing a Sustainable Agriculture Trade Framework with clear definitions, science-based standards and guiding principles.
Strengthening international cooperation to promote policy coherence GFFPI representatives were pleased to be able to further develop insights from the Paris workshop and push this important conversation forward.
“We are proud of and grateful for the global collaboration we have built over the last few years via GFFPI for respectful and evidence-based dialogue to elevate and advance possible pathways forward for agricultural trade and sustainability,” said Shari Rogge-Fidler, president and CEO of Farm Foundation.
Mark Titterington, co-founder and director of the Forum for the Future of Agriculture, agreed saying, “This is another strong contribution to the ongoing discussion on the role of trade policies in supporting the development of a more resilient and sustainable agri-food system. There is certainly a worthy case to consider for developing a global sustainable agriculture trade framework, underpinned by robust science, measurement and data, and which is outcome based. We were delighted to work with our partners in GFFPI in facilitating the discussion that led to this report and look forward to building on the key insights that emerged, also by bringing the European point of view and sensibilities to the discussion.”
The benefit of being able to share their specific point of view was shared by other GFFPI representatives. “As a trade-focused nation, Australian farmers know that our food-secure future depends on collaborative global action to meet shared goals,” said Katie McRobert, executive director of the Australian Farm Institute. “Trade can be a powerful lever to incentivize action on building natural, social, and economic capital in agricultural systems, provided that policies recognize unique local environmental and cultural contexts.”
When considering what comes next, the workshop highlighted the complex interplay between trade policy and agricultural sustainability and acknowledged there are many steps to make towards meaningful progress.
“The dialogue at the Washington workshop built on GFFPI’s past work, but underscored how much more work needs to be done to find solutions to the challenge of agriculture sustainability and trade,” said Tyler McCann, managing director of the Canadian Agri-Food Policy Institute. “This work needs to be done between countries and must include leaders in trade and sustainability to lead to meaningful outcomes.”
The Global Forum for Farm Policy and Innovation (GFFPI) leverages evidence and dialogue leading to increased understanding, substantive action, and enhanced outcomes for more sustainable agriculture around the world. GFFPI members include the Australian Farm Institute, the Canadian Agri-food Policy Institute, the Farm Foundation (United States) and the Forum for the Future of Agriculture (Europe).
Shifts in trade and tariff policies expected in the incoming second Trump administration may pose challenges and may create opportunities, international trade consultant Chris Wojtowicz told Robin Washington.
The Republican presidential nominee, former U.S. President Donald Trump, speaks at the Detroit Economic Club on October 10, 2024 in Detroit, Michigan. Trump is campaigning in Michigan, a key battleground state, ahead of the upcoming presidential election. (Photo by Bill Pugliano/Getty Images)
WASHINGTON — Former President Donald Trump promised to “save the American auto industry” Thursday during a meandering speech to the Detroit Economic Club, during which he insulted his host city as a “mess” and announced a new plan to make car loan interest payments fully deductible.
Trump unveiled the new plank of his tax plan near the close of his remarks that included berating the United States as “dumb” on trade and pledging, if elected, to “have a lot of fun” renegotiating a trade agreement with Canada and Mexico.
The former president spoke for nearly two hours to the economic club in Michigan, a key swing state.
Trump is already running on a platform to impose across-the-board tariffs, up to 20%, on all imported goods, and at 60% on goods from China. On Thursday he said cars imported from Mexico could see tariffs as high as 200% if he wins in November.
He told the crowd that his newest plan to make interest on car loans fully deductible is “going to revolutionize your industry.”
“This will stimulate massive domestic auto production and make car ownership dramatically more affordable for millions and millions of working American families. This is a phenomenal thing, if I do say so myself,” Trump said.
However, it’s unclear whether the deduction would only be available to taxpayers who itemize, or also to those who take the standard deduction. For example, some deductions, like student loan interest, can be a special exception.
Another question would be the price tag of Trump’s proposal: Americans owe about $1.6 trillion in car loans, according to the quarterly consumer report issued in February by the Federal Reserve of New York.
R&D tax credits
The former president also promised — to applause from the crowd — that U.S.-based carmakers “will be rewarded with expanded research and development tax credits, very substantial, where they will be able to write off 100% of their cost of heavy machinery and other equipment necessary to build a plant in the first year, and full expensing for manufacturing investments.”
The Trump campaign did not respond to emails asking whether the proposals were new, or would be an extension of expiring policies enacted under Trump’s signature 2017 tax law, titled the Tax Cuts and Jobs Act.
Erica York, senior economist and research director for the Tax Foundation, wrote on X that “R&D tax credits are an entirely separate policy from deductions for R&D expenses or capital expenditures.”
“(B)ut if I had to guess, Trump is probably talking about bringing back immediate R&D expenses and restoring 100 percent bonus depreciation,” wrote York, who’s been closely following the tax debate during the 2024 presidential election.
Except for wanting to change the corporate tax rate — lowering it to 15% — Trump is campaigning on fully renewing the TCJA, which cleared Congress strictly along party lines. The law sunsets at the end of 2025.
‘Take a look at Detroit’
Trump also used his speech to attack trading partners and competitors, at one point describing the European Union as “brutal” and recalling an alleged conversation with former German Chancellor Angela Merkel.
“‘Angela, how many Chevrolets do we have in the middle of Berlin?’ ‘Oh, I do not know. Perhaps, perhaps none.’ ‘You’re right. Angela,’” Trump said he recalled.
“And yet, they send their cars to us. Like a bunch of dummies we are — BMW, Mercedes, Volkswagen, by the millions and millions and millions. We’re not doing that crap anymore,” Trump said. “Now they’re gonna have to play by our rules.”
It is a fact that American cars are on the streets of Europe.
But China was the “biggest abuser” of trade while he was president, he said.
“They were a professional abuser. They did things to us, and they go down as a ‘developing nation,’” he said, as if talking in another’s voice. “‘We are a developing nation.’ But we’re (the U.S. is) a developing nation too — just take a look at Detroit.”
His campaign did not answer an email asking for clarification about the remark.
Harris campaign responds to Detroit visit
Ahead of Trump’s Detroit appearance, Vice President Kamala Harris’ campaign organized a press call featuring Shawn Fain, president of the United Auto Workers.
Fain told reporters Trump “has done nothing” to help autoworkers.
“The job-killer-in-chief is once again back in Michigan to do what he does best. He’s going to lie about bringing our jobs back,” Fain said.
The union leader endorsed President Joe Biden in January, and promptly endorsed Harris in July when Biden exited the race.
Biden became the first sitting U.S. president to walk a picket line when he joined striking UAW members in September 2023.
Harris was in Las Vegas, Nevada, Thursday to record a live town hall for Spanish-language network Univision. The question-and-answer session for undecided Hispanic voters was organized by the network’s news division and moderated by TelevisaUnivision’s Enrique Acevedo.
Harris was scheduled to speak at a campaign event Thursday night in Phoenix, Arizona.
‘There will be no rematch!’
Once again, the question of another presidential debate has come, and apparently gone.
Fox News on Wednesday issued a final offer to host a live 90-minute presidential debate in Pennsylvania on either Oct. 24 or 27, with moderators Bret Baier and Martha MacCallum.
“THERE WILL BE NO REMATCH!” Trump posted Wednesday evening on his online platform Truth Social.
On Thursday, CNN offered to host live town halls with each candidate.
Ahead on the campaign trail, Minnesota Gov. Tim Walz will campaign in Wisconsin on Monday, hitting both Eau Claire and Green Bay.
President of Ukraine Volodymyr Zelenskyy holds an American flag as he addresses a joint meeting of Congress in the House Chamber of the U.S. Capitol on Dec. 21, 2022 in Washington, D.C. (Photo by Win McNamee/Getty Images)
This is one in a series of States Newsroom reports on the major policy issues in the presidential race.
WASHINGTON — The next U.S. president must steer the nation through crises across the globe, including worsening violence in the Middle East, Russian President Vladimir Putin’s refusal to retreat from Ukraine and U.S-China trade relations.
The Democratic nominee, Vice President Kamala Harris, largely built her career as a prosecutor, but once in Washington she sat on the U.S. Senate Select Committee on Intelligence, a position that comes with access to highly classified national security files.
As vice president she’s represented the U.S. at high-profile international meetings, including the Munich Security Conference and Asia-Pacific Economic Cooperation.
The Republican nominee, former President Donald Trump, who followed his wealthy father’s path into real estate and ascended to the status of celebrity businessman, has already held the elected position of Commander-in-Chief for four years — though high-ranking officials who served under him say he shouldnot occupy that seat again.
Trump and Harris’ track records can provide clues on how, if elected, they would handle complex and challenging national and economic security policies.
But overall on the campaign trail, foreign policy “has played a back seat role to domestic politics in the 2024 election,” James M. Lindsay, a senior fellow in U.S. foreign policy for the Council on Foreign Relations, told States Newsroom in an interview.
That’s not unusual, Lindsay said, as presidential year politics generally tend to have a domestic focus.
“This has been more a campaign about personalities than about specific policy prescriptions. It’s safe to say that the two candidates have very different world views,” Lindsay said.
Relationships with allies
Harris centers relationship building, and promised in her Democratic National Convention acceptance speech to “stand strong” with NATO allies.
In Trump’s convention speech he lamented that the U.S. has “long been taken advantage of” by “so-called allies.”
Observers say the former president leads with a transactional outlook: In other words, nations must pay for access to U.S. markets and security.
“Trump thinks that U.S. support to allies is a bad deal for America, whereas Harris realizes that the United States benefits immensely from them,” Matthew Waxman, senior fellow at the Council on Foreign Relations and chair of Columbia Law School’s National Security Law Program, told States Newsroom.
But predicting how a presidential candidate would act on the global stage, if elected, is tricky. Conflicts continue to evolve, and those in top defense and diplomatic jobs are likely to turn over.
“It’s partly because a President Harris or President Trump could face a very different situation in the Middle East or in Ukraine come Inauguration Day, but it’s also because in Washington personnel are policy, people are policy,” Lindsay said.
Here are some of the serious international situations either administration will face:
Middle East
The deadly Oct. 7, 2023 Hamas attack on Israel, launched from the Palestinian territory of the Gaza Strip, reignited smoldering regional tensions and highlighted the inextricable U.S. role. Hamas militants killed roughly 1,200 in the brutal and unexpected incursion, and took 250 hostages, many of whom still remain in captivity.
President Joe Biden immediately surged weapons and security aid to the key U.S. defense partner, and in April Congress approved his request for $8.7 billion more in foreign military financing and missile defense.
Israel’s year-long campaign to completely eliminate Iranian-allied Hamas militants from the Gaza Strip has resulted in a staggering death toll, now over 41,000, according to Gaza health officials.
Hamas’ assault also set in motion attacks from other Iranian-backed militias, opening up a war front between Israel and Hezbollah fighters to the north in Lebanon. And for months, Yemen’s Iranian-backed Houthis have terrorized commercial shipping in the Red Sea.
Biden has faced fierce criticism for Israeli Prime Minister Benjamin Netanyahu’s war tactics.
Harris, as early as March, publicly criticized Israel over the humanitarian “catastrophe” in Gaza and called for an immediate six-week cease-fire.
Harris, who became the Democratic presidential nominee in mid-summer after Biden dropped his bid, has repeatedly said she defends Israel’s right to defend itself but that “how it does so matters.”
Protesters could be heard in the distance Monday as Harris planted a memorial tree at the vice president’s residence to mark the one-year anniversary of the Oct. 7 attack. Pro-Palestinian activists protesting the death toll in Gaza have marched and rallied throughout the U.S. during the past year.
Harris told reporters that the administration is “not giving up” on negotiating a cease-fire deal and release of hostages, an effort that has so far floundered.
“It’s one of the most important ways we will be able to end this war and bring any type of stability to the region. It’s one of the highest priorities of this administration,” she said.
She has not indicated any slowdown or conditions on assistance to Israel if elected — though she continues to advocate for a two-state solution.
“Trump may give Jerusalem less public chastising and criticism, but I’m not sure the policy differences would be that great either,” Michael O’Hanlon, senior fellow and foreign policy research director at the Brookings Institution, told States Newsroom. O’Hanlon recently published an article arguing the Trump and Harris defense strategies would at least “partially” converge.
Trump maintains that Oct. 7 “would never have happened” had he been in office, and he accuses the Biden administration of inviting the attack because of its “weak” relationship with Iran.
“What is needed more than ever is a return of unwavering American leadership and unquestioned American strength. We were strong, we were powerful … That’s what I intend to deliver as the 47th president of the United States,” he said Monday while in Miami marking one year since the ambush on Israel.
The attack also wrecked any forward progress on the Abraham Accords — Trump’s signature Middle East achievement that created full diplomatic relations between Israel and the United Arab Emirates, Bahrain and Morocco. While those established channels remain steady, the Biden administration’s efforts to strike a deal between Israel and Saudi Arabia are now at a standstill.
Trump is increasingly selling himself on the campaign trail as the candidate of stability who can quash Iran’s aggression — which is pretty much a “standard approach to campaigning,” Lindsay said.
“He is not the first challenger to argue that the incumbent president has been weak.”
But Lindsay said, “the important question isn’t whether he was tougher, it’s whether his policies were more effective.”
For example, the Iranian-backed so-called “axis of resistance” militias currently upending the Middle East were also operating during Trump’s presidency.
“(They) pre-dated his coming into office but it’s not that a Trump administration ended that network of anti-Western, anti-Israeli groups,” Lindsay said. “And during the Trump administration it was the case that Iran both underwrote attacks on American troops and actually launched attacks on American troops.”
Trump drew attention last week to an early January 2020 barrage on U.S. troops in Iraq when he again described the traumatic brain injuries they suffered as “headaches.”
U.S. troops in Iraq and Syria, already a target, have come under increasing fire from Iran-backed militants, with more than 100 attacks on U.S. service members since Israel began its post-Oct. 7 offensive. A drone strike in January killed three U.S. soldiers and injured 30 at an outpost in Jordan on the Syrian border. The U.S. retaliated by launching more than 100 precision rockets at 85 of Iran military sites in Iraq and Syria.
The U.S. assisted Israel twice in 2024 in intercepting rockets fired directly from Iran — once in April following Israel’s bombing of the Iranian embassy in Damascus, and again in September after Israel’s assassination of Iranian-backed Hezbollah leader Hassan Nasrallah in Beirut, Lebanon.
“We’re in the last months of the Biden presidency, and Biden’s own, I think, personal influence here is quite diminished. And you know, I can’t predict what Trump policy really would be. I assume he would be less likely to be trying to restrain the Israelis, but so is the Biden administration. And maybe that is a Biden-Harris policy,” Elliott Abrams, CFR’s senior fellow for Middle Eastern Studies, told reporters on Oct. 2, the day after Iran launched its second direct attack.
Ukraine and NATO
Ukrainian President Volodymyr Zelenskyy met with both Harris and Trump in recent weeks to shore up continued U.S. support for his country’s ongoing war against Russia’s occupation.
Harris’ meeting with the Ukrainian leader was her seventh, and she pledged continued aid for the eastern European nation on the principle that Putin would continue marching into Europe if allies relent on Ukraine.
Harris supports continued U.S. assistance, which has totaled roughly $175 billion since 2022. At the Ukraine peace summit in Switzerland in June, Harris pledgednearly $2 billion, some new and some redirected, to bolster the country’s energy sector and add to humanitarian efforts.
The vice president has represented the U.S. threetimes at the annual Munich Security Conference in Germany, where she praised the NATO alliance and said the U.S. commitment to its principles is “ironclad.”
When facing Harris on the presidential debate stage in September, Trump refused to answer whether he wants Ukraine to be victorious over Russia.
Trump’s rhetoric and past behavior “spells bad news for Ukraine,” Waxman said.
“He is likely to reduce American support for Ukraine and push Ukraine to make concessions to Russia. Overall, Trump’s transactional approach to leader-to-leader diplomacy is likely to benefit Putin,” Waxman continued. “Whereas Harris wants to invest in alliances like NATO, Trump is skeptical of them.”
That type of leader-to-leader communication was notoriously highlighted in 2019 when U.S. House lawmakers impeached Trump for directly threatening to withhold Ukraine aid if Zelenskyy did not announce an investigation into Biden — Trump’s presidential campaign rival at the time. The Senate acquitted Trump.
Like his campaign line on the Israel attack, Trump also repeatedly claims that had he been in office, instead of Biden, Russia would have never launched its February 2022 attack on Ukraine.
“The war in Ukraine did not begin in February of ‘22, it began back in 2014,” Lindsay said, referring to Putin’s forced annexation of the Crimean Peninsula.
Trump’s own administration expanded Obama-era sanctions meant to punish Russia’s actions in Crimea.
“Experts can argue about how to dole out criticism across administrations, but clearly the issue of Russian support for a notionally independent insurrection in eastern Ukraine was not solved during the Trump presidency,” Lindsay continued.
China and trade
Foreign trade is a “political hot potato,” and neither Harris nor Trump are offering much clarity for U.S. trading partners around the world, Mary E. Lovely, senior fellow at the Peterson Institute for International Economics, told States Newsroom in an interview.
Lovely described the Biden-Harris approach as multipronged, in that they’ve instituted policies to bring manufacturing back to the U.S. while also aiming to maintain good trade relationships with partner nations.
The tightrope walk becomes even trickier as U.S. policy also disincentivizes materials and components from China — one of the world’s largest trading nations — in the final products imported from trading partners. Think: components in solar panels and electric vehicles.
The Biden administration’s major legislative accomplishments — the Inflation Reduction Act and the CHIPS and Science Act — provided major subsidies for “reshoring,” or returning to the U.S., clean energy and semiconductor production. But the policies were not without risks to U.S. trading partners.
“We had a lot of things (in the legislation), including things that upset the allies — you know, subsidies for American businesses, that they saw potentially as pulling investment out of their economies,” Lovely said.
“These are things that the European Union, Japan, Korea were concerned about,” Lovely continued. “So we’ve seen it there — this tension between foreign policy and this idea of economic security.”
While Lovely said she worries about how some of the Biden-Harris trade policies might affect competition and the nation’s ability to sign timely trade agreements, she said Trump’s plans are overall “destabilizing.”
“The increased use of tariffs is misguided at best,” Lovely said.
Trump’s promise to not only increase tariffs on Chinese imports to 60%, but also to slap flat 10% to 20% tariffs on all imports across the board is akin to “starting a trade war with the entire world.”
“We’re not going to see those kinds of tariffs without retaliation,” Lovely said.
If enacted, the tariffs would be particularly challenging for Indo-Pacific countries that rely on U.S. partnership in the face of China’s regional dominance.
“I mean, you can imagine how this will go down in, say, Japan and Korea, two countries which rely on the U.S. for a security umbrella, which is why Trump thinks that he can do stuff to them. But they also have to protect their own economies,” Lovely said. “So it’s going to put them in a really terrible position because it’s very important for them to maintain their alliance with the U.S., economic as well as military.”
But one thing is for sure, Lovely said: “Everybody wants to know what’s going to happen. Everybody in every embassy here in Washington.”
On Thursday, July 18, 2024, Farm Foundation participated in the second Global Forum for Farm and Policy Innovation (GFFPI) workshop, held in Washington D.C. The focus of the workshop was “measuring sustainability outcomes to facilitate agricultural trade.” This was a priority identified in the previous workshop.
Leaders from the Global Forum for Farm and Policy Innovation (GFFPI) co-founder organizations at the second GFFPI workshop. From left: Shari Rogge-Fidler, president and CEO of Farm Foundation; Tyler McCann, executive director, Canadian Agri-Food Policy Institute; Katie McRobert, executive director, Australian Farm Institute; and Mark Titterington, co-founder and director, Forum for the Future of Agriculture. Photos provided by Emmanuelle Mikosz/Forum for the Future of Agriculture.
The nearly 70 participants representing 18 countries discussed the topics of an outcomes-based approach to trade and sustainability, and measuring challenges and opportunities in trade and sustainability. Farm Foundation President and CEO Shari Rogge-Fidler provided opening remarks and also facilitated small group discussions, along with Farm Foundation Vice President of Programs and Projects Martha King. U.S. Department of Agriculture Under Secretary for Trade and Foreign Agricultural Affairs Alexis Taylor spoke on the importance of trade and sustainability for global food and agriculture.
The first workshop, held in late 2023, brought together representatives from OECD countries and OECD Secretariat as well as industry experts from across Europe, North America, Japan, and Australia to discuss the role of trade and agriculture sustainability in an interactive and thought-provoking format. That workshop, held at the OECD in Paris, enabled stakeholders from around the world to identify common goals and priorities.
The Washington D.C. workshop was held in partnership with the Australian Farm Institute, Farm Foundation, the Canadian Agri-Food Policy Institute, and the Forum for the Future of Agriculture.
GFFPI events, including this one, support Farm Foundation’s mission of building trust and understanding about U.S. agriculture with global food and agricultural stakeholders. In addition, Farm Foundation offers a uniquely independent platform for these dialogues to advance and elevate trade and sustainability issues.
In the Perspectives guest blog series, Farm Foundation invites participants from among the varied Farm Foundation programs to share their unique viewpoint on a topic relevant to a Farm Foundation focus area. Michelle Klieger is a 2024 Farm Foundation Young Agri-Food Leader and president of Stratagerm Consulting. In this blog she discusses the European Union’s new deforestation regulations.
The European Union aims to raise the global bar with new Deforestation Regulations. Effective since June of 2023, the regulations ban imported goods that stand to profit off of deforestation practices. By devaluing and even penalizing these practices, the EU hopes to create a commodity trade standard that will reverse the effects of deforestation. They predict 177,920 acres of forests, or one quarter of Rhode Island, will be saved in 2025, and are optimistic that these steps will reduce air pollution.
Soy, palm oil, beef, coffee, and cocoa trades are expected to experience a significant impact due to these new requirements. Brazil, Argentina, Malaysia, Indonesia, Canada and parts of Africa are on edge as they consider trading options. Some argue this is the beginning of a new era, while others see it as a reorganization of supply chains.
Michelle Klieger is the president of Stratagerm Consulting, a food and agricultural consulting firm. An economist and a business strategist, she works with the global seed industry, ag tech companies, conventional and non-conventional agriculture firms, and philanthropic foundations.
Complexities of EU Regulations
For companies working to meet regulations, the process is complex. While individual companies must produce data to receive deforestation- free certification, entire supply chains must be vetted. Each industry faces unique obstacles. Soy, for example, goes from farm production, and is then transported to processing facilities, then moved onto crushers, then to product manufacturers, and finally to retailers. If at any point in the process operations have made use of deforested land, the trading company could be banned from exporting goods to EU countries. Palm oil batches typically mix fruit from many sources at once. Many of these companies can only trace a product after it has been processed and would need to develop brand new traceability methods to meet requirements.
Meeting the new regulations requires an investment in technology and manpower. In order to make products fully traceable many companies are purchasing GPS technology that allows them to accurately map and consistently monitor their farms. Similarly, if products must be tracked and segregated from planting all the way to a grocery store shelf, digital tracking technology will also be needed. Guaranteeing deforestation-free methods must include in person inspections done by real people traveling from farm to farm to see operations up close.
It’s a time consuming process to build out this framework, but one that many companies deem both valuable to the global environment and financially lucrative in the long run. Decisions involve farmers, transportation companies, processing plants and manufacturers, but they also must include government policy, technology and in some cases legal crossroads. There is no overnight shift, but rather a development of practices.
A Supply Chain Split
Already many companies are rerouting supplies to other buyers and avoiding EU regulations altogether. The trend prompts speculation that the new requirements will not raise the bar, but simply split or change the flow of supply chains. Brazil could turn to China as a new soy buyer and Indonesia could potentially trade palm oil to Africa. We’ve seen substitute shifts like these in the past with the U.S.-China trade war and sanctions on Russian energy. It may prove simpler and more cost effective to change buyers rather than invest in meeting new EU regulations. Many of these companies have little ability to enforce downline or upline adherence to regulation and they fear penalties.
Interestingly, in 2020 Brazil produced ⅓ of the world’s soy, but only 13% of crops account for 95% of the deforestation that occurred that year. The other 87% appear to have been produced on grassland and savannah areas. The scenario is true elsewhere and begs the question; will this create a new environmental imbalance that puts stress on other ecosystems? Companies looking to meet regulations could potentially exploit approved farming areas by over farming them.
Demand For a Different Type of Supply
Will it be harder to secure buyers or much used commodities? For the EU, value is placed not just on the product, but how it is sourced. The decision will impact both consumers and European agriculture.
European countries are braced to experience a decreased supply of things like chocolate and coffee. But, exactly how increased operating costs will be absorbed remains uncertain. Typically consumer prices reflect production cost increases, but in this situation one or more points along a supply chain may need to take ownership of costs to ensure tradability. The result, at least in the initial stages, would be lower profit margins for most of these companies and possibly higher purchase prices for consumers.
Several European countries are seeking reduced regulations and maintain that the current requirements are virtually impossible for small and medium sized farms to accommodate. They also argue that these regulations negatively impact many of the current sustainability processes farmers are working to implement for the sake of biodiversity, crop and grazing rotations. Farmers worry that they will not be able to produce the soy meal needed to feed their own livestock and that the EU will become too reliant on exports which would negatively affect the European ag sector.
Good News For U.S. Producers
The EU is not alone. Other countries have similar environmentally focused goals and policy in the works to support these goals. The United States has seen a growing consumer demand for traceability, prompting many businesses to begin the process of leveraging technology and better communication up and down supply chains to help customers make informed decisions.
The Forest Act of 2023 was birthed out of the same desire to stabilize regions of the world that have suffered from illegal deforestation and offer opportunities for many industries and individual businesses to clean up their processes. If it goes into effect, the Forest Act would be very similar to the EU’s Deforestation Regulation; banning products that have been produced on illegally deforested land and penalizing unmet requirements.
Many American operations are positioned to receive deforestation-free certification. Several top soy producers are predicted to meet regulations and be granted access to the EU markets. A welcome relief to farmers who have faced narrowing markets in recent years.
Exactly how competitive this “new” market will be, only time will tell. Traceability efforts take time. Unless trade lines were already working toward deforestation-free goals, it will take years for many of these supply chains to implement methods that meet EU regulations. In the meantime, it’s highly likely that global trade negotiations will be impacted and supply chains will shift in response to the environmental standard.
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