Article: Food and Ag Policy Briefing 6 May

The article below has been taken from our IEG Policy dated 05/05/20.

US President Donald Trump signed an executive order on Tuesday last week (April 28th) designed to keep meat plants open and shield food companies from "liability problems" due to COVID-19. The order was a response to rolling meat plant closures and fears of meat shortages.

The White House said it would use the Defense Production Act "to ensure that Americans have a reliable supply of products like beef, pork, and poultry."

Under the order, the Department of Agriculture was directed to ensure America's meat and poultry processors continue operations uninterrupted "to the maximum extent possible", and to ensure processors continued to ensure worker safety by following the latest guidelines from the Centers for Disease Control and Prevention (CDC) and the Occupational Safety and Health Administration (OSHA).

The day after the order was signed, it was reported that efforts to resume operations at US meat processing plants shuttered due to outbreak of COVID-19 among workers was making steady progress. But the situation for producers remained precarious and animal depopulation had been unavoidable according to House Agriculture Committee Chairman Collin Peterson (D-Minn.) who spoke at a press briefing on Wednesday (April 29) in southwestern Minnesota.

EU-Mexico deal signed

In Europe, the European Trade Commissioner Phil Hogan and Mexican Economy Minister Graciela Marquez finalised the details of the trade agreement over a telephone call on Tuesday.

Under the EU-Mexico agreement, almost all trade in goods between the EU and Mexico will be duty-free. The Commission has said that EU agricultural exports would be one of the biggest beneficiaries of the trade deal, particularly producers of poultry, cheese, chocolate, pasta, and pork.

The two parties had started negotiations in May 2016 and reached an agreement in principle two years later, but they had to finalise one remaining issue - better access to the public procurement market at national and regional levels for EU companies.

The European Commission also reported last week that the EU agri-food sector had coped well amid the COVID-19 disruptions.

Staple food such as flour, pasta, canned fruit and vegetables, and rice have been in higher demand, while higher-value products such as quality meat cuts, wine and specialty cheeses are seeing a significant decrease in consumption.

However, thanks to the sustained demand for food, EU agriculture has also suffered relatively less damage from the lockdown measures than other parts of the economy, the Commission observed.

Member states address COVID

In Italy, a new emergency action plan to address critical issues pertaining to farm labour was announced by the country's ministry of agriculture, food and forestry policy, or MIPAAF.

The new plan will cover critical elements such as an urgent mapping of the needs for agricultural labour, a possible use of projects that are already funded by the ministries of labour and interior to help address the emergency, as well as the acceleration of a platform used to match labour supply and demand.

Meanwhile, Slovakia loosened restrictions in place due to the COVID outbreak, allowing local retailers to open their store, but ensuring that there is a ratio of 25 square metres per customer, and that customers cover their faces and maintain a two-metre distance from other persons.

In the UK, the group representing frozen food manufacturers published guidance on re-opening factories whilst in Poland, the sugar tax implementation was looking set to be further delayed because of the COVID crisis.

Food labeling back in the news

Food labelling policy was back on the agenda last week as multinational food giants, Danone, McCain and Nestlé, were among nearly 40 organisations that joined forces with three MEPs to write to EU Health and Food Safety Commissioner Stella Kyriakides urging the European Commission to make the colour-coded Nutri-Score mandatory across the 27-nation bloc.

With one in two European adults overweight or obese, the letter stated that it was clear that stronger action was required to "help stem the tide of this public health crisis".

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This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.