🚢 Ag's Port Problem Persists + Mic(robial) Drop, Farm Tax Breather, and more...

Ag exporters are facing major shipping delays at American ports. What else is new?

Well, a lot.

In a letter recently sent to President Biden, several ag organizations told the Commander in Chief that “the problem not only persists, but is becoming even more dire.”

The letter, signed by more than 70 ag groups, sincerely thanked the president for actions already taken to alleviate the issues but urged him to take further action—ASAP.

Refresher: Fallout from the pandemic (here we go again) has left the ag industry facing a boatload of challenges. Foreign-owned ocean carriers have been holding U.S. ag exporters hostage through massive fees, canceled cargo bookings, and a general lack of transparency.

Going to need a bigger fuller boat: With Asia-bound ocean carriers not allowing time for ships to be loaded with U.S. ag products, over 70% of all shipping containers leaving West Coast ports are completely empty. That’s an all-time record… and not exactly one to brag about.

Empty containers, paired with strong imports are causing a bit of an… ahem… imbalance.

Soundbite: “Right now, imports seem to be enjoying the equivalent of an eight-lane highway while our exports have been relegated to narrow country roads; that’s not right…” noted Krysta Harden, U.S. Dairy Export Council President and CEO.

Where this goes: The petitioning parties sent a laundry list of suggestions to the president, which, if implemented, should help the situation. In the long term, they are requesting his support for the bipartisan Ocean Shipping Reform Act—meant to codify policies that will address the unfair practices facing ag exports.

Quick Hits

→ Shipping hurdle headline on repeat. Brazil stands to lose $500M as green coffee exports fell 27% in August from the prior year, mainly due to difficulties finding container and vessel space.

→ Negotiator nominated. President Biden nominated Elaine Trevino, the current president of the Almond Alliance of California, as the Chief Ag Negotiator to work on trade programs, export agreements, and tariff disputes.

→ Cargill wants in on carbon frenzy. The global commodity player will launch its own program in 2022 that will pay farmers for increasing soil health by capturing carbon to lower emissions.

→ Ida wallops sugarcane. The destructive hurricane negatively impacted 118,000 acres of Louisiana’s crop, about 26% of the expected harvest.

→ $eed treatment funding. Biotech startup Andes raised a $15M Series A round to scale its seed treatment technology that reduces a farmer’s reliance on synthetic, chemical-based fertilizers.

→ Longest railroad crossing ever… After a months-long buying battle, Canadian Pacific will purchase Kansas City Southern for $27B, creating the first freight rail network from Canada to Mexico, a major transport opportunity for ag exports in North America.

→ Once-in-a-decade pear output. The Pacific Northwest is reporting an estimated pear harvest of 16.1M standard box equivalents, with quality experts praising the crop’s top-notch shapes and high sugars.

AgBiome, a crop protection company in North Carolina, has raised $116M in its latest funding round, co-led by Blue Horizon Ventures and Novalis LifeSciences.

Microbe manager: Investors are backing the company that focuses on naturally-derived fungicides. With AgBiome’s microbial collection, combined with microbe sequencing and its strain identification system dubbed “GENESIS,” they’re able to develop natural fungicide products for the market. Science.

The goal of their products is to provide the same level of protection with biological products that synthetic chemicals provide.

Shoot for (or howl at) the moon: Howler®, AgBiome’s first fungicide product, works on soil-borne, foliar diseases and various mildews on strawberries, grapes, leafy vegetables, cucurbits, pome fruit, and stone fruit. Howler works on more than 300 crop-disease combinations. How do you like them apples?

Climate helpers: The company also highlights their technology could help with climate change, citing “50 to 70% fewer greenhouse gases through microbial-based pesticides versus synthetic ones.”

In the pipeline: We’ll see their second product, Theia Fungicide, in 2022 while their third fungicide is with the EPA for registration. AgBiome says they’ll use the funds raised to expand its product portfolio and scale its team. Their plan is to have 11 products on the market by 2025.

Lawmakers on both sides of the aisle have been concerned about the implications of stepped-up basis on U.S. farms proposed in President Biden’s America’s Family Plan. But now it seems everyone can take a breather.

This week, the House Ways and Means Committee unveiled a new plan that excluded the transfer tax and left intact the “step-up in basis” (a rule allowing an appreciated asset’s value to be reset to the fair market value at the owner’s death).

That’s after the National Farmers Union (NFU) released a letter late last week urging Congress to preserve the rule, with other farm groups agreeing.

Tax translation: Family farmers and ranchers can rest easier if this plan moves forward as it’s more favorable to their interests. Essentially, if there’s a death, the family won’t have to $hell out a mint in transfer taxes to continue the farming operation. But dairy farmers and larger farms may have to pay more, and the Senate verdict is still outstanding.

Break it down: Positive changes to the House plan include the tax rate dropping for “C Corporation” farms, an increase in estate tax exclusions, and replacing an extra 12.4% self-employment tax with a 3.8% net investment income tax.

The Senate is still working on its tax proposal, so this House plan is only the first step. Because the only certainties in life? Death, taxes, and political back-and-forth about taxes.