Permanent estate tax bills introduced: The House and Senate each introduced bills June 19 that would permanently repeal the estate tax. The Death Tax Repeal Act of 2013, introduced in the Senate by Sen. John Thune (R., S.D.) and in the House by Reps. Kevin Brady (R., Texas) and Mike McIntyre (D., N.C.), is identical to legislation introduced in the last Congress that received bipartisan support. The estate tax exemption level is currently at $5 million ($10 million per couple). The top tax rate on the value of the estate over the exemption level increased from 35% to 40% as part of the "fiscal cliff" negotiations that took place at the start of 2013. The legislation introduced would repeal the estate tax, maintain the stepped-up basis and make permanent a 35% maximum gift tax rate and $5 million lifetime gift tax exemption, indexed for inflation. Recent increases in agricultural cropland values, which averaged 15% from 2011 to 2012, have greatly expanded the number of farms and ranches that now top the estate tax exemption, supporters pointed out.
Senate confirms new USTR head: The Senate easily confirmed Mike Froman to be U.S. trade representative by a voice vote of 93-4 last Wednesday. Froman received unanimous support in the Senate Finance Committee earlier this month, with committee chairman Max Baucus (D., Mont.) noting that he looks forward to working with Froman on renewing trade promotion authority as well as advancing trade agreements that are currently in the works. Froman has most recently served as assistant to the President and deputy national security adviser for international economics. He also chairs the Major Economics Forum on Energy & Climate and co-chairs the Transatlantic Economic Council. In a statement from the White House, President Barack Obama noted that Froman "has been my closest adviser on a broad range of international economic issues and will continue to play a key role on my economic team. He's trusted and well-respected by our partners around the world, and for the last several years, he's been a driving force behind our international economic agenda."
Morgan Stanley to drop ag trading: Following similar moves by other major banks in recent months, Morgan Stanley confirmed last week that it will exit agricultural commodity trading, forecasting poorer revenue opportunities in that business. The firm said it will dismiss nearly 10% of its commodity traders as it ceases trading in lower-margin commodity categories. Banks have different regulatory challenges in trading commodities, and the cyclical nature of the agriculture business has left many, including Barclays and Deutsche Bank, pondering the wisdom of staying in the sector at all. Earlier this year, Barclays stopped trading agricultural products with hedge funds and Deutsche significantly trimmed its commodities team. Morgan Stanley additionally said it will exit dry freight and Australian power trading and will limit its exposure in European power and gas trading by exiting some Eastern European markets. The firm said it will step up its business in North American fertilizer and shale gas.
House cafeterias end Meatless Mondays: The Farm Animal Welfare Coalition (FAWC) announced that it has convinced the House Administration Committee to instruct Compass Group/Restaurant Associates, which holds the foodservice contract for all House office building cafeterias, cafes and carryouts, to immediately end its promotion of "Meatless Mondays" and remove all signage and promotion from the eateries. In a letter to the committee, the coalition said, "FAWC takes no issue with anyone's personal dietary choices. ... However, the choice by Compass Group/Restaurant Associates to use 'Meatless Mondays' as a promotional tool (for vegetarian/vegan meal options) is unfortunate and political. Meatless Mondays is an acknowledged tool of animal rights and environmental organizations who seek to publicly denigrate U.S. livestock and poultry production, alleging we provide unhealthy foods from mistreated animals while contributing disproportionately to climate change and environmental damage. These claims are offensive to us and are wrong." FAWC is an ad hoc coalition of many of the nation's largest farm, ranch, dairy, biotechnology and feed groups and was created by the American Feed Industry Assn. and American Farm Bureau Federation to ensure that any state or federal legislation or regulation affecting farm animal production is science based and equally weighs animal welfare and producer welfare.
APHIS administrator: Kevin Shea was appointed administrator of the U.S. Department of Agriculture's Animal & Plant Health Inspection Service (APHIS) on June 18; he has served as acting administrator since June 2012. Shea will carry out the agency's broad mission of protecting and promoting U.S. agriculture, regulating genetically modified organisms, administering the Animal Welfare Act and carrying out wildlife damage management activities. Shea previously served as associate administrator of APHIS since September 2004.
Niacin price increase: Lonza announced June 19 a worldwide price increase of 7% for niacin feed grade and niacinamide feed grade. The price increase will come into immediate effect for non-contract customers or as existing commitments permit.