Groups oppose cash replacing grain in foreign aid

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Speculation that the Obama administration will be proposing a 2014 budget that includes a restructuring of foreign aid programs to center around cash payment programs rather than whole grains and processed grain products has the American Soybean Association and other commodity grain organizations worried.

Cash payments would reportedly eliminate the Food for Peace and Food for Progress programs, which provide food aid to foreign countries. There has been considerable debate through the years about the best way to reduce the total cost of federal government involved nutrition programs. The administration expressed goal is to provide nutrition aid with least cost and waste. The U.S. Agency for International Development (USAID) would be in charge of a cash program.

Of course, commodity associations prefer grains being involved because this increases demand for grain and increases export volumes. Cash doesn’t guarantee that aid money will go to purchase U.S. grains and processed foods.       

“The Food for Peace and Food for Progress programs provide nutritious foods to developing markets and have been a key priority for ASA for multiple years. We are expressly opposed to the replacement of in-kind food aid with cash aid, which takes a key market away from American producers, placing aid recipients at a potential risk by allowing them to purchase commodities from foreign suppliers whose safety and quality are unknown,” said ASA President Danny Murphy, a soybean farmer from Canton, Miss.

ASA’s World Initiative for Soy in Human Health (WISHH), the long-term market development arm of the soybean industry, works within both the Food for Peace and Food for Progress programs to help meet food and feed needs while developing long-term markets for U.S. soy, according to the ASA.

As an example, the WISHH program shipped 25 metric tons of U.S. hi-pro soybean meal to Pakistan in February. The soybean meal will be utilized in the production of floating fish feed by Pakistani company Oryza Organics. WISHH is partnering with Oryza Organics as part of the three-year FEEDing Pakistan program funded by the U.S. Department of Agriculture.

WISHH and Oryza have worked together to purchase a U.S.-manufactured extruder that will arrive in Pakistan in March, ASA announced. The high protein floating feed that Oryza will produce with U.S. soybean meal will be the first produced locally in Pakistan. “The floating feed has the capacity to greatly impact the aquaculture industry in Pakistan,” ASA noted.

“A restructuring like the one proposed in the president’s budget would have a disastrous effect on that productivity and on the ability of WISHH to help the world’s hungry with American soy,” Murphy said.

ASA is among the drivers of a coalition opposing the “restructuring” to cash payments that includes groups in the agriculture, supply chain and logistics, labor, non-governmental organization (NGO) and development industries.

The groups have collaborated on a series of letters to President Obama and Senate leaders expressing opposition to the plan and citing the positive impacts of both programs both at home and abroad. “Growing, manufacturing, bagging, shipping, and transporting nutritious U.S. food creates jobs and economic activity here at home, provides support for our U.S. Merchant Marine, essential to our national defense sealift capability, and sustains a robust domestic constituency for these programs not easily replicated in alternative foreign aid programs,” wrote the groups. “Overseas, Food for Peace has a strong track record of reducing child malnutrition and increasing incomes and food supplies for very poor and vulnerable populations. Food for Progress expands business and income opportunities along the agriculture value chain and improves the quality and quantity of food supplies. Both of those programs are proven models for addressing global food insecurity.”

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