The National Grain and Feed Association (NGFA) and North American Export Grain Association (NAEGA) commended the Senate Agriculture Committee for giving final clearance to its version of legislation reauthorizing the U.S. Grain Standards Act, including language mandating that the U.S. Department of Agriculture (USDA) restore any future disruptions in official grain inspection and weighing service at export ports.

The legislation, which reauthorizes the U.S. Grain Standards Act through Sept. 30, 2020, will provide for much needed continuity, predictability and ongoing improvement of the important services provided by the Federal Grain Inspection Service (FGIS).

The Senate Agriculture Committee's bill, which updates a similar bill approved earlier this summer by the committee, contains compromise language worked out with the House Agriculture Committee that is expected to smooth passage of the bill within the next few weeks. 

The final version includes several significant reforms to FGIS operations and the official grain inspection system sought by the NGFA and NAEGA, including a requirement that USDA approve requests for waivers of the official grain inspection requirement if FGIS fails to restore official inspection service unless the disruption is caused by an emergency. The bill also includes specific language that establishes transparent disruption notification and reporting requirements to Congress if and when FGIS is unable to immediately restore official inspection service.  

"Congress mandates that USDA has an unequivocal obligation to ensure that official grain inspection and weighing services at export elevators are provided in an uninterrupted, reliable and consistent basis," said NGFA President Randy Gordon and NAEGA President and Chief Executive Officer Gary Martin in a joint statement. "The legislation approved today by the Senate Agriculture Committee takes important steps to reinforce this mandate and hold USDA accountable."

Official grain inspection and weighing services at the Port of Vancouver, Washington were disrupted in 2014 when the state agency delegated by FGIS to perform the service - the Washington State Department of Agriculture - periodically and frequently declined to provide the service during a labor negotiation. Current law already requires USDA to step in and provide the service in such situations, but the department failed to do so.

The House already approved the House Agriculture Committee's version of the bill, which includes mandatory waiver authority, as well as the ability for exporters to select a different delegated state agency to perform inspections if service is disrupted.  It is expected that the House will consider the Senate version of the bill once it is approved on the Senate floor.

Neither the House-passed bill nor the Senate Agriculture Committee's version includes language preferred by NGFA and NAEGA that would mandate that USDA utilize qualified independent third-party inspectors licensed and overseen by FGIS to perform official inspections at export facilities in the event of a disruption, something that both organizations plan to reemphasize during future reauthorizations of the law.  

"These highly qualified experts already are working at U.S. export elevators - often at the request of international customers - to perform non-U.S. official grade-determining testing services that often are requested," the NGFA and NAEGA said. 

In fact, a study conducted by NAEGA showed that between 20 and 25 percent of U.S. exports of bulk grains, oilseeds and major coproducts currently are being reinspected by these independent third-party entities in response to requests from foreign buyers.

"Utilizing these talented professionals would further strengthen the U.S. official grain inspection system - a point we'll continue making as we seek to improve the long-term viability and professionalism of the U.S. grain inspection service," NGFA and NAEGA said.

However, both the House and Senate versions include other reforms sought by the NGFA and NAEGA, including the following:

  • For the first time, state agencies that are delegated official inspection duties at export ports would be required to undergo the same notice-and-comment rulemaking process that already applies to domestic state and private entities that provide official inspection services in the domestic market.
  • Important changes to the current flawed formula now used by USDA to set user fees charged to export elevators, which NGFA and NAEGA estimated will result in up to $12 million in overcharges during the current and immediately preceding fiscal years.
  • A shortening of the reauthorization period from the current 10 years to five years, which NGFA and NAEGA believes is essential given the rapidly changing international marketplace and different approaches to government-based grain inspections by the United States' foreign competitors.