The Trump Presidency: What it Means for the Food Industry

20 Jan 2017 --- Donald Trump has pledged that his presidency will unify and “make America great again” but his plans for the food industry remain unclear for the most part. Apart from issuing a hard-hitting statement – afterwards retracted – about wanting to abolish the Food and Drug Administration’s “food police” with their “inspection overkill” his priorities for the food industry were seldom mentioned during the campaign.

As he is sworn in as American’s 45th president later today, some industry stakeholders have already speculated what a Trump presidency will mean for the food industry, but most have remained quiet.

On the face of it, a Trump presidency should be a positive for big food corporates as, unlike his predecessor president Obama, Trump is expected to peel away legislation and regulations, which he has described as burdens on industry.

On the flip side, campaigning group Center for Science in the Public Interest (CSPI), said the Trump presidency was “shaping up to be a nightmare” while some farmers have expressed concern that Trump’s negative sentiment towards China will lead to worsening trade relations and put exports at risk.

While Trump’s priorities will become apparent over the coming days, behind the scenes Trump has begun making key appointments in the sector, as well as meeting industry luminaries, though it is far too early to call on whether he will prove to be a friend or foe to the food industry.

Trump has met Werner Baumann, Bayer CEO, and Hugh Grant, Monsanto chairman, the heads of the two companies who have thrashed out a $66bn deal to become one of the world’s biggest agrochemical giants.

The two companies described the meeting with Trump as “very productive” and that Trump and his team shared “their view on the future of the agriculture industry and its need for innovation.”

Perhaps Trump, who campaigned heavily on keeping manufacturing jobs in America, was swayed by Bayer and Monsanto’s pledge to create “several thousand new high-tech, well-paying jobs.”

With a handful of big mergers currently occurring in the agrochemical industry, shareholders and executives backing those deals will hope that Trump will preside over a light-touch regulatory system.

This week Trump named the former Georgia governor Sonny Perdue, who served on Trump’s agricultural advisory committee during his presidential campaign, as his nominee for secretary of agriculture.

Trade is fundamental to the US farm economy: U.S. farm and food exports to China were more than $20 billion in 2015, according to Reuters.

However, some have been concerned about Trump’s anti-China rhetoric during the campaign, which they argue could harm trade.

However, the appointment of Perdue appears to have been well received.

The American Farm Bureau said Perdue represented a strong voice while Ron Moore, president of the American Soybean Association (ASA), told Reuters that he thought Perdue would support agriculture exports.

More broadly, speculation is still rife about what Trump’s presidency will mean for trade deals, global exchange rates, production, research and development.

Some companies have spoken to FoodIngredientsFirst about the impact of a Trump presidency, but many chose not to.

An ADM spokesperson said: “At ADM, we have prospered for 115 years under 20 US presidents, and nothing in yesterday’s US presidential election changes our positive outlook for the food or agriculture industry, or for ADM specifically.”

Questions will be raised about what kind of food and agricultural policies the US can expect from Trump and how major proposed trade agreements such as the Transatlantic Trade and Investment Partnership (TTIP) will fare under his presidency. 

Questions about the Republican party’s platform on issues like genetically modified food, improvements in food labeling, the numerous proposed sugar levies across the US, sustainability and environmental issues like climate change will be abundant – especially as in the past Trump has severely criticized climate change policies.

Then there is the US food stamps program, officially knowns as the Supplemental Nutritional Assistance Program (SNAP), which provides nutritional assistance to more than 45 million low income families and saves children, the disabled and the elderly from going hungry. 

Prior to the election, the Democrats had supported SNAP calling to maintain or perhaps increase funding, while the Republicans have spoken about possible cuts to the program and possibly taking it away from the USDA.

Health issues like the obesity epidemic and spiraling Type II diabetes rates will be on the agenda at some point as will numerous other controversial policies, reforms, taxes and cuts. 

Under president Obama, America saw some significant changes to food policies like banning trans fats, introducing farm subsidy reforms, reducing sodium and the GM food labeling bill that was signed into law earlier this year. 

Congress passed the legislation that means the majority of food packaging must carry a label, symbol or an electronic code readable by a smartphone indicating whether it contains GMOs. 

The Bill, signed by Obama in the summer, gives companies three different options and has come under fire from many in American politics and the food industry who believe it is a watered down version of what was put forward in Vermont.

First Lady Michelle Obama was well known for her work in the healthy eating space and for addressing the obesity crisis over the course of the eight years at the White House and became an advocate of nutrition, physical activity and healthy eating. The Let’s Move program also specifically targeted childhood obesity.

Concerns for the food industry remain under question after Trump's election victory, with a widespread belief among anti-GMO activists that Trump is opposed to GMOs and favors labeling. This belief first arose in October, 2015, during the run up to the Iowa Republican caucus.

The New York Times reported that Donald Trump is hoping to become America’s first fast food President. He has, on several occasions, posed for social media pictures with burgers and fried chicken from fast food chains on his private plane.

The CSPI is one vocal lobby group that has put its head above the parapet.

Michael Jacobson, co-founder and president of CSPI, anticipates the Trump administration will be “a nightmare” and is particularly angry at the appointment of congressman Tom Price as health and human services secretary.

The CSPI fears that Trump’s pro-business and anti-regulatory stance will put the squeeze on health and environmental concerns.

He said: “For those of us who care about health, the environment, and science-based regulatory policy generally, the Trump Administration is shaping up to be a nightmare. His nominee for Health and Human Services Secretary, for instance, has voted against food safety reform, voted against healthier school meals, and voted against the Affordable Care Act.”

“The good news is that even with an anti-regulatory Administration in power, some companies are responsive to scientific evidence and consumers’ concerns – and we expect to make continued progress for healthier, safer food. In any case, industry should be aware that inaction in Washington will sometimes leave companies open to private litigation aimed at correcting marketplace abuses.”

by John Reynolds