Letter to Hon Tom Vilsack, Secretary of Agriculture, and Hon. Pete Buttigeig, Secretary of Transportation - Kelly Calls on Biden Administration to Immediately Address Record-High Food Prices

Letter

Dear Secretary Vilsack and Secretary Buttigieg:
 
I am writing regarding the record-high food prices that are straining families in Arizona
and across the nation. I hold quarterly meetings with farmers and ranchers in my state. We recently discussed escalating food prices and agree that the federal government could do more to reduce costs for consumers.

The increase in food prices in the United States has tripled beyond the 10-year
average.  Arizonans deserve a whole-of government approach to strengthening the reliability and
affordability of our nation's food production, now and in the years following this pandemic. These
efforts can start by establishing an interagency working group within the Administration's supply
chain task force exclusively focused on lowering food prices and reducing supply chain
bottlenecks for middle class families.

But in addition to greater coordination, I support further specific and concrete policy
actions, most of which this Administration could implement immediately, to reduce food prices
for consumers. These include cracking down on corporations who are raising prices to increase
profits, modernizing and increasing competition in the meatpacking sector, enhancing our trucking
industry and workforce, reducing costs for farmers, and addressing longstanding structural
challenges within our supply chain.

Arizona families deserve action. To address these challenges, I ask that you take the
following actions:

Crack down on Corporate Price Gouging and support competition within the meatpacking
industry:

As prices for chicken, pork, beef, and other meats continue to skyrocket we must support
innovation within the meatpacking industry. Important first steps include better utilizing
technology in meat inspections. Delays in meat inspection, due to outdated processes and fewer
inspectors, delays the ability of new facilities to open or existing facilities to expand. And the
Department of Agriculture should provide additional grant funding to build, modernize or
expand meat processing facilities.

At the same time, this Administration must exercise full oversight over the food supply
chain to ensure that big corporations are not artificially raising prices at the expense of Arizona
families. In some agricultural supply chains, a small number of players have disproportionate
control over supply chains, leaving them vulnerable to price fixing. To address these challenges, I
urge you to direct the Department of Agriculture and Department of Justice to accelerate their
investigations into the meat-processing industry, to identify instances where price-fixing occurs
and ensure that the prices consumers pay reflect the true costs of a product. To improve oversight,
I also support the quick enactment of the Cattle Price Discovery and Transparency Act, to
improve data sharing and transparency in the cattle market, which is driving some of the most
significant price hikes in the meatpacking industry. And USDA should fully utilize its authorities
under the Packers and Stockyards Act to crack down on anti-competitive behaviors in the
meatpacking industry and provide new growth opportunities to small businesses.

The Administration must also do more to support small businesses and workers in the food
processing industry, to foster robust competition and provide consumers choices at the grocery
store. The Department should ensure that new start-up or growing businesses in the meat packing
and agricultural production industry can access grants, low-interest loans, and other technical
assistance to scale up production and promote competition, which will bring down prices.

Enhance the commercial trucking workforce, cut red tape:

Price hikes at grocery stores are also being driven by workforce shortages and
inefficiencies within the trucking industry, which plays a critical role in moving goods quickly and
keeping shelves stocked. While the administration's recently released Trucking Action Plan takes
some important first steps, more must be done. To address a shortage of qualified truck drivers,
the Department of Transportation should quickly implement Sec. 23022 of the Infrastructure
Investment and Jobs Act to establish a Truck Driver Apprenticeship Pilot Program that allows
drivers between the ages of 18 to 21 who are licensed to operate commercial vehicles within a
state to also drive commercial vehicles across state lines. The provision also requires the Federal
Motor Carrier Safety Administration to conduct a Truck Driver Compensation Study to identify
best practices for retaining qualified truck drivers through cost-effective compensation programs.
These provisions take important steps to address both the short-and long-term causes of the truck
driver shortages that are affecting food prices.

The Federal Motor Carrier Safety Administration (FMCSA), which regulates commercial
trucking operations, can also play a bigger role in addressing supply chain bottlenecks. In the face
of driver shortages and supply chain bottlenecks, FMSCA must ensure truck drivers can quickly
move goods and services, while maintaining safety. I support efforts to maintain and expand the
hours-of-service rule, which took effect last September and allows drivers more flexibility to
manage their time and complete their trips quickly. FMCSA should also quickly implement Sec.
23018 of the Infrastructure Investment and Jobs Act, which exempts truck drivers who are
transporting livestock from hours-of-service rules, so that unnecessary delays are not added to
commercial trips to transport agricultural products across the country. FMCSA must also guarantee
that no changes are made to the minimum federal liability insurance requirements, which
would increase costs for truck drivers, and ultimately consumers. DOT should also use existing
authorities to ensure that projects to increase the availability of truck parking facilities are
prioritized within discretionary grant programs. Drivers spend an average of an hour a day looking
for parking due to shortages. Addressing these shortages will improve both safety and efficiency
within the trucking sector.

Lastly, the Department of Transportation should make permanent COVID-19
emergency waivers that allow certified, third-party commercial truck driver's license training
programs to conduct the skills tests that truck drivers must pass in order to be licensed. This
commonsense change will allow new drivers to get licenses faster and prevent existing drivers
from facing additional delays when renewing their licenses.

Address longstanding supply chain issues:

Inefficiencies in our domestic supply chain have created significant challenges for
manufacturers, agricultural producers, shippers, distributors, and retailers. At times when supply
chains are tight, the federal government must do more to help address these inefficiencies where
possible. I support efforts by the Department of Commerce to research and disseminate
voluntary standards, guidelines, and best practices for producers, distributors, and retailers to
help address inefficiencies in our supply chains. This should also include additional work done by
the Bureau of Economic Analysis, the National Institutes of Standards and Technology, and the
Bureau of Industry and Security to conduct detailed research and mapping of critical domestic
supply chains to identify bottlenecks.

Ports across the country are also facing significant freight backlogs, which are contributing
to empty shelves and higher prices at grocery stores across the country. To address these
challenges, the Federal Maritime Commission (FMC), which overseas operations at seaports,
should issue regulations requiring marine terminal operators and ocean carriers to share
information to facilitate the movement of goods at ports. Currently, there is a failure of shippers
and port operators to share information, which can cause unnecessary delays or
miscommunications that delay port operations. I also support efforts by the Department of
Transportation and FMC to standardize the terms used in documents and operations by
shippers, port operators, and regulators to avoid miscommunications, accidents, or delays at
ports.

Fuel and diesel prices:

Finally, as I have written previously to President Biden on the topic of gas prices, diesel
and other fuel prices remain volatile hurting families not just at the pump but through higher prices
at the store as shipping costs rise. Although crude oil prices now appear to be declining, the
potential for foreign oil cartels to restrict global supplies remains a risk. Stability in domestic oil
and gas production is important throughout the pandemic and during the transition to carbon-free
and cleaner burning fuels.

Reduce costs for farmers:

Global trade dynamics, supply chain backlogs, and regulations have caused price hikes for
many essential products that are critical to farmers -- and these price hikes persist throughout the
supply chain and ultimately hurt consumers. Current projections indicate that fertilizer prices will
rise 5% in 2022, with specialty fertilizers needed for certain products increasing more. Ongoing
anti-dumping and countervailing duty investigations by the U.S. International Trade Commission
(ITC) have contributed to rising fertilizer prices. ITC must consider the affect that its
investigations are having on fertilizer prices for farmers and ranchers. At the same time, as
the Environmental Protection Agency (EPA) continues to conduct periodic reviews of pesticide
safety, the EPA should provide clear communication and make predictable decisions, based
on available data, to avoid creating price spikes within the agricultural supply chain.

Arizona families cannot continue to bear the cost of price volatility present within our food
supply chains, and the federal government can do more to help. I respectfully request that you
make the issue of rising food prices a top priority for your Departments, and act quickly to
implement the actions detailed above to begin to provide relief to hardworking families.

Sincerely,

Source