Senate Reconciliation, SNAP Reforms, and Farm Bill Fractures

This week, the Senate Ag Committee released budget reconciliation text that includes a boost to some key farm bill programs and a less aggressive state SNAP cost share proposal than the House.

On this episode of Agri-Pulse Newsmakers, Sen. Cindy Hyde-Smith, R-Miss., discussed the proposal and her recent meeting with HHS Secretary Robert F. Kennedy Jr. about the Make America Healthy Again Commission report.

Plus, Katie Naessens with Torrey Advisory Group and Ken Barbic with Invariant continued the discussion on reconciliation, then dive into trade and state SNAP waivers restricting soda and candy purchases.

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Please note: This transcript has not been edited.

Lydia Johnson: Welcome to “Agri-Pulse Newsmakers,” where we aim to take you to the heart of ag policy. I’m your host, Lydia Johnson. This week, we’re joined by Mississippi Senator Cindy Hyde-Smith, who will discuss the Senate Ag Committee’s reconciliation text, the Make America Healthy Again Commission Report and Trade. But first, here’s this week’s headlines.

Ag Secretary Brooke Rollins signed three new waivers allowing Arkansas, Utah, and Idaho to restrict SNAP purchases of soda. This brings a number of states with waivers to six, with Indiana, Iowa, and Nebraska already having waiver requests approved. Applications from seven additional states remain under review at USDA. During the signing in Rollins’ Office, Health and Human Services Secretary Robert F. Kennedy Jr. also hinted he hopes to expand state SNAP waivers to limit purchases of ultra-processed foods.

President Trump and his cabinet officials say they’ve struck a deal on tariffs with Chinese officials. Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent, and US Trade Representative Jameson Greer met with Chinese officials in London this week. Negotiating with their Chinese counterparts, the parties agreed to preserve the truce negotiated last month, keeping in place a 10% baseline tariff on imports from China, as well as 20% duties applied for China’s role in the Fentanyl crisis. China will maintain a 10% retaliatory tariff on US imports. Lutnick said Chinese officials also agreed to work with the US to examine opportunities to deepen trade in agriculture.

Ag Secretary Brooke Rollins now has a right hand at USDA. Stephen Vaden, a judge on the Court of International Trade, was confirmed this week as Deputy Ag Secretary on a party line vote. He’s returning to the Agriculture Department after serving his general counsel during the first Trump Administration. During his confirmation hearing before the Senate Ag Committee, Vaden said USDA would advocate for removing trade barriers to farm exports through the administration’s broader tariff negotiations.

The Senate Ag Committee released their version of reconciliation text Wednesday with less drastic spending reductions than the House Bill and a boost to key farm programs. Senate ag changes would yield a net spending reduction of $144 billion over 10 years, while the house version of the One Big Beautiful Bill Act would cut spending by $238 billion during the same time period. Both bills would raise price loss coverage reference prices by 10% to 20%, and the agriculture risk coverage guarantee would be raised to 90%. They would also both allow producers to enroll as many as 30 million new base acres that would be eligible for PLC or ARC coverage. The new Senate ag text includes a scaled back state cost-share requirement for the Supplemental Nutrition Assistance Program that’s calculated based on state program error rates. Under the House Reconciliation Bill, states would have to cover 75% of the administrative costs in addition to a baseline 5% of program costs. That could go up to 25%, depending on error rates.

Senator Cindy Hyde-Smith represents the state of Mississippi. We asked if she thinks Republicans can unite her on the state SNAP cost-share requirements included in the Senate Ag Committee’s reconciliation text.

Cindy Hyde-Smith: I think that we can, you know, it gives us an opportunity for the states to have a lot of accountability with the SNAP program. You know, the SNAP program is great for those people who need it, but there’s been so much abuse, there’s been some fraud, and we worry about what we call our error rate. And that is when people get the SNAP programs that they don’t deserve that they don’t qualify for the SNAP programs. So we’re looking at that, and if we get our error rate down anywhere 5% or below, we’re not gonna be penalized. So, it’s kind of a way to say, “Yeah, we wanna make sure,” and I mean we have a while. We’ve got to 2028 to work on this, so it’s not immediate, but I think everybody is interested in making sure that we improve how that program is implemented and that the states realize that you’re gonna be penalized if you don’t do a good job of making sure everybody that receives SNAP benefits is the qualified recipient of that. So, you know, I think anytime you have accountability for something that is as important as that, that’s a lot of…That’s a big number, that’s a lot of money. And so I’m pretty excited about that, that the states will have the opportunity to improve and make sure they’re going to. or are they gonna be penalized.

Lydia Johnson: The Senate ag plan isn’t going to cut as much as the House Bill did. Can you sell this to the deficit hawks and the House and Senate who worry that the bill will add to the federal deficit?

Cindy Hyde-Smith: Well, you know, the good thing is that we’re saving so many programs that are very, very, very important. And I mean, we are increasing the Farm Safety Nets, which, you know, if you want anybody to survive, it better be your farmers. So we do have money in the Farm Safety Net. I mean, over the next 10 years, we’re looking at around $60 billion in the Farm Safety Nets. So, I think that the House was doing a great job. They sent over a good bill to get things passed over here. You have to make sure that you include everybody and you have to have negotiations. And this is where we landed, but I think we’re in a good spot. We’re excited about this.

Lydia Johnson: And Senator Jim Justice has warned that the state SNAP cost-share proposal could cost Republicans the majority in 2026. Do you agree with him?

Cindy Hyde-Smith: Well, you know, our state in Mississippi, we usually do a pretty good job, but there’s other states that do not, and they’re going to be penalized. So I think that people are gonna see this for what it is. But midterms are so incredibly important And I was in the room with Senator Justice when he was having these concerns. And he even made the comment, he said, “West Virginia’s gonna be fine. We can get there. But there’s other states with the, you know, with the penalties that will be faced because they’re not doing a good job in keeping their errors under control.” You know, you never know what effect that that may have on elections. But the bottom line is we’re doing the right thing.

Lydia Johnson: The Make America Healthy Again Commission report has raised a lot of questions among farm groups with little input into its development. We asked Senator Cindy Hyde-Smith about her thoughts on the report and if she has concerns over its claims about pesticides.

Cindy Hyde-Smith: Oh yes, the MAHA Report came out, and so many groups, farmers groups, research groups, they were very upset that they didn’t have any more input in it than they did. They just rolled it out. And of course, our secretary, Robert Kennedy, we’ve had conversations with him that things that are proven safe that the EPA has for 50 years done research. We need those tools. The crops cannot fail. We cannot afford for crops to fail. We have worked so hard, put millions of dollars into research to have these tools available to us. And then to mention things in the MAHA report that could cause some type of confidence that’s lost in consumers, I think is pretty unfair. So yeah, we’re having a lot of conversations about that, but we’re continuing to fight for the ability to use safe proven methods of raising crops to make sure that we can produce the agriculture products that the American people need.

Lydia Johnson: And you met with Secretary Kennedy earlier this week. Did he give you and your colleagues any reassurance about how the process could be different before that second MAHA report is released?

Cindy Hyde-Smith: He assured us that the stakeholders would be at the table this time. The meeting got a little intense. I am very, very concerned when you throw something in a report that is published and it’s just out there that may cause concern and may cause pause. But he assured us that the stakeholders would be at the table on the next round. And I think he understands how serious we are, that if you put something out there, you better have the evidence to back it up. And he just did not include that, which was concerning. But yeah, it was a pretty intense discussion. But my job here on the Ag Committee is to make sure that farmers have every benefit, every resource, every safety net that they can have. Because again, failure is not an option. We’ve gotta feed this country, and there’s 2% of us that feed the other 98%. So when it comes to policy, when it comes to regulations, you bet we’re in the center of that. And we want to get to a place that the farmers can do their jobs and have everything they need to do it without burdens and regulations or things being taken away that we’ve used through generations that helped us get to where we are.

Lydia Johnson: And the Trump administration is continuing to negotiate tariffs, but farmers likely won’t feel the effect of those until harvest time. Are producers and those in farm countries still right to be concerned about a trade war?

Cindy Hyde-Smith: We’re trying to get there. I think the president has used tariffs in a way that he understands, we just want a level playing field. We want to have the opportunity when we’re competing with others that the United States is at the table, we have a level playing field, that when countries are subsidizing other things that bring products in, whether it’s live animals, whether it’s grains, the commodities that we have to compete against, that the US farmer has a fair chance. The T word, the tariffs have been brutal. No one said this was not going to be painful, but I really think we’re trying to get to a place on the other side that we will benefit from this. But I’ll tell you, it’s a rough road right now, I’ll be honest with you.

Lydia Johnson: Senator, thank you so much for joining us. We’ll be right back with more of our panel discussion. But first, Andrew Huneke looks at the growing American ag trade deficit in this week’s Ag By the Numbers.

Andrew Huneke: USDA has slightly raised its ag trade deficit projection to 49 and a half billion dollars for fiscal year 2025. This chart shows the updated projected ag trade deficit, as well as the estimates for both imports and exports. As mentioned, the ag trade deficit is expected to grow to $49.5 billion, which is up 500 million from the deficit projected in February. This is also nearly $18 billion higher than last year’s deficit. Ag exports are expected to total about 170 and a half billion dollars. But the estimate for imports has now risen to $220 billion, leading to the higher projected deficit. Lower export forecasts for livestock products were unable to offset higher prices for grains and oil seeds. Coffee and cocoa products accounted for higher import prices. For Agri-Pulse, I’m Andrew Huneke.

Lydia Johnson: The Senate Ag Committee released text on their portion of the Budget Reconciliation Bill this week that saves about $144 billion over 10 years, which is a less drastic cut than the House version. We’re joined by Katie Naessens from Torrey Advisory Group and Ken Barbic from Invariant on our panel this week. We’ll begin with you, Katie. Do you think conservative hardliners will go along with this smaller cut?

Katie Naessens: I think a lot of it is going to depend upon everything in the entire bill, not just the agriculture pieces. There will be a lot of differences to assess. So a good example of that is the CBO current policy scoring versus the current law scoring that the House used in their assessment of the bill. And so for those folks who are looking at some of those hard numbers, that’s going to be an interesting sticking point. I think the other big thing to note about the Senate language is that it hasn’t gone through the Senate bird bath yet, so this really could bring a lot of those provisions into question, and potential changes will need to be made. So while this is just, you know, the first initial release of that text, you know, not a lot of substantive changes. You know, the orphan programs were included, the support for commodity programs. The cuts to nutrition were also there. Some of the conservation programs were included. It’s really gonna come down to a lot of these other questions, in particular the bird bath process. The other point to note is that Senator Rand Paul has been very vocally opposed to the Senate process, not just focused on the agriculture pieces, but writ large. So I think, you know, there are still a lot of questions out there in terms of where some of those fiscal conservatives or conservatives on the Senate side will end up landing.

Lydia Johnson: And the House Ag Committee’s SNAP cost-share proposal with states place a pretty large burden on states. Do you think that the Senate version strikes a better, maybe more workable balance of that state SNAP cost-share?

Katie Naessens: Well, I will say, you know, the Senate bill still takes a significant cut to those nutrition programs, upwards of about at least $200 billion, and this is going to impact millions of people, millions of families. They will be impacted by these cuts. I do really worry that these cuts will have a significant impact on the Farm Bill Coalition as a whole and any potential future efforts to try to bring together the nutrition groups, the farm groups, the conservation groups, the rural development groups, all of these folks who are interested in working on getting a farm bill done. Historically, bipartisan farm bills have always had large coalitions, and I just worry that this process will have a really big impact on that Farm Bill Coalition.

Lydia Johnson: And Ken, bringing you into the conversation here, the farm programs in the Senate bill will track pretty closely with what’s included in the House version, including an increase to reference prices. Where do you think that farmers will see the biggest benefit from this bill, from the Senate version?

Ken Barbic: Yeah, so, you know, as we talked about already, there’s not, you know, huge changes on the Title I side from what the House proposed. They carried a lot of that over. So, as we’ve seen across farm country, there’s been a lot of pressure on commodity prices in the Title I space. And so it is gonna be really important to see some of those changes brought across the finish line, in one form or another, to address some of those issues going on in rural America with our Title I commodities in particular. Also encouraging to see the Senate bill carry forward from the House some of the other farm bill provisions that impact areas like specialty crops and conservation and some of the other parts of that vehicle from the House that we’d like to see get across in this process as well.

Lydia Johnson: Many farm bill elements are being rolled into reconciliation. We asked Ken Barbic with in Invariant about the chances for a complete farm bill to be passed in the future.

Ken Barbic: Yeah, that’s gonna be a really interesting thing to watch over the course of this year. Chairman Thompson has indicated, you know, a desire to continue moving, you know, kind a farm bill that includes things that were not part of the reconciliation process. You know, where the dynamics play out from a bipartisan standpoint on moving something, something a lot of us are watching and looking to engage on. There is a lot of policy, we all know, that takes place in the Farm Bill beyond just the Title 1 issues and some of the money-related titles, there’s a lot of policy in that five-year farm bill that a lot of agriculture really cares about. And we’re now, you know, seven years past the 2018 Farm Bill getting completed. One other item I would mention that, you know, farmers are really watching this reconciliation process, is the 45c provisions as well. Very critical, especially in the biofuel space to see, you know, some type of action taken to make those credits more workable, and also give more certainty long term on that front. So that’s gonna have, you know, a significant impact to see those move forward in this process as well.

Lydia Johnson: And Katie, the Make America Healthy Again movement continues to gain traction, as more states apply for waivers to restrict purchases on candy and soda. You know, I’m wondering, I want your take on, how do these waivers change the program administration, the SNAP program administration, at the state level?

Katie Naessens: Yeah, well I think that’s a really good question, and one that we are still waiting to see exactly what those impacts will be. So while USDA has signed some of those waivers in several different states, the implementation of those waivers is still yet to be seen. So I think as early as January of 2026 is when we’ll start seeing some of those impacts, so right now is really the time when states are putting together what those plans will look like, and what the mechanics of those specific waiver restrictions will look like. So it will obviously change how SNAP is delivered in specific states, but what elements, and what different targets and things that folks are looking at, we just don’t know yet at this time exactly what that will be.

Lydia Johnson: And Ken, as we wrap up here, US and Chinese officials met earlier this week to negotiate trade deals. I’m wondering your perspective, do you think the deal that they negotiated will stand, and will farm country still feel the effects of those heavy tariffs that were originally implemented?

Ken Barbic: Yeah, that’s a great question, we’re continuing to see action on the trade front. You know, you mentioned China and the news we’re seeing on that front, there certainly seems to be something of a coming together of the two parties. Still, you know, I think more ground needs to be covered and more needs to be addressed. But you know, we also see action on, you know, about 18 other countries as well. We’re in a period right now with this 90-day pause on the reciprocal tariffs. We’re really hopeful to see more get done in the agricultural space in particular, on market access, and tariff relief, in some of these key export markets. And then also, you know, hopefully avoiding any kind of, you know, punitive retaliation from some of these key export markets. So really glad to see this team actively and aggressively engage. We know that there are some USDA officials over at USTR helping with the efforts. We’re also hopeful to see, you know, more of the key officials to get confirmed soon, you know, get the USTR, the ag negotiator front, and then also in the trade mission area, you know, with Luke Lindberg’s confirmation in the Senate still pending.

Lydia Johnson: Wonderful. Ken and Katie, thank you both so much for joining us. We’ll be back with more “Agri-Pulse Newsmakers.” But first, Andrew Huneke looks at the number of USDA employees that have left the department through the deferred resignation program, in this week’s Map it Out.

Andrew Huneke: The majority of the roughly 15,000 USDA employees who left the agency after accepting buyouts from the Trump administration, worked outside the DC area. This map shows the number of USDA employees that have left the agency by taking buyouts through the deferred resignation program by state. Only about 2200 of the 15,000 workers who accepted buyouts were based in either the District of Columbia, Maryland, or Virginia. The remaining 12,900 were from other states, including more than 700 each in California and Colorado. Nearly half of the workers that left in California work for the Forest Service, which has lost over 4,000 workers. Ag Secretary Brooke Rollins told lawmakers this week, USDA is adequately staffed after the buyouts. For “Agri-Pulse” I’m Andrew Huneke.

Lydia Johnson: Thanks for joining us for another episode of “Agri-Pulse Newsmakers.” Next week in Washington, the Senate will be in session while the House goes on recess. Thursday is Juneteenth, a federal holiday. Senate majority leader John Thune still has his eye set on passing the Senate version of President Trump’s One Big Beautiful Bill Act by the 4th of July. Tune in next week and check our website anytime for the latest developments. For Agri-Pulse, I’m Lydia Johnson. Thanks for watching.

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