Committee Discusses Ways to Drive Domestic Ag Demand

Current conditions in farm country have the U.S. Senate Committee on Agriculture, Nutrition and Forestry looking at ways to increase domestic consumption of U.S.-produced agricultural commodities.

In a recent hearing, committee chairman John Boozman (R-AR) said agricultural trade with other nations must remain a high priority, but recent experiences have underlined the importance of domestic markets.

“This hearing comes at a time of great financial stress for America’s farmers. If you’re putting something in the ground, you’re probably losing money,” Boozman said. “It doesn’t matter what you’re planting or where you’re planting it. No row crop is currently profitable.”

High input costs, including the cost of labor and interest rates, coupled with low commodity prices and significant trade headwinds for certain commodities highlight the need to consider what the future of agriculture in the U.S. should look like, Boozman said.

“Expanding market access and developing new trading partners is crucial to the success of American producers and our rural communities. However, our recent experiences made me think about how we can build more robust domestic markets that will not subject our producers to the whims of foreign governments,” Boozman said.

The committee invited representatives from several agricultural organizations, including the American Farm Bureau Federation (AFBF), the National Cotton Council and the National Corn Growers Association, to weigh-in on increasing domestic consumption of U.S. commodities.

AFBF President Zippy Duvall said the Farmer Bridge Assistance Program payments have provided an important lifeline to farmers this season, but farmers do not want to rely on government aid.

“We must reinforce our production capacity of critical ag supplies and restore domestic processing capacity,” Duvall said. “We must ensure our safety nets are strong and expand fair and enforceable market access abroad.”

More than 20% of total agricultural products are exported in a typical year. When exports fall, farm income falls, impacting the whole farm economy.

“Export markets must be strengthened through fair and enforceable trade agreements. Global competitors have expanded acreage, improved yields and invested heavily in ports and rail systems. That competition is not going to back down,” Duvall said. “We must be competitive in export markets but also expand domestic demand and processing capacity to be truly resilient.”

One way to improve domestic demand, Duvall said, is through biofuels.

Ethanol production now accounts for about 40% of total U.S. corn usage. If year-round E-15 is allowed, it would increase the amount of corn purchased and used for biofuels.

“Renewable diesel and biodiesel markets continue to transform oilseed demand,” Duvall said. “This shift has been driven expansion in soybean crushing capacity, creating jobs and strengthening local communities.”

Federal purchases of U.S. commodities for food programs would also help drive domestic demand.

Duvall noted federal agencies purchased nearly $7 billion in U.S.-grown food and agricultural products last year.

“Buy American policies are both patriotic and powerful, but oversight and enforcement can be strengthened,” Duvall said.

The National School Lunch Program provides nearly five billion meals annually that are supposed to be domestically sourced.

“But the rules allow a substantial share of foreign products and many exceptions,” Duvall said.

Enabling schools and food banks to source directly from U.S. farms is another demand booster, especially for fruit and vegetable growers. Incentives to buy American-grown products could also help boost domestic consumption

“The Buy American Cotton Act of 2026 is a good example of legislation that builds demand through a tax credit for businesses using American-grown cotton,” Duvall said.

Addressing problems with agricultural labor would also help domestic demand.

“The current labor shortage is unacceptable and unnecessary. We need modernized ag labor programs and improved guestworker programs. Otherwise, farm production and food processing will continue moving outside our borders,” Duvall said.

Committee ranking member Amy Klobuchar (D-MN) suggested approving year-round E-15 to drive demand along with investing in local markets, expanding support for rural businesses, investing in research to develop new revenue streams for farmers, completing a five-year farm bill and addressing tariffs.

“The best thing we can do in addition to have less of these tariffs is having them much more targeted using a chisel or hammer instead of a sledge hammer would be good,” Klobuchar said.

The committee plans future hearings on increasing domestic demand with ag processors, manufacturers and retailers, as well.