By Heather McGuire Doyle, Senior Market Reporter (North America)
A gridlocked Congress and looming federal budget cuts could disrupt the US feed industry, threatening ingredient supply chains, regulatory approvals, and agricultural research funding. With just 96 days left in the legislative session to pass critical funding bills, industry stakeholders are bracing for uncertainty.
Congress narrowly avoided a government shutdown last week (March 13) by passing a temporary spending bill, but the real fiscal battle is far from over. With only 96 days left in the legislative session, lawmakers face mounting pressure to finalize a full-year budget before the September 30 deadline, which marks the end of the government’s fiscal year. The US fiscal year runs from October 1 to September 30, meaning that without a long-term spending agreement, key agricultural programs, trade support, and research funding could face disruptions in fiscal year 2025, beginning October 1. As negotiations continue, industry leaders are bracing for deeper spending reductions that could impact ingredient supply chains, regulatory oversight, and global trade policies.
Tara Smith, Executive Vice President of the Torrey Advisory Group, a Washington, D.C.-based consultancy explained that administrative changes, staffing cuts, stalled legislation, and supply chain bottlenecks are already affecting the sector. Smith was speaking at the American Feed Industry Association Purchasing Ingredient Supplier Conference (AFIA-PISC).
The current administration's focus on reducing federal spending has led to significant budgetary adjustments, including cuts to programs that directly impact the agricultural sector. Smith noted that these reductions have resulted in unintended consequences, such as the firing of essential personnel and the halting of critical research projects.
"We've seen firings at CVM [Center for Veterinary Medicine], research projects pulled—a lot of different areas where we have seen these firing stories hit folks and perhaps lead to some unintended consequences," Smith said.
These budgetary decisions have raised concerns about the industry's ability to maintain efficient operations and meet the demands of both domestic and international markets. The reduction in the workforce and resources could lead to delays in regulatory approvals, disruptions in research and development, and challenges in maintaining quality standards, Smith explained.
The high-stakes budget battle—which includes unfinished fiscal year 2025 funding, the farm bill, and trade-related legislation—could have widespread impacts on feed ingredient imports, price stability, and regulatory oversight.
Farm Bill in Limbo: No Certainty for Ag Trade and Research
The passage of the new farm bill, a critical piece of legislation for the agricultural sector, is currently in jeopardy due to political disagreements and budgetary constraints. Smith emphasized the complexity of the situation, noting that the slim majority in the House makes it challenging to pass bipartisan legislation.
"To get a farm bill across the finish line, you need a bipartisan bill," Smith said. "If you try to cut $230 billion from nutrition, you are not getting any Democratic votes."
The delay in passing the farm bill means funding for crop insurance, conservation programs, and research into alternative feed ingredients remains in limbo. Without a resolution, companies in the feed sector could struggle to plan for long-term investments.
She explained, "You only got one or two or three [votes], depending on the day of the week and who shows up to vote. To get a farm bill across the finish line, you need a bipartisan bill."
The inability to pass the farm bill could have far-reaching effects on the feed and ingredient industry, including uncertainty in subsidy programs, conservation initiatives, and research funding. This legislative impasse adds another layer of complexity to an already challenging environment.
Supply Chain Risks: Budget Stalemate Could Slow Ingredient Imports
Beyond legislative hurdles, the ongoing budget stalemate could slow feed ingredient imports and disrupt global trade flows. The US relies on imports of essential feed additives—such as amino acids, vitamins, and minerals—to maintain livestock nutrition and efficiency. Any disruption in trade approvals or port operations could raise costs and cause shortages.
According to a report by the Federal Trade Commission (FTC), supply chain instability has already affected agriculture, with rising costs and bottlenecks making it harder for businesses to secure critical inputs. Smith highlighted the potential for increased food prices and reduced availability of certain agricultural products as direct consequences of these disruptions.
Smith emphasized that regulatory slowdowns caused by federal budget cuts could create additional headaches for feed manufacturers, delaying ingredient approvals and increasing compliance costs.
Industry Response: How Companies Can Prepare for Uncertain Policy Changes
With Congress facing an $8 trillion legislative workload and only a few months to pass major bills, industry leaders are pushing for swift action to secure trade policies and funding that support feed manufacturing.
Farm groups are urging Congress to resolve the impasse on economic aid for farmers in year-end funding packages, emphasizing the necessity of such aid to sustain operations and maintain the food supply chain.
For companies in the feed and ingredient sector, contingency planning is critical, Smith explained during the Q&A session.
Strategies to mitigate risks include: diversifying supplier networks to reduce reliance on a single import source, monitoring trade policy changes for potential tariff impacts on feed ingredients, and staying engaged with policymakers to advocate for stable agricultural funding.
As Smith put it, the industry's ability to adapt to policy shifts will determine how well it weathers the coming months. "This is a tight spot, and companies need to be prepared for potential disruptions ahead," she cautioned.
For now, all eyes are on Washington to see whether lawmakers can find common ground—or if industries will be left making alternative plans.
