"A Review of the U.S. Grain Standards Act"

1[House Hearing, 119 Congress]2[From the U.S. Government Publishing Office]34                A REVIEW OF THE U.S. GRAIN STANDARDS ACT56=======================================================================78                                HEARING910                               BEFORE THE1112 SUBCOMMITTEE ON GENERAL FARM COMMODITIES, RISK MANAGEMENT, AND CREDIT1314                                 OF THE1516                        COMMITTEE ON AGRICULTURE17                        HOUSE OF REPRESENTATIVES1819                    ONE HUNDRED NINETEENTH CONGRESS2021                             FIRST SESSION2223                               __________2425                             JUNE 26, 20252627                               __________2829                            Serial No. 119-83031    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]3233          Printed for the use of the Committee on Agriculture34                         agriculture.house.gov3536                                   _______3738                 U.S. GOVERNMENT PUBLISHING OFFICE394061-671 PDF                   WASHINGTON : 20254142                        COMMITTEE ON AGRICULTURE4344                 GLENN THOMPSON, Pennsylvania, Chairman4546FRANK D. LUCAS, Oklahoma             ANGIE CRAIG, Minnesota, Ranking47AUSTIN SCOTT, Georgia, Vice          Minority Member48Chairman                             DAVID SCOTT, Georgia49ERIC A. ``RICK'' CRAWFORD, Arkansas  JIM COSTA, California50SCOTT DesJARLAIS, Tennessee          JAMES P. McGOVERN, Massachusetts51DOUG LaMALFA, California             ALMA S. ADAMS, North Carolina52DAVID ROUZER, North Carolina         JAHANA HAYES, Connecticut53TRENT KELLY, Mississippi             SHONTEL M. BROWN, Ohio, Vice54DON BACON, Nebraska                  Ranking Minority Member55MIKE BOST, Illinois                  SHARICE DAVIDS, Kansas56DUSTY JOHNSON, South Dakota          ANDREA SALINAS, Oregon57JAMES R. BAIRD, Indiana              DONALD G. DAVIS, North Carolina58TRACEY MANN, Kansas                  JILL N. TOKUDA, Hawaii59RANDY FEENSTRA, Iowa                 NIKKI BUDZINSKI, Illinois60MARY E. MILLER, Illinois             ERIC SORENSEN, Illinois61BARRY MOORE, Alabama                 GABE VASQUEZ, New Mexico62KAT CAMMACK, Florida                 JONATHAN L. JACKSON, Illinois63BRAD FINSTAD, Minnesota              SHRI THANEDAR, Michigan64JOHN W. ROSE, Tennessee              ADAM GRAY, California65RONNY JACKSON, Texas                 KRISTEN McDONALD RIVET, Michigan66MONICA De La CRUZ, Texas             SHOMARI FIGURES, Alabama67ZACHARY NUNN, Iowa                   EUGENE SIMON VINDMAN, Virginia68DERRICK VAN ORDEN, Wisconsin         JOSH RILEY, New York69DAN NEWHOUSE, Washington             JOHN W. MANNION, New York70TONY WIED, Wisconsin                 APRIL McCLAIN DELANEY, Maryland71ROBERT P. BRESNAHAN, Jr.,            CHELLIE PINGREE, Maine72Pennsylvania                         SALUD O. CARBAJAL, California73MARK B. MESSMER, Indiana74MARK HARRIS, North Carolina75DAVID J. TAYLOR, Ohio7677                                 ______7879                     Parish Braden, Staff Director8081                 Brian Sowyrda, Minority Staff Director8283                                 ______8485 Subcommittee on General Farm Commodities, Risk Management, and Credit8687                    AUSTIN SCOTT, Georgia, Chairman8889DAVID ROUZER, North Carolina, Vice   SHARICE DAVIDS, Kansas, Ranking90Chair                                Minority Member91ERIC A. ``RICK'' CRAWFORD, Arkansas  DAVID SCOTT, Georgia92DOUG LaMALFA, California             SHONTEL M. BROWN, Ohio93MIKE BOST, Illinois                  DONALD G. DAVIS, North Carolina94DUSTY JOHNSON, South Dakota          NIKKI BUDZINSKI, Illinois, Vice95MARY E. MILLER, Illinois             Ranking Minority Member96BARRY MOORE, Alabama                 ERIC SORENSEN, Illinois97BRAD FINSTAD, Minnesota              KRISTEN McDONALD RIVET, Michigan98JOHN W. ROSE, Tennessee              ------99MONICA De La CRUZ, Texas             ------100ZACHARY NUNN, Iowa                   ------101MARK HARRIS, North Carolina          ------102DAVID J. TAYLOR, Ohio103104                                  (ii)105106                             C O N T E N T S107108                              ----------109                                                                   Page110Craig, Hon. Angie, a Representative in Congress from Minnesota,111  opening statement..............................................     4112    Prepared statement...........................................     4113Davids, Hon. Sharice, a Representative in Congress from Kansas,114  opening statement..............................................     2115    Prepared statement...........................................     3116Scott, Hon. Austin, a Representative in Congress from Georgia,117  opening statement..............................................     1118    Prepared statement...........................................     2119Thompson, Hon. Glenn, a Representative in Congress from120  Pennsylvania, opening statement................................    34121122                               Witnesses123124Friant, Nicholas R., Director, Raw Material Quality and125  Regulatory, Cargill, Inc.; Chairman, Grain Grades and Weights126  Committee, National Grain and Feed Association, Wayzata, MN....     5127    Prepared statement...........................................     7128Mikesh, Kia, President, American Association of Grain Inspection129  and Weighing Agencies; Vice President, North Dakota Grain130  Inspection Service Inc., Fargo, ND.............................    11131    Prepared statement...........................................    13132Walton, Dave, Secretary, American Soybean Association, Wilton, IA    15133    Prepared statement...........................................    17134Donnelly, Ph.D., Kevin J., Professor Emeritus, Department of135  Agronomy, Kansas State University, Manhattan, KS...............    19136    Prepared statement...........................................    21137138                A REVIEW OF THE U.S. GRAIN STANDARDS ACT139140                              ----------141142                        THURSDAY, JUNE 26, 2025143144                  House of Representatives,145Subcommittee on General Farm Commodities, Risk Management,146                                                and Credit,147                                  Committee on Agriculture,148                                                   Washington, D.C.149    The Subcommittee met, pursuant to call, at 10:00 a.m., in150Room 1300, Longworth House Office Building, Hon. Austin Scott151of Georgia [Chairman of the Subcommittee] presiding.152    Members present: Representatives Austin Scott of Georgia,153Rouzer, LaMalfa, Johnson, Miller, Moore, Finstad, Rose, De La154Cruz, Harris, Taylor, Thompson (ex officio), Davids of Kansas,155Brown, Davis of North Carolina, Budzinski, Sorensen, McDonald156Rivet, and Craig (ex officio).157    Staff present: Austin DeBerry, Luke Franklin, Harlea158Hoelscher, Sofia Jones, Josie Montoney, Thomas Newberry, Sam159Rogers, John Konya, Kate Fink, Emily Pliscott, Ashley Smith,160Michael Stein, and Jackson Blodgett.161162  OPENING STATEMENT OF HON. AUSTIN SCOTT, A REPRESENTATIVE IN163                     CONGRESS FROM GEORGIA164165    The Chairman. Good morning, everyone. Thank you for joining166us today. I would like to start by welcoming the witnesses167before us as they help to lay the groundwork for legislation to168reauthorize the United States Grain Standards Act. I also want169to thank Ranking Member Davids for participating with me to170make today's hearing happen.171    Originally passed in 1916, the United States Grain172Standards Act (Pub. L. 64-190, Part B) gives the Federal173Government the authority to set official marketing standards174for grains and oilseeds. It provides procedures for grain175inspection and weighing that are essential to helping U.S.176grain maintain its strong reputation for reliable quality and177consistencies. Bad actors in the 1970s routinely manipulated178the market in various ways to take advantage of producers and179buyers, including through bribing officials or contaminating180shipments. However, over the years, this Committee, working181with the USDA and industry partners, devised a system of182standards and measurements that have earned the positive183reputation we see now, ultimately benefiting both farmers and184consumers.185    While much of the Act is permanently authorized, such as186mandatory inspection and weighing of exported grain, there are187still key provisions that are set to expire this September. A188lapse in authorization would disrupt the current grain189inspection and weighing process, potentially creating dramatic190consequences for the U.S. grain industry.191    Grain standards play a critical role in keeping a key192agricultural supply chain strong and supporting U.S. trade,193while ensuring farmers receive a fair price and buyers get the194product they need. Trust and consistency are what make the U.S.195grain industry the gold standard across the globe. I hope the196discussion today will provide Congress with necessary insight197into the importance of grain standards and shed light on areas198where improvements may be necessary. I look forward to getting199this vital piece of legislation across the finish line.200    [The prepared statement of Mr. Austin Scott follows:]201202 Prepared Statement of Hon. Austin Scott, a Representative in Congress203                              from Georgia204    Good morning everyone and thank you for joining us today--I would205like to start by welcoming the witnesses before us as they help to lay206the groundwork for legislation to reauthorize the United States Grain207Standards Act.208    I also want to thank Ranking Member Davids for partnering with me209to make today's hearing happen.210    Originally passed in 1916, the United States Grain Standards Act211gives the Federal Government the authority to set official marketing212standards for grains and oilseeds. It provides procedures for grain213inspection and weighing that are essential to helping U.S. grain214maintain its strong reputation for reliable quality and consistency in215global markets.216    Bad actors in the 1970s routinely manipulated the market in various217ways to take advantage of producers and buyers, including through218bribing officials or contaminating shipments. However, over the years,219this Committee, working with USDA and industry partners, devised the220system of standards and measurements that have earned the positive221reputation we see now, ultimately benefiting farmers and consumers222alike.223    While much of the Act is permanently authorized, such as mandatory224inspection and weighing of exported grain, there are still key225provisions that are set to expire this September. A lapse in226authorization would disrupt the current grain inspection and weighing227process, potentially creating dramatic consequences for the U.S. grain228industry.229    Grain standards play a critical role in keeping a key agriculture230supply chain strong and supporting U.S. trade; while ensuring farmers231receive a fair price and buyers get the product they need. Trust and232consistency are what make the U.S. grain industry the golden standard233across the globe.234    I hope the discussion today will provide Congress with the235necessary insight into the importance of grain standards and shed light236on areas where improvements may be necessary. I look forward to getting237this vital piece of legislation across the finish line.238    With that, I'll turn it over to Ranking Member Davids for her239opening remarks.240241    The Chairman. With that, I will turn it over to Ranking242Member Davids for her opening remarks.243244 OPENING STATEMENT OF HON. SHARICE DAVIDS, A REPRESENTATIVE IN245                      CONGRESS FROM KANSAS246247    Ms. Davids of Kansas. Thank you. Good morning, everyone.248Thank you, Chairman Scott, for holding today's hearing. I look249forward to working with you and the rest of the Subcommittee on250reauthorizing the U.S. Grain Standards Act later this year.251    The inspections provided by the Federal Grain Inspection252Service define and classify grains, as well as assign grades to253specify weight and quality requirements. These inspections254provide a gold standard assurance, backed by the Federal255Government, to both grain buyers and sellers.256    Grain farmers in Kansas and across the country participate257in a very competitive world market. Foreign grain buyers should258be confident in the process we have in place to ensure that our259exports are adequately inspected. As we move ahead with260reauthorization, I hope we can take this as an opportunity to261support and improve our grain inspection system, which remains262critical to global grain trade.263    I am proud that Kansas is home to the one-of-a-kind Kansas264State University Department of Grain Science and Industry,265which prepares students to become agricultural professionals in266this space. As we discuss potential improvements in technology267for grain grading, we must consider how to prepare the next268generation of our workforce to adapt to changing jobs.269    I would like to thank our panel of witnesses for making the270trip all the way to D.C. during one of the hottest weeks of the271year. I very much look forward to your testimony and appreciate272your time and your expertise.273    Again, thank you to our Chairman for holding today's274hearing, and I look forward to working together on275reauthorization this year. I yield back.276    [The prepared statement of Ms. Davids of Kansas follows:]277278Prepared Statement of Hon. Sharice Davids, a Representative in Congress279                              from Kansas280    Good morning. Thank you, Chairman Scott, for holding today's281hearing.282    I look forward to working with you and the rest of the Subcommittee283on reauthorizing the U.S. Grain Standards Act later this year.284    The inspections provided by the Federal Grain Inspection Service285define and classify grains, as well as assign grades to specify weight286and quality requirements.287    These inspections provide a ``gold standard'' assurance backed by288the Federal Government to both grain buyers and sellers.289    Grain farmers in Kansas and across the country participate in a290very competitive world market.291    Foreign grain buyers should be confident in the process we have in292place to ensure our exports are adequately inspected.293    As we move ahead with reauthorization, I hope that we take this as294an opportunity to support and improve our grain inspection system,295which remains critical to global grain trade.296    I am proud that Kansas is home to the one-of-a-kind Kansas State297University Department of Grain Science and Industry, which prepares298students to become agricultural professionals in this space.299    As we discuss potential improvements in technology for grain-300grading, we must consider how to prepare the next generation of our301workforce to adapt to changing jobs.302    I'd like to thank our panel of witnesses for making the trip all303the way to D.C. during one of the hottest weeks of the year.304    I very much look forward to your testimony and appreciate your time305and expertise.306    Again, I thank the Chairman for holding today's hearing and look307forward to working together on reauthorization this year.308309    The Chairman. Thank you, Ranking Member Davids.310    I should have said this before, but in consultation with311the Ranking Member pursuant to Rule XI(e), I want to make312Members of the Subcommittee aware that other Members of the313full Committee may join us today. I expect Chairman Thompson to314come back from a meeting that he is in right now.315    And I would now like to recognize Ranking Member Craig for316any opening comments she would like to make.317318  OPENING STATEMENT OF HON. ANGIE CRAIG, A REPRESENTATIVE IN319                    CONGRESS FROM MINNESOTA320321    Ms. Craig. Thank you so much, Chairman Scott and Ranking322Member Davids.323    Considering the fact that we are in the middle of a324worldwide trade war, we should be doing everything we can to325avoid further disruption to our domestic trade system.326    Every summer, grains planted by hardworking Minnesotans327cover 40 percent of my district. Ensuring grain can get from328our farms and grain elevators and onto ships bound for overseas329markets requires an operationally efficient and properly funded330Federal Grain Inspection Service. That is why I am so glad to331see the bipartisan nature of this hearing today and the support332from across this Subcommittee for reauthorizing the U.S. Grain333Standards Act. Our grain farmers need to know they can rely on334the Federal Government and USDA as reliable partners, not335roadblocks to trade. Reauthorizing the U.S. Grain Standards Act336is important for our farmers and their customers, and I am glad337to see this bipartisan effort to ensure we meet their needs.338    Thank you again for holding this hearing, and thank you to339our witnesses for coming to educate us today about the critical340role grain standards play in your businesses and the farm341economy.342    Mr. Chairman, I yield back.343    [The prepared statement of Ms. Craig follows:]344345 Prepared Statement of Hon. Angie Craig, a Representative in Congress346                             from Minnesota347    Thank you, Chairman Scott and Ranking Member Davids.348    Considering the fact that we are in the middle of a worldwide trade349war, we should be doing everything we can to avoid further disruption350to our domestic trade system.351    Every summer, grains planted by hardworking Minnesotans cover 40352percent of my district. Ensuring grain can get from our farms and grain353elevators and onto ships bound for overseas markets requires an354operationally efficient and properly funded Federal Grain Inspection355Service.356    That is why I am glad to see the bipartisan nature of this hearing357today and the support from across this Subcommittee for reauthorizing358the U.S. Grain Standards Act.359    Our grain farmers need to know that they can rely on the Federal360Government and USDA as reliable partners, not roadblocks, to trade.361    Reauthorizing the U.S. Grain Standards Act is important for our362farmers and their customers, and I am glad to see this bipartisan363effort to ensure we meet their needs.364    Thank you again for holding this hearing, and thank you to our365witnesses for coming to educate us today about the critical role grain366standards play in your businesses and the farm economy.367    I yield back.368369    The Chairman. Thank you, Ranking Member.370    The chair would request that other Members submit their371opening statements for the record so the witnesses may begin372their testimony and to ensure that there is ample time for373questions.374    Each of the witnesses will have approximately 5 minutes.375And our first witness today is Mr. Nicholas Friant. Nick serves376as the Chairman of the National Grain and Feed Association377Grain Grades and Weights Committee and is the Director of Raw378Material Quality and Regulatory at Cargill.379    Our next witness is Ms. Kia Mikesh, the President of the380American Association of Grain Inspection and Weighing Agencies,381Kia is also the Vice President of the North Dakota Grain382Inspection, where she oversees the operations and strategic383direction of her family-owned network of agricultural384inspection and testing businesses in Fargo, North Dakota.385    Our third witness today is Mr. Dave Walton, Secretary of386the American Soybean Association. He grows soybeans, corn,387alfalfa, grass, hay, and also raises beef cattle at his family388farm in Wilton, Iowa, with his wife and two sons.389    I will now turn it over to Ranking Member Davids to390introduce our final witness.391    Ms. Davids of Kansas. Thank you, Mr. Chairman. I am excited392and proud to introduce a Kansan to testify today. Dr. Kevin393Donnelly is an Emeritus Professor of Agronomy at Kansas State394University and a farmer in central Kansas. During Dr.395Donnelly's 47 year teaching career, he taught college students396about grain quality and grain grading using Federal Grain397Inspection Service, or FGIS, standards. He also conducts398workshops illustrating FGIS grain inspection procedures for the399International Grains Program at Kansas State University for400industry professionals throughout the world. Dr. Donnelly,401thank you for joining us today.402    I yield back.403    The Chairman. Doctor, I used to go right past your area404headed to Tuttle Creek. It is a wonderful, wonderful part of405the world.406    Thank you to all of our witnesses for joining us today. We407will now proceed to your testimony. You have 5 minutes. The408timer in front of you will count down to zero, at which point,409time has expired. If you go over by 5 seconds, that is okay. If410you go over by 10 or 15, it is $5 per second.411    Mr. Friant, please begin when you are ready.412413        STATEMENT OF NICHOLAS R. FRIANT, DIRECTOR, RAW414MATERIAL QUALITY AND REGULATORY, CARGILL, INC.; CHAIRMAN, GRAIN415                 GRADES AND WEIGHTS COMMITTEE,416        NATIONAL GRAIN AND FEED ASSOCIATION, WAYZATA, MN417418    Mr. Friant. Chairman Scott, Ranking Member Davids, and419Members of the Subcommittee, thank you for the opportunity to420appear before you today to provide the perspective of the421National Grain and Feed Association on reauthorizing the U.S.422Grain Standards Act. I am Nick Friant, Director of Raw Material423Quality and Regulatory at Cargill and Chairman of NGFA's Grain424Grades and Weights Committee. Cargill is proud to be a long-425time participant in the U.S. grain system and member of NGFA.426    Since 1896, NGFA has represented grain industry members427that operate more than 8,000 facilities. This includes farmer-428owned cooperatives and multinational grain exporters. Together,429we rely on a strong, consistent, and transparent official430inspection and weighing system to deliver confidence and value431across the global supply chain.432    We urge Congress to reauthorize the U.S. Grain Standards433Act in a timely and bipartisan manner. Doing so will provide434certainty to farmers, grain handlers, and international435customers who depend on the integrity of the U.S. official436grain inspection system.437    I want to focus on two core issues that are top priorities438for our industry in this reauthorization. First, investment in439grain grading technology to speed and improve the inspection440process; and second, strengthening the emergency waiver441authority to ensure continuity and flexibility in grain export442inspection services.443    The U.S. grain inspection system has long set a global444benchmark for quality and reliability. While this basic445framework of grain standards has remained stable over time, the446international grain market has become increasingly competitive.447Thus, our inspection and grading systems must evolve448accordingly.449    Today, the Federal Grain Inspection Service still relies on450legacy technologies for determining grade factors that451ultimately influence a commodity's value and fungibility. FGIS452must prioritize research, development, and validation of modern453grain grading technologies that improve accuracy, speed, and454consistency. The agency should actively collaborate with455industry and academia to identify innovative tools that can456reduce human error and improve grading objectivity.457    Furthermore, we believe that new technologies can help the458agency drive efficiencies, reduce costs, and address the459staffing challenges it faces, all of which ultimately benefit460U.S. farmers, agribusiness, and rural economies. We believe the461U.S. Department of Agriculture should allocate dedicated462resources, both staffing and funding, to expedite this process.463    NGFA and its members are ready and willing to partner with464USDA and FGIS to pilot and implement new technologies, provided465there is a clear pathway for scientific validation,466standardization, and eventual deployment. Therefore, we have467worked with our partners at the American Association of Grain468Inspection and Weighing Agencies and the American Soybean469Association, who are also testifying today, on language for the470U.S. Grain Standards Reauthorization Act that will provide FGIS471with the necessary tools to focus their resources on this472important issue. We encourage this Committee to approve this473proposal.474    The second central area we urge Congress to address is the475need for enhanced flexibility in issuing emergency waivers of476official inspection requirements during service disruptions.477The 2015 reauthorization wisely included provisions requiring478FGIS to act transparently when official services are disrupted479at export ports due to withdrawal of a service by delegated480state agencies.481    Let me be clear, the U.S. industry strongly supports the482requirement for mandatory official inspection and weighing of483export grain. It is fundamental to preserving market integrity484and the credibility of our supply chain. But during natural485disasters or other force majeure events, or in rare instances486where buyers and sellers mutually agree to waive inspection due487to service disruptions, the Act must allow for pragmatic488flexibility. We recommend that Congress revise the Act to489clarify the definition of emergency and authorize FGIS to issue490conditional waivers.491    Further, the waiver would be applied provided that the492buyer and seller voluntarily agree, the absence of an official493inspection does not impair the transaction, and such a waiver494would not undermine the objectives of the Act. Establishing495transparent and predictable contingency planning for future496disruptions would provide exporters, importers, and customers497with confidence that the flow of U.S. grains can continue498during unexpected challenges without compromising overall499integrity of the system.500    While I have highlighted two key priorities, we are ready501to discuss other elements of the Act, including advisory502committee functionality, ensuring timely appointments and503maintaining a quorum, clarify use of user fees. We support504FGIS's final rule that decoupled Schedule A fees from tonnage-505based rolling average fees, we will continue to monitor the506impact of the new fees on the industry moving forward. And user507fee cap reform--limit the cap to USGSA-regulated commodities.508    The U.S. grain inspection system is a foundation of our509country's reputation as a reliable agricultural supplier.510Timely reauthorization of the U.S. Grain Standards Act,511combined with the enhancements we have outlined today, will512ensure that our inspection system continues to meet the high513expectation of U.S. producers and our global customers.514    As Chairman of the NGFA Grain Grades and Weights Committee515and on behalf of Cargill and the broader grain industry, I516would like to express my sincere appreciation for your517oversight and bipartisan leadership on this issue. We look518forward to working with you to modernize and strengthen this519vital Act.520    Thank you for the opportunity to testify, and I welcome521your questions.522    [The prepared statement of Mr. Friant follows:]523524   Prepared Statement of Nicholas R. Friant, Director, Raw Material525   Quality and Regulatory, Cargill, Inc.; Chairman, Grain Grades and526                                Weights527      Committee, National Grain and Feed Association, Wayzata, MN528    Chairman Scott, Ranking Member Davids, and Members of the529Committee, I am Nick Friant, Director, Raw Material Quality and530Regulatory at Cargill and Chairman of NGFA's Grain Grades and Weights531Committee. I am pleased to testify today on the very important topic of532reauthorizing the U.S. Grain Standards Act (USGSA) on behalf of the533National Grain and Feed Association (NGFA), where I serve as Chairman534of the Grain Grades and Weights Committee. I have also served several535terms as an appointed member of the Federal Grain Inspection Service's536(FGIS) Grain Inspection Advisory Committee.537    I have been with Cargill for more than 20 years and I provide538technical and regulatory compliance assistance on a wide range of539issues related to grain quality, handling and inventory for Cargill's540operations and merchandizing.541    For 160 years, Cargill has been proudly headquartered in the United542States, where today we connect 54,000 American farmers and ranchers to543domestic and global markets and employ 39,000 people across 39 states.544We have operations in 70% of the Congressional districts represented by545Members of this Subcommittee and are privileged to play an important546role in your communities and local economies.547    Globally, Cargill employs 160,000 people in 70 countries, providing548food, ingredients, agricultural solutions, and industrial products that549help nourish the world in a safe, responsible, and sustainable way. We550are proud to connect farmers with markets so they can prosper. And by551providing customers with products that are vital for living, we help552businesses grow, communities prosper, and consumers live well in their553daily lives.554    NGFA, established in 1896, consists of grain, feed, processing,555exporting and other grain handling companies that operate more than5568,000 facilities that handle grains and oilseeds. NGFA's membership557encompasses all sectors of the industry, including country, terminal558and export grain elevators; commercial feed and feed ingredient559manufacturers; biofuels producers; cash grain and feed merchants; end-560users of grain and grain products, including processors, flour millers,561and livestock and poultry integrators; commodity futures brokers and562commission merchants; and allied industries. The NGFA also has a563strategic alliance with the North American Export Grain Association. In564addition, affiliated with the NGFA are twenty-seven state and regional565grain and feed trade associations.566    NGFA strongly supports reauthorization of the USGSA to maintain and567continually improve the U.S. Official grain inspection system. Our568association has a long history of advocating for a Federal Official569grain inspection and weighing system. We have worked continuously for570over 50 years to encourage continued improvements to this system--and571have several recommendations to further enhance it in our testimony572today. NGFA also works to improve the broader regulatory and commercial573environment to enhance the value, safety, competitiveness and574sustainability of U.S. agriculture, and the positive contribution it575makes to America's balance of trade and job-creation.576    FGIS performs an essential role by establishing, maintaining and577updating the Official U.S. grain standards, which are critical to578establishing value and price-discovery in the U.S. and global grain and579oilseed marketplace. The inspection and other services provided by580FGIS, which are funded principally through industry-paid fees,581contribute significantly to the marketing and trading of U.S. grains582and oilseeds by farmers and other commercial parties. The U.S. grain583handling and export system is recognized around the world for its584ability to market and provide a competitively priced, fungible,585abundant, safe and sustainable commodity supply that is responsive to586customer needs.587    U.S. competitiveness in global markets, as well as stakeholders588ranging from farmers to end-users, benefit when FGIS and its delegated589and designated state and private agencies provide state-of-the-art,590market-responsive Official inspection and weighing of bulk grains and591oilseeds, and do so in a reliable, uninterrupted, consistent and cost-592effective manner.593    At the outset, I want to state that NGFA aligns itself with, and594supports, the testimony being provided here today by the American595Association of Grain Inspection and Weighing Agencies whose member596companies provide Official inspection and weighing services on behalf597of FGIS.598    NGFA wishes to begin by expressing its appreciation to Congress--599and particularly this Committee--for its leadership in enacting600fundamental reforms as part of the 2015 reauthorization of this601statute, which set in motion dramatic improvements within FGIS that602place our industry and our farmer-customers in a much better position603today than we were then, when the reputation of the Official system for604providing reliable and cost-effective Official inspection and weighing605service was under serious challenge during a service disruption in6062013-2014.607    The second major contribution was former Secretary of Agriculture608Sonny Perdue's decision as part of his 2017 USDA reorganization plan to609extricate FGIS from the Grain Inspection, Packers and Stockyards610Administration (GIPSA) and return it to the Agricultural Marketing611Service, where it had resided prior to 1994, as well as to install612fresh new leadership at the agency.613    NGFA strongly supported this aspect of Secretary Perdue's614reorganization plan. The merger of FGIS and the Packers and Stockyards615Administration into GIPSA during the Clinton Administration had always616been an odd fit, since the two agencies have distinctly different617missions and functions. FGIS is an agency focused on maintaining grain618standards and providing Official inspection and weighing service to619facilitate the marketing of U.S. agricultural products under authority620provided by both the U.S. Grain Standards Act and the Agricultural621Marketing Act, under the latter of which AMS operates. By contrast, the622Packers and Stockyards Administration is primarily an enforcement623agency operating under a completely different statute (the Packers and624Stockyards Act).625    In addition, the synergy provided by AMS's administrative support626services, development of quality standards, training expertise and627experience in operating user-fee-funded services have enhanced FGIS's628performance. So, too, has the capable new leadership installed at the629agency. Further, the reorganization helped FGIS address problems that630occurred over the last decade involving the overall expense and631effectiveness of federally mandated FGIS Official grain inspection632services by eliminating programmatic redundancies, reducing633administrative costs, and providing opportunities for interaction with634AMS personnel with a similar mission and focus. We especially want to635recognize and commend the dedication of many career public servants636within AMS and FGIS for their hard work and commitment in addressing637important stakeholder issues during this transition.638    While continual improvement is necessary and important for all639enterprises, NGFA believes that the service-oriented culture of AMS has640had a demonstrable and transformatively positive impact that is serving641American farmers and our industry well.642    While changes to the USGSA in 2015 and the reorganization of FGIS643in 2017 have improved Official inspection and weighing services, NGFA644believes there are several additional improvements that can be made to645create an even more reliable, competitive and cost-effective system to646facilitate the marketing of U.S. grains and oilseeds in export and647domestic markets.648    NGFA's recommendations consist of the following:649650   First, we urge that the USGSA be strengthened by651        prioritizing the importance of modernizing grain grading652        technologies to assist FGIS in the research process to improve653        the accuracy, speed, and consistency of the Official inspection654        and weighing process.655656      The U.S. grain inspection system has long set a global benchmark657        for quality and reliability. However, as the international658        grain market becomes increasingly competitive, our inspection659        and grading systems must evolve accordingly.660      Today, the FGIS still relies on legacy technologies--some of661        which date back decades--for determining grade factors that662        ultimately influence a commodity's value and fungibility. While663        the basic framework of grain standards has remained stable over664        time, the tools used to assess quality must keep pace with the665        demands of modern agriculture and the expectations of666        international buyers.667      FGIS must prioritize research, development, and validation of668        modern grain grading technologies that improve accuracy, speed,669        and consistency. The agency should actively collaborate with670        industry and academia to identify innovative tools--such as671        enhanced visual imaging systems, rapid chemical analysis, and672        machine learning-based detection platforms--that can reduce673        human error and improve grading objectivity. Furthermore, we674        believe that new technologies can help the Agency drive675        efficiencies, reduce costs, and address the staffing challenges676        it faces--all of which ultimately benefit U.S. farmers,677        agribusinesses, and rural economies.678      We believe the USDA should allocate dedicated resources--both679        staff and funding--to expedite this process. Updating the680        methods and technologies behind our Official inspections will681        enhance customer satisfaction, support U.S. export682        competitiveness, and reduce the long-term costs of service683        delivery.684      NGFA and its members are ready and willing to partner with USDA685        and FGIS to pilot and implement new technologies, provided686        there is a clear pathway for scientific validation,687        standardization, and eventual deployment.688      We have worked with our partners at AAGIWA on language for the689        USGSA that will provide FGIS with the necessary tools to focus690        their resources on this important issue. We encourage the691        Committee to approve the proposal.692693   Our second recommendation pertains to the need for enhanced694        flexibility in issuing emergency waivers of Official inspection695        and weighing requirements during service disruptions.696697      The 2015 USGSA Reauthorization wisely included provisions698        requiring FGIS to act transparently when Official services are699        disrupted at export ports due to the withdrawal of service by700        delegated state agencies. However, in practice, the701        implementation of these provisions under 7 CFR 800 has been702        overly restrictive and has not kept pace with operational703        realities.704      The U.S. industry strongly supports the requirement for mandatory705        Official inspection and weighing of export grain. It is706        fundamental to preserving market integrity and the credibility707        of our supply chain. But during natural disasters or other708        force majeure events, or in rare instances where buyers and709        sellers mutually agree to waive inspection due to service710        disruptions, the Act must allow for pragmatic flexibility.711      We recommend that Congress revise the Act to clarify the712        definition of ``Emergency'' and authorize FGIS to issue713        conditional waivers. Specifically, after the existence of a714        general emergency is declared, the agency would publicly715        identify the port(s), terminal(s), or region(s) so affected;716        and waive the requirements for official inspection and weighing717        for 7 days or until the general emergency has concluded,718        whichever occurs first.719      Further, the waiver would be applied provided that:720721       The buyer and seller voluntarily agree;722723       The absence of an official inspection does not724            impair the transaction;725726       And such a waiver would not undermine the objectives727            of the Act.728729      Establishing a transparent and predictable contingency plan for730        future disruptions would provide exporters, importers, and731        customers with confidence that the flow of U.S. grain can732        continue during unexpected challenges without compromising the733        overall integrity of the system.734735   Third, we recommend that the FGIS Grain Inspection Advisory736        Committee (GIAC) be reauthorized and modifications made to the737        process for accepting applications and officially announcing738        new members.739740      The advisory committee provides counsel to the FGIS administrator741        on the implementation of the USGSA. It is comprised of members742        who represent the interests of grain producers, exporters and743        handlers. NGFA believes the advisory committee serves a744        worthwhile function by providing expert advice and assistance745        to FGIS--and helps hold the agency accountable--for fulfilling746        its core mission of ensuring that Official inspections are747        performed in a reliable, consistent, cost-effective and748        uninterrupted manner to facilitate the export of U.S. grains749        and oilseeds to global customers.750      However, delays in approving nominees and failure to have a751        quorum for official business, limit the effectiveness of the752        committee and the knowledge and expertise of those that are753        limited in the time they can participate. Therefore, we propose754        that a specific time frame for the Secretary to name new755        committee members--e.g., 90 days--be included in the USGSA.756        Additionally, we recommend the USGSA allow the option for757        current GIAC Members to serve until new Members are announced758        by the Secretary. This provides flexibility for achieving a759        quorum and conducting business if the nominations process is760        delayed.761762   Fourth, we support FGIS's final rule that decoupled all763        other Schedule A fees from the rolling average-based tonnage764        fee. We will continue to monitor the user fee formula that was765        implemented by the FGIS on January 27, 2025 The formula is the766        same one used with other AMS agencies but is the first time767        that it has been used for Official grain inspection services.768769      Overall, NGFA supported the fee increase but urged the FGIS to770        take the necessary steps to mitigate the issues that could lead771        to significant fee increases moving forward. FGIS acknowledged772        that they supported the comments and are addressing the773        concerns raised.774      FGIS published an interim rule in the Federal Register on June 6,775        2024 establishing revised fees for official services performed776        by FGIS and requesting comments. The revised fees announced in777        the interim rule became effective on July 8, 2024. On December778        27, FGIS published a final rule that adopts the fees779        established by the interim rule without change and responds to780        the comments submitted by NGFA.781      The hourly contract rate increased from $41.20 to $65, and the782        non-contract rate increased from $73 to $93.30. The contract783        rate for weekends and overtime increased from $49.10 to $81.30.784        The non-contract rate increased from $73 to $116.60. With the785        increased revenue, as well as the continued implementation of786        cost-saving measures, FGIS ``projected'' positive revenue and a787        positive operating reserve balance by the end of FY24. Based on788        the interim final rule and the increase Officially inspected789        grain, FGIS completed FY24 with a 1 month operating surplus of790        $3.5 million. Further, FY24 Officially inspected grain reached791        108mmt, a 12 percent increase from the previous year. The792        current revenue for FY25 is projected at $38M. Prior years793        revenue was around $30M.794      All official USGSA services are financed by user fees, with the795        Federal portion of fee revenue maintained in an operating796        reserve (OR) fund. Activities such as developing grain797        standards and procedures for measuring quality are financed798        through Congressional appropriations (management level salaries799        are also covered by appropriated funds). Currently, 70 percent800        of FGIS's budget is based on user fees while the other 30801        percent is covered through appropriated funds. In addition,802        there is a $55 million cap on these user fees that is803        maintained annually through Congressional appropriations. This804        means that FGIS cannot exceed $55 million in expenses unless805        the Secretary of Agriculture makes a formal request to806        Congress. Therefore, any increase in expenses to perform807        official services counts against the user fee cap. In addition,808        the user fee cap includes work that FGIS does in inspecting809        rice and lentils which is regulated by the Agricultural810        Marketing Act, not the USGSA.811      The USGSA provides FGIS with the authority to charge and collect812        reasonable fees to cover the cost of performing official813        services. In 2015, the USGSA was amended by the Agriculture814        Reauthorizations Act of 2015, to require FGIS to adjust815        annually the export grain inspection and weighing fees when the816        operating reserve (OR) is less than or more than 4\1/2\ months817        of operating expenses. The amendments also instructed the818        Program to adjust tonnage fees on an annual basis using a819        rolling 5 year average of export tons.820      NGFA led the efforts to amend the USGSA in 2015. NGFA believed821        that the rolling 5 year average in tonnage fee calculations822        would result in predictable tonnage rates that will accurately823        reflect and gradually adjust to changing national and local824        tonnage volumes. Since the change to the fee structure, the825        national tonnage fees have decreased significantly while826        exports have increased which was the original intent. In827        addition, since the tonnage fee rates are directly impacted by828        FGIS's national and field office administrative costs, FGIS829        administrative cost reductions have also helped to lower the830        fees.831      The significant increases in hourly contract rates and other832        Schedule A fees, not tonnage fees, paid by industry are833        unsustainable. User fees should be predictable and market-based834        to provide enough funding and properly reflect the work835        performed. We encourage the FGIS to continually monitor the fee836        formula, maintain transparency with industry and be flexible in837        streamlining the process to make changes when applicable.838839   Fifth, and finally, we recommend that the USGSA-related840        expenses should only apply to the user fee cap. Each year,841        Congressional Appropriations Committees set a cap on how much842        of the industry-funded user fees can be spent on FGIS's843        inspection and weighing services--currently set at $55 million.844        The user cap covers commodities that fall under the scope of845        both the USGSA (e.g., corn, wheat and soybeans) as well as the846        Agricultural Marketing Act, or AMA, (e.g., rice and pulses).847848      The additional expenses for AMA commodities has limited the849        amount of resources that can be spent on administrative costs850        to improve grading and inspection services, e.g., technology851        related to the USGSA. This cap should exclude AMA crops since852        most fees are used to cover expenses for services on USGSA853        commodities.854Conclusion855    The grain storage, handling and export industry specializes in the856logistics of purchasing the commodities a farmer grows and finding a857market for it here at home or in global markets. In serving this role,858our industry relies on FGIS and its delegated and designated state and859private agencies to provide competent, state-of-the-art and reliable860Official inspection, weighing and related services for which the861industry pays to facilitate the efficient and cost-effective marketing862of U.S. grains and oilseeds.863    NGFA believes our legislative recommendations to amend the USGSA864will strengthen the Official inspection and weighing system, foster the865competitive position of U.S. grains and oilseeds in world markets, and866maintain the integrity of Official inspection results. In addition,867reauthorizing the USGSA on schedule--or even a bit early--would provide868continued certainty to grain handlers, farmers and our global869customers. NGFA is committed to working constructively with Congress to870enact policies that achieve these positive outcomes.871    Thank you for the opportunity to testify. I am pleased to respond872to questions you may have.873874    The Chairman. Thank you. Ms. Mikesh.875876         STATEMENT OF KIA MIKESH, PRESIDENT, AMERICAN877         ASSOCIATION OF GRAIN INSPECTION AND WEIGHING878         AGENCIES; VICE PRESIDENT, NORTH DAKOTA GRAIN879               INSPECTION SERVICE INC., FARGO, ND880881    Ms. Mikesh. Good morning. Thank you, Chairman Scott and882Ranking Member Davids, as well as Chairman Thompson and Ranking883Member Craig, for prioritizing this important issue and working884together to hold this bipartisan hearing. My name is Kia885Mikesh. I am privileged to serve as President of the American886Association of Grain Inspection and Weighing Agencies, or887AAGIWA. I am also the Vice President of North Dakota Grain888Inspection, the third generation of my family to help lead the889business.890    AAGIWA's members are agencies delegated and designated by891USDA's Federal Grain Inspection Service to weigh and inspect892the nation's grain. From the public agencies, such as the State893Departments of Agriculture of Washington, Missouri, Alabama, or894North Carolina, to private agencies like my own, AAGIWA's895members work alongside USDA's FGIS to provide essential support896to the agricultural economy. The U.S. Grain Standards Act897authorizes this unique public-private partnership to carry out898its uniform standards and export grain inspection mandate.899    While FGIS and certain state agencies weigh and inspect900every load of grain on an export vessel, state and private901agencies will conduct nine times as many inspections before902grain ever reaches port. At all hours of the day and night, our903inspectors are at railyards, grain elevators, and in the lab.904Yes, we work to maintain trust in U.S. grain contracts, but we905are also testing for toxins harmful to Americans and our906livestock herds. The export inspection mandate underlies907official inspection, but it also allows a uniform voluntary908inspection system to provide trust in U.S. grain, no matter909whether it is destined for export or for domestic feed, food,910or biofuels production. The significance of this system might911not be obvious, but it helps explain why America remains the912world's leading agricultural exporter.913    Before the 1976 Act (Pub. L. 94-582, United States Grain914Standards Act of 1976), our grain markets were inefficient,915even chaotic. Markets did not trust U.S. grades and weights,916which meant that producers and agribusinesses earned lower917prices abroad than their grain was really worth. Today, thanks918to official inspection, U.S. grain standards and quality are919the gold standard of the world. Buyers will pay a premium for920American grain, giving our farmers and exporters a critical921competitive edge.922    American standards are the universal reference for grain923contracts. Even transactions that never touch our country rely924on them. Our system is so successful that changes to the Act925should always be weighed cautiously, but the Committee should926also know that cracks are beginning to show, and maintenance is927required.928    Grain inspection has relied on the same basic technology929for 100 years. As the ag supply chain has become more930efficient, inspection remains reliant on an ever-shrinking pool931of highly trained human inspectors. It is time- and personnel-932intensive. The lack of technological advancement is creating933unnecessary costs to taxpayers, exporters, producers, and our934own agencies. We have become the bottleneck. Without new935technology, the consequences could be stark. The rigorous936standards that were yesterday's privilege will be tomorrow's937burden, simply because we lack modern tools to implement them938efficiently.939    On the other hand, the efficiencies reaped by grain940inspection technology would reduce costs in the food supply941chain and the direct cost to taxpayers of maintaining the942inspection system. The barriers of new technology reflect the943fact that FGIS and official agencies have a near monopoly on944the data and expertise necessary to develop the technology, but945we are not R&D agencies nor venture capitalists. We need to be946able to work flexibly with the private-sector to find solutions947to our unique problems and foster the conditions necessary for948investors to take risks in our field.949    FGIS's dedicated staff have made a heroic effort to advance950technology, but they need more than resources. They need951flexibility that reflects the realities of the unusual small952market for inspection technology. I urge the Committee to953reauthorize the Act with a modest toolbox of new authorities954for FGIS to speed technology development.955    Specifically, Congress should clarify in the statute that956FGIS may leverage official agencies for R&D, provide other957transactions authority for inspection technology research and958development, and establish a modest dedicated funding account959through user fees and appropriations to support the evaluation960and deployment of new technology. With these tools, FGIS can961coordinate flexible partnerships with research institutions,962technology developers, official agencies, and the grain trade963so that promising technologies can be developed outside964government, validated in the real world, and approved quickly965once they reach FGIS. This reauthorization is an opportunity to966modernize the most trusted inspection system in the world,967ensuring it remains competitive, cost-effective, and resilient.968    I want to thank the Committee for recognizing the urgency969of this issue and for your ongoing support of American970agriculture and the inspection system that underpins it. I look971forward to your questions.972    [The prepared statement of Ms. Mikesh follows:]973974 Prepared Statement of Kia Mikesh, President, American Association of975 Grain Inspection and Weighing Agencies; Vice President, North Dakota976                Grain Inspection Service Inc., Fargo, ND977    Good morning. Thank you Chairman Scott and Ranking Member Davids,978as well as Chairman Thompson and Ranking Member Craig, for prioritizing979this important issue, and working together to hold this bipartisan980hearing.981    My name is Kia Mikesh. I am privileged to serve as President of the982American Association of Grain Inspection and Weighing Agencies983(AAGIWA). I am also the Vice President of North Dakota Grain984Inspection--the third generation of my family to help lead the985business.986    AAGIWA's members are agencies delegated and designated by USDA's987Federal Grain Inspection Service (FGIS) to weigh and inspect the988nation's grain.989    From the public agencies--such as the State Departments of990Agriculture of Washington, Missouri, Alabama, or North Carolina--to991private agencies like my own, AAGIWA's members work alongside USDA's992FGIS to provide essential support to the agricultural economy. The U.S.993Grain Standards Act authorizes this unique public-private partnership994to carry out its uniform standards and export grain inspection mandate.995    While FGIS and certain state agencies weigh and inspect every load996of grain on an export vessel, state and private agencies will conduct997nine times as many inspections before grain ever reaches port. At all998hours of the day and night, our inspectors are at railyards, grain999elevators, and in the lab. Yes, we work to maintain trust in U.S. grain1000contracts, but we're also testing for toxins harmful to Americans and1001our livestock herds. The export inspection mandate underlies official1002inspection, but it also allows a uniform voluntary inspection system to1003provide trust in U.S. grain, no matter whether it is destined for1004export or for domestic feed, food, or biofuels production.1005    The significance of this system might not be obvious, but it helps1006explain why America remains the world's leading agricultural exporter.1007    Before the 1976 Act, our grain markets were inefficient, even1008chaotic. Markets did not trust U.S. grades and weights, which meant1009that producers and agribusinesses earned lower prices abroad than their1010grain was really worth.1011    Today, thanks to official inspection, U.S. grain standards and1012quality are the gold standard of the world. Buyers will pay a premium1013for American grain, giving our farmers and exporters a critical1014competitive edge. American standards are the universal reference for1015grain contracts--even transactions that never touch our country rely on1016them.1017    Our system is so successful that changes to the Act should always1018be weighed cautiously. But the Committee should also know that cracks1019are beginning to show, and maintenance is required.1020    Grain inspection has relied on the same basic technology for one1021hundred years. As the ag supply chain has become more efficient,1022inspection remains reliant on an ever-shrinking pool of highly-trained1023human inspectors. It's time and personnel intensive. The lack of1024technological advancement is creating unnecessary costs to taxpayers,1025exporters, producers, and our own agencies--we have become the1026bottleneck.1027    Without new technology, the consequences could be stark. The1028rigorous standards that were yesterday's privilege will be tomorrow's1029burden, simply because we lack modern tools to implement them1030efficiently.1031    On the other hand, the efficiencies reaped by grain inspection1032technology would reduce costs in the food supply chain and the direct1033cost to taxpayers of maintaining the inspection system.1034    The barriers to new technology reflect the fact that FGIS and1035official agencies have a near-monopoly on the data and expertise1036necessary to develop technology, but we are not R&D agencies nor1037venture capitalists. We need to be able to work flexibly with the1038private-sector to find solutions to our unique problems and foster the1039conditions necessary for investors to take risks on our field.1040    FGIS's dedicated staff have made a heroic effort to advance1041technology. But they need more than resources--they need flexibility1042that reflect the realities of the unusual, small market for inspection1043technology.1044    I urge the Committee to reauthorize the Act with a modest toolbox1045of new authorities for FGIS to speed technology development.1046Specifically, Congress should clarify in the statute that FGIS may1047leverage official agencies for R&D, provide Other Transactions1048Authority for inspection technology research and development, and1049establish a modest, dedicated funding account--through user fees and1050appropriations--to support the evaluation and deployment of new1051technology.1052A Technology Toolbox for FGIS1053Authorizing Research Activities by Official Agencies1054    The objective of authorizing research activities by official1055agencies would be to resolve regulatory uncertainty that slows data1056collection in grain inspection technology development.10571058   Under current regulation, Official agencies cannot use1059        unapproved inspection methods under any circumstances. The1060        intent of the existing restriction in CFR 800.76 is well-1061        meaning and a straightforward application of the Act's intent.1062        But the regulation did not anticipate the need to leverage the1063        whole official inspection network for technology development--1064        these technologies often require an enormous volume of data,1065        and collecting such data is a key bottleneck in the speed of1066        developing technologies.10671068   Permitting the use of the whole network would exponentially1069        increase the pace of data collection. It is unclear under1070        current law if FGIS has the authority to except R&D purposes1071        from the restriction--an outcome universally supported by1072        stakeholders. The proposed provisions are essentially technical1073        correction that would resolve the uncertainty.10741075    We recommend two changes toward this objective:10761077   7 U.S.C. 87(e) of the United States Grain Standards Act1078        currently authorizes the Secretary of Agriculture to conduct a1079        continuing research program, in cooperation with other agencies1080        within the Department of Agriculture, aimed at improving the1081        accuracy and uniformity of grain grading methods. Additional1082        language would explicitly authorize the Federal Grain1083        Inspection Service (FGIS) to engage official agencies in its1084        research and development efforts.10851086   Additionally, positive language could be included to clarify1087        that official inspection agencies may use unofficial inspection1088        methods solely for research and development purposes, but not1089        for issuing official inspection certificates.1090Other Transactions Authority1091    Lawmakers have long acknowledged that the constraints required of1092grants, cooperative agreements, and contracts, which are heavily1093regulated and are not always fit for small-scale technology1094development. Congress has situationally carved out innovation1095initiatives from these onerous requirements, authorizing lean and1096nimble research and development partnerships--called ``Other1097Transactions.''1098    AAGIWA recommends the inclusion of Other Transactions Authority1099(OTA) to permit FGIS to enter into flexible research and development1100agreements led by the private-sector with the facilitation and1101assistance of FGIS:11021103   OTA enables FGIS to pursue unconventional, outcome-driven1104        agreements not governed by traditional procurement or1105        cooperative agreement regulations.11061107   This tool is important for engaging vendors outside the1108        usual Federal contractors (which is most potential inspection1109        technology developers) and accelerating experimentation.11101111   This provision does not require FGIS to assume development1112        risk but enables it to support innovative partnerships where1113        appropriate.1114Grain Inspection Technology and Efficiency Fund1115    The Committee should consider establishing a dedicated fund to1116support innovation in grain inspection technology. The benefit of such1117a fund would be to:11181119   Hold multi-year or non-expiring appropriations and limited1120        user fee funds;11211122   Allow outlays to follow the technology cycle rather than the1123        fiscal year;11241125   Ensure that technology development expenditures need not1126        compete for resources with the day-to-day activities of FGIS.11271128    One such model could be a ``Grain Inspection Technology and1129Efficiency Fund:''11301131   Provide authorization for additional appropriations of $51132        million annually for FY 2026-2030;11331134   Additional funding flexibility could be granted through1135        permissive use of other appropriated dollars and up to 5% of1136        user fees collected in the prior fiscal year, allowing the1137        investment of excess collections from exporters after FGIS has1138        met its reserve requirements;11391140   The fund would support the use of current personnel and1141        short-term experts on technology evaluation, and provide1142        funding for incentives, financing, or other resources useful to1143        other transactions or cooperative agreements for research,1144        development, and implementation of grain inspection1145        technologies.1146Conclusion1147    With these tools, FGIS can coordinate flexible partnerships with1148research institutions, technology developers, official agencies, and1149the grain trade--so that promising technologies can be developed1150outside government, validated in the real world, and approved quickly1151once they reach FGIS.1152Other Recommendations1153    AAGIWA is aligned with and supports the testimony provided by the1154National Grain and Feed Association (NGFA). AAGIWA supports NGFA's1155proposals on:11561157   The definition of a new category of emergency to address1158        major disruptions to grain inspection.11591160   Amendments to the Grain Inspection Advisory Committee.11611162   Decoupling Schedule A fees from the rolling average-based1163        tonnage fee.11641165   Applying the user fee-cap only to USGSA expenses.1166Conclusion1167    AAGIWA believes that these changes would improve the grain1168inspection system and enhance the significant value it provides to1169American agriculture. I want to thank the Committee for the opportunity1170to testify, for recognizing the urgency of this issue, and for your1171ongoing support of American agriculture and the inspection system that1172underpins it.1173    I look forward to your questions.11741175    The Chairman. Thank you. Mr. Walton from the great State of1176Iowa, 5 minutes, please.11771178     STATEMENT OF DAVE WALTON, SECRETARY, AMERICAN SOYBEAN1179                    ASSOCIATION, WILTON, IA11801181    Mr. Walton. Thank you. Good morning, Chairman Scott,1182Ranking Member Davids, and distinguished Members of the House1183Agriculture Subcommittee on General Farm Commodities, Risk1184Management, and Credit. It is an honor to join you today to1185testify on behalf of the American Soybean Association regarding1186this Committee's review of the U.S. Grain Standards Act.1187    My name is Dave Walton, and I am a soybean farmer from1188Iowa. I also have the privilege of serving as Secretary of ASA,1189which represents U.S. soybean farmers across 30 main soy-1190producing states.1191    Soybeans are the largest ag export in the U.S., and a1192robust international trade is a priority of our industry.1193Market access and relationship maintenance would not be1194possible if it were not for the trusted and reliable grain1195inspection and marketing efforts undertaken by the Agricultural1196Marketing Service's Federal Grain Inspection Service, as1197authorized by this U.S. Grain Standards Act.1198    For most soybean farmers, our sole interaction with FGIS1199designated or delegated agencies and the U.S. grain standards1200are at our local elevator. When I deliver my soybeans to the1201elevator, they are then tested, sorted, and consolidated into1202larger lots for eventual shipment. The grain standards1203determine the price a farmer like me receives for their1204soybeans at the elevator, and I know the official grain grades1205provide our international customers with the knowledge that the1206commodity they receive has been assessed for quality, purity,1207moisture, and soundness.1208    Recently, the industry conducted a series of conversations1209with stakeholders across the soybean sector, including farmers,1210inspectors, regulators, exporters, and international buyers,1211about the value and perception of FGIS and the U.S. grain1212standards. While the full results are still being evaluated,1213initial feedback shows that the value of the U.S. grain1214standards and the Federal inspection is extremely high for the1215soybean exports value chain and our international customers.1216Global customers consider FGIS the international gold standard1217for grain grading. Inspections carry the weight of the U.S.1218Government, creating peace of mind for international customers1219and providing impartiality that private inspections may lack.1220    Additionally, the standards are simple, and the customers1221rely on that simplicity to mitigate risk. The ability to1222effectively hedge risk through the futures market is a key1223differentiator for U.S.-origin soybeans. The longstanding1224simplicity and consistency of U.S. grain standards have allowed1225for the development of extensive futures markets for U.S.1226products that promote true price discovery.1227    The U.S. soybean industry has a strong relationship with1228FGIS, and when issues arise, we can address them in a manner1229that meets the needs of U.S. farmers while maintaining the1230integrity of the standards. Most recently, the U.S. soy1231industry worked with FGIS to review and remove soybeans of1232other color, or SBOC, as an official grade-determining factor1233under the U.S. standard for soybeans. This was due to rising1234occurrences of SBOC resulting from a new soybean seed variety1235that had a tendency to produce off-color seed coats. This had1236no impact on the soybean's protein or oil content, but farmers1237were being penalized because of the seed coat color.1238    In response to rising levels of SBOC, FGIS conducted a1239study on the functionality of protein and oil content of the1240soybean samples containing varying amounts of SBOC. The results1241found that there was no significant differences in the protein1242or oil content as compared to samples not containing SBOC.1243However, marketing concerns still remained, and FGIS took1244multiple meetings with industry, solicited feedback, and1245provided notice of proposed rulemaking to remove SBOC from the1246U.S. standards for soybeans.1247    In July of 2023, a final rule was issued removing SBOC as a1248grade-determining factor for soybeans, a win for soybean1249farmers, an example of this industry collaboration that we1250seek. Changing the standard for soybeans benefited farmers,1251exporters, and international customers by providing additional1252clarity and ensuring our trading partners knew that no matter1253what, they were still receiving the soybeans that they1254required.1255    Reauthorization of the U.S. Grain Standards Act is vital1256for the continued success of U.S. soy in the international1257marketplace. On behalf of ASA, I thank the Subcommittee for1258their timely attention to the expiring provisions of the U.S.1259Grain Standards Act. We appreciate the opportunity to share the1260importance of the Federal grain inspection system and look1261forward to working with this Committee to reauthorize the Grain1262Standards Act this year.1263    Thank you, and I look forward to your questions.1264    [The prepared statement of Mr. Walton follows:]12651266    Prepared Statement of Dave Walton, Secretary, American Soybean1267                        Association, Wilton, IA1268Introduction1269    Good morning, Chairman Scott, Ranking Member Davids, and Members of1270the House Agriculture Committee General Farm Commodities, Risk1271Management, and Credit Subcommittee. It is an honor to join you today1272to testify on behalf of the American Soybean Association regarding the1273reauthorization of the U.S. Grain Standards Act. My name is Dave1274Walton. I am a soybean farmer from Wilton, Iowa, where I grow soybeans,1275corn, alfalfa, grass hay, and raise beef cattle and sheep alongside my1276wife and sons. I serve as Secretary of the American Soybean Association1277(ASA) and am also a member of the ASA Executive Committee. Our1278association, founded in 1920, represents U.S. soybean farmers on1279domestic and international policy issues important to the soybean1280industry. ASA has 26 affiliated state soybean associations representing1281nearly 500,000 farmers in the 30 primary soybean-producing states.1282    The U.S. soybean industry has a profound, positive impact on the1283U.S. economy. We have long been U.S. agriculture's No. 1 export crop,1284and a by-the-numbers look demonstrates the value of the soybean1285industry to our domestic economic health. The U.S. Department of1286Agriculture (USDA) reported 86 million acres of soy were harvested in12872024, with production of 4.4 billion bushels. Soybean production1288accounts for more than $4 billion in wages and over $80 billion in1289economic impacts, according to a study by the United Soybean Board1290(USB)/Soy Check-off and National Oilseed Processors Association (NOPA).1291This economic impact does not include secondary soy markets and1292supporting industries like biofuels, grain elevators, feed mills,1293ports, rail, refining, barges, etc., which bring the national total1294economic impact of the soybean value chain to a significant $1241295billion.1296    Soybeans are the largest agricultural export in the U.S., and1297robust international trade is a priority of the U.S. soybean industry.1298In conjunction with our partners at the U.S. Soybean Export Council1299(USSEC), the World Initiative for Soy in Human Health (ASA-WISHH),1300USDA, and the Office of the U.S. Trade Representative (USTR), our1301industry is working actively across the world to open new markets and1302introduce new customers to the value of high quality, high protein U.S.1303soy. Opening new markets is just the beginning: Markets require time,1304attention, and long-term relationship maintenance to ensure that once a1305market is open to U.S. soybean exports, access remains unhindered.1306    Market access and relationship maintenance would not be possible if1307it were not for trusted and reliable grain inspection and marketing1308efforts undertaken by the Agricultural Marketing Service's (AMS)1309Federal Grain Inspection Service (FGIS) as authorized by the U.S. Grain1310Standards Act of 1916 (since amended). The Act authorized FGIS to1311establish official marketing standards for certain grains and oilseeds,1312including soybeans, corn, oats, wheat, and sorghum, among others. Prior1313to export, inspections are carried out by FGIS or by state agencies1314that have delegated inspection authority by FGIS.1315    FGIS offers specialized testing in addition to standard grading1316offered by inspectors. These tests can vary by commodity, and include1317aflatoxin testing for corn, testing oil content in soybeans, and1318protein content in wheat. Inspectors also conduct cargo inspections to1319ensure grain vessels are free from contamination, ensuring U.S. grain1320reaches its international customers at the same high-quality it was1321when it left the U.S.1322    For most soybean farmers, our sole interaction with FGIS,1323designated or delegated agencies, and the U.S. grain standards are at1324our local grain elevator. When I deliver my soybeans to the elevator,1325they are then tested, sorted, and consolidated into larger lots for1326eventual shipment. The grain standards determine the price a farmer1327receives for their soybeans at the elevator, and I know the official1328grain grades provide our international customers with the knowledge1329that the commodity they receive has been assessed for quality, purity,1330moisture, and soundness.1331    The official standard for U.S. soybeans includes the following:13321333  1.  U.S. Grades No. 1 to 4 (1 being highest quality) are based on:13341335      a.  Test weight (52-60 pounds/bushel)13361337      b.  Damaged kernels (2-8%)13381339      c.  Foreign material (1-5%)13401341      d.  Splits (10-30%)13421343    Additional grading factors can include moisture and oil content for1344processing into vegetable oil and soybean meal. Grain grades are a true1345vector for price discovery due to their influence over the1346marketability for U.S. soybeans and other commodities.1347    Recently, the industry conducted a set of conversations with1348stakeholders across the soybean sector (including farmers, inspectors/1349regulators, exporters, and international buyers) about the value and1350perception of FGIS and the U.S. grain standards. While the full results1351from those conversations are still being evaluated, initial feedback1352shows that the value of the U.S. grain standards and Federal inspection1353is extremely high for the soybean exports value chain and our1354international customers. A few highlights of these conversations1355include these themes:1356    Trust: Global customers consider FGIS the ``gold standard''1357internationally for grain grading. Inspections carry the weight and1358impartiality of the U.S. Government, creating peace of mind for1359international customers and providing impartiality that private1360inspections may lack. Customers in export markets trust that when they1361receive a shipment of U.S. soybeans, they are receiving a high-quality,1362inspected product because of the services provided by FGIS.1363Furthermore, this trust is reinforced by the transparent and impartial1364appeal system available through FGIS. Samples are retained by FGIS for136590 days, allowing any disputes between customers to be resolved by an1366independent board. U.S. customers can also file complaints and note1367discrepancies in grades through U.S. embassies throughout the world,1368further reinforcing the integrity of U.S. grain standards and FGIS's1369services with U.S. soy customers[.]1370    Consistency: The standards established and carried out by FGIS are1371simple, and customers rely on that simplicity to mitigate risk. The1372ability for buyers and sellers to effectively hedge risk through1373futures markets is a key differentiator for U.S. origin soybeans.1374FGIS's standards and their simplicity and consistency over time have1375allowed for the development of extensive futures markets for U.S.1376products that promote price discovery and liquidity. These markets1377benefit the entire supply chain, from farmers to end-users, and are1378underwritten by the grade factors developed by FGIS.1379    FGIS's quality controls also ensure that when trading partners in1380Japan place an order for No. 1 soybeans in November, and another order1381for that same grade soybeans in February, both orders--despite being1382placed months apart--will comprise of soybeans graded to the grade1383standard for No. 1 yellow soybeans.1384    When asked about what would happen should the U.S. grain standards1385no longer be in place, the most common answer was ``chaos.''1386Ultimately, our strong grain standards, backed by the force and weight1387of the U.S. Government, are one of the strongest reputational1388enhancements available to U.S. soybean farmers.1389    The U.S. soybean industry has a strong relationship with FGIS, and1390when issues arise, we can address them in a manner that meets the needs1391of U.S. farmers while maintaining the integrity of the standards. As1392part of its duties, AMS regularly reviews grain standards to ensure1393they are able to effectively meet the marketing needs of the grain1394trade, and groups like ASA regularly engage with AMS when our industry1395faces issues regarding the standard.1396    Prior to 2023, USDA maintained ``soybeans of other colors,'' or1397SBOC, as an official grade-determining factor under the U.S. Standard1398for Soybeans. The seed coat of a soybean can naturally vary in color1399based on a variety of reasons, and the grading standard allowed for a1400certain percentage of SBOC within the soybean standards. For example,1401U.S. No. 1 soybeans could have up to 1% SBOC, U.S. No. 2 soybeans up to14022%, et cetera.1403    However, occurrences of SBOC began to rise in 2021, and in 2022 hit1404levels that had not been seen before in the modern era. This was due to1405adoption of a new seed variety by many farmers across the U.S. This new1406variety is extremely popular and has proven to combat herbicide-1407resistant weeds. An unexpected side effect of this new soybean seed1408variety was the occasional occurrence of off-color seed coats. In1409response to rising levels of SBOC, FGIS conducted a study on the1410functionality of protein and oil content of soybean samples containing1411amounts of SBOC. The results found no significant differences in the1412protein or oil content as compared to samples not containing SBOC.\1\1413---------------------------------------------------------------------------1414    \1\ USDA, Agricultural Marketing Service. (2022). ``Study of1415Soybeans of Other Colors and the Impact on End-Use Functionality in14162021-2022 Market Samples.'' (Link: https://www.ams.usda.gov/sites/1417default/files/media/FGISSBOCStudy.pdf)1418---------------------------------------------------------------------------1419    However, marketing concerns remained, and FGIS took multiple1420meetings with industry, solicited feedback, and provided notice and1421comment on a proposed rule to remove SBOC from the U.S. Standard for1422Soybeans. In July 2023, a final rule was issued removing SBOC as a1423grade-determining factor for U.S. soybeans--a win for soybean farmers1424and an example of industry collaboration. Changing the U.S. Standard1425for Soybeans benefited farmers, exporters, and international customers1426by providing additional clarity and ensuring our trading partners knew1427that no matter what, they were still receiving the soybeans they1428wanted.1429    Reauthorization of the U.S. Grain Standards Act is vital for the1430continued success of U.S. soy in the international marketplace. As1431industry noted in a letter to the Senate during the 20201432reauthorization process, international buyers place a premium on the1433U.S. inspection service, which helped U.S. farmers maintain some1434competitiveness despite the negative impact of tariffs on exports. In14352025, we are again seeing negative tariff impacts on exports, and the1436value provided by FGIS and our grain inspection system can help keep1437our exports competitive.1438    On behalf of U.S. soybean farmers, I thank the Subcommittee for1439their timely attention to the expiring provisions of the U.S. Grain1440Standards Act. We appreciate the opportunity to share the importance of1441the Federal grain inspection system. ASA looks forward to working with1442this Committee to reauthorize the Grain Standards Act this year.1443    Thank you again for your attention to this matter, and I look1444forward to your questions.14451446    The Chairman. Thank you, Mr. Walton.1447    Dr. Donnelly, please begin when you are ready.14481449  STATEMENT OF KEVIN J. DONNELLY, Ph.D., PROFESSOR EMERITUS,1450 DEPARTMENT OF AGRONOMY, KANSAS STATE UNIVERSITY, MANHATTAN, KS14511452    Dr. Donnelly. Chairman Scott, Ranking Member Davids, and1453Members of the Subcommittee, thank you for the opportunity to1454testify. I am Dr. Kevin Donnelly, Emeritus Professor of1455Agronomy at Kansas State. My experience with the U.S. Grain1456Standards Act is through my teaching, so I will offer a1457different perspective since I am not directly involved with1458grain handling, merchandising, or processing. I am most1459familiar with the FGS standards and inspection process, which1460is the focus of my grain grading course, the crops contests1461that I have trained students for, and the workshops that I1462conduct for the International Grains Program at K-State. I also1463own a farm in central Kansas, so I know how important reliable1464and consistent grain standards are for our producers.1465    I have been interested in grain quality since my 4-H and1466FFA days exhibiting grain samples at the county fair, so as a1467professor, I have tried to integrate crop quality topics into1468several of my agronomy courses. In the Grain Science Program at1469K-State, we offer three very unique degrees in milling, feed,1470and bakery science. Graduates typically enter industries with a1471vested interest in quality as end-users of grain. Agronomy1472students learn how environmental and management practices1473affect the quality of grains produced, which may in turn impact1474the grade and price received by the farmers, as noted by Mr.1475Walton. So although most of our students do not take specific1476courses on the subject or become grain inspectors, we strive to1477incorporate some knowledge of the Federal grain standards into1478our curricula, especially for these majors.1479    As mentioned, the system is also called the gold standard.1480What that means is that it provides benefit to producers,1481handlers, merchandisers, processors, exporters, importers, and1482end-users of grain. It also determines the manner in which1483grain is segregated, stored, handled, and transported along the1484supply chain. As I interact with foreign visitors enrolled in1485the IGP courses at K-State, I have found them eager to1486understand how our integrated system of impartial third-party1487inspection functions. A visit to the National Grain Center is1488generally included in these courses to showcase FGIS activities1489which maintain the integrity of our export markets.1490    FGIS standards typically describe physical characteristics1491of grain, such as test weight, damaged kernels, foreign1492material, et cetera. Factors and factor limits differ for each1493crop and reflect the levels of soundness and purity consistent1494with typical end-uses. The system provides a basis for1495marketing that can include quality specifications, and the FGIS1496official inspection certificate then provides validation of the1497actual quality and weight of grain loaded. Although not1498required for the official grade, FGIS also provides many other1499quality tests upon request, such as mycotoxins or chemical1500residues and composition factors such as oil or protein that1501may impact end-use.1502    Most of the Act is permanently authorized as noted, but1503several provisions expire in September. It is critical that we1504maintain the ability of FGIS to continue its functions and not1505allow a lapse that could disrupt grain exports so critical to1506our trade balance.1507    My peer witnesses have offered some recommendations to1508consider as you develop legislation for reauthorization, which1509I support. As already noted, there is a strong focus on1510advancing technology-driven solutions to reduce costs and1511improve efficiency. An example that I might relate from my1512personal experience is the potential use of imaging to1513facilitate inspection. Our FGIS personnel pass rigorous tests1514and undergo extensive continuing training to ensure inspection1515accuracy. I know from training my crops team that is a very1516challenging and tedious process. Many of them become very good1517at it and can well transition into a grain inspection position,1518but still very few of them aspire to do that.1519    Although visual inspection has served the system very well1520for many years, advanced imaging technology may be able to give1521equal or even better inspection results and could help meet1522limited workforce challenges in the future. Incorporating more1523technology might also make careers in grain inspection more1524attractive to young people. If their focus can be first on the1525interest in technology rather than tedious inspections or1526crawling around taking samples on top of a barge, they may be1527more interested in entering the profession.1528    I strongly encourage you to move forward promptly with1529reauthorization of the U.S. Grain Standards Act to avoid a1530lapse, including the proposed provisions that will further1531enhance the Act.1532    A more detailed version of my testimony will be included in1533the record. Thank you for the opportunity to testify today.1534    [The prepared statement of Dr. Donnelly follows:]15351536  Prepared Statement of Kevin J. Donnelly, Ph.D., Professor Emeritus,1537     Department of Agronomy, Kansas State University, Manhattan, KS1538    Chairman Scott, Ranking Member Davids, and Members of the1539Subcommittee, thank you for the opportunity to testify today. I am Dr.1540Kevin Donnelly, Emeritus Professor of Agronomy at Kansas State1541University. My experiences related to the U.S. Grain Standards Act1542(USGSA) are through my university teaching career, so I offer a bit1543different perspective than the other witnesses, since I am not directly1544involved with grain handling, merchandizing or processing. I am most1545familiar with application of the Official U.S. Standards for Grain and1546the FGIS inspection process, as that is the focus of what I have taught1547in my grain grading course, the crops team contests that I have trained1548students for, and the workshops that I direct for the International1549Grains Program at Kansas State. I also own a farm in central Kansas, so1550I also know how important reliable and consistent grain quality1551standards are for our producers.1552    I have long been interested in grain quality, probably stemming1553from my 4-H and FFA days when my projects involved crop production, and1554I started exhibiting grain samples at the county fair. As a college1555professor, I have integrated crop quality topics into several of my1556courses. We offer three unique degree programs in Grain Science at1557Kansas State (Milling Science and Management, Feed and Pet Food1558Science, and Bakery Science and Management). These programs produce1559graduates that typically enter industries with a vested interest in1560quality characteristics as end-users of grain and oilseeds. Agronomy1561students who enter farming or consulting jobs need to understand how1562environmental and management practices impact the quality of grains1563produced and delivered to market, which may impact the grade and price1564received. Although most or our students do not take specific courses on1565the subject, nor become grain inspectors, we strive to incorporate at1566least some knowledge of the Federal grain standards into our curricula1567at Kansas State, especially in these majors.1568    The United States Grain Standards Act originally passed in 1916,1569and as amended since, authorizes the Federal Grain Inspection Service1570to establish uniform standards for grain and oilseed quality, regulate1571grain handling practices, and manage a network of Federal, state, and1572private laboratories that provide impartial official inspection and1573weighing services. For over a century, the USGCA has provided the1574foundation for quality assessment of grains and oilseeds.1575    In 1976, to address some issues with export inspections, FGIS was1576established, and increased the role and oversight provided by Federal1577inspectors. Today, the system is often called the ``gold standard'' for1578grain quality assessment that assures uniform and consistent standards1579are applied for the benefit of producers, handlers, merchandisers,1580processors, exporters, importers, and end-users of grain. It also1581determines the manner in which grain is segregated, stored, handled and1582transported along the supply chain.1583    As I have interacted with foreign visitors from across the globe1584enrolled in short courses with our International Grains Program at1585Kansas State, I have found them eager to understand how our integrated1586system of impartial, third-party inspection functions. A visit to the1587National Grain Center in Kansas City is generally included in these1588courses to showcase FGIS quality assurance and science and technology1589activities and give them more confidence in the integrity of the1590system. The USGSA is critically important to maintain the integrity of1591our export markets, especially with ongoing international trade1592negotiations.1593    The USGSA requires that all exported grains and oilseeds be1594officially weighed and inspected. Domestically marketed grain and1595oilseeds are often officially inspected, but are not required to be.1596Export inspections must be completed only by FGIS inspectors or FGIS1597supervised state inspection agencies, called delegated official1598inspection agencies. Domestic official inspections are predominately1599done by FGIS supervised state agencies or private companies, called1600designated official inspection agencies.1601    FGIS standards describe physical characteristics (such as test1602weight, damaged kernels, foreign material, broken kernels, defects,1603etc.), market class, special grades and dockage as appropriate. Grade-1604determining factors and factor limits differ for each crop, and reflect1605levels of soundness and purity consistent with typical end-use of the1606crop. Under the USGSA, FGIS establishes and maintains official1607standards for barley, canola, corn, flaxseed, oats, rye, sorghum,1608soybeans, sunflower seed, triticale, wheat, and mixed grain. This1609system provides a basis for contract marketing by allowing sellers and1610buyers a reliable and consistent measure of quality to value1611commodities, and the FGIS official inspection certificate provides1612validation of the actual quality and weight of the grain loaded for1613domestic delivery or export.1614    Although not required for the official grade, FGIS also provides1615many other quality assessments upon request, including sanitary factors1616such as mycotoxins or chemical residues and composition factors such as1617oil, protein or starch that impact nutritional value and end-use1618functionality. These factors are often very critical in domestic or1619international marketing. In addition, numerous other agricultural and1620food commodities not covered by the USGSA are assigned to FGIS for1621standardization, classing, inspection, grading, sampling, or testing.1622    Official inspection and weighing services are provided based on1623user fees. Per recent amendments to the USGSA, federally collected fees1624can only be used for activities directly related to the performance of1625inspection and weighing services. Costs for activities such as1626developing grain standards and or new procedures for measuring quality1627must use Federal appropriations.1628    Most of the USGSA is permanently authorized, including mandatory1629inspection and weighing of exported grain, as well as authority to1630amend the grain standards. However, several provisions expire in1631September of 2025, including a number that were added during the past1632two reauthorizations in 2015 and 2020. Those include the authority for1633USDA to collect fees to fund official inspections, a cap on1634administrative and supervisory costs, and continued authorization of1635the Grain Inspection Advisory Committee. It is critical that we1636maintain the ability of FGIS to continue performing its functions and1637not allow a lapse in authorization that could disrupt the grain1638inspection and weighing program, and grain exports so critical to our1639trade balance.1640    Your witnesses representing organizations more directly involved1641with the industry and inspection operations have provided1642recommendations to consider as you develop legislation for1643reauthorization, for which I encourage your careful consideration. One1644area that I might emphasize involves advancing the use of technology1645driven solutions in for the grain inspection process to reduce costs1646and improve efficiency. The Grain Inspection Advisory Committee has1647been discussing this topic also. Examples include use of imaging1648technology and equipment that is more automated or combines separate1649measurements into one apparatus (i.e., moisture and test weight).1650    Official personnel pass rigorous tests and undergo extensive and1651continuous training to ensure inspection accuracy. I know from personal1652experience in training my K-State Crops Team students for competitions1653using FGIS standards that it is very challenging, and tedious. System-1654wide quality control requirements ensure that official personnel1655consistently provide high-quality, accurate services and information.1656Although visual inspection has served the system very well for many1657years, we should think ahead. I would encourage continued evaluation of1658advancements in imaging technology, which may provide potential for1659equal or even more consistent inspection results, and could also be a1660key to meeting limited workforce challenges in the future.1661Incorporation of more advanced technology would likely make careers in1662the grain inspection profession more attractive to young people.1663    I strongly encourage you to move forward promptly with1664reauthorization of the U.S. Grain Standards Act to avoid a lapse. The16652020 bill included a number of improvements, and we hope that the next1666reauthorization bill will consider additional provisions that further1667enhance the Act.1668    Thank you for the opportunity to testify.16691670    The Chairman. Thank you all for your important testimony1671today.1672    At this time, Members will be recognized for questions in1673order of seniority, alternating between Majority and Minority1674Members in order of arrival for those who joined us after the1675hearing convened. Every Member will be recognized for 5 minutes1676each in order to allow us to get as many questions as possible.1677    I now recognize myself for 5 minutes.1678    During the first Trump Administration, significant efforts1679were made to restructure and streamline key functions within1680the USDA, including the realignment of FGIS. Mr. Friant, you1681noted your support for former Secretary Perdue moving FGIS back1682under AMS. Are you able to speak to any measurable improvements1683as a result of the realignment? And additionally, are there any1684issues remaining, whether structural or cultural, that hinder1685the effectiveness of FGIS that we should be aware of?1686    Mr. Friant. Thank you, Mr. Chairman, for the question. And1687I would also like to thank former Secretary Perdue for that1688decision to realign FGIS to put the agency under AMS. And I1689think some of the areas that we definitely saw improvements in,1690and what we heard both from the agency and actually Mr. Perdue,1691was putting the service back in Federal Grain Inspection1692Service. And so we saw a much, much better relationship with1693the agency where we wanted to collaborate and make sure that we1694still had the most effective, efficient grain inspection1695service in the world, so we definitely have seen those types of1696improvements.1697    As far as future improvements, current leadership at the1698agency has been very open to maintaining that dialogue, and1699that is what we would like to continue to see going forward is1700that opportunity to interact with them when we have concerns,1701when there are issues that the industry needs to address1702together, and be able to continue to have that open dialogue1703and conversation with them.1704    The Chairman. Consistent and reliable grain standards are1705an essential piece of the puzzle for our producers being able1706to maintain market access. Mr. Walton, your testimony alluded1707to the fact that, as a producer, the work of the FGIS is done1708beyond the farmgate and is not necessarily felt on a daily1709basis within your operation, but it is foundational to your1710overall success as a farmer. Even though farmers may not1711directly feel the impact of the work that FGIS does, it is1712critical. Can you share what some of the real, immediate1713impacts would be if services were disrupted due to a lapse in1714authorization, even for a short period of time?1715    Mr. Walton. Yes, thanks for the question. You are correct.1716We don't normally have direct contact with it, but what we do1717is rely on that system to keep the grain flowing through. So1718once we deliver to the elevator, it gets consolidated. In my1719case, I consolidate onto a barge shipped to New Orleans,1720transloaded there. And if there was any disruption to that1721system, it would disrupt the flow of soybeans from my farm to1722our foreign customers. And that would basically back up the1723system and create an impact on price. So the direct impact on1724us would be lower price. The longer-term impact would be just a1725disruption of that supply chain from my farm to our foreign1726customers.1727    The Chairman. Thank you. I am going to yield now to Ms.1728Davids.1729    Ms. Davids of Kansas. Thank you, Chairman.1730    The Chairman. I am sorry. I am going to recognize Ms.1731Davids for her 5 minutes.1732    Ms. Davids of Kansas. Thank you. Thank you, Mr. Chairman.1733    Here in Congress, I have the privilege of representing a1734district in Kansas. Kansas is often called the wheat state,1735where agriculture plays such a critical role in our country's1736economy. Kansas farmers and ranchers feed not just the nation1737but the world. And in 2023 alone, Kansas farmers exported $5.21738billion in agricultural products around the world. Whether it1739is wheat, sorghum, or soybeans, Kansans know what it means to1740work hard and produce results.1741    As a Member of the House Agriculture Committee, I have made1742it a priority to support family farmers and strengthen our1743supply chains because I know that this is a way to support our1744economy. I know how vital these folks are to rural economies1745and to our country's global competitiveness. I am also proud1746that the Kansas City region is home to the National Grain1747Center and that Kansas State University continues to lead in1748agricultural research and workforce development through its1749Department of Grain Science and Industry.1750    So Dr. Donnelly, I will say I have continued to be1751impressed by the work that is happening at K-State,1752particularly in the International Grains Program. I am curious1753if you could share a bit more about how the program helps build1754relationships with our international trading partners and1755supports the export of high-quality American grain.1756    Dr. Donnelly. Well, thank you for the question. I think the1757International Grain Program Institute mission really reflects1758the answer to your question in that we try to work with1759industry professionals internationally, do some training for1760them, and hopefully, in return, that will start their use or1761enhance their use of U.S. grains. So these relationships1762established through these courses are a first step in that.1763    Many of the courses involve partnerships then with our1764national organizations focused on grain exports, like the U.S.1765Wheat Associates and U.S. Export Grain Council, United Sorghum1766Check-off Program. In fact, wrapping up today is the 18th year1767of a Sub-Saharan African milling course that is supported by1768U.S. Wheat Associates. And some facts from that, in 2024, IGP1769hosted 814 participants from 44 countries and 31 onsite and 111770distance courses, so certainly, it is a way to make a1771connection with folks from around the world that uses our1772grain.1773    Ms. Davids of Kansas. That is amazing. Thank you. And I1774might want to get a few more of the stats after. We will follow1775up on that.1776    My next question I was hoping to hear from Ms. Mikesh about1777your testimony you gave. You started to talk about this--I know1778it is in your written testimony as well--the potential for1779grain grading technologies. I am curious if you could share a1780bit more about how additional either appropriations--you had1781mentioned user fee allocations--or additional staffing could be1782used to support the Federal Grain Inspection Service research1783and development partnerships.1784    Ms. Mikesh. Thank you, Raking Member Davids. At the most1785basic level, the private-sector should be the driver of the1786research and development, and FGIS should remain being able to1787quickly evaluate and approve technology when a finished product1788is submitted to them. However, there are many tools that we can1789work on to be a partnership with industry, official agencies,1790and FGIS.1791    Right now, flexible partnerships would allow for FGIS to1792dedicate personnel and experts to technical assistance and1793facilitation at any stage of the development process as1794necessary. The partnerships could do a number of things that1795would improve investor and entrepreneur confidence in final1796approval down the road, which is important because it means1797more developers will make an attempt in the first place.1798Cooperative agreements are a good start, and FGIS has utilized1799this tool, but they have much more red tape that can scare away1800small developers. Other transactions authority were1801specifically designed to remove those barriers to entry for1802small innovators and would allow for more flexible partnership1803structures that follow the needs of the technology.1804    So in review, FGIS would not drive the process1805specifically, but their formal involvement as a resource to1806developers could make the R&D smoother and increase attempts at1807innovation. Many of these flexibilities might not be used in1808full right away, but we are looking at this for the long-term.1809For example, FGIS could use funding to incentivize development1810of an especially important technology, or FGIS could work with1811the private-sector to facilitate a consortium of developers and1812researchers working toward the technology goal that private1813markets struggle to produce on their own, and other1814transactions authority can also help for those flexibilities1815using grad students in other areas.1816    Ms. Davids of Kansas. Thank you. And I would love to stay1817in touch about additional innovations happening.1818    Mr. Chairman, I yield back.1819    The Chairman. The chair now recognizes the gentleman from1820North Carolina for 5 minutes.1821    Mr. Rouzer. I thank the Chairman and my friend from1822Georgia.1823    Mr. Friant, I am going to start with you. I always have a1824few basic elementary questions that I like to get the answers1825on the record because I think they are important for the1826record.1827    As you know, the Grain Inspection Advisory Committee is1828authorized under the Grain Standards Act. This is a group that1829advises the Department on matters dealing with grain1830inspection, of course. Recommendations by the Committee help1831AMS to better meet the needs of growers, handlers, processors,1832and their customers. Can you tell me what happens to the Grain1833Inspection Advisory Committee if the Grain Standards Act is not1834reauthorized?1835    Mr. Friant. Thank you for the question. And if the Act is1836not reauthorized, it is one of four provisions that it expires,1837and so in fact, we would lose the advisory committee.1838    Mr. Rouzer. So tell me what are some of the areas that you1839have seen the advisory committee work on that have benefited1840growers and others in the grain value chain?1841    Mr. Friant. So I have personally had the chance to be on1842the committee three different times, and what we see is a great1843opportunity for industry, producers, grain handlers to have a1844public forum to talk with FGIS about ways we can see the agency1845improve. And in the example that we heard from Mr. Walton, that1846is where some of the SBOC discussion started was at the1847advisory committee. Some of the conversations around technology1848and new technology adaptation and adoption have come out of the1849advisory committee. So we see that as that good opportunity to1850bring multiple groups together and have that conversation with1851the agency on what do we want to see going forward.1852    Mr. Rouzer. Yes, I noted in your testimony, your oral1853testimony, you made reference to the need for flexibility,1854perhaps waivers. Sometimes waivers can be really, really good1855policies. Sometimes waivers can be abused and become very bad1856policy. When you were mentioning that, are there any specific1857examples or criteria you could elaborate on there?1858    Mr. Friant. So one thing--and I want to make sure that we,1859from an industry perspective, are clear--we do not want waivers1860at any time. We want it to be very specific during times of1861service disruption. And if you think back to the 20151862reauthorization, that is where that section came from was we1863had a service disruption in the industry and the company was1864not able to get official services. And so we want to avoid that1865risk of any disruption in official services so that, as many1866folks on the panel have said today, we can still export our1867grain from the U.S.1868    Mr. Rouzer. Very good. I appreciate the clarification.1869    Any other comment from any other panelists?1870    [No response.]1871    Mr. Rouzer. Okay. Sticking with you, Mr. Friant, your1872testimony mentioned that NGFA and its members are ready to1873partner with USDA and the Federal Grain Inspection Service to1874pilot new grain grading technologies. To your knowledge, has1875there been any engagement or investment from the private-sector1876to support that effort?1877    Mr. Friant. Yes, there has been, and I would say it started1878about 2 years ago. We actually held a workshop or a summit1879hosted by NGFA at the Cargill offices in Minneapolis where we1880brought together industry, technology providers, folks from the1881official system, so Kia, and then folks from FGIS, where we1882could, first of all, find out what technology was available1883that could be adapted for grain inspection, and we are able to1884get some sense of what might be available. And now we have seen1885where FGIS has started to explore some of those technologies1886that we have been learning about. And maybe more specifically1887in the case of Cargill, we have engaged with at least one1888technology provider to see how their system works, could it be1889fit for grain grading purposes, visual imaging for damage, and1890that is where we have seen that private partnership start.1891    Mr. Rouzer. Thank you. Any other comment from any other1892panelists on that?1893    [No response.]1894    Mr. Rouzer. Dr. Donnelly, in the last 45 seconds, just real1895quickly, you mentioned in your testimony that you have1896interacted with international students and buyers at the1897National Grain Center in Kansas. Can you speak to what parts of1898the U.S. grain inspection system they find are most effective?1899And are there areas where we are clearly falling behind our1900foreign competitors?1901    Dr. Donnelly. In terms of specific, I always try to1902actually have them pick some samples so they can understand the1903detail of the process as far as the class, and so I think that1904gives them a confidence. It is a bit confusing, and so I think1905in the end the integrity of the system is important. And they1906appreciate it if they are involved with it. If they are sort of1907remote, it can be kind of confusing. But I think in the end we1908have smooth marketing and an efficient system, then it speaks1909for itself.1910    Mr. Rouzer. Yes, my time has expired. Thank you, Mr.1911Chairman. Thank you, panelists.1912    The Chairman. The chair now recognizes the gentlelady from1913Ohio for 5 minutes.1914    Ms. Brown. Thank you, Chairman Scott and Ranking Member1915Davids.1916    Homegrown American grain is a top-quality product. When our1917trading partners see the ``Product of the USA'' label, they1918know they are getting a product that is reliable, consistent,1919and of the highest quality. This trust has been earned over1920decades of hard work by our farmers, exporters, and the1921reliability and consistency and standards that have been set to1922ensure that our products are truly top-notch. The U.S. Grain1923Standards Act has long served as the foundation for that trust.1924It serves as the blueprint to guarantee that our grain is1925graded fairly, weighed accurately, and certified transparently,1926protecting the reputation of American agriculture around the1927world.1928    In a time when farmers are facing uncertainty on all1929fronts, from inconsistent policy promises from this1930Administration to rising input costs and climate volatility,1931Congress must step up and do our job. Reauthorizing the Grain1932Standards Act is a practical and necessary step in order to1933give our producers the clarity, stability, and confidence they1934deserve. So thank you to our expert panel of witnesses for1935being here today. Your input is critical as we look towards the1936next era of the USGSA.1937    In a time of such uncertainty, we want to make sure that1938there is clarity on this system and that it is working for the1939people it is meant to serve. I know many of you are farmers1940yourselves with direct experience in navigating how the Grain1941Standards Act plays out in real-world day-to-day operations.1942    For any of our panelists, can you share ways we might1943improve the interaction, whether it is clear grading, feedback,1944better access to dispute resolution, or more practical guidance1945on how standards are applied?1946    Ms. Mikesh. Thank you. One of the ways that I think almost1947all of us have discussed in our oral testimonies is improving1948through technology. Right now, we have a wonderful system, as1949Nick alluded to, where FGIS leadership is very welcoming of any1950feedback that industry or official agencies may have regarding1951any standards, as seen with SBOC. But what we are really1952lacking right now is the way to keep us the gold standard1953without technology. There are many other countries that are1954starting to use this, and we would like to be able to keep up1955with that and make sure that we can continue to be that gold1956standard.1957    Ms. Brown. All right. Well, since we don't have a lot of1958time, I would also add that consistent communication between1959USDA farmers is also critical, and I am increasingly concerned1960about the loss of USDA personnel, both administrative staff and1961inspectors who have been released or taken deferred1962resignation. These holes in staffing risk undermining one of1963the most important aspects of the U.S. Grain Standards Act, the1964relationship between the Department and producers on the1965ground. As we consider reauthorization, we need to ensure that1966the USDA is not only equipped to uphold strong standards, but1967also staffed to maintain the relationships and responsiveness1968that make those standards work in practice.1969    Dr. Donnelly and Mr. Friant, in your testimonies, you both1970emphasized the importance of integrating and modernizing1971technology throughout the inspection process. As this1972legislation was first written in 1916, I agree. Can you talk1973about what technologies are available and ready to be deployed?1974And how can we ensure that the next generation of farming1975workforce is equipped to adapt and effectively use these tools?1976    Dr. Donnelly. I think the example I used is probably one of1977those. If we look even in other ag industries, for example, in1978the seed processing industry, nobody counts seeds anymore. By1979counting seeds, you take a picture of it and count seeds. In1980the food processing industry, you clean and you knock out1981damaged samples in the processing process. So there is a lot of1982technology there involved with use of automation and imaging1983that I think could come to the FGIS system. If I can look at a1984sample, take a picture of it, and then analyze what are the1985damaged kernels, the off types, that would be much more1986efficient than having to pick through a kernel at a time. But1987it does need to be standardized against the traditional.1988    Mr. Friant. Yes, and I would just build on that visual1989imaging, visual imaging, visual imaging. We see that as an area1990that can speed up and make the process more efficient, make it1991more standardized, and overall be better for the system. I1992think that is a big area of opportunity.1993    Ms. Brown. Thank you. I appreciate this conversation and1994look forward to working with my colleagues in a thoughtful way1995to reauthorize and modernize the legislation.1996    And with that, I yield back.1997    The Chairman. Thank you. The chair now recognizes the1998gentleman from Minnesota for 5 minutes.1999    Mr. Finstad. Thank you, Chairman Scott. Thank you for2000holding this important hearing today. And thank you to all the2001witnesses for being here with us.2002    As we have heard today, the U.S. Grain Standards Act has2003been in existence since the Woodrow Wilson Administration, and2004it stood the test of time throughout the decades since as a2005cornerstone of farm policy, ensuring that farm country has the2006tools they need to produce the highest quality fuel and food2007supply in the world.2008    So with that, no offense to Iowa, but I am going to have a2009conversation with my fellow Minnesotan here. Mr. Friant, thank2010you for your testimony, and thank you for being here today. It2011is an honor to have Cargill call Minnesota home, and I2012appreciate the role that you play in supporting southern2013Minnesota's farmers and the farm economy.2014    As you know, the U.S. Grain Standards Act established2015marketing standards for grains and oilseeds and procedures for2016grain inspection and weighing to encourage the marketing of2017high-quality grain for an agriculture sector that is highly2018dependent on export demand. The Act requires that exported2019grains and oilseeds be officially inspected and weighed.2020    So with laying that out, can you explain how the U.S. Grain2021Standards Act helps facilitate the exports of U.S. grain and2022why it is so important for ensuring U.S. grain continues to be2023competitive in the global grain trade market?2024    Mr. Friant. I appreciate that question, Congressman2025Finstad. And I think we heard I believe maybe from all four2026witnesses how we consider the U.S. Grain Standards the gold2027standard, right? Our customers ask for that official USDA2028certificate. And that is really the first step in ensuring that2029our products can be exported, right? That is what the buyers2030want is that official FGIS certificate.2031    And then as I think we look at how we can continue to do2032that going forward, it is what you have heard from all of us2033already, right? We have opportunities for increased use of2034technology, adaptation, and adoption in the system so we can2035still be efficient and effective.2036    And I think the other piece is that the standard, is the2037standard, right? So no matter whether you are delivering grain2038in southern Minnesota or my hometown of Minooka, Illinois, or2039Topeka, Kansas, a U.S. No. 2 yellow soybean is a U.S. No. 22040yellow soybean wherever you deliver, and that standard is the2041same. And the seller knows that, the buyer knows that, and the2042international buyer knows that when they buy a U.S. No. 22043yellow soybean, that is what the grade is going to be.2044    Mr. Finstad. Yes, I appreciate that. As a farmer myself, I2045have just seen on our farm how adapting and incorporating new2046technologies and the advancement of really where the collision2047of science, agriculture, and technology has collided has2048provided all kinds of opportunities. And really it just2049emphasizes that we are the gold standard, and so we should make2050sure that legislation around this, continues to evolve and2051become even more efficient and really incorporate that2052collision of science, technology, and agriculture.2053    One area that I wanted to get to here with my last couple2054minutes is I want to highlight the importance of protecting the2055surplus we have in grain trade. Over the last few years, the2056Biden Administration refused to be at the table for negotiating2057market access for our producers. And grain continued through2058this to be a bright spot for farm country. In fact, America2059enjoys right now a $65 billion trade surplus on the U.S. grains2060and oilseed side. This is a credit to our farmers, who again2061have done a great job with what I just stated, with2062incorporating that collision of science, technology, and2063agriculture, and we continue to grow the highest quality grain2064in the world, our transportation infrastructure, including2065critical American waterways, highways, rail systems, and2066decades of diligent work to develop and grow new markets.2067    So again, Mr. Friant, what are some of the challenges that2068we face right now on grain exports and what can we do in the2069Grain Standards Act reauthorization to help overcome maybe some2070of these challenges?2071    Mr. Friant. I think the first and foremost thing is get the2072Act reauthorized on time or early. It provides us that2073stability. We know that the standards will be there when it2074comes time, when we want to export that grain, and it provides2075that consistency for us. So first and foremost, we want to have2076it reauthorized.2077    I think some of the things that we have laid out in terms2078of--and you have heard from all of us--the technology piece. We2079have talked a lot about continuing to look for those technology2080opportunities that are out there.2081    And then as we referenced in my oral testimony, the2082waivers. When we do have a disruption in service, let's make2083sure that, as long as buyer and seller agree and it doesn't2084impair the Act, we can still get that grain exported from the2085U.S. to those customers that want that U.S. grain and that U.S.2086certificate.2087    Mr. Finstad. I appreciate that. Thank you again to all of2088you for being here, taking time away from your busy lives to2089help us craft hopefully a better policy in the future, so I2090appreciate that.2091    Mr. Chairman, with that, I yield back.2092    The Chairman. Thank you. The chair now recognizes the2093gentlelady from Illinois.2094    Ms. Budzinski. Thank you, Chairman Scott. Thank you,2095Ranking Member Davids. Thank you so much for all the panelists2096for being here today for this hearing.2097    I appreciate the opportunity to discuss this important2098piece of legislation set for reauthorization this year. We are2099proud of the grains we produce in this country, particularly2100the high-quality corn and soybeans grown in my district in2101central and southern Illinois, and Congressman Sorensen's2102district as well, and want to ensure that these grains enjoy2103market access around the world, something you have obviously2104heard a lot about today.2105    And just actually building on the comments and questions2106from Congressman Finstad, just talking about the U.S. Grain2107Standards Act and the importance of it, if others maybe on the2108panel might like to elaborate further on the importance of its2109reauthorization. We heard about looking for technological2110advancements and how that might be able to continue to build on2111the success of the Standards Act. Just kind of curious, any2112other ideas potentially from the panel that you might like to2113elaborate on that further?2114    Dr. Donnelly. I might speak on the reauthorization and the2115importance of it. I believe we have had a very dependable and2116reliable system that is well respected, but currently, grain2117farmers are facing some really challenging times with low2118commodity prices and weakened exports, coupled with high-input2119and credit costs. So I think we must maintain the quality of2120our export system, and let's not add this as another excuse2121maybe for a further reduction of opportunity for exports.2122    Ms. Budzinski. Yes. Yes.2123    Mr. Walton. Yes, so if I might add to that from the2124farmer's perspective, as I said in my earlier testimony,2125soybeans are the number one ag export from the U.S. It is about2126$31.2 billion a year, and that is significant. And that is at2127risk if there is not timely reauthorization of this Act.2128    Ms. Budzinski. Right.2129    Mr. Walton. It disrupts the whole system. So as others have2130noted, our foreign buyers look at us as a gold standard, and2131they know whether the soybeans come out of Illinois or Iowa or2132North Dakota, No. 2 yellow soybean is the No. 2 yellow soybean,2133and they place a premium on that quality and that assurance.2134And so any disruption to the system is going to create chaos.2135    Ms. Budzinski. Yes.2136    Mr. Walton. And at a time, as the doctor noted, the farm2137economy isn't great right now, so any disruptions in that is2138going to come back directly to my farmgate and impact us.2139    Ms. Budzinski. Yes.2140    Mr. Walton. So that is why we really strongly urge this2141timely reauthorization and keep it going.2142    Ms. Budzinski. Thank you. Would you like to add?2143    Ms. Mikesh. Thank you. From the perspective of an official2144agency, we actually do a lot of what Professor Donnelly was2145talking about and hosting foreign groups that come over about2146commodity trade. And we do many of those each year. And every2147time I have about an hour-long spiel on what I talk about on2148why is the official system different than anything else. And if2149this were not to be reauthorized, we wouldn't have that gold2150standard. When I see their faces when we are talking about how2151each of our official agencies, we go through extensive2152compliance reviews, we have daily randomized monitoring.2153    I laugh sometimes that I talk to FGIS more than a lot of2154the people in our company sometimes. We are that big of2155partners. And they are so impressed by the amount of standards,2156even as something as simple as running a moisture. I want to2157say the handbook is maybe 70+ pages long. And that shows that2158we give so much value and everything is thought out very2159intensely. And it is a really enjoyable part each time, each2160year to see their faces and how proud they are of what we do.2161    Ms. Budzinski. Yes. Thank you. Thank you for sharing that.2162    I just, with the time I have remaining, wanted to emphasize2163also the important role that our colleges and universities play2164in bringing the next generation of agricultural professionals2165to the industry. Getting young people interested in working in2166agriculture, particularly farming, has been a priority of mine2167since taking office. The University of Illinois is in my2168district, which, much like Kansas State, is home to a world-2169class agricultural program.2170    Dr. Donnelly, I know that in your role at Kansas State, you2171interact with students who represent the next generation of ag2172professionals. How does a deeper understanding of crop quality2173and Federal grain inspection system serve students in2174indirectly related agricultural careers?2175    The Chairman. Mr. Donnelly, I need you to be brief for2176this, please.2177    Ms. Budzinski. Yes, sorry.2178    Dr. Donnelly. We have talked about grain science and2179agronomy. An example might be animal science. Buying grain2180sometimes for feed production could use a little lesser2181quality. And so understanding that system and perhaps being2182able to move grain that is not at the best quality into the2183livestock feeding operation is important. So an animal feeder2184needs to know about the standards as well.2185    Ms. Budzinski. Okay. Thanks for that short answer.2186    I yield back.2187    The Chairman. And I apologize, it is Dr. Donnelly.2188    The chair now recognizes Mr. Taylor.2189    Mr. Taylor. Thank you, Chairman Scott and Ranking Member2190Davids. Thank you for holding this Subcommittee hearing and2191kicking off the U.S. Grain Standards Reauthorization. And I2192appreciate the witnesses being here to share your insights and2193expertise and the sacrifices you all made to join us here2194today.2195    Even in a broadband desert like most of my district,2196technologies are constantly evolving and changing in the modern2197agricultural economy, especially with the increase in AI. Ms.2198Mikesh, in your testimony, you talked quite a bit about how2199modernizing grain technologies could help improve the2200inspection and weighing process. You mentioned the lack of2201technological advancement is creating unnecessary cost for2202taxpayers, exporters, and more, and I appreciate that2203information, but what more could Congress be doing to promote2204the adoption of these new technologies?2205    Ms. Mikesh. Thank you. Technology is very important to what2206we are needing to do. And we are needing to modernize our2207systems with technological instrumentation to enhance the grain2208quality, as you noted and many of us did as well. Where2209technology is really needed in this system is that when I was2210younger, we would do maybe 50+ cars, and it would take a few2211days to load that. And now we are looking at trains that are2212114 cars, and we are doing that in sometimes less than 5 hours,2213but we are still doing it with the same standards, and we are2214still doing it with the same personnel. It is getting very2215difficult to be in these harsh environments. And so with2216technology, we can then not be as much of a bottleneck to our2217partners in making sure that they are getting the most reliable2218grades in a very quick manner.2219    And what Congress would be doing to help by passing this is2220helping this industry continue to be the most efficient and2221cost effective that it can. And a lot of the areas that we have2222outlined are some tools that are provided as examples that2223could potentially help anything to help with the flexibility. I2224believe that is probably the biggest piece of being able to2225allow industry, official agencies, to help expedite this2226technology. As we know, technology is rapidly changing, and we2227want to make sure that we are ahead of it in giving what we can2228to our industry.2229    Mr. Taylor. Thank you. Has there been much engagement or2230investment from the private-sector to support the adoption of2231these technologies?2232    Ms. Mikesh. There have been a lot of discussions around how2233this could look. FGIS does have various cooperative agreements2234in place looking at visual grading. And it is very impressive2235what they are able to do. But there are so many different types2236of technology, and FGIS needs those flexible partnerships in2237order to continue that. So yes, there are currently some2238technologies being looked at, but we need to be able to do it2239in a quick manner.2240    Mr. Taylor. Thank you. Mr. Walton, you noted that most2241farmers are mostly only exposed to the Inspection Service2242indirectly at the elevator, and I would say most people don't2243realize the Federal Grain Inspection Service even exists. What2244would you say is the average farmer's perception of the grain2245grading system? And are there gaps in transparency or education2246that we as lawmakers could address?2247    Mr. Walton. I think the answer was in your question. I2248mean, there is a transparency there that we know as farmers2249when we deliver grain to an elevator, it is done against a2250consistent standard. And regardless of multiple points that I2251might sell to, that grain is going to be graded the same2252regardless of where it goes to. And I think that is the2253important piece for farmers, that we know that there is an2254assurance behind those grain graders that may be a government2255entity that is providing that sort of consistency. So again,2256that is why we hope not to have any disruption here. It is set2257to expire during harvest for us, and that would be a very2258untimely thing to happen.2259    Mr. Taylor. Sure. Okay. Thanks again to all of you for2260being here, and Chairman, I yield back.2261    The Chairman. The chair now recognizes the gentleman from2262Illinois for 5 minutes.2263    Mr. Sorensen. Thank you to Chairman Scott and Ranking2264Member Davids. Thank you to everyone for joining us today to2265discuss the importance of reauthorizing the U.S. Grain2266Standards Act. And welcome, Mr. Friant, from Illinois. Glad to2267have you here with our Committee and glad that we have2268representation from the land of Lincoln.2269    I was honored to have Illinois farmers in my Capitol Hill2270office on this very floor down the hall just a couple of days2271ago. When I asked what keeps you up at night, it is not the2272weather. It is the fact that we need to expand global markets2273for the export of our grain and our oilseeds. Reauthorizing2274this initiative gives us the opportunity to not only modernize2275our marketing system, but deliver cost savings, improve2276reliability, and create a fairer valuation of U.S. grain in a2277world marketplace.2278    Mr. Walton, I will begin with you. You mentioned the toll2279that this Administration's tariffs are taking, especially on2280our bean farmers. Could you expand a little bit more on how2281important classification of grain grades is for not only price2282discovery but upholding consumer confidence here and abroad?2283    Mr. Walton. Sure. We understand that our international2284customers have a choice in where they purchase grains. And one2285of the reasons why they continue to come back to the United2286States is because we provide the international market with the2287highest quality grains from around the world, and that is2288backed with this U.S. grain standard. So they know when they2289come to the U.S. and they are looking for No. 2 yellow2290soybeans, that is exactly what they are going to get when they2291are delivered. And we as sellers know that the high-quality2292soybeans that we grow on our farms will get to those end-users2293in that same kind of condition. So as we deliver No. 1 or No. 22294yellow soybeans to the market, that is what our customers in2295international markets will receive.2296    Mr. Sorensen. Ms. Mikesh, you just mentioned my fellow2297Congressperson from Illinois, Ms. Budzinski, asked, and you had2298mentioned that the United States were proud to be the gold2299standard of exported grain. How essential is a bipartisan2300reauthorization to keep our American producers on top?2301    Ms. Mikesh. Thank you for that question. Reauthorization is2302essential for that. We give stability within the markets. We2303give confidence knowing what that grade is. You are going to2304know that if we are grading it in Ohio, it is going to be the2305same as in California. And if we do not have that ability to2306have the Federal Grain Inspection Service system, that can be2307very detrimental to the entire grain supply chain and also for2308the markets above when it is already difficult. So again, it2309would be essential, and we urge Congress to pass it.2310    Mr. Sorensen. Thank you for that. And I will pose this to2311everyone. As we consider language to reauthorize this Act, what2312is the most important change that we as Members of Congress2313should consider?2314    Mr. Friant. I mean, I think you have heard it from all of2315us multiple times, technology. How can we ensure that there is2316that language that enables technology from Federal Grain2317Inspection Service?2318    Mr. Sorensen. One of the expiring provisions in 2025 is the2319authority to collect fees for Federal supervision of state2320agencies' export inspections. What do user fees typically2321cover? And what percentage of services and operations are paid2322for by appropriations from Congress?2323    Mr. Friant. So user fees are the direct service, right? So2324that is the inspectors that are inspecting and weighing the2325grain at port facilities. It is the per unit fees if we want2326mycotoxin testing or other factors tested. So it is direct cost2327for the services are the user fees.2328    Mr. Sorensen. Anyone else?2329    [No response.]2330    Mr. Sorensen. Thank you all so much for being here today.2331And Mr. Chairman, I yield back.2332    The Chairman. Thank you. The little chair now recognizes2333the big chair for 5 minutes.23342335 OPENING STATEMENT OF HON. GLENN THOMPSON, A REPRESENTATIVE IN2336                   CONGRESS FROM PENNSYLVANIA23372338    Mr. Thompson. Well, thank you, Mr. Chairman, Chairman2339Scott, and Ranking Member Davids for convening this important2340hearing.2341    The United States Grain Standards Act has been the linchpin2342of American agriculture and trade for nearly a century. And it2343is a vital tool that ensures the integrity of our grain2344markets, both here at home and around the world. This law2345provides the framework for official marketing standards,2346inspection and weighing procedures for grains and oilseeds, and2347is essential for ensuring transparency, market confidence, and2348price discovery. These principles are foundational to a fair2349and functioning agriculture economy.2350    With several provisions of the current law set to expire on2351September 30th, it is imperative that we do our job and we2352reauthorize this important piece of legislation. Allowing this2353authority to lapse would cost the farm economy more than $702354million a day and result in serious consequences for our family2355farms, supply chains, and international trading partners. For2356example, nearly $100 million of corn and barley are exported2357from my home state, the Commonwealth of Pennsylvania, each2358year, and more than $26 billion of U.S. grains were exported in23592024.2360    It is critical that no disruption to the essential services2361that underpin our ability to export the safest, most abundant2362grain supply in the world. So fulfilling this obligation and2363continuing safeguards will allow us to avoid disruptions in2364service like what has occurred in the past. Inspection and2365weighing services must be dependable, uninterrupted, and cost-2366effective. It is not a luxury. It is a necessity for American2367food security.2368    The United States has been at the forefront of agricultural2369research, and we are fortunate to have institutions that are2370able to spearhead the promotion of science, technology, and2371innovation. Dr. Donnelly, given Kansas State's longstanding2372leadership in grain science and its connection to FGIS through2373the National Grain Center, is there a role for K-State and2374other land-grant universities to play in advancing the next-2375generation grain inspection technologies?2376    Dr. Donnelly. Well, I certainly think that there would be2377opportunity, but our program at the International Grain Center2378is focused primarily on promotion of market, not so much on the2379technology of the process, but certainly an opportunity for2380partnerships for improving some of the technology. We have2381talked technology all morning, but obviously, we are not quite2382ready to just jump in and do that. I think it comes down to2383having the opportunity to work through appropriations or grants2384that could be utilized to really prove that this technology is2385as dependable as the current system. So I think that is where2386we could participate in that if that opportunity was available.2387    Mr. Thompson. Well, I think given the status of obviously2388American agriculture's science, technology, and innovation,2389that is my definition. Obviously, that is why we are doing2390significant investments in research and specific funding for2391land-grant universities for research facilities as a part of2392this Farm Bill 1.0 and Farm Bill 2.0 as we have been moving2393ahead with.2394    As I mentioned in my opening remarks, we must maintain2395transparency, market confidence, and price discovery for grain2396standards that have led to our ability to be considered the2397gold standard across the globe. Mr. Friant, your testimony2398mentions that, in the event of a service disruption, additional2399flexibility on emergency waivers for official inspection and2400weighing requirements is needed, part of the great work this2401Committee did in 2015 to ensure there is transparency and2402continuity from FGIS. In the event of service disruption, where2403do you believe that there are shortcomings in the current2404waiver process? Is there anything Congress can do to rectify2405those challenges?2406    Mr. Friant. I appreciate that question, Mr. Chairman, and2407we have seen much better transparency in the process. One of2408the areas, as we noted in our testimony, was simply having a2409good definition of what constitutes an emergency. There seems2410to be some ambiguity around that, and so being much clearer on2411what is an emergency would be a very good place for us to2412focus.2413    Mr. Thompson. Very good. Thank you, Mr. Chairman. The big2414chair yields back.2415    The Chairman. Thank you, big chair.2416    I just want everybody to know, I show the order as Mr.2417Rose, Ms. De La Cruz, Mr. Harris, and then Mrs. Miller is what2418I show the order on this sheet right now. Mr. Rose, the chair2419now recognizes you for 5 minutes.2420    Mr. Rose. Thank you, Chairman Scott and Ranking Member2421Davids, for holding this time-sensitive hearing on the review2422of the U.S. Grain Standards Act.2423    Reauthorizing and modifying the U.S. Grain Standards Act is2424yet another opportunity for this Committee to deliver2425prosperity for our producers by strengthening flexibilities and2426reconfiguring the use of funds. As all of you have mentioned or2427alluded to, the Federal Grain Inspection Service, or FGIS, is2428the gold standard for grain grading and the vital role the2429service plays in promoting U.S. competitiveness in global2430markets. Mr. Walton, can you elaborate on the FGIS and how,2431since 1976, the service has bolstered U.S. grain grading?2432    Mr. Walton. Yes, I think in the international marketplace,2433it is widely recognized that that is the gold standard. They2434know that when they enter a contract with a U.S.-based company2435for soybeans, that is exactly what they are going to receive.2436And that kind of assurance in the marketplace gives us a2437dominant position around the globe. It gives us an advantage2438over our competitors. So I think this Grain Standards Act is2439something that has been important for our growth of2440international trade, and it needs to continue to keep us in2441that position.2442    Mr. Rose. Thank you very much. Ms.--and I hope I am saying2443this right--Ms. Mikesh? Okay. In your written testimony, you2444suggested that Congress authorize research activities by2445official agencies. Will you provide additional details and2446examples of this research and how agencies should handle this2447authority and the benefits we would see domestically?2448    Ms. Mikesh. Thank you for that question. Yes, I would love2449to. So currently, under the Act, there is a gray area of2450whether or not official agencies can help with the research and2451development, mainly around the visual imaging piece. We are not2452able to perform any services that have official standards in a2453different manner. And so it has been easy for us to help aid in2454different technologies when you are talking about protein where2455there is a single result. We can put the sample through our2456protein machine and give a result to that instrumentation2457entity.2458    Now, when you are talking about visual imaging, we are2459needing to look at things like individual kernels. And there2460are current standards for grading, but if we were just to give2461a certificate that, states, you have 2.2 percent damage in your2462corn, that isn't going to help these instrumentation entities2463determine what types of damages these kernels are, as well as2464being able to sort them within their models.2465    And something that we talk about a lot when we are2466discussing this is, it is good data in, good data out. And if2467it is bad data, it is not going to be a great outcome. And2468official agencies and along with FGIS, I believe I stated in my2469opening statement, is that we have a near monopoly on the2470expertise on how to grade. There are wonderful universities,2471like Professor Donnelly, where they go through and they can2472teach others how to grade. However, we are the ones doing that2473every day. There are approximately 40 agencies across the2474country, and we are all very willing to work with2475instrumentation manufacturers to develop these models and work2476alongside FGIS.2477    Mr. Rose. Thank you. I appreciate that added insight.2478    Dr. Donnelly, you noted in your testimony that you are a2479former FFA member, so it is great to have a fellow Future2480Farmer and alumnus joining us today.2481    Mr. Donnelly, you explained that FGIS conducts additional2482quality assessments not required for the official grade. Will2483you elaborate on the impact these additional assessments have2484on grain marketing and the value added by these quality2485measures?2486    Dr. Donnelly. Well, certainly. I think oftentimes that they2487may be more important than the grade. The grade is, as2488everybody has talked about, is very standard, very expected. I2489am not directly involved, but I understand that in the export2490world, the end-user of wheat, for example, is equally or more2491interested in the protein content as it is the damaged kernels.2492And so certainly with things like mycotoxins, the residues, all2493of those things are included as well.2494    And not only that, but FGIS is also tasked with dozens of2495other testing and monitoring of other feedstocks. And we are2496just talking about a limited number of grains here. In fact,2497rice is under the AMA, pulses, field beans, under a completely2498different system, but still they are involved. So FGIS, if you2499really look at it, this is a part of what they do, but it is2500much broader than that as well. And some of this additional2501testing may be equally or more important to the end-user.2502    Mr. Rose. Thank you. I appreciate that insight. I yield2503back, Mr. Chairman.2504    The Chairman. Thank you. The chair now recognizes Ms. De La2505Cruz.2506    Ms. De La Cruz. Thank you, Mr. Chairman. Thank you for2507hosting this important meeting today, and thank you to the2508witnesses for being here.2509    The U.S. Grain Standards Act plays a critical role in2510establishing uniformity and reliability in grain inspection.2511That has secured the United States' role as the most dependable2512provider of quality grain in the world. As we continue to2513assess the effectiveness of Federal programs, it is important2514that we hear from those who are actually engaging in these2515systems to ensure their long-term success.2516    I have heard over and over again the importance of2517technology and that when we talk about reauthorization, that we2518are talking about technology that would help you all. So I want2519to dive into that a little bit here. Ms. Mikesh, you mentioned2520that official agencies have much of the data and the expertise2521that is needed to drive technological innovation. And you even2522said good data in means good work or good data out, correct? We2523want to make sure that that data is being put to good use. So2524could you speak to how those impacts, the good data or bad data2525that is coming out, how we can make innovation better or2526inspection tools better or partnership with developments better2527when good work comes out of this data?2528    Ms. Mikesh. Thank you for that question. Yes, in our2529system, when we are going out and we are grading onsite at2530grain elevators, when we are looking for damages, we have a2531narrow field of foot candles, light candles that we actually2532have to make sure our lights are done by. We have to make sure2533we have a very specific color of countertop. I could go on and2534on, but I won't bore you. So there are a lot of inputs that go2535into making sure that visual grading by a human inspector is2536accurate.2537    Now, there are some things with technology that you are2538going to take a lot of that out of play, which is wonderful.2539And so if we are there providing good data, we need to make2540sure that this technology is as reliable and accurate, if not2541more reliable and accurate than human inspectors. Just \1/10\2542of a result a difference can make such a huge financial impact2543for many of our partners.2544    Ms. De La Cruz. Reclaiming my time one moment. You said2545something very important, as the difference, obviously, between2546a human visual inspection and a technology inspection. Do we2547have any quantifiable data that we have available to us as far2548as an error rate in technology versus human or vice versa?2549    Ms. Mikesh. Thank you. We are actually not at that point2550currently. There are some instruments that are being used where2551we are doing the data of what the damages are, but until that2552is completed, we aren't able to compare the two.2553    Ms. De La Cruz. So what I am hearing is that there is a2554study in place that you are looking for the numbers in what the2555difference is between having the technology available and2556having the human error rate in this. Is that correct?2557    Ms. Mikesh. Yes.2558    Ms. De La Cruz. And when do you think this data would be2559available for us to review?2560    Ms. Mikesh. That is going to be difficult. It is going to2561depend on what your Subcommittee passes. We are looking for2562ways to expedite the technology study. And once we do that, I2563know it is very important to the industry alike that we come2564forth with that data. I am the chair of the Grain Inspection2565Advisory Committee, and we look at new technologies in protein.2566And every time we look at new data, the very first question we2567are asking is, is it the same or better? And that is something2568that none of us want it to go backwards.2569    Ms. De La Cruz. Excellent. Thank you so much for your time.2570I yield back.2571    The Chairman. The chair now recognizes the very patient2572gentleman from North Carolina for 5 minutes.2573    Mr. Harris. Thank you, Mr. Chairman, and thank you for2574having this important hearing and to all of you that have been2575sharing on the panel today.2576    As a freshman on this Committee, I was fascinated to learn2577about the intricate network of inspectors who physically lay2578eyes on grain products coming in and around the country.2579Whether it is wheat, corn, barley, or one of the other dozen2580things the Federal Grain Inspection Service oversees, hundreds2581of inspectors are working to ensure the quality of our grain2582products.2583    Ms. Mikesh, I want to ask you, can you briefly describe for2584my constituents at home what a day in the life of a grain2585inspector entails, and what are the steps that an inspector2586goes through when they get a shipment of, say, wheat kernels?2587    Ms. Mikesh. Thank you for that question. That is a fun one2588to answer. Every day is quite different. We are constantly2589having to check where trains are at, whether or not we are able2590to load due to weather conditions, or whether or not we are2591able to get out to those elevators due to weather and2592conditions.2593    In each of our areas for--I will talk about NDGI--we have a2594little bit different depending on the market. So in our North2595Dakota area, we primarily do rail cars. We do shuttle trains.2596Now, say, when they get the call at 2:00 a.m. that a train is2597going to be heading our way at that particular location within2598the next hour, our inspectors, our samplers, and technicians,2599essentially, they are on call. They are to wake up, get going,2600get on the road, and get out to that location.2601    Those grain elevators, then they are able to make sure that2602there is representative sampling because the grade is only as2603good as the sample we receive is. So we have standards that we2604go through to ensure that the sample is going through. And then2605we go through and run things like moisture, test weight, and2606then it gets to the inspector who is doing mainly the visual2607damages to make sure that everything is accurate.2608    And then those trains can last anywhere from 5 hours to 362609hours. It really depends on what happens. But whether it is2610rain, shine, or a lovely blizzard in North Dakota, we are2611making sure that we are there so that our industry partners can2612get the grain out in time.2613    Mr. Harris. Super. Well, thank you. I know we have talked a2614bit about the technological advancements that you would like to2615see to improve the processes. Can you give a picture of some of2616the cost savings to the system that might occur if Congress can2617reduce the regulations to allow for more technological2618advancement in the inspection process?2619    Ms. Mikesh. Thank you. Yes. Right now, we are in the midst2620of discussions on how exactly having these visual grading2621systems could look. But what we are looking at currently is say2622that you need four people to be onsite and doing the grading.2623We may be able to cut that back to three or less.2624    And what it also can do is that there are a lot of ups and2625downs as far as the volume in the grain industry. So we can go2626through phases where maybe we have--I'm speaking of my own2627agency--maybe we have 60 people out on the road, and then all2628of a sudden there are a few changes and now we are down to 30.2629Having that technology will allow us to handle those ups and2630downs, those ebbs and flows a lot easier, especially when you2631are talking about inspectors.2632    When we have inspectors, it generally takes to just become2633mildly provisioned about a year to get the three main licenses.2634And you can imagine that when there is a downturn in the2635market, as there always are both ways, if we lose that2636expertise of inspecting, it is very difficult to come back2637from. So if we can use things as a tool and an aid to help with2638that, it can help with staffing substantially.2639    Mr. Harris. Excellent. And in the last few seconds, Mr.2640Friant, the Federal Grain Inspection Service is funded2641primarily by user fees with taxpayer dollars from Congress2642filling in the rest of the budget. Given our debt crisis, it is2643encouraging for me to see this funding structure that isn't2644totally reliant on Federal dollars. However, I know that the2645authority to collect user fees is given by Congress and that we2646play a role in ensuring that process goes smoothly. In your2647testimony, you mentioned ways to stabilize the user fees,2648saying they are currently not predictable for the industry. In2649the last 20 seconds or so, can you share more about what the2650issue is and how Congress can fix it?2651    Mr. Friant. So one of the things that we saw and we2652actually got in the 2015 reauthorization was how tonnage fee2653was based on a rolling average, and we saw that same approach2654applied to other Schedule A fees. And so what FGIS has done is2655published a new final rule on a new way to calculate those fees2656to help stabilize it. So now we are going to be in a monitoring2657mode and ensure that those changes indeed are efficient and we2658are achieving the goal that we think as far as stabilizing2659costs for the agency.2660    Mr. Harris. Thank you. Thank you all very much, and thank2661you, Mr. Chairman. I yield back.2662    The Chairman. The chair now recognizes Mrs. Miller for 52663minutes.2664    Mrs. Miller. Thank you, Mr. Chairman.2665    As one of the few family farmers in Congress, I understand2666the huge impact that agriculture has on our economy, and I am2667guessing I am probably the only Member of Congress that was2668actually involved in testing. I had a part-time job in college2669testing for mycotoxin in corn, so anyway, kind of a little side2670note there. I also understand how critical the U.S. Grain2671Standards Act is to the stability and global reputation of our2672ag sector.2673    In Illinois, nearly 44 percent of our grain is exported,2674and we rank fifth nationally for the total agricultural2675exports, valued at $80.8 billion, including being third for2676soybean and feedgrain exports. With so much of Illinois'2677production headed for international markets, it is essential2678that our inspection system operates with efficiency,2679consistency, and integrity. We know that our foreign buyers put2680a premium on the trust and reliability offered through official2681U.S. inspections, and losing that trust would be devastating to2682our farmers.2683    So we are fortunate today to be hearing from Dave Walton, a2684soybean farmer from Iowa and Secretary of the American Soybean2685Association, who brings both firsthand experience and national2686perspective on how this system serves producers and supports2687global competitiveness. As we approach reauthorization, it is2688important that we build on the strengths of the Grain Standards2689Act while modernizing, where needed, to meet the demands of2690today's export-driven markets.2691    Producers in my district and across the country depend on2692timely, uniform inspections to move their grain efficiently,2693especially during peak harvest and shipping seasons, so I look2694forward to hearing more today about how we can strengthen the2695system, improve transparency and responsiveness, and ensure2696USDA has the tools it needs to continue delivering the gold2697standard in grain inspections.2698    So my first question is for Mr. Walton. From your2699perspective, how well is the current grain inspection and2700weighing system serving the needs of high export states like2701Illinois and Iowa?2702    Mr. Walton. Sure, thank you. From my perspective as a2703farmer and a member of ASA's Executive Committee, the current2704grains inspection system meets our needs. It is working for us2705right now. Our international customers know that U.S. soybeans,2706whether they originate from our states or any other soybean-2707producing state in the nation, they are going to be of the same2708uniform and high quality. And mostly what we are here to do is2709just ask that Congress reauthorize the USGSA in time so there2710is no major service disruptions. It is set to expire sometime2711around harvest time, and if we have disruptions at that point2712in time, it would be difficult to manage around as farmers and2713producers.2714    Mrs. Miller. Absolutely. And we know that the producers are2715really struggling right now, and we need to tamp down inflation2716and amp up exports, so thank you very much.2717    And then also Mr. Walton, as Congress looks toward that27182025 reauthorization, can you be specific on any improvements2719or modernizations that you would recommend to ensure the system2720continues to work efficiently, reduce bottlenecks, and support2721a competitive export environment for U.S. farmers?2722    Mr. Walton. Yes, and again, I think my partners here on the2723panel have highlighted some really important things that we2724need to look at, and I defer to them for their expertise on2725what specifically they are looking for to improve. As farmers,2726all we ask is that the system continues to work at the high2727level that it does and gives our international customers that2728assurance that when they buy U.S. grain, they are getting2729exactly what the contract states.2730    Mrs. Miller. And I know it is illegal for anybody to add2731foreign material at the ports. I am just curious what kind of2732penalties there are because we bring clean grain into the2733elevators, and we want to have that reputation for exporting2734clean grain.2735    Mr. Friant. So in the Act, there is a penalty for any2736foreign material. Frankly, we would need to look into exactly2737what the requirements are around that. I don't happen to know2738them off the top of my head.2739    Mrs. Miller. Okay. I think that there is one percent2740foreign material allowed. And, I just want to make sure that2741the good work that the farmers do and the local grain elevators2742to make sure we have clean grain when it is at the ports, ready2743for export, that it remains clean grain and we preserve our2744excellent reputation.2745    Thank you, and I yield my time.2746    The Chairman. The chair now recognizes Mr. LaMalfa from2747California for 5 minutes.2748    Mr. LaMalfa. Thank you, Mr. Chairman. I appreciate it. I am2749sorry I haven't been able to be here the whole hearing today,2750so I hope I don't ask anything redundant.2751    But, I have a great understanding and importance as well,2752along with Mrs. Miller, on this. I am a rice grower in2753California, and we actually grow seed rice that our neighbors2754use as well, so having important grain and seed standards for2755germination, for making sure we have like seed and not other2756stray seed in there is extremely important. And so it is2757important we get this right in many aspects across the board.2758    So I believe our witnesses touched on the organizational2759changes to the Inspection Service moving from GIPSA to the2760Marketing Service. So what is that going to do, as far as we2761have outdated technology--that is hopefully going to be updated2762and realigned to make the process simpler, smoother, and data2763more readily available to more people? What do you anticipate,2764anybody on the panel here, how that is going to work out? And2765do you anticipate any needed changes to continue to refine that2766in process, any of you?2767    Ms. Mikesh. Thank you for that question. Yes, actually, to2768touch on your point of moving FGIS over to AMS, it has been2769wonderful. Being able to be with other grading programs and see2770what it is that they are working on as far as technology and2771many other items as well has been very, very eye-opening.2772    One of the things that I would say, Nick and I actually2773were at an innovation summit a few years back with different2774AMS grading groups, and when you feel like sometimes when you2775are isolated in your industry, you think that your problems are2776your problems are alone. And we were excited to go to that2777summit and have these discussions to see maybe these other2778grading programs are having the exact same problems, and we can2779piggyback and work together on finding a solution.2780    And unfortunately, we found that we are the odd one out in2781that when we are looking at our commodities, we are looking at2782kernel sizes. We are not looking at whole fruits and vegetables2783or an entire cow. And so the technology that we need is very2784different than what is already in use out there in these other2785grading programs. So we have had----2786    Mr. LaMalfa. Other grading for non-grains, you mean?2787    Ms. Mikesh. Yes, for livestock, specialty crops, et cetera.2788    Mr. LaMalfa. Yes, yes.2789    Ms. Mikesh. And so we need a little bit more help and2790effort to be able to get the technology to work for us in the2791most cost-effective way.2792    Mr. LaMalfa. So how difficult is it with a current older2793system versus what you are seeing with technological2794improvements that are available or coming available?2795    Mr. Friant. So maybe I will give an example. When I walked2796into Cargill's offices about 20 years ago, one of my colleagues2797came to me and said, we are working on black-box technology for2798grain inspection, for grain grading. And I sit before you2799today, 20 years later, and we are still working on that2800technology. It hasn't been easy. Frankly, it has been quite2801difficult. But we still believe that it is the way we need to2802go, visual imaging. We think there are great opportunities2803there.2804    And as Kia mentioned, you can tell she and I have talked2805about this a lot together between our organizations because she2806said exactly what I was going to say. Our eyes were opened at2807that technology summit about a year and a half ago to what else2808is out there and what other groups in AMS are using for visual2809imaging technology.2810    Mr. LaMalfa. What is the holdup for you all?2811    Mr. Friant. I think that is a great question that doesn't2812have an easy answer. And Kia kind of alluded to it. We need to2813look at each individual grain in the sample. And when you are2814talking about a sample that could have 100, 200, 300 kernels,2815it is a lot to look through. And so just having that technology2816to identify it. And then when we talk about damage, the types2817of damage and being able to identify this kernel is damaged,2818this kernel isn't.2819    Mr. LaMalfa. Is the damage usually associated with size,2820like brokens, things like that, or could it be damaged and have2821a like size and really take more microscopic work to find?2822    Ms. Mikesh. Yes, there are damages that you can visibly see2823just right when you are looking at, say, the corn. But there2824are also damages, and this is part of the reason why it has2825been more difficult to find the technology, is you have to2826actually scrape at the kernel to determine. There are some2827grains that you have to cut to see the inside of it. And so2828with that, it isn't only visual imaging, but we are needing2829other things like near-infrared and all of that combined2830together, but still cost-effective enough to be able to have at2831thousands of onsite labs across the country.2832    Mr. LaMalfa. So I suppose you are trying to draw samples2833kind of at random and hope that sample represents the whole,2834and you don't run into too many quality problems.2835    Ms. Mikesh. Yes, we do have very specific protocols for2836sampling to ensure that.2837    Mr. LaMalfa. Well, I have to yield back, but I am pleased2838to hear that you are very happy with the AMS coming in, and2839that is making it a little simpler. So please keep us abreast2840at the Committee here of what impediments might be out there2841and the good things too.2842    So thank you, Mr. Chairman. I yield back.2843    The Chairman. Thank you. I have one final question, and2844then I will turn it over to Ms. Davids for any final questions2845she may have, and then begin closing. We had an issue with2846peanuts a couple of years ago where, after they had been2847shipped, the port where they were going to, the buyers2848questioned the grade. It wasn't that there was a problem with2849the grade. It was just that the shipping costs had already been2850incurred, and they were trying to get a better deal if you2851will. Does that ever happen with grain as well, Doctor?2852    Dr. Donnelly. I am going to take that. The system has an2853appeals process. In fact, one of the main functions of the2854National Grain Center in Kansas City is the Board of Appeals.2855So there is always a reference sample kept on reserve, and if2856there is a disagreement about the grade, then that can be2857adjudicated by going back to the reference sample. And the2858Board of Appeals in Kansas City is the supreme court of grain2859grading, so what they determine is what stands in those cases.2860    The Chairman. Okay.2861    Ms. Mikesh. Something else with that as well, us as2862official agencies, as well as FGIS, anything that we have,2863those file samples that he is speaking of, they are considered2864Federal property over an allotted amount of time. And so when2865those come back, we are able to look at those particular file2866samples, as well as our records are all Federal property in2867that sense. And so we are able to go through the various2868records to show what it is that we found and making sure that2869those people are properly trained and licensed and everything2870else with it. So we have very good recordkeeping in order to2871help mitigate that.2872    The Chairman. Do you have anything?2873    [No response.]2874    The Chairman. Okay. Ms. Davids?2875    Ms. Davids of Kansas. I don't have any questions, just a--2876--2877    The Chairman. Closing statement.2878    Ms. Davids of Kansas. Thank you, Mr. Chairman. And I just2879have a closing statement here.2880    First, I would like to thank everyone on our panel today.2881Thank you for showing up and being witnesses here in front of2882the Committee. It is so important for all of us on this2883Committee to stay well informed about the U.S. Grain Standards2884Act, particularly as we look to take action on the2885reauthorization this year. Your time and testimony today have2886absolutely provided us with firsthand knowledge on how2887essential the grain standards are to farmers, not just in2888Kansas, but across the country and to folks in the grain2889industry at large across the country.2890    So again, thank you, Mr. Chairman, for holding today's2891hearing, and I look forward to working together on the2892reauthorization this year. And I yield back.2893    The Chairman. Thank you, Ranking Member Davids.2894    And I want to thank all of you for taking the time to come2895testify. Your expertise matters to us. And I look forward to2896the completion of the legislation in a timely manner.2897    Under the Rules of the Committee, the record of today's2898hearing will remain open for 10 calendar days to receive2899additional materials and supplementary written responses from2900the witnesses to any question posed by a Member.2901    This hearing of the Subcommittee on General Farm2902Commodities, Risk Management, and Credit is adjourned.2903    [Whereupon, at 11:42 a.m., the Subcommittee was adjourned.]29042905                                  [all]