NFU News Clips May 10, 2012
PLEASE NOTE - Contents in the NFU News Clips are presented from their original sources. National Farmers Union & California Dairy Campaign does not have editorial control over the content. NFU nor CDC does not endorse the views and issues contained in these articles and they do not necessarily represent NFU's or CDC's official policy and positions. The News Clips are intended to provide news stories as they are presented by the media.
Lucas Sees Targeted Farm Bill
May 9, 2012
DTN/ Progressive Farmer
All crops need a farm program that protects them from multiyear price drops, House Agriculture Committee Chairman Frank Lucas said Tuesday, a position with which House Agriculture ranking member Collin Peterson agrees.
DTN file photo of House Ag Committee Chairman Frank Lucas as he appeared February at the Commodity Classic. (DTN photo by Chris Clayton)
In a wide-ranging exclusive interview with The Hagstrom Report and DTN, Lucas, R-Okla., praised Senate Agriculture Committee Chairman Debbie Stabenow, D-Mich., for her "herculean efforts" to get a bill through committee, and said that he would not underestimate her ability to convince Senate Majority Leader Harry Reid, D-Nev., to provide time on the Senate floor to debate the bill.
However, Lucas said although the Senate bill's "shallow loss" revenue program that would cover some losses beyond crop insurance is "a great tool" in good times when prices are high, it would not provide a proper safety net if prices plummet.
Because payments under the shallow loss program would depend on revenue comparisons that would gradually go down under such circumstances, there would be "a free fall to the bottom," he said. On the other hand, if target prices were written into the bill, payments would trigger whenever prices reached a certain level.
"You write a farm bill for the bad times," Lucas said.
The bill that Stabenow, Lucas, Peterson and Senate Agriculture Committee ranking member Pat Roberts, R-Kan., sent to the supercommittee in charge of deficit reduction in December gave farmers a choice between the shallow loss program and a target price-based program, but Stabenow and Roberts left it out of the Senate package.
Lucas said he intends to include both the shallow loss program and the target price program in the House bill, and that he believes farmers throughout the country will be interested in it. Lucas said it is incorrect to view him as simply going along with southerners who have said the Senate Ag Committee's bill does not treat rice and peanut growers fairly.
Oklahoma does not grow rice, but it grows a lot of wheat, and Oklahoma wheat growers have told him repeatedly they need protection against the effects of several years of price declines.
"I am the chairman of the House Agriculture Committee," he said. "I represent the whole country."
Peterson, D-Minn., said in a separate interview that he also believes the target prices and counter-cyclical program should be continued.
"Crop insurance looks like a really big deal, but if prices go down ... you're going to be insuring yourself for a loss," Peterson said. "I do not see crop insurance as a safety net."
Growers of minor oilseeds, pulse crops and barley have said the target prices for major crops such as corn, soybeans and wheat would mean that farmers would choose to produce those crops rather than continue the rotation.
But Lucas said he has asked those growers to "show me your data" to prove that farmers will switch crops, and that he has also asked commodity group leaders to advise him and his staff on the appropriate target price for each crop.
To the argument that target prices would interfere with market forces, Lucas noted that corn acreage has gone up since the Renewable Fuel Standard was instituted. "That didn't have anything to do with target prices," he said.
Lucas also confirmed that his staff has developed a chart that shows what percentage of farm program payments each state will lose under the Senate bill. Congressional aides and lobbyists have said the chart shows that states outside the major corn and soybean producing states lose more. Lucas declined to release the chart at this time, but said he would make it available when the numbers are perfected.
Lucas also said he believes the House version of the bill will cut close to the $33 billion over 10 years that President Barack Obama has proposed. He said he is comfortable with the other titles of the farm bill, but that the House will insist on a bigger cut to food stamps than the Senate bill's $4 billion.
The House bill may contain a slightly different cotton program from the one in the Senate bill, he said. Lucas declined to provide details of what the House bill might do differently for rice and peanuts, but noted that he wants sorghum treated properly because it is a crop that requires less water than most crops and has a lot of potential.
He also said he preferred the payment limitation provisions that were in the December agreement to the tighter ones that were included in the Senate bill. Peterson said he is concerned farmers are going to take too much fragile land out of the land-idling Conservation Reserve Program as prices rise, and put it back into production.
Oklahoma has a lot of land in CRP, and landowners who have received the direct payments no matter what they plant and whether prices are high or low have put their land into pasture. Lucas said he expects the subject of sodbuster provisions "will be discussed. I'm not inclined to put restrictions in."
But Lucas also said Congress needs to use the budgetary credit it gets for reducing the size of the CRP.
On the scheduling of the bill, Lucas noted that his committee's final subcommittee hearings will be held next week and an aide said the committee expects to go to markup in June. Lucas noted that the Senate might take up the farm bill on the floor before his committee proceeds to markup.
Lucas said he hopes House Speaker John Boehner, R-Ohio, will allow the bill to proceed to the floor on a modified rule, but said the committee will have to pass a bill before Boehner makes that decision. He also said he wonders how the House leadership will react if 200 or 300 amendments are filed on the bill.
Peterson said this week that he has become very optimistic that Congress can finish the farm bill this year.
"I can see the pathway of how we can get there if they can get the bill up on the Senate floor," he said.
Lucas said he shares Peterson's optimism. "I always expect to make a crop when I put seed in the ground," he said.
Sending the bill to the president before the election "would be a wonderful thing," Lucas concluded.
Transportation deliberations begin in conference committee
May 9, 2012
A congressional conference committee began deliberations yesterday to find a compromise between House and Senate surface transportation bills. Currently, federal transportation programs are funded only through June 30 due to several short-term extension enacted since September 30, the most recent coming in a vote last month.
Tuesday’s session allowed the 47 conferees an opportunity to give opening statements. Despite predictions the conference committee is unlikely to reach agreement, the House-Senate panel’s chair, Sen. Barbara Boxer, D-Calif., promised House members that she will “work with you to improve the Senate bill . . . We’re going to work together until we get this done.”
Rep. Rick Crawford (R-Ark.) told Agri-Pulse he would be a voice for rural interests on the conference committee and specifically emphasized the importance of the Harbor Maintenance Trust Fund yesterday.
“My district has more Mississippi River frontage than any other district in the country,” Crawford said. “Moneys from the trust fund should be used for harbor maintenance projects like dredging. Dredging along the Mississippi River is essential for farmers to get their goods to market and will be a priority for me on the committee.”
“I’m optimistic that we’re going to get a conference report out of it,” he added, when discussing the potential outcome of the committee deliberations. “I’m hoping that it’s longer term and provides a certain level of certainty.”
Streamlining bureaucracy and cutting down the time it takes to complete transportation projects is important to Crawford. He said the House measure attempts to take cut project times in half. For example, an infrastructure project that would typically take 15 years to complete could be reduced to a timeline of seven years.
“That cuts costs considerably and speeds up delivery of projects,” he said. “We want to condense some of the bureaucratic reviews and make it easier for highway contractors get job the done quicker.”
He noted that an important part of the negotiations will be the Keystone XL Pipeline provision, which is included the House transportation measure and expected to be a key sticking point in the deliberations.
Additional provisions for railroads are included in the Senate bill, S. 1813. Consumer Union for Rail Equity (CURE) outlined the rail sections of the bill below:
Section 36402 - The Surface Transportation Board (STB) must post a report on the progress of pending formal and informal complaints every three months;
Section 36403 - Maximum relief in "simplified" rate procedures increased to $1.5 million in "three benchmark" cases and to $10 million for "simplified stand alone cost" cases; the STB also is directed to periodically review and revise maximum relief levels;
Section 36404 - Establishes time lines for rate cases;
Section 36405 - Within 180 days of enactment, the STB must initiate a study to provide further guidance on how it will apply its revenue adequacy pricing constraint;
Section 36406 - starting 60 days after enactment, the STB must provide quarterly reports to the Senate Commerce, Science and Transportation Committee and the House Transportation and Infrastructure Committee on status of unfinished regulatory proceedings; and
Section 36407 - within 180 days of enactment, STB must consult with the Office of Personnel Management regarding the STB workforce: size and deployment.
Several agriculture groups support the rail provisions of the Senate bill, S. 1813, including establishing a timeline for rate cases taken to the Surface Transportation Board (STB), requiring the STB to issue quarterly reports of complaints received, and changing the maximum relief possible for shippers in “simplified” rate procedures.
“These freight rail provisions are modest steps that we believe would contribute to a better balance between shipper and carrier interests in rail policy deliberations,” the groups said in a letter sent Monday to the Senate Committee on Commerce, Science and Transportation. For a copy of the letter, click HERE.
In a separate letter, the same agricultural groups expressed support the Realize America’s Maritime Promise (RAMP) Act in the House-passed measure that Crawford supports.
“U.S. ports, waterways and harbors are in desperate need of maintenance and dredging in order to keep channels open for commerce,” state the organizations.
The RAMP Act ensures that the money in the Harbor Maintenance Trust Fund is appropriately used for harbor operations and maintenance, an important provision, noted Crawford, because of the ongoing expansion of the Panama Canal and the need for larger domestic ports. For a copy of the organizations' letter, click HERE.
The agricultural organizations supporting the rail and harbor provisions include the Agricultural Retailers Association, American Farm Bureau Federation, American Soybean Association, National Association of Wheat Growers, National Chicken Council, National Corn Growers Association, National Council of Farmer Cooperatives, National Grain and Feed Association, National Oilseed Processors Association, National Turkey Federation, The Fertilizer Institute and the USA Rice Federation.
Farmers Markets Get an Upgrade
May 10, 2012
Farmers markets are an increasingly popular tool for local buyers to have access to fresh, in-season produce, meat and eggs. And for several years, low-income customers could also use their SNAP benefits to buy those products - provided the market had some way for connect to the electronic system that is the backbone of the food program. Not all farmers markets have that access, but Wednesday Agriculture Deputy Secretary Kathleen Merrigan announced awards to make that happen.
Says Merrigan: "Our country's 7,100 operating farmers markets offer opportunities to our children and their families to access healthy food across the country. SNAP participation at farmers markets helps provide fresh fruit and vegetables to families and expands the customer base for local farmers."
In the past, lack of connectivity in those markets meant it was a challenge to redeem SNAP benefits using the Electronic Benefit Transfer system. However, funding provided by the Consolidated and Further Continuing Appropriations Act 2012 will allow states to provide wireless equipment to currently non-participating farmers markets opening the door to greater participation in SNAP.
Merrigan adds that the funding will allow SNAP users to increase their access to healthy food, and she says "evidence suggests they will take advantage of that access." In addition, strategies including education, cooking demonstrations and community support often found at farmers markets could boost consumption of those healthy foods even more.
There are currently 1,500 farmers markets using EBT. Since 2008, SNAP spending at farmers markets is up four-fold.
As part of yesterday's announcement, which gets federal funds to state agencies, USDA's Food and Nutrition Service will soon post a Federal Register notice to solicit public input on how best to use the funds in the future. USDA wants to expand use of SNAP beyond the current numbers, and increase annual SNAP redemptions at these locations.
USDA has a National Farmers Market Directory that lists which locations take SNAP benefits.
U.S. grains needed for new USAID products
May 10, 2012
Tons of U.S. processed grains are going into food aid for malnutritioned and starving populations around the world. That message became clear during the three days of the USDA & USAID International Food Aid and Development Conference in Kansas City. The conference wrapped up Wednesday.
Accepted as fact during the conference was that 33 percent of child mortality in the world is related to malnutrition. Additionally, an uncounted number of moderately malnutritioned children are developmentally stunted.
As the fact sheet handed out during the conference noted, USAID is in the process of initiating improvements to “the timeliness and appropriateness of food assistance.” In general terms, it was noted that the changes “include advanced and ever improving early warning systems, new and more nutritious food aid products, state of the art preposition of commodities for timeliness of delivery, significant cash programming and new programming approaches.” All this sounds like a lot of beauracratic paperwork to accomplish feeding the hungry, and attending the conference probably wouldn’t dispel that thought by the average American.
It was professed by a Bread for the World Institute spokesperson that $11.8 billion in aid is needed each year in a total of 36 countries to counter 90 percent of the world’s malnutrition.
As for meeting a portion of the goals outlined by the USAID fact sheet, Paul Alberghine, program specialist (health and nutrition), Foreign Agriculture Service (FAS) of the USDA, gave an overview and update of the Micronutrient-Fortified Food Aid Products Pilot (MFFAPP) program funded by Congress in fiscal year 2010. The $14 million funding was to develop more nutritious and micronutrient-fortified food aid products. In 2011 FAS funded six projects for $8 million out of the original funding.
FAS expects to identify new products that can be used in USDA’s Food for Progress and McGovern-Dole International Food for Education and Child Nutrition programs. This is where U.S. grains become important and new markets are being established.
The products being developed are classified in four general categories—emergency food products, ready-to-use foods, general food basket products and fortified blended foods. The emergency food products are meal replacement products for use at the onset of emergencies until traditional humanitarian food assistance can be provided. The ready-to-use foods are the biggest variety of products from ones that are nutritionally dense, highly fortified products for treating severe acute malnutrition to supplements or complementary foods. The general food basket reference is to processes and end products with vitamin and micronutrient fortification to conventional foods such as vegetable oil or milled flours. Fortified blended foods in general are ones that can be used as a basic food, often when cooked as a type of porridge, and in most cases, these contain blends of corn, soy and dairy protein.
Alberghine outlined the six projects funded in 2011. Some are multi-year projects that could rely on continued funding from Congress, which worries many of those involved in the programs, because of the budget cutting under way.
Kansas State University is working in Tanzania working with three fortified blended foods—sorghum and soy blend, sorghum and cowpea blend and corn-soy blend.
Joint Aid Management is working in Mozambique developing a soy-based vanilla flavored powder for mixing with water.
The organization of Meds & Food for Kids, associated with the University of Illinois, is working in Haiti to test Mamba Lespri, which translates from Creole as “smart peanut butter,” to provide supplemental food for school children.
The International Partnership for Human Development is proceeding with a dairy-based micronutrient fortified supplementary dairy paste in Guinea and Bissau.
The Program for Appropriate Technology in Health (PATH) is working in Cambodia to gain acceptance of an “enhanced strain of ultra rice” with high levels of iron and Vitamin A.
Hormel Foods is working in Guatamala with its product “Spammy,” which is a canned poultry-based supplemental spread that can be flavored to the taste of different countries’ population preference, and is curry flavored in the initial stages of development.
All the products have to meet three main goals, cost effectiveness, nutritional value and quality assurance. Another factor to any product is the ability to assure its stability in the conditions of storage available within undeveloped countries. But the biggest end goal also has to be acceptance by the undernourished population.
The ultra rice project is an example of trying to gain acceptance by the public. Ultra rice actually is rice ground into powder, fortified with iron and Vitamin A, made into a paste, extruded into the shape of rice kernels and dried. The fortified ultra rice is then mixed with conventional white rice in a one to 100 kernel ratio. Until cooked, the ultra rice has a slightly different appearance, and the concern has been that people who only eat white rice, but need more vitamins and minerals, have been known to pick the ultra rice out of the mix.
The cost of feeding the hungry has to be a major consideration in any program because of the limited resources and the large malnourished population. Again ultra rice is an example, in the small scale operations of today the cost to fortify rice is about $15 to $20 per metric ton, and the project director for the ultra rice project with PATH, Dipika Matthias, said the process has to be less than $10 per metric ton to be a competitive food source.
With the fortified blended foods, which are cooked into a porridge, an early product that has recently been improved is the corn-soy blend plus plus (CSB++) product, it is in a category of foods that can feed the moderately acute malnutritioned for 16 cents to 38 cents per day, according to presentations at the conference.
It was obvious from most of the presentations that processed foods and supplements are necessary and that whole grains or unprocessed commodities are not the most successful approach to treating extreme malnutrition.
Postal Service to Keep Rural Offices Open
May 10, 2012
The U.S. Postal Service is facing big losses, and management is looking for new ways to cut costs, but a move to close 3,600 smaller facilities is no longer an option. Wednesday, the service announced a new strategy that would keep those smaller offices open, yet achieve cost savings as part of plan to get back on a firm financial footing.
The plan offered, which will be reviewed by the Postal Regulatory Commission, would keep the existing Post Office in place but with modified retail window hours to match customer use. Access to the retail lobby and the P.O. Boxes would remain unchanged, and the town's ZIP code and community would be retained in this new plan.
Rural customers were quite vocal about the proposed closings and Congress reacted to the idea in response. That put pressure on the Post Office to look at alternatives. The agency, which has 31,000 operating locations - which compares to 13,000 for McDonald's and 4,300 for Walmart, is looking for ways to beat down costs.
Postmaster General Patrick Donahoe says "meeting the needs of postal customers is, and will always be, a top priority. We continue to balance that by better aligning service options with customer demand and reducing the cost to serve. With that said, we've listened to our customers in rural America and we've heard them loud and clear - they want to keep their Post Office open."
The service offers a four-point strategy for cutting costs.
Maintain the Post Office with reduced retail window service hours to match customer need.
Deliver using either rural carriers or highway contract routes.
Engage a local establishment within the community to establish a Village Post Office.
Merge with a nearby Post Office and provide service from that location.
Essentially the Post Office in a local community will remain open unless a community has a strong preference for one of the other options. We will not close any of these rural Post Offices without having provided a viable solution.
The press statement quoted research from Opinion Research Corporation conducted in February that showed 54% of rural customers would prefer the new solution to maintain a local Post Office. The remaining 46% prefer one of the other solutions (20% prefer the Village Post office, 15% prefer working with a nearby Post Office, 11% prefer expanded rural delivery).
The Post Office has seen a 27% drop in customer retail visits in the last 6 years and already provides alternative access through 70,000 locations.