Any farmer or rancher who believes he/she was negatively impacted by the bankruptcy of MF Global, the eighth largest bankruptcy in U.S. history, has to file all necessary claim paperwork by January 31, 2012, according to reports. Funds are now being distributed by trustees to clients and customers. Sen. John Tester (D-MT) urged his farmers not to wait until the last minute, and is also calling for a hearing in the Senate Banking Committee on then MF Global case.
Rural voters heard little new in the President's State of the Union speech delivered January 24, with President Obama once again talking about rural communities in the context of biofuel feedstock production and places in need of broadband access. He did not address EPA proposed and pending regulations that are a serious source of concern in the country, nor did he reference the Department of Labor's pending rule on "child labor." Industry sources indicated they were not surprised. One of the few sectors praising the President was the ethanol industry; President Obama said the word "energy" 23 times throughout the speech, according to an Agri-Pulse count.
The U.S. Supreme Court ruled unanimously in favor of the meat industry this month, ruling the state of California had gone too far in its attempt to regulate non-ambulatory animals moving to slaughter. The high court agreed with the meat processing industry, saying the state of California had crossed into federal regulatory territory in enacting a law stricter than the federal law on so-called "downer" livestock. The state law is now invalid. The industry, in challenging the law, claimed federal preemption; however a California appeals court cited the "good intentions" of the state law. However, the suit brought on behalf of California pork producers was supported by the U.S. Department of Justice. Wayne Pacelle, president of the Humane Society of the U.S. (HSUS), called the decision "deeply troubling."
H.R. 3798, “The Egg Products Inspection Amendments of 2012", a political deal cut between the United Egg Producers (UEP) and the Humane Society of the U.S. (HSUS) to "enrich" the production environment for egg laying hens while removing from the egg industry from the threat of state referenda on cage size, was introduced this week by Rep. Kurt Schrader (D-OR). Schrader, not a major force in the House, was able to bring along only Reps. Elton Gallegly (D-CA) Jeff Denham (R-CA) and Sam Farr (D-CA) as cosponsors. The bill would codify a deal cut between UEP and HSUS and amend the Egg Products Inspection Act to allow USDA to set housing standards for egg laying hens, effectively doubling the size of current hen cages. If approved, it would be the first time the federal government has been given authority to set husbandry practices for any species of animal raised for food. The National Cattlemen's Beef Assn. (NCBA) and the National Pork Producers Council (NPPC) immediately and publicly came out opposing the bill, with NPPC saying it sets a dangerous precedent and is unnecessary, but the American Society for the Prevention of Cruelty to Animals (ASPCA) and the National Consumers League (NCL) support the bill. The bill will be sent to the House Ag Committee but is unlikely to see action.
House Agriculture Committee Chair Frank Lucas (R-OK) says there is still an opportunity to get a bill written this year, but he will need a convergence of economic and political factors that will let him push forward with a Farm Bill in 2012. Saying he needs to come up with a bill that cuts $23 billion over the life of the bill, Lucas says it's going to be tough to get all the ducks in line to get a bill done this year, though he said Senate Ag Committee Chair Debbie Stabenow (D-MI) has earned her stripes on farm policy development during the end-of-2010 deficit committee deliberations. He also said, however, he doesn't feel he's ready to push forward and needs to sit down with committee ranking member Rep. Collin Peterson (D-MN), as well as committee members who don't feel as though they had sufficient input to the super committee document. At the same time, various commodity sectors will have to agree on which of several approaches to rewriting direct payment programs to embrace. It does not appear the outlying titles will be problematic -- conservation program consolidation was relatively painless -- but the heavy lifting will come in rewriting the commodity and direct payment titles given there does not appear to be a consensus approach that satisfies groups by commodity and by region. The only agreement is that any new approach needs to be built off the federal crop insurance model as part of a mechanism to protect income. The challenge here is producer premium subsidies, a cost-cutting target for some members. Lucas said he'll talk to anyone about any proposal, including those being talked about by the American Farm Bureau Federation (AFBF) and those floating around in the Senate, including Sen. Kent Conrad's (D-ND) "shallow loss" proposal.
Following up on the President's State of the Union messages this week, Secretary of Agriculture Tom Vilsack did not rule out more retirements and greater retrenchment of existing USDA programs. In a call with reporters on how the President's State of the Union messages would affect rural communities, Vilsack would not rule out "greater restructuring" of USDA, including higher-than-expected retirements, and consolidation of programs above and beyond what was announced last week. USDA's "Blue Print for Stronger Service," which can be found on USDA's website (www.usda.gov), includes 69 recommendations for greater program and agency efficiencies in both the short and long terms. The Secretary also said the National Agricultural Statistics Service (NASS) is in for some restructuring, indicating announcements would be coming soon.
With ranking member Rep. Collin Peterson (D-MN) questioning the need for the legislation while rulemaking is still underway, the House Agriculture Committee this week approved six separate measures -- three already approved by the House Financial Services Committee -- to modify the Dodd-Frank Act. The six bills would require the Commodity Futures Trading Commission (CFTC) to assess the cost/benefit of qualitative and quantitative impacts of intended regulation; exempt swaps from margin requirements if the other side of the transaction is an end-user or is "an affiliate of a person that qualifies as an end-user;" exempt inter-affiliate swaps from clearing and execution requirements and swap dealer and certain capital and margin requirements; exempt inter-affiliate swaps from clearing and execution requirements and swap dealer and certain capital and margin requirements; prohibit the CFTC from requiring a swap execution facility to have a minimum number of participants receiving bids or offers; prohibit insured depository institutions and farm credit institutions from being defined as swap dealers when they work with customers on risk mitigation and hedging, and prohibit a trading entity from being defined as a financial entity if the entity exposure does not exceed $1 million, and as a "swap dealer. " Exempted from the definition are transactions for risk mitigation and hedging, with a de minimus exception set at $3 million per year.
With the railroads strongly opposing, shippers of all stripes will descend on Washington next week to push for language in the House federal highway reauthorization bill allowing the states to permit rigs weighing up to 97,000 lb with six axles and additional braking power on federal highways within their borders. The current limit is 80,000 lb, forcing shippers to run less-than-truckload shipments or use state roads with higher weight limits. The shipper fly-in -- with members of several coalitions combining forces, will be held February 1, just a day before the House Infrastructure & Transportation Committee begins markup of the House package, expected to cost over $500 billion over six years. This week a letter from the American Farm Bureau Federation, the National Cattlemen's Beef Assn., and the nation's largest livestock and poultry groups was sent to Committee Chair Dan Mica (R-FL) and ranking member Nick Rahall (D-WV) supporting the heavy truck language.
The Administration is reviewing some 300,000 deportation cases on an individual basis and looks to grant temporary leniency to some illegal immigrants, an expansion of a program announced last summer by President Obama. The GOP has denounced the move as "back door amnesty" because it would allow illegal aliens with family in the US or who are enrolled in school or the military, similar provisions to the failed Dream Act from last year. Supporters say the program only provides a temporary reprieve and does not permit illegal immigrants to work. Sen. Charles Schumer (D-NY) has, however, asked the Administration to allow temporary work visas during the one-year holding status based on individual cases. Immigration reform advocates want the work permits granted on a generalized basis to all whose deportation status is in limbo. Schumer won't support the broader work permitting, calling that action amnesty. Immigration & Customs Enforcement (ICE) says it can only deport about 400,000 illegal immigrants a year and the new program will allow it to focus resources on those who have committed serious crimes. The program currently operates in Denver and Baltimore where over 1,600 deportation cases out of a pending 12,000 were closed. The pilot is being considered for national application, resulting in a close-out of an estimated 40,000 cases.