The House Agriculture Committee this week adopted its FY2013 budget letter, formal communication from the ag panel to the House Budget Committee explaining actions taken to meet budget targets, challenges facing the committee and its jurisdiction and making the case for mercy, if not autonomy, when it comes to overall reductions in spending as part of the FY2013 House budget resolution. In a less formal process, Senate Agriculture Committee Chair Debbie Stabenow (D-MI) came out of her discussion this week with Senate Budget Committee Chair Kent Conrad (D-ND), also a member of the ag committee, saying budget cuts to 2012 Farm Bill spending should not exceed the $23 billion in reductions agreed to with the House last December as part of the deficit reduction committee effort. “It’s a number that is fairest to agriculture,” she said, adding that “America wants a reduced deficit and more jobs and a 2012 Farm Bill will help accomplish both goals.” House Ag Committee Chair Frank Lucas (R-OK) and ranking member Rep. Collin Peterson (D-MN) made the same argument to budget panel Chair Paul Ryan (R-WI) in their letter, but face a budget committee that last year approved a budget resolution recommending a $30-billion cut over 10 years in commodity and crop insurance programs, $20 billion less for conservation and a $127-billion reduction in food stamp spending. At the same time, a budget agreement continues to elude House Republicans. Recent heated GOP leadership negotiations with budget hawk House members over their demand that this year’s House budget resolution be set $20 billion less than the deficit reduction target adopted last winter. Lucas and Peterson explained in their letter the $23 billion agreed to with Senate included $15 billion from commodity programs, $6 billion from conservation through consolidation of existing programs and “streamlining” of how those consolidated programs will work, and $4 billion from nutrition programs. Other renewing programs were paid for with offsets, the duo said. Stabenow, Lucas and Peterson, along with Senate ag panel ranking member Sen. Pat Roberts (R-KS), have told their respective budget and appropriations committees the federal crop insurance program is not only the most popular risk management tool among farmers, but is a program that has already withstood more than $6 billion in cuts over the last three years.
During a hearing this week on nutrition programs and marketing of local and regional products, Sen. Pat Roberts (R-KS), ranking member of the Senate Agriculture Committee, told Secretary of Agriculture Tom Vilsack and his committee Chair Debbie Stabenow (D-MI) that he believes all titles of the 2012 Farm Bill must be “consolidated, streamlined and evaluated to determine the best use of taxpayer dollars.” In his opening statement, Roberts said “to those producers who market crops locally, congratulations and keep up the good work … however, I caution that the belief that ‘locally grown’ and purchased food is inherently better, safer or more ‘environmentally sustainable’ than food produced elsewhere in our country pits farmer against farmer, town against town and state against state.” Roberts took on a report out of the U.S. Department of Agriculture (USDA) highlighting 27 programs geared to local foods. “This is concerning given our budget situation, couple with our mission to reduce waste, duplication and redundancy.” On the issue of food stamps, Roberts pulled no punches when he reported on President Obama’s recent budget request to increase food stamp spending. “With a retailer trafficking rate of 1 percent, and improper benefit payments totaling 3.8 percent, annual [food stamp] errors total $3.4 billion … let me repeat that … $3.4 billion PER YEAR in errors.”Roberts said the food stamp error rate is over two-thirds of the annual commodity support programs for farmers.
Corn-based ethanol continues to face controversy and opposition from food and agriculture interests, and with the Environmental Protection Agency (EPA) allowing new registrations for the sale of higher ethanol-blended gasoline, Secretary of Agriculture Tom Vilsack told ethanol makers this week the fuel’s “public record” has to be set straight. The EPA formally published its evaluation of its emissions and health effects data and said it will begin accepting new registrations with the agency to sell an 85 percent gasoline/15 percent (E15) ethanol fuel blend. The agency previously approved a waiver for the use of E15 in vehicles manufactured after 2000. The U.S. Department of Agriculture (USDA) doesn’t see much of an immediate effect from new registrations given the cost to retailers to shift from E10 to E15 is substantial, and major investment is necessary to sell both fuels. Meanwhile, Vilsack told the Renewable Fuels Association (RFA) National Ethanol Conference that it’s been tough for the department the last few years trying to “set the record straight about the effects of ethanol production on food costs … (and) contributions to the global feed market.” Vilsack warned the RFA that there continues to be a strong need to defend Renewable Fuels Standard (RFS) mandates on ethanol, as well as building a broader market for the fuel and investment in “innovative emerging technologies.” Vilsack said he sees the ethanol industry as “the platform for our transition to producing more advanced biofuels.” He said the EPA’s decision on E15 is important, but maintaining the RFS is a greater priority, citing oil company efforts to modify or eliminate the federal mandate. In a related development, a coalition of more than 20 agriculture, food, automobile and business associations has publicly registered its opposition to the so-called “Open Fuels Standard,” a move by Sens. Maria Cantwell (D-WA) and Richard Lugar (R-IN) to mandate 80 percent of gasoline-powered light duty vehicles manufactured and sold in the U.S. be capable of running on any combination of ethanol, methanol and gasoline by 2018. The groups called the amendment to Senate highway bill a “massive new tax on consumers.”
Faced with a looming March 31 expiration date, the House surrendered this week on voting on its own highway bill, despite the House Transportation & Infrastructure Committee’s approval of a five-year, $260-billion package. Instead, House Speaker John Boehner (R-OH) this week signaled he will accept the Senate’s version of the federal highway/urban commuter program spending package. Boehner had earlier given his GOP caucus a choice: Vote for a modified five-year House package many in the House oppose, or accept the Senate’s $109-billion two-year bill. Budget hawks in the House oppose the committee-passed bill because it requires Treasury funding for at least a portion of the program rewrites, but leaders continue to try and fix the bill to make it politically palatable so the House can send its own version of the highway reauthorization bill to conference. One option was for the House to pass a short-term extension of current programs to allow itself the time to cut a deal. However, the Senate, having reached an agreement this week allowing 30 amendments to its highway package, and targeting March 13 for final passage, is unlikely to go along with the move. Among the amendments the Senate rejected this week was a series of changes aimed at curbing gas price increases; an amendment by Sen. Susan Collins (R-ME) to curb Environmental Protection Agency (EPA) regulatory authority on boiler emissions, and separate amendments to approve the Keystone pipeline and ban export of oil brought down from Canada via the pipeline. Pending is an amendment by Sen. Debbie Stabenow (D-MI) to extend several energy tax breaks, including those for biodiesel.
Chinese 2011 corn production may be overestimated by its government by as much as 14 percent, and may lead to increased corn demand by that nation from a world market already struggling to deal with severe drought in South America and the lowest U.S. stocks in 16 years, according to a Reuters news service investigation published this week. The wire service said Chinese corn imports are likely to increase, along with wheat imports to backstop corn supplies unavailable or priced too high for China’s feed and food purposes. China’s National Bureau of Statistics said that nation produced a record corn crop in 2011 of 191.8 million metric tonnes, but Reuters cites private analysts and other ag sources both in and outside of China who are skeptical of the government figure, figuring the estimate is overstated by 6.8-24 million tonnes. The U.S. Department of Agriculture (USDA) says the Chinese record corn crop and about four million tonnes in imports will meet China’s domestic demand, but competition between the government and private corn processors for available supplies is already pushing prices higher, Reuters said, adding that two weeks ago China purchased 120,000 tonnes of corn, its first since harvest was completed in 2011. An Australian market analyst is quoted by Reuters: “We see a year-on-year increase in corn imports, just as we did with soybean imports.”
Calling for an “all-of-the-above” energy plan, House Agriculture Committee Chair Frank Lucas (R-OK) challenged President Obama this week to join House Republicans in pushing for a national energy policy that reduces costs for farmers and ranchers, creates jobs and works to ensure U.S. energy security. Lucas chided Obama for talking about a program, but offering no specifics or “new solutions.” Lucas pointed out how energy-dependent agriculture and ag processing are, citing rising costs of machinery fuels, heating oil, fertilizer, petrochemicals and seed, as well as the energy cost of planting, harvesting, processing and transporting production. Lucas took a shot at the Administration’s rejection of the Keystone Pipeline from Canada, as well as decisions to restrict energy exploration.
In an effort to explain agency policies on confined animal feeding operations (CAFOs), the Environmental Protection Agency (EPA) announced it will hold a March 13 public meeting in West Point, NE for livestock producers in Region 7. The meeting is part of the EPA’s enhanced “national emphasis” on preventing CAFOs from polluting streams and rivers through runoff, and Region 7 has been a target for the agency since it includes heavy cattle production areas in Iowa, Nebraska, Kansas and Missouri. The focus of the meeting will be to explain the importance of EPA inspections, along with aerial overflights to assess CAFOs, winter feeding areas, manure stockpiling and nutrient management plans. Details of the meeting can be found at www.epa.gov.
Secretary of Agriculture Tom Vilsack announced this week that nearly $20 million is available through U.S. Department of Agriculture (USDA) disaster assistance to communities ravaged by flooding, drought and other natural disasters. The new monies come on the heels of $215 million already distributed to 26 states to assist in disaster recovery. The dollars are partnership money; USDA pays 75 percent of the cost of reconstruction while a local or state government pays the remaining 25 percent, Vilsack said. Projects include clearing clogged waterways, reseeding burned or eroded areas, and in some cases, purchasing floodplain easements on eligible land.