Vilsack Hearing Set
Bloomberg writer Alan Bjerga reported yesterday that, “The Senate Agriculture Committee will hold a hearing next week on the nomination of former Iowa Governor Tom Vilsack to be U.S. Agriculture Secretary.
“Senator Tom Harkin, the committee’s chairman, scheduled the hearing for Jan. 14, according to an e-mailed statement released today by the Iowa Democrat’s office.”
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Global Economy Impacts U.S. Agriculture
Andrew Martin, writing in last week’s New York Times, reported that, “The long economic boom, fueled by easy credit that allowed people to spend money they did not have, led to a huge oversupply of cars, houses and shopping malls, as recent months have made clear. Now, add one more item to the list: an oversupply of cows.
“And it turns out that shutting down the milk supply is not as easy as closing an automobile assembly line.
“As a breakneck expansion in the global dairy industry turns to bust, Roger Van Groningen must deal with the consequences. In a warehouse that his company runs here, 8 to 20 trucks pull up every day to unload milk powder. Bags of the stuff — surplus that nobody will buy, at least not at a price the dairy industry regards as acceptable — are unloaded and stacked into towering rows that nearly fill the warehouse.”
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DTN Ag Policy Editor Chris Clayton reported yesterday that, “After seeing USDA’s effort to redefine ‘actively engaged’ rules for farm payments, Sen. Charles Grassley, R-Iowa, is calling on President-elect Barack Obama and Agriculture Secretary nominee Tom Vilsack to better tighten eligibility for farm programs.
“A strong advocate of weaning non-farmers off commodity programs, Grassley said USDA did not make an effort to define how a person proves they provide ‘significant management’ on a farming operation in the payment-limit details USDA posted in the Federal Register on Monday.
“‘I’m disappointed they didn’t do exactly what we set out in the farm bill to do,’ Grassley said Tuesday in a conference call with reporters [MP3 audio replay available here]. ‘They didn’t take the opportunity to then make real changes to payment limit eligibility when they clearly had the instructions from Congress to do that.’”
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Scott Kilman and Roger Thurow reported in today’s Wall Street Journal that, “Benjamin Riensche has just come off two of his best years in farming. But like growers all over the globe, he is in the midst of a more turbulent era of sharply rising and then suddenly falling prices.
“Now the 47-year-old, who grows corn and soybeans across 10,000 acres in Iowa, fears he will incur losses in 2009 that would be his first red ink in 16 years. His revenue is falling, but the costs of seed, fertilizer and machinery have remained high. Mr. Riensche bought most of his supplies months ago, when grain prices were still high. Many of his suppliers are still trying to pass along the higher costs they absorbed in recent years for everything from metal and chemicals to natural gas. To lower his costs, he could idle land, but figures raising a crop at least gives him a chance to benefit if prices move back up, as some predict.
“‘I never thought the stakes could get so big,’ Mr. Riensche says. ‘We’ve gone from the nickel slots to world-class poker.’”
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David J. Lynch reported today at the USA Today Online that, “The unstoppable force has stopped.
“With economies in the United States, Europe and Japan slowing simultaneously, the World Bank says that global trade will shrink next year by more than 2%. That will mark the first time in more than a quarter century that the seemingly inexorable tide of globalization will be in retreat.
“‘Trade tends to be extra responsive to changes in income. When the world economy contracts, trade contracts even more rapidly,’ says economic historian Douglas Irwin of Dartmouth College.”
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Posted by Keith Good • January, 6, 2009 • 5:12 am 