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Vilsack Gets to Work, and Price Issues

Vilsack Gets to Work

Philip Brasher reported in today’s Des Moines Register that, “Tom Vilsack began work Wednesday as the nation’s new agriculture secretary in his office overlooking the National Mall after taking the oath of office and participating in his first White House Cabinet meeting.

“Vilsack installed a fellow Iowan as his chief of staff, John Norris, the chairman of the Iowa Utilities Board. Norris’ wife, Jackie, already had a plum job as chief of staff to first lady Michelle Obama. John Norris served as chief of staff to Vilsack during his first two years as governor of Iowa.”

Mr. Brasher indicated that, “Vilsack, who late in the day met briefly with reporters in a conference room off his office, said he would heed a White House directive and put a hold on all regulations that the USDA issued in the Bush administration’s final days. Vilsack promised to ‘conduct a thorough review’ of the regulations, which include rules for labeling meat with the country of origin. Some farm groups said the rules are too weak.

“Vilsack said one of his top priorities for today was a meeting on civil rights. The Department of Agriculture has been embroiled in a long-running dispute over its handling of complaints by black farmers.”

Today’s Register article also noted that, “Two other key USDA jobs were filled Wednesday with people involved with Obama’s campaign and transition team.

David Lazarus, a former adviser to Sen. Richard Durbin, D-Ill., who led an outreach effort to farm organizations during the campaign, will be a special assistant at the USDA.

“Vilsack’s deputy chief of staff will be Carole Jett, a longtime employee in the USDA’s Natural Resources and Conservation Service. She helped direct Obama’s transition work with the department.”

A Reuters news article from yesterday, which was posted at DTN (link requires subscription) reported that, “The Agriculture Department will review newly issued regulations including rules that require country-of-origin labels on meat sold in U.S. grocery stores, Agriculture Secretary Tom Vilsack said on Wednesday.

Vilsack, on his first day on the job, also told reporters he expected additional spending on U.S. antihunger programs, such as food stamps and school lunches. He said public nutrition programs were a sure-fire way to stimulate economic activity.”

Yesterday’s article stated that, “In a memo, the White House said federal officials should delay for 60 days the effective date of rules that have not yet taken effect.

“USDA revisions to farm subsidy rules, including a stricter definition of who is eligible for payments, are slated to take effect Jan. 28. The 2008 farm law bars subsidies to people with more than $500,000 in adjusted gross income from off-farm sources.

Vilsack said it was important to have ‘a complete and thorough understanding’ of what Congress intended on access to subsidies. Two Southern senators say USDA’s rules exceed its authority.”

And the article noted that, “Child nutrition programs and the related Women, Infants and Children food program are due for reauthorization this year. Some $21 billion a year are spent on the programs.

“‘There is the opportunity for us to be creative and innovative’ to inject more nutritious foods into the programs, said Vilsack. After mentioning food stamps, he added, ‘I would anticipate we probably will’ put additional resources into food programs.”

A related update from USDA’s Daily Radio Newsline yesterday provided a brief audio clip in which, “Newly confirmed Agriculture Secretary Tom Vilsack talked about what he sees as the main issues to address during his tenure.” To listen to this brief audio recap, just click here (MP3).

Meanwhile, DTN Political Correspondent Jerry Hagstrom reported yesterday (link requires subscription) that, “The economic stimulus package moving through the House of Representatives will contain $250 million to fix long-term problems in the Agriculture Department computer system, congressional leaders said this week.

“House Agriculture Committee Chairman Collin Peterson, D-Minn., revealed at a National Farmers Union inaugural reception late Monday that the long-sought money would be in the bill. Peterson told the Farmers Union that USDA had requested $300 million and that the stimulus package would provide $250 million.

“Peterson, who is an accountant by profession, noted that he had some experience in the computer business before his election to Congress and that he trusts the USDA request because it comes from the computer professionals USDA has hired to evaluate the agency’s long-term problems in modernizing its computer systems rather than from Bush administration political appointees.”

And, Associated Press writer James MacPherson reported today that, “Outgoing U.S. Agriculture Secretary Ed Schafer said he leaves Washington, D.C., with a sense of accomplishment and no regrets – and no plans to run for another office.

“Schafer, who was North Dakota’s Republican governor from 1992 to 2000, has long ignored the urging of fellow Republicans, including former President Bush, to seek a U.S. Senate seat.

“‘I don’t have any interest in the legislative branch – I’m just not a legislative branch type of guy,’ he said Wednesday. ‘I don’t have any plans or visions of any elected office.’

“He said he is packing up and leaving Washington for a long road trip through the South with his wife, Nancy, before returning to their North Dakota home in a few weeks.”

Price Issues

Bloomberg writer Jeff Wilson reported yesterday that, “Corn rose, erasing an earlier decline, on speculation that a rebound in oil prices may signal improved demand for alternative fuels, including grain-based ethanol.

Crude-oil futures rose the most in three weeks, after yesterday dropping to a one-month low of $32.70 a barrel in New York. About 3.6 billion bushels of the U.S. corn crop, the world’s largest, will be used to make ethanol this year, up from 3.03 billion a year earlier, the U.S. Department of Agriculture said in a Jan. 12 report” [related graph available here].

Mr. Wilson explained that, “Corn futures for March delivery rose 6.75 cents, or 1.8 percent, to $3.9025 a bushel on the Chicago Board of Trade, after earlier falling 1.4 percent. The most-active contract dropped 4.8 percent last week after the U.S. government forecast rising global reserves. The price is down 51 percent from a record $7.9925 in June.

“Crude oil for March delivery, which became the most-active contract today, rose $2.71, or 6.6 percent, to $43.55 a barrel on the New York Mercantile Exchange. A sign that oil’s slide may be over since dropping from a record $147.27 in July is that front- month futures are up 24 percent since Jan. 15, when the February contract was the most active, [Roy Huckabay, the executive vice president for the Linn Group in Chicago] said.”

Bloomberg writer Tony C. Dreibus reported yesterday that, “Wheat rose the most in two weeks on mounting concern that a drop in production from the U.S., the world’s largest exporter, will curb supplies as global demand increases.

“U.S. farmers sowed 42.1 million acres of winter wheat from September through November, down 9 percent from a year earlier, the Department of Agriculture said Jan. 12. About 30.2 million acres of hard winter varieties were planted in the southern Great Plains, and 8.29 million acres with soft-red winter wheat were sown in the eastern Midwest, the USDA said.”

Yesterday’s Bloomberg article indicated that, “Wheat futures for March delivery rose 21.75 cents, or 4 percent, to $5.7175 a bushel on the Chicago Board of Trade, the biggest gain since Jan. 6. The price fell 4.9 percent yesterday and is down 58 percent from a record $13.495 on Feb. 27.”

The article noted that, “The U.S. is the largest wheat shipper, followed by Canada, Russia, Australia, Ukraine and Kazakhstan, the USDA said. Wheat is the fourth-biggest U.S. crop, valued at $13.7 billion in 2007, behind corn, soybeans and hay, government data show.”

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In an article regarding global economic growth, AP writer Joe McDonald reported today that, “China’s economic slump deepened in the final quarter of 2008 as the impact of the global financial crisis spread, according to data released Thursday, adding to the threat of more heavy job losses and possible unrest.

“Economic growth plunged to 6.8 percent compared with a year earlier, the National Bureau of Statistics reported, down sharply from 9 percent the previous quarter.

“‘The international financial crisis is deepening and spreading, with continuing negative impact on the domestic economy,’ Ma Jiantang, the commissioner in charge of the statistics bureau, said at a news conference. In a report, the government promised steps to ensure ‘a harmonious and stable society.’

“The government announced a $586 billion plan in November to try to shield China from the global slowdown by taking steps aimed at boosting domestic consumption. But its effects are not expected to be felt for several months.”

Keith Good