FarmPolicy

October 25, 2014

G8: Food Security; Livestock Issues; Climate Change; and Farm Bill Issues

G8: Food Security

On Saturday, Secretary of Agriculture Tom Vilsack addressed the first-ever Group of Eight (G8) Agricultural Ministerial.

According to a news release from USDA, Sec. Vilsack indicated that, “This meeting, the first of its kind in the G8’s history, underscores the important role that agriculture will play in the coming months and years, as we look for ways to improve global food security

“During President Barack Obama’s inaugural address earlier this year, he made the following pledge: ‘To the people of poor nations, we pledge to work alongside you to make your farms flourish and let clean waters flow; to nourish starved bodies and feed hungry minds.’ I believe this pledge will help guide all of us, as we work together in exploring how the world’s wealthiest countries can address hunger and malnutrition—among the most devastating and persistent challenges on the globe. As we saw with last year’s food riots, food insecurity not only threatens vulnerable populations, it puts our economic security and international stability at risk. If there is one thing we have learned from the global recession, economic crisis knows few boundaries. And economic crisis not only threatens prosperity but also security…”

The final declaration of the G8 Agriculture Ministers’ Meeting noted in part that, “Although the global economic downturn has caused the international market prices of nearly all agricultural commodities to fall dramatically since summer 2008, and prices have fallen for some consumers, they are still well above previous lows in many countries and the depth of the current economic recession means that the number of people who are poor and, consequently, hungry has increased since last year;” and added that, “Agriculture and food security are at the core of the international agenda.”

And a news release posted on Sunday at the Food and Agriculture Organization of the United Nations (FAO) Online noted that increased agricultural production is an important variable in the food security equation. The FAO release indicated in part that, “‘As the financial crisis unleashes more hunger by compounding the impact of the food crisis on the world’s most vulnerable, G-8 leaders must put food security at the top of their agenda,’ said [the World Food Programme’s] Executive Director, Josette Sheeran. ‘This includes ensuring access to food for all, as well as focusing on increased agricultural production.’”

Along these lines, Javier Blas reported in yesterday’s Financial Times that, “The US agriculture secretary has warned that unless countries take immediate steps to sharply boost agricultural productivity and food output and reduce hunger, the world risks fresh social instability.

“In an interview with the Financial Times, Tom Vilsack indicated that food security and global stability were tied, in a sign that Washington’s worries about the global food crisis go well beyond its humanitarian implications.

“‘This is not just about food security, this is about national security, it is about environmental security,’ he said on the sidelines of the first meeting of the Group of Eight ministers of agriculture. Although the US has in the past talked about the links, Barack Obama, US president, and his team have made it a priority, officials said.”

The FT article added that, “Mr Vilsack said the challenge to boost output to feed the world’s population – expected to reach 9bn by 2050 from today’s 6.5bn – was compounded by climate change. For that reason, he called on the G8 to back the use of science in agriculture, including genetically modified organisms, to boost productivity.”

Meanwhile, yesterday’s Commodity News for Tomorrow report (CME Group and Dow Jones News) reported that, “The Group of Eight rich nations took a first step Monday towards combating price speculation that has helped pushed up the cost of basic foods, sparking riots in poor countries.

“The G8 agriculture ministers called for a study into setting up a global system to stockpile essential foodstuffs, following three days of talks in northeastern Italy joined by key developing countries.

“‘We call upon the relevant international institutions to examine whether a system of stockholding could be effective in dealing with humanitarian emergencies or as a means to limit price volatility,’ the ministers said in a final declaration.”

However, Reuters writer Jeremy Smith reported on Sunday that, “United States Agriculture Secretary Tom Vilsack cautioned on Saturday against the idea of creating global grain reserves, saying it might not be the ideal tool to ensure food price stability.

“Speaking on the margins of a meeting of G8 and G5 farm ministers, Vilsack said the U.S. experience with such schemes had shown it was better to focus on technical advances in irrigation, seed varieties, machinery and farming methods.”

In a separate Reuters article from Sunday, Jeremy Smith reported that, “Several farm ministers from the world’s most developed nations called on Sunday for an end to protectionism in agriculture, saying the best way to food security lay in better incentives for farmers.

“Debate at the first meeting of farm ministers from G8 and G5 states has shifted towards options for improving food security and ways to raise output. But food protectionism, as exercised by both rich and poor countries in the form of export bans and import duties, has also been a subject of debate.

“International organisations such as the World Food Programme have called for self-restraint in curbing exports, criticising export bans imposed by countries hit by rising prices which it says are impeding efforts to get food to the world’s neediest.”

And a news release issued yesterday by USDA indicated that, “On Monday, Agriculture Secretary Tom Vilsack returned from the first-ever gathering of the G8 Agriculture Ministerial, held in Treviso, Italy.

“‘I am pleased to report that the G8 Agriculture Ministerial has produced a strong declaration of support for the critically important task of promoting food security,’ said Vilsack. ‘Supporting food security is not only our moral obligation, as a factor impacting global economic development and international stability, it is our responsibility. We took an important step toward building a consensus around issues affecting access, availability, and utilization of food among vulnerable populations.’”

Livestock Issues

Simultaneous to acknowledgment from global agricultural leaders that the current financial crisis has caused the number of people who are poor and, consequently, hungry to increase since last year, some political and legislative activities in the U.S. are unfolding that could curtail production and limit the supply of important food products.

Cliff Gauldin noted yesterday at Feedstuffs Online that, “It has been two months since Ohio farm group leaders met with representatives of the Humane Society of the United States (HSUS) to talk about livestock and poultry confinement issues. The animal welfare group is waiting to hear if the groups want to talk some more.

“On Feb. 17, Paul Shapiro, who heads up the HSUS Factory Farming Campaign, sat down with representatives of the Ohio Farm Bureau (OFB), the Ohio Veterinary Medical Assn. and leaders from the state’s pork, beef and poultry organizations.

“‘We certainly have made it clear that we are contemplating the possibility of a ballot initiative in Ohio,’ said Shapiro. ‘At the same time, we also made it clear that our preference is to avert a ballot initiative campaign.’”

The article explained that, “HSUS wants sow gestation stalls, veal crates and laying hen battery cages phased out in Ohio, just as they were in a California vote last November. However, HSUS would prefer that Ohio take the same route as Colorado, where farm group leaders agreed to a legislative compromise that headed off an initiative drive.

“‘They went to great lengths to explain how it would be in our best interest to do things that way,’ said Joe Cornely, OFB spokesman. ‘The bottom line was: ‘If we don’t work together on legislation, then we’re going to take it to the ballot.’’

“Cornely said OFB has been communicating with its membership and elevated the urgency level on the issue.”

Yesterday’s Feedstuffs article also explained that, “HSUS is conducting Humane Lobby Days in 40 states this year, but Shapiro said Ohio is the only one in which the group has met with farm leaders to discuss confinement issues and the possibility of a ballot measure.

“‘Ohio has 28 million laying hens,’ Shapiro noted. ‘There are a lot of breeding pigs there. It also is a serious veal production state. As an animal welfare organization, our mission is to reduce animal suffering. As with California, we’re interested in enacting policy that reduces the suffering of large numbers of animals.’

“Ohio ranks second nationally in egg production and ninth in hogs. Cornely said it’s anybody’s guess as to why Ohio seems to be the next target.”

In a related article, the AP reported on Sunday that, “One of the state Senate’s leaders wants to ensure that cattle, poultry and pigs raised in California aren’t routinely given antibiotics, a practice consumer advocates say can lead to the development of drug-resistant bacteria.

“A Senate committee Tuesday will hear legislation authored by Majority Leader Dean Florez that would bar ranchers and farmers, starting in 2015, from giving feed containing antibiotics to healthy animals to promote growth and ward off disease.

The bill would also prohibit schools, starting in 2012, from serving students meat from animals that have been routinely treated with antibiotics and would require state and local government facilities to try to buy antibiotic-free meat for their kitchens.”

Climate Change

Another important development with implications for U.S. agricultural producers is regulation or legislation regarding greenhouse gas emissions and climate change.

DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “Farmers are going to become more familiar with terms such as ‘carbon sink’ and ‘leakage’ in the coming months as agricultural groups move to explain the language of climate-change policy to producers.”

Yesterday’s DTN article noted that, “The National Farmers Union and American Farm Bureau Federation laid out their thoughts on potential cap-and-trade legislation at a forum Monday in downtown Washington hosted by the North American Agricultural Journalists.”

And Mr. Clayton explained that, “Right now, no legislation has been written. The House Energy and Commerce Committee is pushing to have a bill out of committee by the end of May, while the House Agriculture Committee is starting to look at possible hearings on the subject. The Senate, which debated a bill last year, has not laid out such an agenda.”

And with respect to action by the House Energy and Commerce Committee, four days of hearings by the Committee on the discussion draft of ‘The American Clean Energy and Security Act of 2009,’ will begin today at 3:00 pm (Eastern).

Farm Bill Issues

Carolyn Lochhead indicated yesterday at The San Francisco Chronicle’s Politics Blog that, “Today the White House is touting that President Obama is fulfilling his pledge to go ‘line by line through the budget to cut spending’ by ‘challenging’ his cabinet to find $100 million in savings in 90 days.

“That will sure make a big dent in the nearly $10 trillion in deficit spending his budget projects for the next decade. Trillions, billions, millions, hey, what’s the difference?”

With respect to agriculture, Ms. Lochhead added that, “The White House lists examples that should be fodder for late-night comedy:

$16 million in improper farm program payments, even though Obama voted for a subsidy-laden $170 billion farm bill last year around the time of those Iowa caucuses…”

***

In other developments regarding federal farm policy and agriculture, Kansas State University Agricultural Economics Professor Art Barnaby, Jr. released a paper yesterday entitled, “Planting A Crop Could Cost Farmers Revenue.”

In part, the paper stated that, “It is too early to determine the level of freeze damage on the winter wheat crop but as insurance companies settle these freeze claims, farmers need to be careful they don’t void their free SURE (SUpplemental REvenue) disaster aid coverage from the Farm Service Agency (FSA).

The first step before planting any crop is to get a release from their insurance company. If the insurance company thinks there is a chance for recovery they may require farmers to leave test strips of wheat. It is recommended that revenue insured farmers only consider a second crop on failed wheat acres if the insurance company is willing to appraise the remaining crop and release it without requiring test strips. The reason is because wheat has a very ‘high’ base revenue price of $8.77. Changing to grain sorghum coverage will have a much lower level of coverage because of the lower base price. Also, many wheat farmers will not have a grain sorghum history and will be required to use ‘county’ yields for their aph. If the test strips recover, farmers may generate lower net revenue because of the reduction in the wheat indemnity payment and that is especially true if the replacement crop fails.”

The KSU item explained that, “The issue is farmers who plant grain sorghum (or other crops) on failed wheat acres may eliminate their SURE payments. In many cases, the grain sorghum is considered ‘double’ crop because the wheat will not be released until it heads out (maybe the wheat will recover). There is still plenty of time to plant grain sorghum but if it is classified as double-crop it will require farmers to have paid the $250 NAP fee for double-crop grain sorghum back on March 15. So farmers end up in a Catch 22 because few farmers paid the NAP fee for double-crop grain sorghum by the final date of March 15, 2009 unless double-cropping is part of their normal farming operation. Therefore, farmers planting a replacement crop on failed wheat acres that is classified as a ‘double’ crop without NAP coverage, will not be eligible for SURE payments.”

Meanwhile, a news release issued yesterday by the Georgia Peanut Commission indicated that, “The Georgia Peanut Commission board of directors recently met with U.S. Representative John Barrow, D-Ga., regarding farm bill regulations that are still not finalized by the U.S. Department of Agriculture. The 2008 Farm Bill approved a new rotation program which provides an incentive to farmers who practice this conservation initiative.

“‘The 2008 Farm Bill was authorized last year and USDA has yet to write regulations for the rotation program,’ says Armond Morris, chairman of the Georgia Peanut Commission. ‘The rotation program is a new incentive that may help determine what many farmers plant in 2009. We are very frustrated that the program has not been implemented yet for this year.’”

Yesterday’s release added that, “The University of Georgia’s National Center for Peanut Competitiveness was instrumental in developing the rotation program and the Georgia Peanut Commission supported it through passage of the farm bill.

The rotation program offers supplemental payments for producers who adopt a beneficial crop rotation. The program encourages producers to adopt new, additional beneficial crop rotations that provide significant conservation benefits. The payments are to be available to producers across the country and are not limited to a particular crop, cropping system, or region of the country.

In the Southeast, peanuts are an example of a crop that responds well to increased rotation lengths.”

Keith Good

Comments are closed.