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Biofuels: Indirect Land Use; Climate Change; Executive Branch Ag Policy Perspectives; and Peanuts

Biofuels: Indirect Land Use

The Los Angeles Times editorial board noted on Monday that, “Until somebody comes up with a way to power a car with garbage, like the time-traveling DeLorean in ‘Back to the Future,’ our options are limited: gasoline and diesel, electricity, natural gas, liquid coal, hydrogen or plant-derived biofuels such as ethanol. Most people on both the right and the left agree that if we want to decrease our reliance on foreign oil and/or slow the progress of climate change, we’re going to have to use less of the first two and focus on some combination of the remaining five. Yet pursuing the alternatives can cause environmental and economic damage that’s as bad as, or worse than, that of oil and gasoline. So how do we come up with regulations that encourage cleaner fuels and discourage destructive ones, without making technology decisions that are better left to the free market?

That’s the challenge the state of California is taking on by creating a Low Carbon Fuel Standard, which after more than a year of development and hearings by the state Air Resources Board [CARB] is slated for approval Thursday. It’s a daunting task, all the more so because the state is trying to do something that hasn’t been tried before: regulate not just the direct ‘life-cycle’ emissions from producing, transporting and using fuels, but the indirect emissions that result when land is converted to grow crops for biofuels.

“This matters a great deal, because not all biofuels are created equal. Some of them, particularly ethanol produced from corn, raise food prices, pollute waterways as more fertilizer is spread over the fields, and encourage farmers in places such as Latin America to cut down more rain forest to grow crops. Yet measuring these indirect effects relies on untested and possibly unreliable science, which is why the biofuels industry is in an uproar over California’s proposed regulation.”

Chris Clayton pointed out on Monday at the DTN Ag Policy Blog that, “The CARB decision is going to be closely watched as there is anticipation the Environmental Protection Agency also will soon come out with its position on ethanol’s carbon footprint, including indirect land use. These decisions by CARB and EPA are critical really for setting the basis for the value of corn-based ethanol usage of the fuel in qualifying for low-carbon emissions.”

And Dan Looker reported on Friday at Agriculture Online that, “Biofuel supporters are worried that the EPA is going to use convoluted logic to make ethanol and biodiesel look worse than petroleum when it updates the 2007 Energy Bill’s Renewable Fuel Standard this year. The snag is a theory that every U.S. corn or soybean acre devoted to ethanol or biodiesel means an acre of tropical rainforest is being cut down somewhere to offset it and grow food. Deforestation puts greenhouse gases into the atmosphere.”

The Domestic Fuel Blog pointed out on Tuesday that, “In written comments to the California Air Resources Board (CARB) in advance of its April 23 hearing, the RFA [Renewable Fuels Association] outlined concerns about the LCFS that are particularly troubling to conventional and next generation ethanol producers.”

On the other hand, an update posted yesterday at The Mulch Blog (Environmental Working Group) stated that, “Today, a letter sent by over 170 scientists from the Union of Concerned Scientists to the California Air Resources Board urged the CARB in advance of their vote on California’s low carbon fuel standard to: account for biofuel pollution from indirect land use change — as well as from other major fuel emissions sources — under the state’s proposed low carbon fuel standard (LCFS). Nearly all the 177 signers are independent experts in fields that directly relate to the issue, including climate, land use and economics. The signatories include nine members of the National Academies of Science and two Nobel laureates.”

Climate Change: EPA Analyzes Waxman-Markey Bill

Keith Johnson reported yesterday at the Environmental Capital Blog (The Wall Street Journal) that, “Curbing carbon emissions might not cost as much as previously thought.

“The Environmental Protection Agency presented its analysis of the Waxman-Markey bill on Tuesday and said the contentious plan would cost households less than $150 a year.

“That’s a far cry from some of the dueling price tags that have been bandied about. Republican leadership in the House of Representatives says the climate bill will cost families about $3,000 a year.

Mr. Johnson added that, “Eliminating the use of carbon offsets—as environmentalists want—would double the cost of pollution permits, the EPA says. The future of nuclear power and clean coal is basically impossible to model. The cost to households was calculated on the assumption that Washington will give most of the cap-and-trade proceeds straight back to voters. But that isn’t close to a done deal yet.

“Regardless, the EPA analysis should provide something for members of the House Energy and Commerce Committee to chew on as they continue their four-day marathon of hearings.

“On Tuesday, the first day, members laid out their opening statements. Basically, Democratic members offered support for the energy bill and especially the renewable-energy provisions; Republican members attacked it and worried about job losses.”

Reporting on the same EPA analysis of the Waxman-Markey climate change bill, Jad Mouawad indicated yesterday at the Green Inc. Blog (The New York Times) that, “In a summary (PDF), the E.P.A. said it focused its analysis on the bill’s proposed cap-and-trade mechanism. It assumes that carbon prices would range from $13 to $17 per ton in 2015, and would rise by about 5 percent a year. By 2020, carbon costs would reach $17 to $22 per ton. That is approximately what participants in a European Union cap-and-trade program are currently paying.

“The E.P.A.’s analysis suggests that under the plan, the share of low-carbon and zero-carbon energy sources — including renewables like wind and solar, as well as nuclear and carbon capture plants — would rise to 26 percent of the nation’s energy mix by 2030, and could reach 46 percent by 2050. Without the policy, that share would remain at a steady 14 percent the E.P.A. estimated.”

Climate Change: Agricultural Implications

More specifically with respect to climate change issues and agriculture, Philip Brasher reported yesterday at The Des Moines Register Online that, “Agriculture Secretary Tom Vilsack says climate legislation should be a ‘net winner’ for farmers although key details that will determine how much growers get paid for offsetting greenhouse gas emissions are yet to be worked out.

“Payments to farmers could hinge on the extent to which emission allowances for greenhouse gases are sold or given away to utilities and other polluters, Vilsack said in an interview with agricultural journalists.

“He listed numerous issues yet to be addressed, such as how carbon-saving measures are analyzed and verified.”

Mr. Brasher explained that, “One of the biggest issues for farm organizations is whether farmers can earn credits for measures they’ve taken prior to the passage of the law. Many farmers in Iowa and other parts of the Midwest, for example, already have reduced their tillage and in some cases are earning payments through a voluntary credit exchange.

“Sen. Charles Grassley, R-Ia., said Tuesday that climate legislation could be ‘punitive to agriculture’ unless farmers can get paid for past practices.

However, critics say that rewarding farmers for what they are already doing won’t reduce greenhouse gas emissions, which is the point of the legislation.

Vilsack declined to take a position on the issue.”

And DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “Secretary of Agriculture Tom Vilsack said Tuesday it’s not his role in the Obama administration to advocate specifically how farmers are given credit for carbon offsets, but said he will be stressing that agriculture is part of the solution to the problem of greenhouse-gas emissions.

“USDA is one of a number of departments and agencies involved in discussions regarding how legislation or policy on climate change should develop. Vilsack said he expects the entire Obama administration will come out with a position that will work with Congress on legislation.”

Mr. Clayton noted that, “Agriculture is in a ‘somewhat unique position,’ Vilsack said, because it is not as much of an emitter of greenhouse-gas emissions as other sectors of the economy, but agriculture is disproportionately one of the solutions. Vilsack said his goal is to make sure farmers and ranchers and people in rural communities can participate.

“‘I do think it’s a net winner for agriculture, and that’s what I’m advocating,’ Vilsack said. ‘I do think we need to be part of the offset regime in a very comprehensive and significant way. I think we have a lot to offer.’”

Yesterday’s DTN article added that, “Vilsack said he has not gotten down into specific language and he acknowledged a lot of details are open questions, such as the way in which land is used, fertilizer applied, crops are grown, the way in which livestock are fed, and the way in which agriculture captures gases and the way in which sequestration is verified.

“‘The point right now is agriculture needs to be at the table as all these questions are being asked and answered, and we are,’ he said.”

A Daily Radio Newsline item from USDA yesterday (“Emissions Ruling and Possible Impacts on Agriculture,” about one minute) noted that, “The Agriculture Secretary says agriculture could benefit from the need to reduce greenhouse gas emission level if ag offsets are part of a environmental based economy.”

Executive Branch Ag Policy Perspectives

Jane Black reported in today’s Washington Post that, “In another sign that the Department of Agriculture is embracing sustainable food, the agency today will unveil expanded plans for a People’s Garden that will include the entire six-acre grounds of the Whitten Building, the department’s neoclassic marble headquarters on the Mall.

“The plans, to be announced at the agency’s Earth Day celebrations, include a 1,300-square-foot organic vegetable garden — slightly larger than the one at the White House — as well as ornamental flower gardens and bioswales, or mini-wetlands designed to reduce pollution and surface water runoff. The building grounds now are landscaped with grass, flower borders and trees planted to honor a person or mark an event.

“Secretary Tom Vilsack, an avid runner, came up with the idea for the garden during one of his daily runs around the Mall. He noticed tourists stopping to look at the trees and their dedication plaques. A thriving garden, he thought, would be a better way to communicate the agency’s mission of sustainability and in particular the importance of fresh fruits and vegetables, a cornerstone of the agency’s push to improve school nutrition and reduce childhood obesity.”

Today’s Post article stated that, “The emphasis on gardening might surprise some sustainable-agriculture advocates who initially greeted Vilsack’s appointment with skepticism. A former governor of Iowa, Vilsack had close ties to conventional farmers and ranchers and had supported biotechnology and ethanol. But in his first 91 days, the secretary has made concerted efforts to win food advocates’ trust. He has met with progressive farm groups and food policy organizations and watched a screening of ‘Food Inc.,’ a searing indictment of the industrial food system, with authors Eric Schlosser and Michael Pollan, two leaders of the sustainable-food movement. One of Vilsack’s standard lines is, ‘If I had to summarize the vision I have for this department in one word, it would be ‘sustainable.’”

While today’s Washington Post article noted that Sec. Vilsack has highlighted “sustainability” as a potential philosophical cornerstone of the USDA, recall that Javier Blas reported in Monday’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.”

As U.S. farm policy developments move forward, stakeholders will be curiously observing how “boosting agricultural productivity” and ideas regarding “sustainability” balance out in tangible terms.

In a related news article, Javier Blas reported in Monday’s Financial Times that, “China has said it will not join the growing trend of outsourcing food production by investing in overseas farmland, particularly in Africa, expressing doubts that such deals could improve its food security.

“Niu Dun, China’s deputy agriculture minister, said on Monday that Beijing preferred to depend on its own land to maintain self-sufficiency in grain, distancing the country from nations such as Saudi Arabia and South Korea, which are investing in land overseas.”

The FT article added that, “The pursuit of foreign farmland signals how countries are seeking to boost their food security after last year’s spike in agricultural commodities prices and trade restrictions led them to believe they could not rely on the global food market.”

Meanwhile, The Washington Post editorial board opined in today’s paper that, “President Obama is requiring government agencies to find $100 million in savings. Next year’s budget deficit will be $1.4 trillion. The new reductions would generate savings equal to 0.007 percent of that — something like trying to deal with a $5,000 credit card debt by forgoing a pack of gum.”

The Post editorial noted that, “Here are a number of policies the administration and Congress could consider if they wanted to go beyond symbolism. None would be easy, but they would have the potential to generate significant savings or revenue and generate at least some bipartisan support.”

And among these specific suggestions, the Post included: “Reduce farm subsidies, which run well over $10 billion most years. Price supports have led to an industry overly dependent on government giveaways. They should be replaced with a fairer system of self-sustaining insurance. Mr. Obama has proposed a fairly timid version of subsidy reform, and even that is running into stiff opposition.”

Peanuts

Reuters writer Christopher Doering reported yesterday that, “The U.S. peanut industry is starting to rebound from a nationwide salmonella outbreak that sent consumers fleeing from popular products such as peanut butter, a lawmaker from the country’s largest peanut growing state said on Tuesday.

“Sen. Saxby Chambliss, a Georgia Republican, told reporters peanut sales rose during March, a sign that ‘it’s going to be a shorter period of recovery than we thought it might be.’”

Mr. Doering explained that, “The Georgia Peanut Commission said in March the fallout from the recall could cost the U.S. peanut industry $1 billion. The source of the outbreak was traced to a Peanut Corporation of America processing plant in Georgia.

Peanut buyers slashed contracts for the crop this year following the outbreak, and the U.S. Agriculture Department projected peanut acreage this spring would be the smallest since 1915.

“‘It is still going to be a huge hit on the ag economy in my state,’ Chambliss told a North American Agricultural Journalists’ meeting. But, he added, ‘We’re recovering from that disaster.’”

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A related Dow Jones News article from yesterday (posted at DTN, link requires subscription) reported that, “Key U.S. lawmakers said Tuesday there is still broad support in Congress to make significant changes in the way the government oversees food safety, but little consensus on how to go about making improvements.

“A food safety ‘overhaul’ is needed, Sen Saxby Chambliss, R-Ga., told a gathering of reporters.”

The Dow Jones article added that, “Chambliss, the ranking minority member on the Senate Agriculture Committee, praised the job the U.S. Department of Agriculture is doing to oversee the safety of meat, but stressed that the Food and Drug Administration is under-funded and doesn’t have the resources it needs.

“While the USDA is responsible for safety measures for the U.S. meat supply, the FDA is responsible for virtually every other type of food, including peanut products.”

And the article noted that, “House Agriculture Committee Chairman Collin Peterson, D-Minn., agreed with Chambliss’ assessment of the FDA. ‘The problem is in the FDA,’ Peterson said.

“Congress needs to either combine the food safety divisions of USDA and FDA or leave them separate and make dramatic improvements to the FDA, Peterson said, but expressed doubts that FDA’s food division is salvageable.”

Keith Good