- FarmPolicy - http://farmpolicy.com -

Food Production; Ag Economy; Jobs Bill-Agriculture; Climate Issues; and Trade

Food Production

Damon Darlin reported in yesterday’s New York Times that, “Industrial food production is not very fashionable right now.

“Three books by Michael Pollan criticizing the system of giant corporate farms and food factories have topped the best-seller lists. A graphic documentary, ‘Food, Inc.,’ based in part on his books, has been nominated for an Academy Award.

“In Washington, Michelle Obama grew vegetables on the White House lawn as an example of self-sufficiency. And across America, more farmers’ markets and restaurants have popped up that sell vegetables and meat produced on small farms.”

The Times article added that, “As a sustainable trend, localism bears at least some resemblance to Mao Tse-tung’s Great Leap Forward. In the late 1950s, Mao decreed that steel production be localized in backyard steel furnaces. Villagers began melting down pots and pans and creating their own steel, which amounted to low-quality and largely useless pig iron.

“It was a bad idea that dragged down the nation’s productivity and played a role in widespread famine.

Localism is difficult to scale up enough to feed a whole country in any season. But on the other extreme are the mammoth food factories in the United States. Here, frequent E. coli and salmonella bacteria outbreaks are the food industry’s version of Toyota’s sudden-acceleration and braking problems. It may be a case of a manufacturing system that has grown too fast or too large to be managed well.

“Somewhere, there is a happy medium.”

Meanwhile, Chris Clayton reported on Friday at DTN that, “A bigger spotlight could shine on USDA, food and American agriculture with first lady Michelle Obama mounting a more aggressive campaign to reduce childhood obesity.

While USDA may not become the ‘Department of Food,’ the department is at the center of the Obama administration’s agenda of assisting Americans to make healthier food choices.”

The DTN article stated that, “Debra Eschmeyer, who works on marketing and lobbying for the Farm to School Network, sees a lot of enthusiasm for the direction food programs are headed in the administration, even though she and other nutrition advocates were disappointed the president’s proposed 2011 budget boosted nutrition programs $1 billion a year, and not more. That’s about 7.6 cents per child’s lunch served at school. They don’t think the increase would do enough to provide healthier choices. There is greater demand for reforming the lunch program, she said.

“‘There’s this huge outcry for actually cooking meals in school again, instead of just heat and serve, and they need the basic equipment,’ Eschmeyer said.”

Mr. Clayton also pointed out that, “Missouri farmer Blake Hurst, who has developed a reputation for taking on the local and organic concepts, had an article published last week in the Weekly Standard online that raised doubts over the environmental and economic benefits of aggressively touting local production.

“Hurst pointed out that the environmental benefits of local food may be overblown.”

Friday’s article indicated that, “Countering such talk, [Deputy Secretary of Agriculture Kathleen Merrigan] said the goal of Know Your Farmer is to boost incomes for farmers and ranchers. So far, Merrigan has explained the ideas to consumers more than to farm groups.

“‘I still haven’t had the opportunity to talk to as many farm groups as I would like to,’ Merrigan said. ‘The initiative is sort of getting out ahead of me in a way. That’s really good news, but when I have an opportunity to sit down with farmers, we have great conversations about how this can increase their bottom line, which is really a major part of this.’

“‘I think that farmers do get what I’m talking about when I get a chance to talk to them,’ she said.”

In other news regarding agricultural production, Andy Potter reported on Saturday at WCAX News Online (Vermont) that, “The economic crisis for dairy farmers got first-hand attention today from the Obama administration. U.S. Agriculture Secretary Tom Vilsack came to Vermont for a whirlwind tour that also touched on the growing local food movement.

“The ongoing dairy situation dominated Vilsack’s visit. He was invited by Sen. Bernie Sanders [related news release] and was joined by Sen. Patrick Leahy and Rep. Peter Welch. Vilsack is a former governor of Iowa and familiar with the key frustration for dairy farmers. Even before the economy crashed, many were losing their farms.”

The article noted that after meeting on the dairy issue, “Vilsack and the congressional delegation moved to the University of Vermont for the annual meeting of the Northeast Organic Farmers Association. NOFA started as a movement in 1971 and has grown into an industry. He told a packed hall at Ira Allen Chapel, ‘You’re responsible for developing one of the fastest-growing, if not the fastest-growing, segment in American agriculture today. And I would say that organic agriculture is thriving throughout the country. It supports now thousands of farmers in every region of the country.’”

An AP article from Saturday that discussed the Secretary’s visit to Vermont stated that, “U.S. Agriculture Secretary Tom Vilsack told struggling dairy farmers Saturday that the USDA is committed to making milk prices more stable and helping to create regional food systems linking farmers with local consumers.

At a town hall meeting attended by Vermont’s congressional delegation, Vilsack said the peaks and valleys of the dairy industry have become ‘very severe and very frequent’ and that farmers are suffering across the country. Temporary fixes, such as price supports, are not enough, he said.”

Agricultural Economy

In more specific news regarding the agricultural economy, Dow Jones writer Gary Wulf reported on Friday that, “With producers generating greater income, farm credit conditions improved during the fourth quarter of 2009 across the seven-state region served by the Federal Reserve Bank of Kansas City.”

The article stated that, “Ultimately average farmland values rose above year-ago levels, by an average of 2.3% for dryland parcels and 1.4% for irrigated acreage. The largest increase–of 3.8%–occurred on non-irrigated farms in Oklahoma.

“In contrast, ranchland values slipped below year-ago levels–by as much as 7.3% in Kansas–as contractions in the livestock sector dampened demand for pasture ground.”

On Friday, USDA’s Economic Research Service released a report titled, “Farm Household Well-Being: Comparing Consumption- and Income-Based Measures,” which noted in part that, “The traditional measures of a household’s economic well-being are money income and wealth, both of which indicate the financial resources available to the household. An alternative measure, indicating the current standard of living enjoyed by a household, is the household’s consumption of goods and services. USDA’s Economic Research Service (ERS) has long published estimates of farm household income and wealth based on responses to USDA’s annual survey of farms, the Agricultural Resource Management Survey (ARMS), a joint effort by ERS and the USDA National Agricultural Statistics Service. This report presents, for the first time, estimates of consumption for farm households, calculated using new survey questions in ARMS, and compares them to consumption estimates for all U.S. households, calculated from the Consumer Expenditure Survey collected by the Bureau of Labor Statistics.”

Also on Friday, USDA’s National Agricultural Statistics Service (NASS) released its “Farms, Land in Farms, and Livestock Operations” 2009 summary report.

In part, the NASS report stated that, “The number of farms in the United States in 2009 is estimated at 2.2 million, virtually unchanged from 2008. Total land in farms, at 919.8 million acres, decreased 110 thousand acres from 2008. The average farm size is 418 acres, unchanged from the previous year.” [See related graphs from the report here (Number of Farms and Average Farm Size), and here (Average Farm Size by State)].

The report indicated that, “The number of operations with cattle totaled 950,000 for 2009, down 1 percent from 2008. Beef cow operations in 2009, at 753,000, were also down 1 percent from last year. The number of milk cow operations for 2009 totaled 65,000, down 3 percent from 2008 [see related graph].”

The number of operations with hogs totaled 71,450 for 2009, down 2 percent from 2008 [related graph] Places with 2,000 or more head accounted for 86 percent of the inventory,” the report said.

Jobs Bill-Agriculture

Lisa Lerer reported on Friday at Politico that, “Sen. Blanche Lincoln (D-Ark.) slammed Senate Majority Leader Harry Reid on Friday for casting aside a bipartisan jobs proposal in favor of his own scaled-back package.

“‘Most Americans don’t honestly believe that a single political party has all the good ideas,’ she said in a statement. ‘We’re not going to accomplish anything until we start governing from the center.’”

The article noted that, “It’s unusual for a rank-and-file Democrat to publicly criticize her own caucus leader, but Lincoln is one of the most vulnerable Democratic incumbents in the Senate, which may be why she’s pushing a more bipartisan jobs bill that was introduced by Sens. Max Baucus (D-Mont.) and Chuck Grassley (R-Iowa.).

The Baucus-Grassley bill included $1.5 billion in agriculture disaster funding — a proposal championed by Lincoln, who is the chairwoman of the Agriculture Committee.”

DTN Political Correspondent Jerry Hagstrom reported on Friday (link requires subscription) that, “Senate Agriculture Chairman Blanche Lincoln appealed to Senate Majority Leader Harry Reid on Friday to put $1.5 billion in disaster aid for farmers, the biodiesel tax credit and other provisions back into a proposed jobs bill.”

Mr. Hagstrom explained that, “Supporters of disaster aid and a $1-per-gallon biodiesel credit had some temporary hope Thursday when Senate Finance Committee Chairman Max Baucus, D-Mont., and his committee ranking member, Sen. Charles Grassley, R-Iowa, announced a bipartisan jobs package largely made up of tax extensions and new tax breaks for business.

But Reid, D-Nev., came out later in the day and offered a more stripped down version of the jobs bill that eliminated most of the tax breaks and the ag-disaster package.

“Grassley’s office also criticized Reid’s decision Thursday to strip dozens of tax cuts from the jobs bill.”

“Reid said Thursday he would move the Senate Finance package separately. His office declined to comment on Lincoln’s statement Friday,” the DTN article said.

Jay Heflin, in an article posted on Saturday at The Hill Online, also noted that, “Senate Majority Leader Harry Reid’s (D-Nev.) decision to move a scaled-back job bills has thrown a bipartisan deal to reduce the impact of the estate tax into doubt.”

And Patrick Reis and Colin Sullivan of Greenwire reported on Friday at The New York Times Online that, “Sen. Dianne Feinstein has targeted the Senate jobs bill in a bid to guarantee more water for struggling farmers in California’s San Joaquin Valley regardless of restrictions imposed by the Endangered Species Act.

“Feinstein’s office yesterday announced plans to attach a rider to the jobs bill, calling it the ‘Emergency Temporary Water Supply’ amendment. It would seek to ensure that farmers and water districts get between 38 percent and 40 percent of their normal allocations. A final draft of the amendment is yet to be written, her office said.

“Allocations have dropped to as low as 10 percent recently because of a three-year drought and restrictions on pumping water from the Sacramento-San Joaquin River Delta system that are intended to protect chinook salmon and delta smelt, both of which are federally protected species under ESA.

“‘I believe we need a fair compromise that will respect the Endangered Species Act while recognizing the fact that people in California’s breadbasket face complete economic ruin without help,’ said Feinstein (D-Calif.) in a statement.”

Reuters writer Dan Whitcomb reported on Friday that, “California has been deluged with rain and snow this winter, but its epic tug-of-war over water rages on, this time in the form of a plan by U.S. Senator Dianne Feinstein to divert more water to the state’s farmers.

“Feinstein has infuriated environmental activists, fishing groups and even fellow California Democrats by drafting federal legislation that would ease Endangered Species Act restrictions to allow more water to be pumped out of the Sacramento-San Joaquin River Delta for growers in the state’s Central Valley.”

Climate Issues

Jim Tankersley reported in Saturday’s Los Angeles Times that, “The U.S. Chamber of Commerce announced late Friday that it would challenge the Environmental Protection Agency’s decision to regulate greenhouse gas emissions under the Clean Air Act, setting the stage for a protracted legal battle with the Obama administration over global warming.”

Washington Post writer Juliet Eilperin reported on Friday at the Post Carbon Blog that, “On Friday, groups including the U.S. Chamber of Commerce and the Competitive Enterprise Institute said they would file petitions to overturn the endangerment findings, on an array of different grounds. The Chamber said it would challenge the rulemaking process EPA had followed, while CEI and two allied groups, the Nongovernmental International Panel on Climate Change and the Science and Environmental Policy Project, suggested there was not sufficient scientific evidence to justify such a move.”

And Chris Clayton reported on Friday at the DTN Ag Policy Blog that, “The National Cattlemen’s Beef Association issued a news release Friday afternoon stating that the group had joined other associations in petitioning EPA Administrator Lisa Jackson to reconsider the EPA finding that greenhouse gas emissions are an endangerment to public health. According to the release, the petition ‘is based upon information uncovered during the recent ‘climategate’ scandal, which seriously calls into question the scientific validity behind EPA’s finding.’

“‘It’s become evident that EPA’s endangerment finding may be based on flawed data,’ said Tamara Thies, NCBA chief environmental counsel. ‘The fact that EPA did not choose to reconsider its finding after the extent of the climategate scandal was revealed publicly is perplexing to say the least; ignoring climategate will not make it go away.’”

In related news, Juliet Eilperin and David A. Fahrenthold reported in today’s Washington Post that, “With its 2007 report declaring that the ‘warming of the climate system is unequivocal,’ the U.N. Intergovernmental Panel on Climate Change won a Nobel Prize — and a new degree of public trust in the controversial science of global warming.

But recent revelations about flaws in that seminal report, ranging from typos in key dates to sloppy sourcing, are undermining confidence not only in the panel’s work but also in projections about climate change. Scientists who have pointed out problems in the report say the panel’s methods and mistakes — including admitting Saturday that it had overstated how much of the Netherlands was below sea level — give doubters an opening.

“It wasn’t the first one. There is still a scientific consensus that humans are causing climate change. But in the past year, a cache of stolen e-mails, revealing that prominent climate scientists sought to prevent the publication of works by their detractors, has sullied their image as impartial academics. The errors in the U.N. report — a document intended to be the last nail in the coffin of climate doubt — are a serious problem that could end up forcing environmentalists to focus more on the old question of proving that climate change is a threat, instead of the new question of how to stop it.”

The “Washington Insider” section of DTN noted on Friday (link requires subscription) that, “Sen. Lisa Murkowski (R-Alaska) is likely to petition the Senate Environment and Public Works Committee by the end of the month to force the committee to release her proposal, which would block the Environmental Protection Agency from regulating greenhouse gas emissions. Murkowski introduced her bill in response to EPA’s recent finding that greenhouse gases endanger public health and welfare, an EPA finding upon which EPA would base regulations of greenhouse emissions under the Clean Air Act.

“Under the expedited procedures outlined in the Congressional Review Act of 1996, Murkowski would need the votes of just 30 senators to pry the bill out of the Environment and Public Works Committee, and she currently has lined up more than 30, according to Capitol Hill sources.

“However, once her resolution moves to the Senate floor –– which could happen by late March –– Murkowski would need 51 votes, and she has not yet reached that number.”

Trade

Dow Jones news reported on Friday that, “Brazil’s government Thursday formalized guidelines for an $830 million retaliation against U.S. cotton subsidies granted by a World Trade Organization ruling last year.

“According to a decree published in the country’s federal register, the government, among possible retaliatory measures, gave authorization for suspension or limitation of intellectual property rights locally to imports from the U.S., and temporary blockage of royalty remittances related to intellectual property.

“Brazil’s trade ministry last week published a list of U.S. goods totaling $560 million that could be subject to direct import retaliations. The remaining $270 million in WTO authorized sanctions, it said, would likely come through restrictions of intellectual property rights.”

The AP reported on Friday that, “The European Union’s new trade chief wrapped up his first visit to the World Trade Organization on Friday with the stark assessment that officials were making no progress on a new global commerce pact.

“If heads of state really want to see the Doha trade liberalization round completed this year, they need to give their negotiators the authority to make key concessions to eliminate trade barriers in agriculture, manufacturing and services, said EU trade chief Karel De Gucht.”

Meanwhile, Stewart Doan, a Senior Editor at Agri-Pulse, filed an interesting audio report last week regarding agricultural trade, which featured analysis from former chief ag trade negotiator Allen Johnson. To listen to Mr. Doan’s audio report, just click here (MP3).

Keith Good