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House Appropriations; Policy Issues; Ag Economy; and Regulations

House Appropriations- Nutrition Issues

DTN Political Correspondent Jerry Hagstrom reported yesterday (link requires subscription) that, “Further House consideration of the fiscal year 2015 Agriculture appropriations bill has been postponed until at least the week of June 23 because House Republicans are so involved in selecting new leaders, but the Senate will take up its version of the bill next week.”

The DTN article indicated that, “The House voted on some amendments to the Agriculture bill on Wednesday, but then stopped action on it.

“Democrats in the House are expected to propose an amendment to strike a provision that would require the Agriculture Department to grant a waiver from healthier meal rules to any school that says it has been losing money in its lunch program for six months.”

Ag Appropriations Subcommittee ranking member Sam Farr (D., Calif.) tweeted yesterday that, “‪@HouseGOP pushing Ag Approps bill back means ‪#healthy school meals stays in place for now. Still work to do though. ‪#SaveSchoolLunch

And House Minority Leader Nancy Pelosi (D., Calif.) stated in a news conference yesterday that, “Millions of children nationwide depend on a school breakfast and lunch for their daily meals. Republicans are determined to overrule the views of the science and medical professionals, nutritionist, who are urging children to eat more fruit, vegetable, whole grains, et cetera. Less fats, less sodium, fewer foods containing those ingredients.

Republicans are even going after the nutrition for pregnant women and children — the WIC program — mandating that WIC program include more white potatoes… [A]nd they have an amendment that says more white potatoes than nutritionists recommend. These assaults—- on essential nutritional standards are really hard to explain to anybody. But we do know they reject science. They ignore clear-cut facts and evidence, betray the best interests of America’s families, while protecting special interest.”

Patricia Montague, the Chief Executive Officer of the School Nutrition Association, stated in a column earlier this week at Roll Call Online that, “School cafeteria professionals have been leading the charge to help students adopt healthier lifestyles. They have been improving school menus, offering a wider variety of produce and whole grains, and reducing the sodium and calories in school meals.

Unfortunately, US Department of Agriculture’s new nutrition standards for school meals, intended to promote these healthier choices, are so extreme that many students are leaving the cafeteria altogether, missing out on the fruits, vegetables, milk and lean protein offered with every school meal.”

And Justin Sink reported yesterday at The Hill Online that, “First lady Michelle Obama encouraged parents Thursday to fight with her ‘until the bitter end’ to preserve tougher new school lunch standards that House Republicans are working to roll back.”

Meanwhile, the Senate Ag Committee held a hearing on nutrition related issues yesterday.

Jacqui Fatka reported yesterday at Feedstuffs Online that, “In what Senate Agriculture Committee chairwoman termed as the ‘big picture’ points within the discussion, the hearing focused on how child nutrition has a major impact on national security and long-term economic sustainability. The hearing’s witnesses spoke about the importance of child nutrition through the lens of major national priorities, presenting perspectives on behalf of military leaders, doctors and researchers, school leaders and parents and teachers.”

In a column earlier this week at The Hill Online, Ag Committee Chairwoman Debbie Stabenow (D., Mich.) noted that, “Nearly 70 years ago, Gen. Lewis Hershey asked Congress to create a National School Lunch program to improve the health of American children. Today, our generals are asking us to protect and strengthen these programs to restore the health of children once again, because poor nutrition is having a crippling impact on our nation’s military preparedness.”


Policy Issues: Farm Bill, Biotech (Labels), and Tax Extenders

University of Illinois agricultural economist Nick Paulson indicated yesterday at the farmdoc daily blog (“2014 Farm Bill: Estimated Payment Sizes for County ARC and SCO on Soybean Acres in Illinois”) that, “Today’s post continues the historical analysis of the new County ARC and Supplemental Coverage Option programs created in the 2014 Farm Bill. Last week’s post (available here) focused on the likelihood of payments being triggered by yield or revenue losses on soybean acres in Illinois.  This post provides estimates of relative payment size on Illinois soybean acres based on the same historical data. Similar analyses have also been performed for corn acres in Illinois and can be found here and here. More details on the new commodity program options can be found here.  Details on SCO can be found here and here.”

With respect to biotech and labeling issues, Bloomberg writer Jonathan Stearns reported yesterday that, “European governments agreed to go their own way on the cultivation of genetically modified crops, ending years of legislative deadlock.

European Union environment ministers decided to let individual member countries ban the planting of gene-altered crops so EU nations that favor such seeds can grow them, denting a free-trade tenet of the bloc.

“The ministers swung behind a 2010 proposal to give national governments, when it comes to cultivating gene-altered crops, an opt-out from rules making the 28-member bloc a single market. The opt-out option would follow any EU authorization to grow such foods, known as gene-modified organisms, or GMOs.”

An update yesterday at USDA’s Economic Research Service chart gallery indicated that, “More than 60 percent of U.S. corn farmers planted Bt corn in 2010 in response to the threat of highly localized insect infestations [related graph].”

AP writer Wilson Ring reported yesterday that, “The Grocery Manufacturers Association and other industry groups challenged a new Vermont law in federal court Thursday that requires the labeling of food made with genetically modified organisms.

“The suit, filed in U.S. District Court in Burlington, had been expected since Gov. Peter Shumlin signed the state’s GMO labeling law last month, making Vermont the first in the nation to require the labeling.

“The suit asks a judge to overturn the law and describes it as ‘a costly and misguided measure that will set the nation on a path toward a 50-state patchwork of GMO labeling policies that do nothing to advance the health and safety of consumers.’”

AP writer David Klepper reported yesterday that, “Agricultural, food and beverage companies have spent millions of dollars to defeat legislation in New York state that would require labels on food containing ingredients from genetically modified crops, highlighting the state’s key role in the debate about what Americans should know about the products they consume.

“Supporters are mounting a final push for the proposal as state lawmakers work to wrap up their session. A vote on the bill hasn’t been scheduled, but both sides say the stakes are too high to assume the bill is dead for the year until lawmakers end the session.”

And in a separate issue, Brent Kendall reported yesterday at The Wall Street Journal Online that, “During oral arguments this spring, Supreme Court Justice Anthony Kennedy led sharp questioning on whether Coca-Cola Co.’s marketing of a pomegranate-blueberry juice misled consumers because the drink contained little actual pomegranate.

“Thursday he wrote a unanimous opinion allowing rival juice maker Pom Wonderful LLC to proceed with a false advertising lawsuit against Coca-Cola, a decision giving companies room to sue competitors over food and beverage marketing that may push the envelope.”

And in tax developments with agricultural implications, John D. McKinnon reported yesterday at The Wall Street Journal Online that, “The House voted Thursday to make permanent a tax break allowing small businesses to write off up to $500,000 in new equipment purchases.

“While the move adds to momentum for congressional efforts to extend a range of now-temporary tax breaks, it also sharpens a conflict between the House and Senate over whether to extend the breaks permanently or temporarily.”

The Journal article pointed out that, “Senate Democrats want to extend virtually all the breaks for another two years, a path that could be politically easier in a year when major policy changes are proving almost impossible in Congress. The conflict over the so-called extenders appears likely to drag on for much of the year, perhaps until after the November elections.”


Agricultural Economy: Corn Prices, Biofuels

Jamie Chisholm reported yesterday at The Financial Times Online that, “There is a technical term traders may use right now for the chart of the Chicago Board of Trade’s December 2014 corn futures contract. It sucks.

The price is threatening to enter multiyear lows after the recent rally failed.”

Christopher Doering noted yesterday at The Des Moines Register Online that, “Corn prices have fallen by about 25 percent during the last year following a plentiful 2013 crop and timely moisture this spring.”

In a detailed analysis this week at the farmdoc daily blog, University of Illinois agricultural economists Scott Irwin and Darrel Good (“Why Are Ethanol Prices and Production Profits So High?”) noted in part that, “With generally good growing conditions and prospects for a large U.S. corn crop, the expectation is that corn prices will remain well below the levels experienced in 2012 and 2013. Lower corn prices in turn, have been expected to result in declining ethanol prices and a return to more normal profit levels for the domestic ethanol producers. However, it appears that the recent surge in net ethanol exports has prevented those expected declines. If that is the case, prospects for ethanol trade will continue to be a crucial factor in determining ethanol prices and production profits. This in turn can have important implications for usage of corn in ethanol production. Next week, we will examine the details of the recent surge in net U.S. ethanol exports in order to assess those prospects.”


Regulations: EPA Water Issues

Tim Devaney reported yesterday at The Hill Online that, “A bipartisan group of lawmakers is pushing back against the Environmental Protection Agency (EPA) over its enforcement of the Clean Water Act.

“Reps. Bob Gibbs (R-Ohio) and Nick Rahall (D-W.V.) introduced legislation Thursday that would limit the EPA’s power to revoke permits from farmers, miners and companies that are digging through the ground near a waterway.

“The Regulatory Certain Act of 2014 would prevent the EPA from revoking a permit more than 30 days after the permit was issued, unless the company was violating the terms of the permit.”

Rep. Sam Graves (R., Mo.) indicated in a column this week at Roll Call Online that, “Congress passed the Clean Water Act over four decades ago to safeguard our nation’s major waterways. These rivers and other bodies of water are sources for drinking water and transportation, known as ‘navigable waters.’ In my northern Missouri district, situated between the Missouri and Mississippi rivers, healthy rivers are absolutely essential to the local economy and farm communities.

“The Environmental Protection Agency and U.S. Army Corps of Engineers seem to be losing sight of their fundamental mission and instead are more concerned with expanding their own regulatory footprint. Under a newly proposed ‘Waters of the United States’ rule, thousands of small streams, ditches, ponds and other isolated bodies of water, and lands near them, will be subject to federal jurisdiction and all the regulation, permitting and mitigation that entails. The consequences for millions of small businesses, farmers and local governments could be dire.”

Keith Good