Senate Finance Committee Looks at Disaster Assistance
In an unprecedented move Thursday the Senate Finance Committee took a step to claim jurisdiction over agricultural policy. In a bi-partisan move the committee took action on a $5 billion permanent disaster fund for agriculture. Democratic committee chairman Max Baucus (Mont.) and ranking Republican member Charles Grassley (Iowa) were joined by Democratic Senate Budget Committee chairman Kent Conrad (N.D.) in supporting the bill. To help pay for the disaster fund the committee approved reduction of 5 cents per gallon from the Volumetric Ethanol Excise Tax Credit (VEETC), also known as the “blender’s credit”. The Finance Committee agreed on a $16 billion package late yesterday that includes funding for permanent disaster assistance, tax credits to pay for conservation programs, incentives for renewable energy and rural development, and dozens of other provisions. After the meeting, Sen. Conrad said the committee’s actions will help the Senate Agriculture Committee move forward on marking up the 2007 farm bill. The Finance Committee action does not provide any additional funding for the Agriculture Committee. Conrad said that markup is now scheduled for Oct. 23rd. The proposed blender’s credit reduction was also part of the tax package the Finance Committee attempted to put together early this summer for the Senate Energy bill. At that time the associations representing the ethanol industry all approved the reduction as part of the package to increase the Renewable Fuels Standard. None of those organizations opposed the inclusion in the current Finance Committee package.
NCGA Tells House Rail Service Not Keeping up with Demand
NCGA has told legislators the nation’s railroad freight system is providing “deteriorating service” to agricultural shippers. In written testimony, NCGA said “service predictability is a huge issue. Determining when rail equipment will arrive at origin for loading, when it will be furnished locomotive power and when it will reach destination are increasing uncertainties. It is common to hear reports from agricultural shippers who experience wait times for rail cars exceeding 30 days. In a world of ‘just in time’ delivery, a 30-day wait for your product to be picked up is often unacceptable to your customers.” Agricultural shippers also often pay higher prices and receive a lower service priority than other customers. NCGA pointed out that a Government Accountability Office study found that while railroad rates for coal, motor vehicles and other large shipments have declined, rates for agricultural shippers have actually gone up. The rising demand for ethanol could make matters worse. Rail is the primary method to transport ethanol and, NCGA testified, “ethanol production is centered in the Midwest, but 80 percent of the population, and therefore the ethanol demand, lives along the coastlines.” NCGA also discussed the Railroad Competition and Service Improvement Act of 2007 (H.R. 2125). The bill is an important step toward addressing many of the rail transportation problems facing agriculture. “This legislation will improve access to competitive rail service, protect those without competition from being subjected to unreasonable rates and/or practices and re-establish the reliability of rail service,” NCGA said. “In particular, this legislation provides key improvements to issues important to agriculture including the removal of paper barriers and the use of final offer arbitration. We look forward to working with the Committee to see that this legislation moves quickly through the congressional process.” Read the entire text of NCGA’s statement here. |
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AROUND THE CORN BELT
News
from State Associations
Michigan: With very little rain in Michigan in June and early August, many corn growers are seeing lower than average yields. Even though the state average bushels per acre has steadily increased, the lack of rainfall has caused lower than normal yields this year for much of the state. The United States Department of Agriculture has predicted about 251.9 million bushels of production. If you take this year’s crop and add the carry over, Michigan’s available corn crop is 272.9 million bushels.
Minnesota: The USDA economic research service (ERS) studies ethanol industry development over the long term and develops projections: by 2016 American drivers will consume about 14 billion gallons of ethanol, which would be about 7.5 percent of the total transportation fuel consumption, according to Paul Westcott, an agricultural economist with ERS. Westcott observes that the farmer response to the demand from the market for corn-to-ethanol, was to grow even more corn than needed. This should build stocks and cause corn prices to move back down. American farmers expect to harvest 14.8 million more acres of corn this year than last year, up from 70.6 million acres in 2006 to 85.4 million acres in 2007. In addition to investing more acres in the corn crop, we can expect bigger yields, according to the USDA. Yield is estimated to increase from 149.1 bu/acre last year up to 155.8 bu/acre (and many analysts believe it will go higher).
Virginia: The Virginia Grain Producers Association (VGPA) during a recent Board meeting voted unanimously to support the revenue-based farm bill proposal by Sens. Dick Durbin (R-Ill.) and. Sherrod Brown (D-Ohio). The Association endorsed the Farm Safety Net Improvement Act (S. 1872) noting it would provide policy to keep Virginia agriculture viable in the long term and provide a safety net that would protect producers against crop losses and volatile commodity prices. Virginia’s current situation is a perfect example of why this type of farm bill policy reform is necessary. VGPA has called on its Senators and Representatives, one of which is the Ranking Member of the House Agriculture Committee, to support the revenue farm bill proposal. |
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Cellulosic Summit to Highlight Infrastructure
The agricultural, biotech, biorefinery developer and financial communities will meet in Washington, D.C. to discuss the nation’s ethanol infrastructure. Building an infrastructure to satisfy the growing need for corn by the nation’s ethanol producers is the theme of this year’s Cellulosic Ethanol Summit, to be held Oct. 15-17. NCGA is one of the participating sponsors in the summit. U.S. Representative Jay Inslee will give the keynote address for the opening ceremonies while acting Secretary of Agriculture Chuck Connor will address the convention on agriculture’s role in building a national cellulosic ethanol industry. Connor replaces former Secretary Mike Johanns. Energy Secretary Samuel Bodman has also been invited to speak. As a prelude to the summit, an all-day briefing will provide a report on the status of industry activities to develop a feedstock logistics infrastructure for collecting and shipping large volumes of biomass to biorefineries. The annual three-day event has established itself as the major place where all communities in the cellulosic ethanol value chain come together to discuss how to build a national cellulosic ethanol industry. To learn more about the summit and register, visit the event website.
NCGA Urges President Bush to Sign WRDA
Citing the nation’s need for a world-class inland waterways system, NCGA formally asked President George W. Bush to sign the Water Resources Development Act (WRDA). The letter, signed by NCGA President Ron Litterer Wednesday, said WRDA authorized improvements to the Upper Mississippi River System which would “dramatically improve our ability to deliver crops to the global marketplace.” Litterer added, “After years of work and months of extensive negotiations, Congress has delivered a WRDA conference report that represents a meaningful and responsible legislative package, addressing issues such as environmental restoration, navigation, flood control, hurricane protection, water supply, irrigation and beach nourishment and recreation. Improvements in these areas will contribute mightily to the well-being of the nation, serving us well in the years to come.” The letter noted the overwhelming support WRDA received from the Senate and the House of Representatives and called on President Bush to sign the bill into law without delay. “Now it is time for you to show leadership and make a commitment to maintaining a world-class inland navigation system. We cannot afford to wait any longer,” Litterer said. “If we fail to move forward, the world will look elsewhere for a reliable supplier of basic food commodities. The Administration simply cannot let this happen.” The final WRDA bill has been cleared for transmittal to the White House. Once officially received, the president will have 10 days excluding Sundays to sign the bill into law, veto it, or let it become law without his signature. Click here to read the complete letter to President Bush.
NCGA Calls on Senate, USDA to Strengthen BioPreferred Program
In separate messages to the U.S. Department of Agriculture and the Senate, NCGA called for quick action to improve the federal Biobased Products Preferred Procurement Program, known as the BioPreferred Program. NCGA told Senate Agriculture Committee Chairman Tom Harkin and ranking member Saxby Chambliss that the 2007 farm bill can enhance the market development of biobased products. Specifically, NCGA called for five biobased initiatives in the farm bill:
- Allowing feedstocks and intermediate ingredients to be designated as biobased
- Allowing products with a biobased component to be designated as biobased
- Implementing a labeling program for biobased products
- Congressional recognition of the environmental benefits of biobased products
- Improved reporting of an incentive/recognition program for government employees to improve the BioPreferred program.
NCGA also called on the Department of Agriculture to roll out a biobased procurement labeling program and issue rules to designate more biobased items. “The BioPreferred Program and the biobased labeling program can highlight positively the many products that are available to government agencies and to consumers,” NCGA said in the letter addressed to Acting Secretary of Agriculture Chuck Conner. “Greater acceptance and use of biobased products will bolster rural economies, reduce our country’s dependence on foreign oil and improve the environment.” For the complete text of both letters, click here.
NCGA Committee Discusses Yield Contest Changes
A record-breaking year may lead to some refinements to America’s premier corn yield competition. The National Corn Yield Contest (NCYC) Committee gathered at NCGA headquarters to discuss how more entries and higher yields might affect the competition in future years. “It was an outstanding meeting,” said NCGA Director of Production, Stewardship and Livestock Max Starbuck.” Along with the committee, we had growers, supervisors and seed company representatives participating. Every viewpoint was represented.” One major area of discussion was yield rechecks, particularly with average contest yields increasing every year. Starbuck noted the 2007 contest has more than 4,900 entrants, and yields of more than 250 bushels per acre are becoming more common in all categories. The panel came up with several proposals to verify yield checks which will be discussed in more detail before 2008 contest rules are made final. Other recommendations included some category changes to better reflect the mix of tillage practices used by growers. The panel also discussed ways to better use the data from the contest to help educate growers about the best management practices to improve both yields and stewardship. “All the participants felt the meeting made significant progress in addressing important issues,” Starbuck said. “We will keep the state corn growers associations informed of what’s being discussed and how the process is taking place. We want to make sure everyone’s questions and concerns are heard and addressed.” NCGA will announce the winners of the 2007 NCYC competition Dec. 17. The national and state awards will be distributed at the 2008 Commodity Classic in Nashville, Tenn., Feb. 28 – March 1.
New NCGA President Promises to Focus on Energy, Farm Bill Legislation
On Oct. 1 Ron Litterer assumed the office of National Corn Growers Association (NCGA) president. He shares his thoughts about the opportunities and challenges corn growers face over the next 12 months.
There’s no doubt the last year has been a watershed for corn growers. We answered the market’s demand to produce enough corn to supply the world with both food and fuel. In doing so, record production and strong prices helped invigorate both agriculture and rural America. After such an amazing year, it might be tempting for us to sit back and catch our breath. But this is not the time to be complacent. We’ve overcome many obstacles to get where we are today, but we still face many long-term challenges. Our most immediate concerns are with government policies. Congress is considering a farm bill that will have both immediate and lasting effects on agriculture. Legislation this sweeping must provide a framework for agriculture in the 21st Century. Ever since discussions began on the 2007 farm bill, NCGA has strongly and consistently fought for an improved revenue-based safety net. There’s still much discussion in Washington about this, and we must continue to make our voices heard. A second priority is national policy with respect to biofuels, especially ethanol. Our nation’s ethanol industry has grown rapidly to meet demand. Production has grown so quickly that we’re facing a temporary supply-demand imbalance as ethanol supplies increase beyond the ability of the marketplace to absorb them. What then? How will the industry continue to grow? We must continue to fight for an energy policy that encourages production of American-grown biofuels, including ethanol from corn and other sources. As NCGA president, I will fight for our positions to encourage a growing market for corn. These include supporting trade agreements that continue to promote corn exports, as well as policies that encourage research and development of domestic sources of biofuels, support the use of distillers dried grains as livestock feed and encourage the development and use of corn-based products. The past year has been remarkable, and I want to see our success continue in the years to come.
New Leadership Kicks Off NCGA 2008 Fiscal Year
This week marked the start of the 2008 fiscal year for NCGA, bringing with it new opportunities for the nation’s corn growers. Ron Litterer of Greene, Iowa, serves as president, with Ken McCauley of White Cloud, Kan., as chairman. Bill Dickey of Laurel, Neb., is first vice president. Gerald Tumbleson ends his service as chairman. NCGA’s Corn Board also has some new faces. Elected to the board this past July were Clark Gerstacker of Midland, Mich., and Bart Schott of Kulm, N. D. Also marking the new year are grower appointments to NCGA action teams, committees and working groups, as well as rotation in the association’s officers. Action team and committee chairs and vice chairs are:
- Association Relations Committee – Bart Schott, chairman
- Biotechnology Working Group –Martin Barbre, chairman; Rob Korff, vice chairman
- Bylaws Committee – Clark Gerstacker, chairman
- Ethanol Committee –Steve Ruh, chairman; Jon Holzfaster, vice chairman
- Finance Committee – Jamie Jamison, chairman
- Grower Services Action Team –Matt Gibson, chairman; Tim Dolan, vice chairman
- Joint Trade Policy A-Team – Bill Hoffman, chairman
- Mycotoxin Committee – Scott Averhoff, chairman
- Nominating Committee – Ken McCauley, chairman
- Production & Stewardship Action Team –David Ward, chairman; Steve Ebke, vice chairman
- Public Policy Action Team –David Gillen, chairman; Keith Sexton, vice chairman
- Research & Business Development Action Team –Pam Johnson, chairwoman; Wendell Shauman, vice chairman
- 2008 Commodity Classic Committee – Theresa Schmalshof, co-chairman
For a listing of NCGA action teams and committees, click here. To read about each 2006 Corn Board member, click here.
NCGA, Farm and Food Groups Call on Senate to Pass Farm Bill
With the 2002 farm bill officially expiring Oct. 1 NCGA and a coalition of almost 70 other organization joined forces last week asking the Senate to pass a new farm bill. The groups ranged from farm commodity groups such as NCGA to conservation groups, hunger relief organizations, such as School Nutrition Association, and faith-based action groups. In addition to agricultural programs, the farm bill also authorizes and funds a number of conservation and nutrition programs. “While our organizations have differences on specific policy recommendations,” the letter noted, “we believe it is vitally important that the Senate Agriculture Committee mark up and pass a 2007 Farm Bill as soon as possible.” The group said extending the 2002 farm bill is not acceptable. “Extension is only a short-term solution that does not provide the assurances that the nutrition, agriculture and conservation communities need for efficient long-term planning.” To read the groups’ later in its entirety, click here.
From This Week’s Blog: Still No Farm Bill
Senate Agriculture Committee action on the 2007 Farm Bill was delayed again this week, with Ag Committee Chairman Tom Harkin citing “scheduling difficulties” as the reason for further postponing mark-up. The ag committee was waiting on the Senate Finance Committee to markup the Heartland, Habitat, Harvest and Horticulture Act of 2007 which will extend some tax incentives for renewable energy; establish the Agricultural Disaster Relief Fund, a permanent disaster program; give beginning farmers and rural development some assistance; and provide funding for the 2007 Farm Bill. Funding is the main issue for the 2007 Farm Bill and everyone is asking for a bigger piece of the pie. The National Wildlife Federation, for example, is asking for an increase of six-billion dollars for conservation funding while the National 25x’25 Alliance wants more energy funding. At this point, it appears the Farm Bill will now wait until after the Columbus Day recess, probably the week of October 22 - maybe longer. The 2002 Farm Bill has already expired but a temporary extension was passed authorizing funding until November 16. Maybe if the Senate spent more time this week working on the farm bill and less time worrying about what Rush Limbaugh did or didn’t say it would be done by now. I’m sorry, but Rush is a talk show host, that’s his job. Our Senators need to do their jobs. |
KEY ISSUES
