IN THIS ISSUE:

• NCGA Encouraged by Statement of Administration Policy Strongly Supporting RFS Provisions in Energy Legislation
• NCGA's Hume Speaks with Agriculture Secretary, Trade Ambassador on TPA
• NCGA Applauds Japanese Approval of Herculex I, Corn Growers Gain New Option
• Veneman Announces Grants for Value-Added Development
• NCGA’s Corzine Shares Concerns about USDA Agency Transfer
• NCGA Trade School Provides Answers to Important Questions
• NCGA's Snider Promotes Co-Products, DDGS Seminar During Midwest Tour
• NCGA Talks Ethanol for AgDay TV
• MO Governor Signs MTBE Ban
• Interim CEO named for Colorado Corn Administrative Committee

NCGA Encouraged by Statement of Administration Policy Strongly Supporting RFS Provisions in Energy Legislation

U.S. Energy Secretary Spencer Abraham has reaffirmed the Bush administration’s support for the Renewable Fuels Standard (RFS) in national energy legislation.

Abraham supported the RFS in a letter written to Energy Conference Chairman Billy Tauzin to provide the administration's views on the legislation that is now before the conference committee.

NCGA is pleased with the administration’s position on RFS. Within Abraham’s letter is a section entitled "Renewable Fuels Standard." The section reads as follows:

“The Administration supports the renewable fuels standard compromise contained in the Senate bill and urges the conferees to adopt it. This provision will increase the use of clean, domestically produced renewable fuels, like ethanol, which will improve the Nation's energy security, farm economy, and environment. The compromise includes a market-based national credit trading mechanism that will increase efficiency and reduce costs. The Administration would oppose changes in the Renewable Fuels Standard provisions that would raise costs and reduce efficiency of the credit-trading program, which is vital to making a renewable energy program for motor fuels economically viable.”
“We are very pleased with the administration's position on the RFS,” said NCGA Director of Energy Analysis John McClelland. “This strong support positions us well in the conference.

“This letter demonstrates the administration’s commitment to passing an energy bill and supporting the RFS as an important part of the bill,” concluded McClelland. “It is also a tribute to the hard work done by so many NCGA members to win and maintain this support.”

McClelland went on to say the conference could be a lengthy process and the nation’s corn growers need to finish what they started. “Our growers need to continue to remind their elected officials how important the RFS and the energy bill is. We’ve won a battle, but we need to be ready for the long haul.”

To see the entire letter, visit the NCGA website at http://www.ncga.com/ethanol/pdfs/BNNZ01!1.pdf.

NCGA's Hume Speaks with Agriculture Secretary, Trade Ambassador on TPA

Agriculture Secretary Ann Veneman and U.S. Trade Representative Robert Zoellick met with NCGA President Tim Hume and other ag group representatives Wednesday to discuss a structure for boosting agricultural exports, such as the use of trade promotion programs for agriculture products overseas; plans for world trade negotiations and free trade agreements; attacks on trade barriers and subsidies that hurt U.S. agriculture.

Also on Wednesday, the House approved a rule to move to conference with the Senate on TPA by a vote of 216-215. Because the Senate passed several trade bills as a package including TPA, Trade Adjustment Assistance and the Andean Trade Preference Act, the House passed the legislation separately.

This legislation is important to corn growers because it would allow for the consideration of negotiated trade agreements. "As trade agreements that benefit agriculture are negotiated," said Hume, "we want to ensure that Congress votes on the entire package and not put the agreement in jeopardy by altering the elements of the negotiations."

Veneman said with the passage of TPA, farmers and ranchers should be able to take advantage of export markets. "The new trade talks launched in Doha last year offer tremendous potential to America's producers by expanding access to growing foreign markets," Veneman said.

To promote U.S. agriculture products overseas, Veneman announced Wednesday the release of more than $100 million in Market Access Program (MAP) and Quality Samples Program (QSP) funds.

MAP provides trade associations, state and regional trade groups and agricultural cooperatives a means to promote their products and build important markets overseas. The U.S. Grains Council is a recipient of MAP funds. The 2002 Farm Bill provides for significant increases to MAP more than doubling funding to $200 million annually by 2006, the first increases to the program since 1996.

QSP funds help create export sales by promoting awareness of U.S. agricultural products among new foreign buyers. The program provides samples of agricultural commodities to foreign importers so that U.S. agribusinesses can develop new business partnerships overseas.

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DID YOU KNOW??

There are 62 ethanol plants with the production capacity of 2.4 billion gallons per year. Twenty-six of these are farmer-owned. There are 14 ethanol plants under construction with the capacity of 435 million gallons per year. Ten of these are farmer-owned. Of the 62 current plants, 6 are undergoing expansions – totaling 80 million gallons per year.

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NCGA Applauds Japanese Approval of Herculex I, Corn Growers Gain New Option

Grain corn containing the Herculex™ I Insect Protection trait has received regulatory committee approvals for food, feed and import into Japan, clearing an important hurdle on the road to commercialization. Leon Corzine, chairman of the NCGA Biotech Working Group, said Herculex I provides a new option for the nation's corn growers.

"It gives corn growers another choice," said the Assumption, Ill., corn grower. "The Japanese approval of the commercialization of Herculex I will give corn growers another tool in the toolbox for production agriculture. It's good for the environment and will help producers with safety and profitability."

NCGA believes the development of biotechnology offers great promise for corn growers through improved efficiencies and potential profits when managed wisely and with regulatory oversight based on sound science.

Herculex I is the first trait in a new generation of in-plant insect-protection traits for corn. This family of traits is being developed in a research collaboration between Dow AgroSciences and Pioneer Hi-Bred International, Inc. Herculex I guards against European and southwestern corn borer and expands protection to include black cutworm and fall armyworm.

Last year, the U.S. Environmental Protection Agency, the United States Department of Agriculture and the Food and Drug Administration granted full food and feed registration to Herculex I for the United States. Later in 2001, the EPA re-registered Herculex I, along with other Bt corn products. While registration efforts continue in other major corn-producing and corn-consuming regions of the world, approval by Japan's regulatory agencies for import of this grain marks a major advancement, since Japan is a key destination for U.S. grain.

"NCGA wants to thank Dow and Pioneer for their recognition of our policies in waiting on the commercialization of Herculex I until they received Japanese approval," said Corzine. "We're confident they will continue to work with us as they commercialize new products using our 'Know Before You Grow' campaign as a model."

Veneman Announces Grants for Value-Added Development

NCGA Grower Services Action Team member Mark Schweers, Agriculture Secretary Ann Veneman and Nebraska Governor Mike Johanns attended a tour of the PLA plant in Blair, Neb. last week to see first-hand examples of new innovations in agriculture.

While in Nebraska, Veneman announced the Department of Agriculture is providing $33 million in grants to producer-owned processing businesses for value-added agricultural development. Priority will be given to proposals that emphasize the development of renewable energy from agricultural production and the use of innovative technologies to develop value-added products.

"Agriculture is one of the most technically advanced industries in America and these grants will promote more innovation and opportunities for producers," said Veneman during a press conference after the tour. "In addition to opening new markets for agricultural products, these grant funds will encourage further exploration and development of alternative energy sources as outlined in the President's energy plan."
Schweers, a grower from Wisner, Neb., and president of the Nebraska Corn Growers Association, said the availability of the grants is good news to corn growers. "It's definitely positive news," he said. "Producers can use any help they get. It will be welcome money."

The Value-Added Agricultural Product Market Development Grants program as authorized under the Farm Security and Rural Investment Act of 2002, is designed to encourage independent producers of agricultural commodities to process their raw products into marketable, value-added goods, thereby increasing farm income.

NCGA’s Corzine Shares Concerns about USDA Agency Transfer

Leon Corzine, chairman of the NCGA Biotechnology Working Group, testified before the House Agriculture Committee on President Bush’s proposal to create a new Department of Homeland Security. Corzine represented NCGA during a joint testimony with the National Association of Wheat Growers, the American Soybean Association, the U.S. Rice Producers Association, the U.S Rice Producers Group, and the Rice Millers Association.

Corzine, who farms in Assumption, Ill., said NCGA and other agriculture groups are concerned about transferring the Animal and Plant Health Inspection Service (APHIS) from the U.S. Department of Agriculture to the proposed Department of Homeland Security.
“We acknowledge that there are sectors of agriculture that are very vulnerable to unwarranted contamination by disease or pests,” Corzine said, “and we need to protect our agricultural production and be vigilant in maintaining a safe, secure agricultural system for the United States.

Corzine urged the Bush administration to be cautious in moving either the trade support or the agriculture biotechnology oversight functions to the Department of Homeland Security. “Both of these functions are highly dependent on the free exchange of information and technology both within the United States and internationally,” he said. “Transparency is essential for strengthening and sustaining the public's confidence in biotechnology.”

If the committee approves the move of all or certain functions of APHIS, Corzine suggested it add language stating nothing in the Homeland Security legislation should be construed as amending or repealing the current legislative authorities, trade agreements or treaties under which APHIS operates.

Agriculture groups have been assured that APHIS would continue to operate under the Department of Homeland Security in the same manner it currently operates within USDA. Additionally, APHIS would maintain the same relationships and ties that it currently has with other agencies and departments including those within USDA.

Corzine said NCGA and the other farm organizations represented in the joint testimony would help make the transition work regardless of the final decision.

NCGA Trade School Provides Answers to Important Questions
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It may be summer, but NCGA is giving a pop quiz. Can you answer these three trade questions?

1. How does the US compare to the European Union with regard to domestic support payments?
2. What are the Green, Blue and Amber boxes?
3. What percentage of agricultural production is headed for export markets?

Did you know the answer to these questions? If not, you are an ideal candidate to attend the National Corn Growers Association "Trade School" and learn why it is important to take an active role in trade policy. By the way, the answers to these three questions are at the end of this article.

"Trade School" is a two-part educational "school" on trade policy. Session one, slated for July 9 and 10 in Washington, D.C., covers trade agreements, what they are, what U.S. commitments under the agreements are and how the United States compares to other countries on trade agreements, domestic support and market access. The session will also focus on the Doha Development Round and the areas of the negotiations impacting agriculture. The trade legislation portion of the session makes all of these trade issues come together - Trade Promotion Authority, Cuba Sanctions, Food Aid, and the Farm Bill.

"U.S. agriculture is dependent upon foreign markets and it is crucial that NCGA and its members take an active role in trade policy," said NCGA Director of Public Policy Keira Franz. "Negotiations in the WTO as well as other free trade agreements impact agriculture, the farm bill and the ability of the United States to access foreign markets."

Session two, scheduled for Dec.12 and 13, will explore other forces affecting trade - biotechnology, the Biosafety Protocol, CODEX alimentarius, labeling and traceability proposals from the European Union, as well as the Foreign Market Development program and the Market Access Program.

Registration for session one is $300. For more information on "Trade School" and to register, please contact Keira Franz at 202-628-7001.

The answers to the questions are:
1. The US is capped at $19.1 billion in Amber box commitments. The EU's amber box commitments are about $60 billion, with another $20 billion falling under the blue box.
2. Classifications of domestic support payments - trade distorting (amber) non trade distorting (green) and production limiting payments (blue)
3. Twenty-five percent

NCGA's Snider Promotes Co-Products, DDGS Seminar During Midwest Tour

Tracy Snider, livestock information and programs manager for NCGA, recently traveled throughout the Midwest to promote the use of ethanol co-products, as well as the upcoming NCGA North Central Distillers Grains Conference to be held in Prior Lake, Minn., Aug. 21-23.
The first stop was Des Moines, Iowa, to meet with the Iowa Dairy Beef Task Force and review incoming proposals regarding the use of distillers grains in the diets of dairy calves raised for beef.

The Iowa Dairy Beef Task Force is a special group selected by the Iowa Market Development Committee and made up of representatives from the animal feed industry, packing industry, Lucy Norton ICPB, Ron Orr, Iowa Alliance for Cooperatives and Snider. The task force is working to develop a dairy beef customer base in Iowa for distillers grains.

Snider also met with the Iowa Market Development Committee to brief them on the livestock and DDGS market research programs at NCGA, as well as the possibility of Iowa hosting a distillers grains conference in August 2003.

Snider's final stop was the St. Paul, campus of the University of Minnesota, where she met with three veterinarians from University of Illinois, four nutritionists from University of Minnesota, and a consulting nutritionist.

"I was invited to attend this meeting and contribute regarding the desired focus of future distillers grains research and the validity of current research programs," said Snider. "Both universities briefed the group on their current research goals and scope and the work being done to confront the consistency/quality issues that exist."

NCGA Talks Ethanol for AgDay TV

Lights! Camera! Corn!

Well, ethanol anyway. Rick Tolman, CEO of NCGA was filmed by AgDay television during a fuel ethanol workshop hosted by BBI International. The segment, Weekend Marketplace with Al Pell, will air on AgDay TV Saturday morning at 7:30 a.m. CDT and again at the same time Sunday It will highlight the panel discussion Tolman participated in and the need for a renewable fuels standard in the energy bill.

“We had a huge crowd, in excess of 1,200,” Tolman said about the Springfield, Ill., meeting. “Other speakers were Bob Dineen of the Renewable Fuels Association, Bliss Baker of Canadian Renewable Fuels Association and we were on stage with Al doing a roundtable on ethanol. We answered Al’s questions, as well as those asked by the audience.

“We focused on how important it is for growers to contact their elected officials and tell them not to come home without a renewable fuels standard in the national energy bill,” said Tolman. “The fight isn’t over yet.”

Also presenting at the BBI workshop was NCGA Livestock Programs and Information Manager Tracy Snider, who spoke on the Customer Perspective of Distillers Grains and focused specifically on consistency and variability issues in distillers grains. Snider spoke before a crowd of more than 200 and also discussed the NCGA North Central Distillers Grains Conference Aug. 21-23 in Prior Lake, Minn.
Tolman is back at the workshop today as a keynote speaker on the future of ethanol.

MO Governor Signs MTBE Ban
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On June 24, Missouri Gov. Bob Holden signed House Bill 1348 into law. Among other items, the bill bans the use of MTBE as of July 2005. Missouri does have one reformulated gasoline (RFG) program (the St. Louis area) that currently uses MTBE (and some ethanol).

Other states banning MTBE include: California, Colorado, Connecticut, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, New York, Ohio, South Dakota, and Washington.

Interim CEO named for Colorado Corn Administrative Committee

Things have been tough in Colorado this year. If it is not drought, it has been fire and now a change in CEO. The fires are being put under control, irrigation and Mother Nature are combining to offset the drought and the Colorado Corn Administrative Committee (CCAC) has hired John Svette as interim CEO until a new CEO is hired. Svette is well-known to NCGA, having worked with the Grower Services Action Team (GSAT) on several projects and activies. He is very capable and well respected in our organization.

Anyone interested in the CEO position or aware of someone qualified for the position should contact the CCAC office at 970-351-8201.

NCGA THIS WEEK

• July 3 NCGA Corn Board member Dee Vaughan and CEO Rick Tolman will attend a meeting of Georgia Corn Commission in Tipton, Ga.
• July 4-5 NCGA offices will be closed in observation of Independence Day. Have a safe and happy holiday!
  

ST. LOUIS OFFICE

WASHINGTON D.C. OFFICE