Cattlemen's Capitol Concerns
April 24, 2008

The Cattlemen’s Capitol Concerns (CCC) is a weekly report from Washington, D.C., giving an up-to-date summary of top policy initiatives concerning the cattle industry; direct from the National Cattlemen’s Beef Association (NCBA). Please feel free to reprint in full or in part. If you’d like to include NCBA’s logo, contact us at 303-694-0305.

FDA Releases Enhanced Feed Rule:  The U.S. Food and Drug Administration (FDA) has issued its final enhanced cattle feed rule which bars certain materials from all animal feed, including pet food.  The rule is scheduled for publication in tomorrow’s Federal Register and is due to be fully implemented on April 25, 2009.

The final rule amends FDA’s existing regulations to prohibit the use of certain materials in the food or feed for all animals. These prohibited materials include the following:

-- The entire carcass of BSE-positive cattle

-- The brains and spinal cords from cattle 30 months of age and older

-- The entire carcass of cattle not inspected nor passed for human consumption that are 30 months of age or older from which brains and spinal cords were not removed

-- Tallow that is derived from BSE positive cattle

-- Tallow that is derived from other materials prohibited by this rule that contain more than 0.15 percent insoluble impurities

-- Mechanically separated beef that is derived from the materials prohibited by this rule

NCBA is still reviewing the rule in order to better understand the implications of this rule for cattle producers, including the potential economic impact.  A more detailed analysis of this rule will be reflected in NCBA’s comments.

Korea Agrees to Accept ALL U.S. Beef:  Following the release of FDA’s enhanced feed rule, the Korean government agreed to expand their pending trade protocol to include all U.S. beef and beef products from cattle of all ages in accordance with World Organization for Animal Health (OIE) guidelines. 

U.S. and Korean officials announced a trade protocol on April 18th that will allow the United States to resume exports of beef to South Korea as early as May 15^th.    

Prior to December 2003, South Korea represented the third-largest market for U.S. beef and beef variety meat exports, valued annually at $815 million.  For U.S. beef producers, South Korea potentially represents a $1 billion market and could grow to be the United States’ top beef customer. 

Next Step – Korean FTA?:  Assuming trade resumes as planned, NCBA will ask Congress to consider, support and pass the long-awaited U.S.-South Korea Free Trade Agreement (FTA).  “For U.S. beef trade, the Korean FTA could be the biggest and most important bilateral trade agreement in history,” says Gregg Doud, NCBA’s chief economist.

In a press statement on April 18th, Senate Finance Chairman Max Baucus (D-Mont) welcomed the announcement about Korea resuming beef trade with the United States, but said he intends to closely monitor Korea’s implementation of the deal. 

“I have been clear for years that Korea must provide full market access for all U.S. beef, and I believe this deal can get us there if the Korean government follows through. The proof is in the porterhouse,” said Baucus. “When U.S. beef is once again available in Korean grocery stores, I look forward to working with President Lee and his new government on moving our trade relationship forward. I will closely monitor the implementation of this new import protocol, and I expect great results.”

As the Farm Bill Turns:  Meetings of the Farm Bill conference committee continued this week with only modest progress toward finalizing a 2007 bill.  At press time, both the Senate and House have approved yet another one week extension now due to expire on May 2^nd. 

It is unclear whether or not President Bush will let Congress continue to drag this out, and he is reportedly supporting a long-term extension.  “There are no signs that the conference committee will reach agreement on an acceptable Farm Bill by Friday,” said Bush earlier this week. “I therefore call on Congress to provide our agricultural producers with the certainty to make sound business and planting decisions about this year's crop by extending current law for at least one year.” 

House Agriculture Committee Chairman Collin Peterson (D-Minn.) insists the conference committee is making progress and says Farm Bill deliberations will continue in the hopes of finalizing a new bill.  Peterson has called a long-term extension “a bad idea” and “not an acceptable outcome.” 

In the meantime, NCBA’s Washington, D.C. staff are on Capitol Hill actively monitoring the conference discussions to ensure that issues of concern to cattlemen are addressed in the final language.  These priorities include: 

-- Ensure that cost-share conservation programs are adequately funded.