Cattlemen's Capitol Concerns

August 16, 2007

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 202-347-0228.

President Bush Signs Disaster Assistance Bill:  President Bush signed into law this week S. 1716 which will clarify that livestock producers are eligible for livestock assistance programs regardless of whether they had Non-insured Crop Disaster Assistance Program (NAP) coverage.  In the emergency supplemental passed earlier this year, Congress included agriculture disaster assistance to provide much-needed aid to livestock producers who were dealt a blow by wildfires, drought and other natural disasters. However, due to interpretation of the legislative language in the emergency supplemental, the majority of our nation’s livestock producers would have been excluded from any assistance unless they had NAP coverage.  S. 1716 strikes the NAP requirement. 

NCBA worked to get the fix added to a number of legislative vehicles, and supported S. 1716 which passed as a stand-alone bill in late July.  “This is good news for many cattle producers who have been hurt by drought, wildfire, blizzards, floods or other natural disasters,” says NCBA’s Manager of Legislative Affairs Jason Jordan.  “This clarification will ensure that farmers and ranchers will benefit from the aid Congress passed earlier this year.”

NAFTA News Update: This week, trade officials from the United States, Mexico, and Canada, met in Vancouver, Canada for an annual meeting of the NAFTA Free Trade Commission (FTC). Following the August 14 meeting, U.S. Trade Representative Susan Schwab, Canada’s International Trade Minister David Emerson, and Mexico's Secretary of the Economy Eduardo Sojo noted that the work accomplished would help lay the foundation for the upcoming North American Leaders Summit in Montebello, Québec, August 20-21, where President George W. Bush, Canadian Prime Minister Stephen Harper, and Mexican President Felipe Calderon will meet.

In a joint statement this week, the three Ministers announced: "The NAFTA – now in its 14th year – has been a remarkable success story for all three partners. It has contributed to significant increases in trade and investment flows between Canada, the United States and Mexico, and has contributed to economic growth and job creation throughout North America.

"We are committed to multilateral trade liberalization and to successfully concluding the WTO Doha Round of negotiations.  We urge all WTO Members to demonstrate renewed energy and flexibility in the negotiations based on the Chairs’ texts in agriculture and non-agricultural market access. At the same time, we reaffirm our commitments undertaken at our last meeting of APEC Ministers Responsible for Trade, held in July 2007 in Cairns, Australia.  To this end, we reiterated our commitment to examine the prospect of a Free Trade Area of the Asia-Pacific (FTAAP).

"We are also pleased with significant progress on rules of origin. In 2003, the NAFTA Working Group on Rules of Origin set out to liberalize the requirements for obtaining NAFTA duty-free treatment. The first set of changes – affecting approximately $20 billion (USD) in annual trilateral trade – was implemented in 2005. A second set of changes – affecting an estimated $15 billion (USD) in trilateral trade – was implemented in 2006. We have now agreed to a third set of changes – affecting an estimated $100 billion (USD) in trilateral trade. These changes will be implemented in 2008."

NAFTA Has Helped the U.S. Achieve Record Beef Exports to Canada, Mexico:  NAFTA has made huge strides for the U.S. beef export industry and is seen as an exemplary agreement. Prior to the agreement, Mexico was an inconsistent market for U.S. beef. When our industry sought NAFTA more than a dozen years ago, no one imagined that one day Mexico would become the U.S. beef industry’s best market.

Today, U.S. beef exports to Canada and Mexico are moving at record levels. The United States exported a record amount of beef and beef variety meats to Canada in both May ($59 million) and June ($66 million). Through the first six months of 2007, the United States has sold to Canada $254 million in beef, versus $196 million during the same period in 2006. Total U.S. beef exports to Canada in 2006 were $433 million, suggesting we're on pace to sell to Canada more than half a billion dollars worth of beef this year.

U.S. imports of Canadian beef through the first half of this year were approximately 147,000 mt worth $460 million, compared to 149,000 mt worth $476 million during the same period last year. The United States imported 599,435 head of Canadian fed and feeder cattle during the first six months of 2007, compared to 527,612 head during the same period in 2006.

In 2006, the United States sold to Mexico a record $1.16 billion in beef and beef variety meats, and at the half-way point in 2007, we're already $12 million ahead of last year. U.S. exports to Mexico in May were an all-time record for any month at $67.5 million compared to $67.1 million in June 2003, the previous record month. U.S. imports of Mexican feeder cattle during the first six months of 2007 were 523,681 head compared to 635,886 during the same period in 2006.

There is a good chance that total U.S. beef exports to both Mexico and Canada in 2007 will set all-time records. The United States will host the next Ministerial level NAFTA Commission meeting in 2008.

Korea Trade Update: USDA is awaiting a response from the Korean government - expected in the next few days - to its audit report on the U.S. plant that recently sent bone-in product to Korea.  It is not known when Korea will lift its suspension on U.S. beef trade as it largely depends upon Korean satisfaction with USDA's official report of the incident, and the implementation of any potential corrective measures that might be necessary. At this time, U.S. beef exports worth $34 - $38 million are in transit to Korea. Historically, August is a high-volume sales month for U.S. beef exports to Korea, and NCBA is very concerned that a prolonged delay could cost U.S. beef producers significant sales.

NCBA’s Western Regions to Hold Joint Meeting: Cattlemen from across the western United States are invited to attend a joint meeting of the NCBA western regions, September 28 and 29 in Jackson Hole, Wyo. NCBA Region V includes the states of Colorado, Idaho, Oregon, Montana, Washington and Wyoming. Region VI includes Arizona, California, Hawaii, Nevada, New Mexico and Utah. Cevin Jones, Region V policy vice president from Eden, Idaho, and Greg Moore, Region VI policy vice president from Wagon Mound, N.M., will chair the meeting.

The NCBA Region V and VI meeting is being held in conjunction with the annual meeting of the Public Lands Council (PLC). The PLC is an organization of public lands ranchers throughout the West, formed by NCBA, American Sheep Industry and the Association of National Grasslands. The registration deadline is September 7. A full meeting agenda, along with hotel and registration information, is available at www.beefusa.org, under the “NCBA Events” section.

For more details on the PLC Annual Meeting, please visit: www.thepubliclandscouncil.org/plc2/Website.pdf. More information is also available by calling NCBA at 866-BEEFUSA or NCBA Western Field Representative Dan McCarty at (406) 855-2815.

IT’S AUGUST RECESS!:  Congress has left Washington for the August recess.  Both the House and Senate are scheduled to reconvene September 4.  August recess is a great time to meet with your legislators to help educate them about how the issues they are debating in Washington affect producers in the countryside.  Whether by attending town hall meetings hosted by the legislator, or by inviting your member of Congress to meet face to face, take advantage of this time when legislators are back home. 

There are several issues scheduled for consideration when Congress reconvenes, which include the following:

- Senate Farm Bill,

- House and Senate conference on the energy bill, and

- Continuing House discussions on expanding federal jurisdiction within the Clean Water Act.

Farm Bill – NCBA views the Farm Bill that was approved in the House as a good start.  Of issue for cattlemen are the payment caps and limitations on Farm Bill conservation programs.  An Adjusted Gross Income (AGI) cap of $1 million was established for participation in all programs.  Any producer having an AGI more than $1 million will be ruled ineligible for program participation.  Also, a payment limitation of $60,000 per program, per year, was placed on all Farm Bill programs.  NCBA believes that these caps and limitations compromise the goals of voluntary conservation programs and should be removed from the bill.

Energy – The House and Senate have taken different approaches to expanding renewable energy policy.  The Senate bill includes an increase in the Renewable Fuels Standard (RFS) to 36 billion gallons by 2022, setting a defacto mandate for feedgrain-based ethanol of 15 billion gallons by 2012.  The House bill does not include an increase to the current RFS.  These two bills are expected to be worked out in conference following the August recess.  As the conference committee meets, NCBA will urge committee members to oppose the inclusion of any increase in the RFS for feedgrain-based ethanol in the conference report.    

Expansion of the Clean Water Act – Rep. James Oberstar (D-Minn.) has introduced H.R. 2421, the Clean Water Authority Restoration Act (CWARA), which will significantly expand federal jurisdiction of the Clean Water Act.  Sen. Russ Feingold (D-Wisc.) recently introduced companion legislation (S.1870) in the Senate.  These bills will redefine “Waters of the United States” by doing away with the requirement that such waters be “navigable” in order to be regulated.  Changing this definition will allow every pond, stream, creek bed, drainage ditch, prairie pot hole, drain tile or any other wet spot on your property that might contain water at some point in time within the year to fall under federal jurisdiction.  NCBA is working with a large coalition of agriculture groups to defeat this legislation.

Contacting your legislator is easy and often involves making a single phone call.  Legislators appreciate hearing from you – their constituents – so take advantage of the August recess and express your opinion on the issues that matter to you.

USDA Calling for Comments on Ethanol Standards:  USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) is seeking public comment on whether there is a market need for USDA to establish additional grain quality standards that would better describe the type and quality of grain purchased for ethanol production.  These standards could differentiate, for example, corn with a high total fermentable starch content from other corn types.

USDA is also asking whether there is a market need for standards to describe the type and quality of feedstuff produced during the ethanol production process and marketed as various forms of distillers grains. During fermentation, grain starch is converted to ethanol and the remaining nutrients, such as protein, fat, minerals and vitamins end up as distillers grains or condensed distillers solubles. These co-products, such as dried distillers grains (DDG) and dried distillers grains with solubles (DDGS) are often sold as animal feed.

NCBA will be submitting comments on this proposal.  Comments are due to USDA by September 18, 2007.

Mark Your Calendars!: The 2008 Cattle Industry Annual Convention and Trade Show

will be held February 6-9 in Reno, Nev.  The meeting will feature joint and individual meetings by NCBA, Cattlemen's Beef Promotion & Research Board, American National CattleWomen, Inc., Cattle-Fax and National Cattlemen's Foundation.

At the NCBA Trade Show, more than 250 vendors will offer attendees a chance to see the latest products and services while networking with other cattle producers. In addition, many booths will feature giveaways, games and prize drawings. Whether you are looking for farm vehicles, fencing, feed supplies, animal health products or the latest in technology, you'll find it right here under one roof.

Education, information and networking are the cornerstones of Convention.  But it's not all business, there will be lots of time to kick back, relax and enjoy your mini-vacation in Reno. Bring your family along!  Additional details and schedule updates are posted at http://www.beefusa.org/convcattleindustryannualconventionandncbatradeshow.aspx.

Don't Miss NCBA’s Cattlemen to Cattlemen:  This week’s edition of NCBA’s Cattlemen to Cattlemen airing August 14-18 focuses on country-of-origin labeling (COOL) requirements for beef, pork and lamb. Learn how changes to the COOL law recently passed by the U.S. House of Representatives could make the law more workable before it takes effect in September 2008. You’ll also hear why cattlemen feel strongly that poultry should not be exempt from COOL.

In this week’s Market Watch, Erica Rosa of the Livestock Marketing Information Center joins host Susie Ross for a look at late-summer cattle inventory numbers in the United States and Canada. Erica tells us how these factors are expected to impact fall calf prices.

And in this week’s Cattle Learning Center segment, you’ll learn how a value-added marketing program can provide a greater return on your cattle, and improve the profitability of your operation.

The episode airing August 21-25 will include a discussion of the JBS-Swift merger with Steve Kay of Cattle Buyers Weekly. The Cattle Learning Center will show you tips on how to prevent shipping fever from affecting your cattle, and an update is provided on the foot-and-mouth disease situation in Great Britain. Sherry Hill of American National CattleWomen also stops by to discuss the 2007 National Beef Cook-off in Chicago.   

NCBA’s Cattlemen to Cattlemen on RFD-TV provides weekly news and features for cattle producers across the country. The show airs Tuesdays at 8:30 p.m. and is rebroadcast Wednesdays at 4:30 a.m. and 12:30 p.m., and Saturdays at 10 a.m. All times are Eastern. Make sure YOU tune into NCBA’s Cattlemen to Cattlemen on channel RFD-TV. For more information or to check out past episodes, visit www.cattlementocattlemen.org.

Media Contact: Tanya A. Camarra or Karen Batra at 202-347-0228, tcamarra@beef.org or kbatra@beef.org.

This publication is funded by cattle producers and other industry supporters through their voluntary membership contributions to NCBA. To join the tens of thousands of cattle producers from across the U.S. in working to preserve our legacy, contact NCBA Member Services at 1-866-BEEF-USA or Membership@beef.org.