Cattlemen's Capitol Concerns ~ August 9, 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.

Korea Trade Update:  A team of senior-level USDA officials left Washington on August 3^rd to audit the U.S. beef processing plant that recently sent bone-in product to Korea.

Last week, while inspecting 41,000 pounds (1,176 boxes) of U.S. beef shipped to Korea, Korean inspection officials reportedly discovered one box containing bone-in short loin or "T-bones" which are specifically prohibited for export to South Korea.  In response, South Korean officials suspended quarantine inspection of all U.S. beef imports last week.

USDA is expected to finish its report to the Korean government by the end of this week. 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. U.S. beef exports, worth $34 - $38 million, are reportedly in transit to Korea at this time.  Historically, August is a high-volume sales month for U.S. beef exports to Korea, and NCBA is very frustrated and concerned that a prolonged delay could cost U.S. beef producers significant sales.

NCBA asked USDA to expedite the audit and report back to Korean officials.  “Our government officials need to get back to Korean officials with the necessary information as soon as possible on how this error occurred,” said Jay Truitt, NCBA’s vice president of government affairs.  “Then, a protocol must be developed which allows U.S. beef companies to ship product to Korea that meets their specifications.”

FMD in Southern England: A third farm in the area of Surrey, England – about 30 miles southwest of London – is now suspected to have been affected by Foot and Mouth Disease (FMD), and animals on the farm are being culled as a precautionary measure.

Government investigators are reporting a "strong probability" that the strain of the virus came from two research labs located near the farms.  The report also said there is a possibility that the release of the virus involved "human movement." The European Union is maintaining a ban on all British fresh meat, milk and live animal exports, which they will review on August 23rd.

As of today, August 9th, the ban on the movement of livestock outside the “protection zone” has been lifted. Any movement is still subject to strict bio-security measures. In 2001, an FMD crisis in Britain devastated farming and cost the industry approximately 8.5 billion pounds ($17 billion USD). It is important to remember that FMD is an animal health issue and in no way affects the safety of the food supply. 

Russian Trade Update:  Recent discussions between the Office of the U.S. Trade Representative (USTR), USDA and Russian officials have provided very significant breakthroughs regarding U.S. efforts to get our beef back into Russia.

In November 2006, Russia agreed to resume imports of U.S. beef, but there has been no movement since then. In fact, at that time Russia agreed that it would accept an import protocol that included no age or product restrictions upon U.S. receipt of its OIE “controlled risk” status. The hold-up for the past nine months has simply been the inability to get Russian veterinary officials to the U.S. to conduct a series of audits that would lead to the resumption of trade.

NCBA is encouraged by the fact that this recent dialogue between government officials may finally facilitate the last step in this process of regaining access for U.S. beef in the Russian market.  In 2003, Russia was the fifth largest market for U.S. beef and beef product exports in terms of quantity, and the seventh largest in terms of value at $53 million. At present, Russia is the second largest beef importing nation in the world, behind the United States and ahead of Japan, and is forecast to import more than 900,000 metric tons in 2007. 

USDA Officials Return from Japan: U.S. technical officials, including USDA Chief Veterinarian Dr. John Clifford, have returned from Tokyo after a dialogue with Japanese officials.  The topic of discussion was the United States' OIE "controlled risk” status and the potential to expand U.S. beef exports to Japan from cattle above and beyond the current 20 months and under age restriction. NCBA is encouraged by these developments and will continue to urge that Japan fully re-open its market to U.S. beef in line with international trade protocol.

Chinese Trade Update:  A group of U.S. government officials are in China this week to further negotiate beef trade issues. The team includes Deputy Undersecretary for Agricultural Marketing and Regulatory Services Chuck Lambert and former Chief Agriculture Negotiator Richard Crowder. They are urging Chinese officials to finally lift ongoing restrictions on U.S. beef, which have been in place for nearly four years.

For more than a year, NCBA has been extremely frustrated with the level of engagement that Chinese officials have put forth on the beef issue. It was more than one year ago that a very high-ranking Chinese official, during discussions with President Bush, committed to resuming imports of U.S. beef, yet this market remains closed. In fact, it appears as though China may actually be the very last country to resume beef trade with the United States.

"Once again, beef trade is symbolic of the frustrations the United States faces in its trade agenda around the world,” says NCBA Chief Economist Gregg Doud. “Unfortunately, in the case of China we're merely one commodity on a very long list of challenges in the bilateral trade relationship."

However, NCBA insists there is absolutely no justifiable reason for this ban on our exceptional beef products.  Back in 2003, China was one of the top ten U.S. beef export markets, with nearly 26.5 million pounds of U.S. beef and beef product exports valued at more than $28 million. U.S. cattle producers have been more than patient with this situation.

IT’S AUGUST RECESS!:  Congress has left Washington for the August recess.  Both the House and senate are scheduled to reconvene September 4th.  August recess is a great time to meet with your legislators and help educate them about how the issues they are debating in Washington affect producers in the countryside.  Whether this is 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.  These include consideration of the:

- Senate Farm Bill,

- House and senate conference on the energy bill, and

- House discussions on expanding the Clean Water Act.

Farm Bill – NCBA views the bill that was approved in the House as a good start.   Of issue for cattlemen are the payment caps and limitation on Farm Bill 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 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 remove the RFS increase from the final package. 

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 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 wet spot, creek bed, drain tile or other 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.

House Passes Energy Bills:  Last weekend, the House debated energy policy and passed H.R. 3221, the New Direction for Energy Independence, National Security, and Consumer Protection Act by a vote of 241-172.  Of importance to cattlemen, the House energy bill includes no increase in the Renewable Fuels Standard (RFS) mandate.  This contrasts with the Senate bill that includes language mandating 36 billion gallons of biofuels by 2022 -- 15 billion gallons of ethanol by 2015, and 21 billion gallons of other biofuels, notably cellulosic-based ethanol by 2022.

The House also passed an energy tax package (HR 2776), which includes $16 billion in tax incentives for renewable energy production.  Under the recommended rule, both of the passed bills were combined and will be sent to the Senate as a single measure.

“When these bills go to conference, cattlemen will be asking for a final package that does not include an increased renewable fuel standard such as the one currently in the Senate version of the bill,” says NCBA Vice President of Government Affairs Jay Truitt.  “NCBA believes that increasing the current law without a safety net provision will only serve to exacerbate an already difficult situation for cattle producers across the country.”

Senate Approves Caswell Nomination to Head BLM:  The Senate confirmed last week the nomination of James Caswell to lead the Bureau of Land Management (BLM).  Caswell currently leads the State of Idaho’s Office of Species Conservation, which was established in 2000 by the state legislature to bring a policy focus to endangered species issues and to coordinate state and federal efforts on endangered species management in Idaho.

Caswell spent 33 years holding various positions within the BLM, Bonneville Power Administration, and the U.S. Forest Service, 16 of those years serving as forest supervisor on the Clearwater and Targhee National Forests. He was also deputy forest supervisor at Boise National Forest and acting deputy regional forester in Missoula, Montana.

Secretary of the Interior Dirk Kempthorne said, “His considerable supervisory experience with the U.S. Forest Service, his proven expertise in coordinating endangered species programs on public lands and his ability to build strong, effective partnerships make him well-qualified for this position.” 

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

will be held February 6-9 in Reno, Nevada.  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 companies 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: On this week’s Cattlemen to Cattlemen, airing August 7 through August 11, we’ll have feature interviews with key Congressional leaders on the 2007 Farm Bill. The Cattle Learning Center also offers tips on de-worming your calves this fall and Duane Lenz of Cattle-Fax looks at how summer grazing conditions are affecting the cattle inventory.  

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.