Cattlemen's Capitol Concerns: December 16, 2004

Cattlemen's Capitol Concerns 

December 16, 2004

The 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).

CANADIAN TRADE:  NCBA continues to watch for publication of the rule to resume movement of live Canadian cattle and bone-in beef from cattle under 30 months of age, and an announcement from the Administration is expected anytime.  As the U.S. cattle industry prepares for implementation of the rule, it is important to remember that this is another step in the process toward normalizing global trade for U.S. beef, which benefits U.S. beef producers.

Political Considerations:  Our trading partners are monitoring our position on this rule, and they will likely apply the same principles to us as we try to normalize trade following our December 2003 case of BSE.  We expect our trading partners to base their decisions to trade with us on science, and we must do the same.  The precedent that has been set by our handling of trade issues with Canada is hurting our government’s ability to fully re-open markets to U.S. beef exports. We must normalize trade with Canada in order for our industry to move forward in the global marketplace, expand our ability to sell U.S. beef to foreign consumers and put more dollars in the pockets of U.S. producers. 

Economic Considerations:  NCBA has made the re-opening of our export markets a top priority.  For U.S. cattle producers, the value of our export markets equals approximately $15 per-hundred-weight (cwt) in fed cattle prices.  Currently, we have recouped roughly one-third of our markets, or $5/cwt, but we are still leaving $10 on the table.  As Canadian cattle are allowed across the U.S, border, producers will likely see a negative impact of approximately $2-3/cwt on fed cattle prices.  But if we re-coup our export markets by setting a science-based precedent, cattle producers will have a net gain of approximately $7-8 on fed cattle prices. 

Scientific Considerations:  Our goal is to be world leaders in establishing a science-based framework for global trade that doesn’t create trade disruptions for U.S. beef.  There is no scientific justification for keeping the borders closed to cattle or any beef from animals under 30 months of age. 

Safety Considerations: It is important to remember that this rule will allow the importation of bone-in beef from animals less than 30 months of age, and feeder cattle and fed cattle less than 30 months of age which science has proven to be safe from BSE.

Market Considerations:  NCBA is insisting that an orderly process be place to ensure the flow of Canadian cattle into the U.S. does not cause unnecessary disruption to the domestic cattle market.

CFIA FEED RULE:  The Canadian Food Inspection Agency (CFIA) announced Dec. 10 proposed changes to their "feed rule." These enhancements are intended to further protect Canadian cattle from BSE.  The proposed regulations have been placed in the Canada Gazette Part 1.  NCBA will submit comments prior to the 75-day comment period deadline (Feb. 24, 2005). NCBA feels that the new rules could go too far in banning some SRMs from the feed supply.  In a statement on Friday, NCBA said "the surveillance programs confirm that the risk of BSE in North America – and in this case, Canada – is extremely low, and that enforcement of existing feed restrictions is adequate to continue eradication of BSE in North America." Information on the CFIA proposed amendments to their feed rule can be found on the Canadian Food Inspection Agency (CFIA) web-site www.inspection.gc.ca.

PRESIDENT BUSH URGES DEATH TAX REPEAL:  A group of NCBA leaders and staff were invited to attend a special briefing today regarding the future of the U.S. economy, as part of this week's White House Conference on the Economy. The President discussed in detail his goals for dealing with the budget, tax issues, and job growth for small businesses.  President Bush vowed to make his tax relief measures permanent – giving special attention to the importance of permanent Death Tax repeal. The President explained how the Death Tax is especially onerous for farmers and ranchers. For many years, NCBA has worked aggressively to repeal the Death Tax, but, because of arcane Congressional budget rules, all of the tax cuts in the current legislation will "sunset" in 2011. Thus, the onerous Death Tax - with rates ranging from 37 to 55 percent - will be reinstated only one year after it is repealed. This means the Death Tax will continue to force some families to sell a business when an active, successful business when the owner dies. NCBA will continue to push for full and final repeal of the Death Tax in 2005.

ANIMAL IDENTIFICATION:  NCBA continues to meet with livestock industry partners regarding the development of a national animal identification system.  NCBA’s Animal ID Commission will meet in Denver January 13-14, 2005 to review implementation plans for a non-federal nationwide system. The commission recommendations will be forwarded to the Executive Committee and the Board of Directors for consideration at NCBA’s annual convention in San Antonio, Feb. 2-5, 2005.

ID LISTEN SESSION:  In related news, USDA’s Animal and Plant Health Inspection Service hosted an animal identification listening session Dec. 15 in Jackson, Tenn.  USDA is holding listening sessions to discuss the development, structure and implementation of a national animal identification program for all livestock and poultry animals.  Transcripts for previous sessions are posted online at http://www.aphis.usda.gov/lpa/issues/nais/nais_listeningsessions.html

ESA ISSUES:  The PLC submitted comments this week to the Department of Fish and Wildlife on a proposal to designate "Critical Habitats" for the Southwestern Willow Flycatcher.  Comments say the aspects of the designation are "arbitrary" and could go "beyond what the facts and science of a situation may call for."  The resulting designation could severely impact grazing operations in the Southwest by placing restrictions and procedural burdens on producers.  FWS announced that they are extending the comment period on this issue into March. 

USDA SURVEILLANCE FOR BSE:  USDA continues its enhanced BSE surveillance program which began June 1. To date, 144,315 tests have been conducted with no positive cases reported. 

Media Contact:

Tanya Augustson or Karen Batra at 202-347-0228; taugustson@beef.org or kbatra@beef.org

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