Cattlemen's Capitol Concerns

February 24, 2005

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).

Update on Export Markets: NCBA has continued to fight for the full re-opening of our valuable export markets for U.S. beef. At last month’s annual convention, NCBA members passed an 11-point directive calling for immediate action on the current issues regarding trade with Canada, specifically calling for the Bush Administration to “reach an agreement to re-establish beef and beef by-product trade with Japan, South Korea and Mexico, and apply economic sanctions if necessary.”  In working to address this criteria, NCBA has taken the following actions:

(1) NCBA has met with leaders in Congress to develop a letter urging the importance of this issue.   Twenty key U.S. Senators sent a letter to Ryozo Kato, Ambassador of Japan to urge resolution to the Japanese embargo on U.S. beef.  The letter says:  “If the Japanese government fails to lift the ban expeditiously, we are afraid that the U.S. Congress may pursue equitable, retaliatory, economic actions against Japan. Our preference is to avoid this course of action, but our livestock producers, our industry workforce and our communities cannot wait a moment longer.” In a media statement this week, Senator Wayne Allard (R-CO) said:  “Closure of the Japanese market has resulted in hardship for entire industries and communities. America has acted in good faith to meet Japan’s concerns.  If the government of Japan does not act soon to lift these sanctions, then the U.S. Congress may pursue retaliatory actions.  It is my hope this situation can be avoided.”

(2) NCBA has urged the Administration to push harder for the re-opening of markets in Japan, and Secretary of State Condoleezza Rice met with her Japanese counterpart, Nobutaka Machimura, on Feb. 19. At the meeting, Rice raised the issue of Japan’s ban on U.S. beef.  A State department official who also attended the meeting said the Japanese understand U.S. concerns and are trying to accelerate procedures.  

(3) NCBA is urging all state affiliates and member organizations to send letters to Congress and Administration officials.

Regarding other key export markets, the Minister of Agriculture of Egypt has accepted the report and recommendations made by Ag Counselor Dr. Mansour of the Egyptian Embassy in Washington, D.C.  In his report, Dr. Mansour outlined procedures for resuming trade of boneless beef from animals less than 30 months of age. This is described as the final step necessary to reopen this market.  Taiwan officials will meet March 8 to review the Department of Health recommendation to allow U.S. boneless beef from animals under 30 months of age.  While the Premier must give the final okay to lift the ban, interagency concurrence with DOH's recommendation is considered the last major hurdle toward trade resumption.

CAFTA is Coming: The Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) is a GREAT trade deal for cattle producers—it’s basically a one-way deal that gives increased market access for beef and reduces tariffs. NCBA is combating misleading myths being spread by anti-trade groups about the agreement. Here are the facts: beef imports coming into the U.S. from these countries pay ZERO tariffs right now, while OUR beef exports to the same countries are taxed at 15-30 percent. As soon as the agreement is final, we can start sending our high-quality beef to these valuable tourist destinations with ZERO tariffs. There will be no ‘flood’ of beef imports, as these countries have never even filled their current import quota levels. This one-way agreement levels the playing field and eliminates barriers to our products while providing adequate protections for the industry. NCBA is strongly behind this agreement and urges the passage of the agreement by Congress as soon as possible. For more details, go to our NCBA CAFTA-DR Backgrounder at http://hill.beef.org/pdfs/CAFTA-DRFactSheet.pdf. NCBA is also a member of the Business Coalition for U.S. - Central America Trade.  More information about the agreement can be found on the coalition's website at www.uscafta.org or at www.ustr.gov. 

Import Procedures for Product from Canada:  USDA’s Animal and Plant Health Inspection Service (APHIS) released on Feb. 22 documents describing the procedures for importing products from Canada.  These procedures are being detailed as part of implementation of the “Canadian Rule” effective March 7, 2004.  The documents specifically address:

- Brokers, Importers and other interested parties who import commodities

- Brokers, Importers and other interested parties who import live animals

- Feedlot Owners and Operators and Other Interested Parties who import cattle and bison for feeding; and

- Accredited Veterinarians and Other Interested Parties addressing their role in the importation of live animals

Some specific recommendations from the NCBA directive passed at the recent membership meeting are addressed in these letters.  Instructions to brokers and feedlot owners, for example, specifically say the animals must be individually identified with a Canadian ear tag applied before arriving at the Port of Entry which cannot be removed, branded with the “CAN” brand at the right hip, moved in sealed trucks to the designated feedlot, moved in sealed trucks from the feedlot to slaughter, and be less than 30 months of age when slaughtered. The documents are posted on the APHIS website at:  http://www.aphis.usda.gov/lpa/issues/bse/bse.html. 

Canadian Feed Rules:  NCBA filed comments today with the Canadian Food Inspection Agency (CFIA) on proposed changes to their feed rule.  Comments state, “While we fully support all appropriate measures to prevent the amplification and spread of BSE, all such measures must be science and risk analysis-based as such changes in Canada will affect trade between our countries.  It is important for us to harmonize our respective BSE prevention regulations based upon science, risk analysis, and equivalency measures.”  NCBA feels that Canada’s new rules could go too far in banning some SRMs from the feed supply, and efforts to harmonize regulations between the two countries could force the U.S. industry to adopt changes to our feed rule which would be costly and unnecessary based on science.  NCBA told the CFIA’s their emphasis should be on assuring effective compliance with the current feed ban, rather than expansion of the feed ban.

Death Tax Update: This week, U.S. Senator Jon Kyl (R-AZ) introduced legislation in the Senate calling for permanent elimination of the Death Tax. The bill is co-sponsored by Senator Bill Nelson (D-FL). NCBA is actively urging support in the House and the Senate for permanent repeal of this onerous tax, and has been fighting this taxation issue for decades in Washington D.C. We are extremely pleased that such strong action is being taken this year by both Houses of Congress and the Administration, and are looking forward to the final vote on this legislation. The death of a family member should NOT be a heyday for the IRS. Farm and ranch families are paying for their ranches two and three times, all while paying taxes on the income used in their operations. In an asset-rich and cash-poor business like ranching, the appraised value of rural land is extremely inflated from the agricultural value over the years. The excessive burden of the Death Tax has forced many cattle producers to sell off land, parts of the operation, or the entire ranch to pay off tax liabilities. This takes more open spaces out of agriculture production, usually at the hands of urban developers.  Members of the NCBA will continue to fight for permanent repeal and urge both Senate and House members to support the new legislation calling for full repeal in the 109th Congress.

EU Hormone Update: A panel has now been established by the World Trade Organization (WTO) Dispute Settlement Body (DSB) regarding the European Union (EU) hormone ban. This panel will rule on the EU’s challenge of U.S. sanctions on EU exports. These continued sanctions were imposed in retaliation against the EU ban on beef containing growth-promoting hormones. The ban on U.S. hormone-treated beef was already found to be an illegal trade barrier by the WTO, violating international trade rules and not at all based on sound science. Repeated scientific studies, including those done by the EU, show that the banned growth promotants pose no threat to human or animal health when used according to approved veterinary procedures. The WTO Appellate Body reiterated this when they upheld sound science rather than using unscientific factors as the basis for international trade rules and ruled in favor of the United States, forcing the EU to drop the ban or prove it is scientifically valid. The EU has failed to look at the science in this matter and refused to implement the recommendations and rulings of the WTO.

NCBA will assist in the pursuit of any legal action against the EU that may benefit the U.S. beef industry in its long battle to gain relief from the EU hormone ban on beef. The EU ban is pure protectionism, and U.S. cattlemen will continue to fight the EU on this matter.

Upcoming Congressional Hearing on BSE:  NCBA leaders and staff are preparing for the upcoming House Agriculture Committee hearing to “Review the U.S. Department of Agriculture's rule providing for Canadian beef and cattle imports.”  The hearing is scheduled for Tuesday, March 1.  NCBA President and Texas cattle producer Jim McAdams will testify on a producer panel for NCBA, and USDA Secretary Mike Johanns is scheduled to testify on the government panel.  Stay tuned for more news on this important hearing, coming up next week.

ESAP Applications Due NEXT WEEK: Applications for the 15th annual Environmental Stewardship Awards Program (ESAP) will be accepted until March 4, 2005. Any group or organization is eligible to nominate one individual/business who raises or feeds cattle.  The prestigious award program recognizes cattle producers across the nation, whose stewardship practices are progressive, cost-effective and contribute to environmental conservation. For more information on how you can become a winner or how to nominate a deserving operation, or for information on the ESAP program, contact Stacey Katseanes in NCBA’s Washington D.C. office at 202-347-0228 or at skatseanes@beef.org.

Spring Conference: Calling all cattle industry folks- mark your calendars and book your flights now! The 2005 Spring Conference in Washington D.C. will be held April 13-16, 2005. NCBA's D.C. staff is already busy with preparations and planning for this exciting event, which brings in hundreds of cattle producers to our capital city for face-to-face meetings with top Members of Congress and Administration officials. This year, Senate Ag Committee Chairman Saxby Chambliss (R-GA) and USDA Secretary Mike Johanns will be among the political elite that are expected to address NCBA members. Register soon…  contact Erica Spiegle espiegle@beef.org or 202-347-0228.

Congressional Schedule:  Congress is out of session this week for President’s day recess.  They will reconvene Monday, Feb. 28. 

USDA Surveillance for BSE: USDA continues its enhanced BSE surveillance program which began June 1.  To date, 242,019 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

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.

For more information, please visit our web site at hill.beef.org.

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