Cattlemen's Capitol Concerns Archive
Cattlemen's Capitol Concerns
January 31, 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 202-347-0228.
EU Threatens Ban on Brazilian Beef: The European Union (EU) has placed a temporary ban on imports of all Brazilian beef due to a failure of Brazilian farms to meet EU import requirements. Brazilian farms can be approved to export to the EU when European health safety inspectors are certain that appropriate standards have been met. In some cases, EU officials have to inspect and certify each operation individually. “This will be a lengthy process,” said EU Health Commissioner Markos Kyprianou.
“This extraordinary development in world beef trade has been coming for some time. Although some say it is unlikely, it has potentially huge implications if it persists,” says NCBA Chief Economist Gregg Doud. “In tonnage, this is one of the largest beef trading relationships in the world, behind Brazil’s 415,000 metric tons (mt) plus export program to Russia, and it is very comparable in tonnage to Australia’s annual beef exports to the United States.”
With more than 300,000 mt worth at least $1.3 billion, Brazilian beef exports to the EU-27 (the 27 countries that make up the EU) amount to about 15 percent of Brazil’s total beef export program and 32 percent of its total value. Brazil is the world's largest exporter of beef, with estimated foreign sales of $4.2 billion in 2007.
“This issue will be watched closely for its implications in third-country markets,” explains Doud. “At first glance, it would appear some of this beef will end up in the Middle East and China, meaning that the impact on U.S. exports should be limited. But the answer largely depends upon how long it takes for these two trading partners to sort this out. Unfortunately, this won’t lead to an opportunity for U.S. beef into the EU because of our miniscule 11,500 mt quota and the long-standing non-hormone requirement. Although we long-ago won the hormone case against the EU, we still haven’t been able to resolve one of the longest standing trade disputes in all of agriculture.”
The EU is currently the seventh largest export market for U.S. beef exports worth about $50 million, a market that has grown by 58 percent over the past year.
Support Grows for Colombia Trade Promotion Agreement: NCBA, along with 42 other national agriculture groups, sent a letter to members of Congress on January 28th lauding the benefits of the Colombia Trade Promotion Agreement and urging a vote soon.
Under the Colombia TPA:
- Prime and choice graded U.S. beef will receive immediate duty-free and quota-free access upon implementation of the agreement.
- Tariffs on remaining beef tariff lines will be eliminated within 12 years.
- Sanitary and Phytosanitary (SPS) terms were agreed upon, put into writing, and signed by both parties as part of the negotiations.
- Colombia has committed to recognize the U.S. meat inspection systems as “equivalent” to its own, thereby allowing imports from facilities approved by USDA.
Passage of the U.S.-Colombia TPA will correct an inequity that exists between U.S. exporters of agricultural and industrial products and Colombian exporters. While 90 percent of Colombian products currently shipped to the United States are free from tariffs, most U.S. exports face significant tariffs or other restrictions in Colombia. This inequity is due in part to the Andean Trade Preference and Drug Eradication Act (ATPDEA), which Congress recently voted overwhelmingly and bipartisanly to extend. Passage of the Colombia TPA is the only way to resolve this inequity.
Colombia is already an important market for America’s farmers and ranchers. In 2006, the United States exported roughly $868 million in agricultural products to Colombia. Once fully implemented, the U.S.-Colombia TPA could provide an annual gain of as much as $690 million for American agriculture.
President Bush Urges Action on Colombia: In his State of the Union Address this week, President Bush stressed the importance of trade and establishing new markets for U.S. products overseas. He specifically called on Congress to approve the pending Colombia Trade Promotion Agreement.
“Today, our economic growth increasingly depends on our ability to sell American goods and crops and services all over the world,” the President said. “We're pursuing opportunities to open up new markets by passing free trade agreements. I thank the Congress for approving a good agreement with Peru. And now I ask you to approve agreements with Colombia and Panama and South Korea. Many products from these nations now enter America duty-free, yet many of our products face steep tariffs in their markets. These agreements will level the playing field. They will give us better access to nearly 100 million customers. They will support good jobs for the finest workers in the world: those whose products say ‘Made in the USA.’”
Cattlemen, Congress Turns Up the Heat on Korea: Senate Finance Committee Chairman Max Baucus (D-Mont.) sent a letter on January 25th to U.S. Trade Representative Susan Schwab reiterating the urgent need for the beef import protocol issue to be resolved with South Korea.
Baucus repeated his promise that a U.S.-Korea Free Trade Agreement will not move forward in the Finance Committee until Korea lifts its unscientific ban on U.S. beef, sets criteria to fairly assess beef imports, and resolves conflicts on a case-by-case basis should they arise.
“Ambassador Schwab must redouble efforts to finalize a new protocol settling the beef issue with Korea once and for all,” said Baucus. “I’ve made clear that until there is a tried and true set of rules allowing imports of American beef to Korea, I am unwilling to move the U.S.-Korea Free Trade Agreement forward.”
A protocol is currently in place for South Korea to accept boneless U.S. beef imports from cattle less than 30 months of age. Korea, however, suspended imports of U.S. beef on October 5, 2007, after inspectors found one box within an 18.5 ton shipment that contained vertebral column. Korean officials said that a ban on ALL U.S. beef products would remain in effect until a new set of quarantine conditions were worked out.
NCBA maintains that any new protocol conditions with South Korea must result in commercially viable trade. “Any agreement to simply ‘resume’ trade doesn't help U.S. cattlemen and doesn’t really represent any progress,” says Jay Truitt, NCBA vice president of government affairs. “The United States produces the safest and highest quality beef in the world. Any protocol that allows for anything short of full market access for all U.S. beef, regardless of cut of beef or age of cattle represents a non-science based trade barrier.”
Economic Stimulus Bills Offer Help for Small Businesses: NCBA sent a letter this week to Senate Finance Committee leaders supporting certain provisions within the Economic Stimulus package currently under consideration by Congress.
In a letter dated January 29th to Committee Chairman Max Baucus (D-Mont.) and Ranking Member Charles Grassley (R-Iowa), NCBA expressed support for a provision that increases the depreciation deduction limitations under section 179 from $128,000 to $250,000 with a corresponding increase in the phase-out threshold from $510,000 to $800,000.
“Beef production, by its very nature, is a capital intensive business. In order to carry out day-to-day activities on a farm or ranch, producers are required to invest significant amounts of money in depreciable, tangible property, such as machinery,” said NCBA Vice President of Government Affairs Jay Truitt. “Section 179 expensing is a valuable tool for small businesses, and this provision will certainly benefit cattle producers as they make the capital investments necessary to maintain their operations.”
NCBA also voiced support for the special depreciation allowance and Net Operating Loss (NOL) carry back rules as important tools for small businesses. The House passed its stimulus bill, HR 5140, on Tuesday by a margin of 385-35. The Senate is expected to act on its own economic stimulus package soon.
Disaster Assistance Update: USDA announced January 25th that eligible farmers and ranchers who suffered livestock, livestock feed and crop losses that occurred before December 31, 2007, can apply to receive disaster payments.
On December 26, 2007, President Bush signed the final consolidated Appropriations Bill, which contained language extending the eligibility dates for producers affected by natural disasters to December 31, 2007. Additionally, $3 billion was allocated for agriculture disaster assistance in the Emergency Supplemental Bill passed in May 2007.
Producers can apply for disaster payments under the Livestock Compensation Program (LCP) and Livestock Indemnity Program (LIP). More information is available online at: http://disaster.fsa.usda.gov.
Schafer Confirmed Ag Secretary: The Senate unanimously confirmed Ed Schafer on Monday, January 28th, to be Secretary of Agriculture. President Bush announced the nomination of Schafer on October 31, 2007.
Schafer served as governor of North Dakota from 1992 to 2000. During that time, he gained experience dealing with issues such as disaster assistance, international trade and renewable energy policy – all issues facing today’s cattle producers. Schafer replaces former Ag Secretary Mike Johanns who resigned on September 20, 2007.
“Ed will lead a Department that oversees our food, agriculture, natural resources, food safety, and health and nutrition programs,” said President Bush. “He will be an advocate for farmers, ranchers, and consumers as he works to open new markets for their products. And he will work with the Congress to pass a responsible farm bill that will provide a safety net for farmers and protect our lands and the environment, while at the same time ensuring federal tax dollars are spent wisely.”
Don’t Miss NCBA’s PAC/PEF All-Breed Bull and Horse Auction! Held in conjunction with the 2008 Cattle Industry Convention & Trade Show, our 3rd annual NCBA-PAC/PEF All-Breed Bull and Horse Auction offers convention attendees a chance to purchase some of the best genetics and seed stock in the nation, and support NCBA-PAC at the same time!
The auction is scheduled for 6:30 p.m. on Wednesday, February 6, 2008, at Booth 101 in the trade show at the Reno Sparks Convention Center.
Thank you to the outstanding operations that have contributed to this exciting event, including:
- Bieber Red Angus Ranch of Leola, South Dakota
- Byrd Cattle Company of Red Bluff, California
- Dalebanks Angus Ranch of Eureka, Kansas
- Errer Hill Farms of Friedens, Pennsylvania
- Fink Beef Genetics of Randolph, Kansas
- Gardiner Angus Ranch of Ashland, Kansas
- Genex Cooperative of Shawano, Wisconsin
- Leland Red Angus Ranch of Sidney, Montana
- Marshall Cattle Company of Burlington, Colorado
- Nichols Farms North Carolina Division of Clinton, North Carolina
- Pollard Farms of Enid, Oklahoma
- One Penny Ranch of Foley, Minnesota
- Ridgefield Farm, LLC of Dahlonega, Georgia
- Seven L Ranch of Devers, Texas
- Steele Land and Livestock of Anita, Iowa
- TC Ranch of Franklin, Nebraska
- Thomas Angus Ranch of Baker City, Oregon
- ViaGen, Inc. of Austin, Texas
- Wulf Limousin Farms of Morris, Minnesota
- Yon Family Farms of Ridge Spring, South Carolina
Thank you to these fine contributors for supporting the 3rd Annual NCBA-PAC/PEF All-Breed Bull and Horse Auction!
Countdown to Convention: The 2008 Cattle Industry Annual Convention and Trade Show begins NEXT WEEK, February 6-9, in Reno, Nevada. The meeting will feature joint and individual meetings by NCBA, the Cattlemen's Beef Promotion & Research Board, the American National CattleWomen, Inc., Cattle-Fax and the National Cattlemen's Foundation.
This is the time of year when NCBA’s producer-members gather to discuss our industry’s priorities at issue forums and committee meetings. On February 9, members will vote on policy for the coming year at NCBA’s Board of Directors meeting.
In the trade show – the cattle industry’s largest – over 250 companies will showcase the latest products and services. For more information on events held in the trade show or to view the list of exhibitors visit the NCBA website at www.beefusa.org. It’s not too late to register! Registration will be open on-site in Reno starting on Wednesday, February 6.
Don't Miss NCBA’s Award-Winning Cattlemen to Cattlemen: On this week’s episode, airing January 29-February 3, we continue our series on artificial insemination, and we learn more about evaluating estrus synchronization programs for your cowherd from Sandy Johnson at Kansas State University. We also visit the National Western Stock Show to interview Jarold Callahan from the Express Ranch. And we learn about the Beef University training program that has been developed for foodservice operators.
On next week’s episode airing February 5-10, Terry Fankhauser of the Colorado Cattlemen’s Association joins us to discuss major legislative issues facing cattlemen at the state level this year. Cattlemen to Cattlemen also continues its look at artificial insemination technologies, and we’ll profile Kansas rancher Ken Stielow as he concludes his term as Cattlemen’s Beef Board chairman.
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 10:30 a.m. and Sundays at 12 a.m. (midnight). 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: Karen Batra at kbatra@beef.org or call 202-347-0228.
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.