Keith Good: Controversial California Drought-Relief Bill Proposed

    Agricultural Economy

    AP writer Scott Smith reported today that, “House Speaker John Boehner visited a dusty California field on Wednesday, joining Central Valley Republicans to announce an emergency drought-relief bill to help farmers through what is certain to be a devastating year.

    “If passed, the bill that’s already stirring controversy would temporarily halt restoration of the San Joaquin River designed to bring back the historic salmon flow, among other measures. Farmers want that water diverted to their crops.”

    The AP article added that, “Standing on the field just outside of Bakersfield, Boehner said that where he’s from in Ohio, the logic applied in California regarding water policy would cause people to shake their heads.

    “‘How you can favor fish over people is something people in my part of the world would never understand,’ Boehner said.

    “Without the emergency legislation, thousands of farmworkers will be unemployed, he said.”

    news release yesterday from Rep. Devin Nunes (R., Calif.) stated that, “Congressman David G. Valadao (CA-21), Congressman Kevin McCarthy (CA-23), and [Rep. Nunes] are developing emergency drought legislation to provide necessary water supplies throughout the state and the Central Valley. The three Congressmen were joined by Speaker of the House John Boehner Wednesday afternoon to announce their legislative proposal to provide immediate relief from the ongoing drought in California.”

    statement yesterday from Western Growers President and CEO Tom Nassif noted in part that, “The drought is doing great damage to farmers, farm workers and many other people who are part of the most productive agriculture state in the country.  Federal regulatory decisions made last year in the Delta made this situation much worse, by failing to pump and store more than 800,000 acre feet of winter runoff.  The federal agencies charged with implementing fish species protections in the Delta declined to use their available discretion to capture that water, instead letting it flow out to sea.

    “It is time for Congress to act.  We appreciate the efforts of Speaker Boehner and Congressmen McCarthy, Nunes and Valadao to encourage action by both houses of Congress on this crisis.  We believe bipartisan agreement is necessary and possible.  There are very moderate and reasonable steps available, such as federal legislation giving the regulatory agencies clear direction to allow the state and federal water project pumps in the Delta to operate at higher levels than they have in recent years.  We must capture water runoff when it is available and store it for the protection of our farms and communities.”

    Meanwhile, University of Illinois agricultural economist Gary Schnitkey indicated yesterday at the farmdocDaily blog (“Controlling Costs With Lower Crop Revenues: Historical Overview“) that, “Corn and soybean prices are likely to be considerably lower in the next several years as compared to prices from 2010 through summer of 2013.  Lower commodity prices then will lead to lower crop revenues.  While crop revenues have come down abruptly, costs likely will decrease much more slowly, and likely not decrease as much as revenues have fallen.  Moreover, management decisions may influence the extent to which costs decrease.  This post documents cost changes that have occurred over time, thereby showing historical cost decreases as a guide for potential future cost decreases.  Future posts will examine specific costs and potential ways of lowering those costs.”

    Also yesterday, Reuters writer Meredith Davis reported that, “Concern among the top U.S. hog-producing states over a virus that is killing millions of baby pigs has reached such an extent that officials at an industry gathering in Minnesota this week swabbed the trade floor to test for the virus.

    “Meeting organizers in Iowa are relying on producers’ knowledge of basic biosecurity measures to guard against spreading Porcine Epidemic Diarrhea virus, or PEDv.”

    The Reuters article stated that, “PEDv has killed an estimated 1 million to 4 million pigs across the U.S. ‘Hog Belt,’ with cases reported in 23 states. South Carolina is the most recent state with confirmed cases, according to the USDA’s National Animal Health Laboratory Network (NAHLN).”

    And with respect to trade, an update yesterday from the U.S. Trade Representative’s Office noted that, “U.S. Trade Representative Michael Froman announced today that Deputy U.S. Trade Representative Miriam Sapiro intends to step down from her position next month after four years of service.”

    Farm Bill – Policy Issues

    The “Washington Insider” section of DTN explained yesterday (link requires subscription) that, “A number of reports have indicated that an agreement among farm bill conferees that would provide a new dairy policy program without supply management means the farm bill is all but completed. However, there remain several loose ends still dangling until Congress reconvenes next week.

    “Chief among these are provisions covering crop subsidy caps and country-of-origin labeling (COOL) for meat and meat products. Some Capitol Hill sources predict that the four farm bill principals likely will decide those issues during a meeting among themselves rather than holding a meeting that includes all 41 conferees.

    “There are some who are promoting a modified North American label for COOL, without a U.S.-origin label, but some pro-COOL farm group lobbyists are opposed. Others are counseling that USDA take its time regarding the final COOL rule, choosing instead to wait until the World Trade Organization decides a pending case on that rule that has been filed by Canada and Mexico.”

    More specifically on the COOL issue, Peter Harriman reported this week at the Argus Leader (Sioux Falls, S.D.) Online that, “Sen. Tim Johnson [D., S.D.] is worried that the Country of Origin Labeling (COOL) provisions he worked to get into law in 2002 will be left out of this year’s farm bill.”

    Mr. Harriman pointed out that, “COOL requires meat to be labeled as to where animals were born, grown and processed. A House-Senate conference committee is closing in on final language for new farm legislation, and meat packers generally object to the labeling laws.

    “Johnson and Rep. Kristi Noem [R., S.D.], a member of the farm bill conference committee, couldn’t predict the chances of COOL making it into the final bill, but Noem also supports it.”

    And a news release yesterday (“R-CALF USA and 97 Groups Urge No Changes to COOL Law“) stated that, “Today, R-CALF USA and 97 other groups representing cattle, farm, manufacturer, consumer and other rural interests sent an urgent letter to members of the Farm Bill Conference Committee [urging] them to make no changes to the country of origin labeling (COOL) law when they finalize the 2014 Farm Bill.”

    Also, a news release yesterday from the National Farmers Union (NFU) stated that, “[NFU] President Roger Johnson sent a letter today to the members of the farm bill conference committee emphasizing the importance of finishing a five-year, comprehensive farm bill as soon as possible.”

    The release added that, “NFU is especially concerned by attempts to repeal or undermine Country-of-Origin Labeling (COOL), which provides valuable information to consumers.

    “‘If any harmful changes to COOL are included in the farm bill, it could very likely affect NFU’s ability to support the entire farm bill,’ said Johnson. ‘Farmers, ranchers, producers and consumers strongly support COOL and I urge Congress to defend the current law.'”

    Meanwhile, Eric Brown reported yesterday at the Greeley Tribune (Colo.) that, “A new farm bill is long overdue, to say the least, and some agriculture experts say there’s as much uncertainty now as there’s ever been.

    “One of those ag experts is Brad Lubben, an agriculture economist and public policy specialist at the University of Nebraska-Lincoln.”

    Mr. Brown noted that, “There are reports that the Farm Bill Conference Committee is close to getting a deal done, but, as Lubben explained, there are still a couple sources of disagreement in Washington.”

    “‘Things could still go a number of ways,’ [Lubben] said. ‘We’ve been at this for a while now, but there’s still no clear picture of where we’re headed.'”

    In other policy related news, DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “OSHA inspectors shouldn’t be inspecting grain bins on most farming operations, but just to be certain, the agency is now going to clarify its regulations on post-harvest activities.

    “A top administrator with the Occupational Safety and Health Administration held a press call Wednesday to clear up some confusion on OSHA’s farm exemption. Following new commands from Congress last week, OSHA also is now consulting with USDA on ways farmers handle grain after harvest.

    “OSHA’s consultation with USDA comes after Sen. Mike Johanns, R-Neb., spotlighted that a farm in his state faces a potential $132,000 fine following a 2011 inspection of the farm’s grain bins. OSHA began examining some more grain elevators in 2010 after a string of fatalities. A 2011 memo to field inspectors also implied inspectors could broaden inspections regarding post-harvest handling of grain. Johanns and 42 other senators wrote OSHA to argue the agency is violating a 1976 appropriations bill that excluded farms with fewer than 10 employees from being subject to OSHA inspections.”


    A news release yesterday from Sen. Joe Donnelly (D., Ind.) indicated that, “[Sen. Donnelly], a member of the Senate Ag Committee, today sent a bipartisan letter to Environmental Protection Agency (EPA) Administrator Gina McCarthy expressing his concerns regarding the EPA’s proposal for the 2014 Renewable Volume Obligations under the Renewable Fuel Standard (RFS). The proposed changes to the RFS would decrease the volume of renewable-fuel production required, potentially undermining domestic energy production and threatening Indiana’s economy.”

    “The letter was sent by a bipartisan group of 31 Senators.”

    Also yesterday, Des Moines Register reporter Christopher Doering tweeted that, “.@EPA spokeswoman says agency has ‘no current plans’ to extend comment period ending Jan 28 for #rfs 2014 #ethanol proposal”

    Mr. Doering reported yesterday at The Des Moines Register Online that, “The head of one of the country’s largest renewable fuels groups said Wednesday he expected the Environmental Protection Agency to make ‘significant changes’ to its ethanol proposal.

    “Bob Dinneen, president of the Renewable Fuels Association, told reporters the EPA was under ‘a lot of pressure’ to come out with a rule showing the market how much renewable fuels must be blended into the country’s gasoline supply in 2014.”

    The Register article indicated that, “‘I do expect there to be significant changes to the final rule,’ Dinneen said without providing details. He said he does not believe the Obama administration has wavered in its support for biofuels or rural America.”

    And, a DTN article from yesterday (link requires subscription) reported that, “The Ninth U.S. Circuit Court of Appeals’ denied a petition on Wednesday, Jan. 22, seeking the rehearing en banc in the litigation regarding California’s Low Carbon Fuel Standard.

    “Petitions were filed in early October by ethanol trade associations including the Renewable Fuels Association and Growth Energy, asking the court for a rehearing with regard to a September ruling that determined the LCFS does not violate the U.S. interstate commerce laws.

    “The September ruling overturned a December 2011 ruling that the LCFS was in violation of interstate commerce, and discriminated against fuels produced out of the state, such as corn-based ethanol.”


    Jake Sherman reported yesterday at Politico that, “The Obama administration wants Congress to raise the debt limit in the next 16 days.

    “Treasury Secretary Jack Lew sent a letter to Speaker John Boehner on Wednesday, saying the ‘best course of action would be for Congress to ‘raise the nation’s debt limit ‘before February 7 to ensure orderly financing of the government.’ At the latest, Lew writes, Congress must lift the cap by the end of February.”

    “There’s not a ton of time. The House is out of session this week and in session for only two-and-a-half days next week. As of right now, there doesn’t appear to be a plan to lift the debt limit,” the Politico article said.

    Jonathan Weisman reported in today’s New York Times that, “Michael Steel, a spokesman for Mr. Boehner, reiterated that the speaker does not want to get ‘even close’ to a default on the United States debt. But, he added, a ‘clean’ increase in the debt limit without some concessions to Republicans ‘simply won’t pass in the House.'”


    AP writer David Kepper reported today that, “In the absence of federal regulation, states from Rhode Island to Hawaii are considering laws to require labels on food items containing genetically modified ingredients.

    “Currently, only Connecticut and Maine have laws requiring labels for genetically modified food. But those requirements won’t kick in until other states adopt their own rules. Bills to do just that are expected in more than two dozen states.”

    The AP article added that, “‘I don’t know if it’s harmful or unhealthy, but it’s something people have a right to know about,’ said Rhode Island state Rep. Dennis Canario, a Democrat sponsoring a labeling bill. ‘They put calories on a package. They put the fat content. If the ingredients have been genetically altered, shouldn’t that be listed on there somewhere?’

    “The proposals are opposed by biotechnology companies and many agricultural groups, who say genetic engineering has yielded more sustainable, affordable and productive farming around the globe. Business groups worry that labeling requirements would raise costs for food producers — and ultimately consumers — and raise unnecessary fears.”


    Russell Berman reported yesterday at The Hill Online that, “The third-ranking House Republican, Majority Whip Kevin McCarthy (Calif.), said he backs granting legal status, but not a new pathway to citizenship, to millions of immigrants in the U.S. illegally.

    “McCarthy stated his personal view on the contentious issue in an interview with KBAK/KBFX Eyewitness News in his hometown of Bakersfield, Calif. He signaled that the call for a provisional legal status would be included in the immigration reform principles House Republican leaders are soon to release.”

    And Pete Kasperowicz reported yesterday at The Hill’s Floor Action Blog that, “Rep. Fred Upton (R-Mich.), who leads the House Energy and Commerce Committee, said he believes the House will be able to pass several immigration bills this year.

    “‘I believe that we can move five or six different pieces of legislation, all bipartisan,’ he told WMUK in Michigan Wednesday.”

    The update noted that, “Upton was not specific on the contents of the bills that could come up. Republicans are exploring ideas to tighten the border, and to give states more authority to enforce immigration laws.”

    Emma Dumain indicated yesterday at Roll Call Online that, “Are House Republicans prepared to pass an overhaul of the nation’s immigration laws in 2014? It depends on whom you ask.

    “‘It’s a very bad time to do anything on this,’ Rep. John Fleming, R-La., said.

    “‘Something has to happen on immigration, and it’s something we as a conference should take up,’ countered Rep. Dennis A. Ross, R-Fla.”

    The Roll Call article pointed out that, “Take the wild cards, such as Rep. Mark Meadows. Against the wishes of leadership, the freshman Republican from North Carolina led the charge to defund Obamacare in the continuing resolution last fall that culminated in the government shutdown; now, he’s breaking with his fellow hard-line conservatives to support a legal status for illegal immigrants.

    “‘I’ve got farmers back in my district that feel like we have to deal with this immigration issue,’ Meadows said. ‘They feel, by not acting, we’re making a decision.’

    “Other factions within the conference still present significant stumbling blocks to action on immigration.”

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