For the Week Ending October 23, 2009

October 23, 2009

Washington, D.C., October 23, 2009 

 

NPPC ASKS CONGRESS TO HELP U.S. PORK PRODUCERS

Laying out the origins of a 2-year-old economic crisis, including the effect on the pork industry of the novel H1N1 flu, NPPC yesterday asked Congress to take steps to help U.S. pork producers. The U.S. pork industry has lost more than $5.3 billion since September 2007, with producers losing nearly $23 on each hog marketed since then, NPPC President Don Butler told the House Committee on Agriculture Subcommittee on Livestock, Dairy, and Poultry in testimony. Many factors have contributed to the economic crisis, including the unwarranted bans on U.S. pork by some countries, citing fears of the H1N1 flu, Butler pointed out. But the most significant contribution, he said, has been high feed grain prices. Feed prices, which account for 60 percent of the cost of raising a hog, have increased over the past two years mostly because of U.S. biofuels policy. NPPC asked Congress to:

•         Urge the USDA to make more purchases of pork for various federal food assistance programs.

•         Reexamine a spending cap on USDA’s Section 32 program so the agency can meet the goals of the program.

•         Pressure U.S. trading partners, particularly China and Russia, to eliminate their barriers to U.S. pork imports.

•         Approve as soon as possible the pending free trade agreements with Colombia, Panama and South Korea.

•         Conduct a study of the economic impact on the livestock industry of an expansion of corn-ethanol production and usage. EPA is considering raising the percentage of ethanol that can be blended into gasoline to 15 from 10.

•         Support allowing the ethanol import tariff and federal blenders’ tax credit to expire.

•         Oppose measures that would place on pork producers undue burdens and higher costs such as restrictions on access to capital and contract arrangements or prohibitions on production practices, including banning the use of certain animal health products.

Other witnesses include Dave Moody, chairman of public policy and past president of the Iowa Pork Producers Association; Mark Greenwood, vice president of commercial lending for AgStar Financial Services of Mankato, Minn.; University of Minnesota agriculture economist Brian Buhr; and Rod Brenneman, president and CEO of pork producer and processor Seaboard Foods. To read Butler’s testimony, visit www.nppc.org/news and go to “Testimony/Comments.”

NPPC URGES CDC TO PROVIDE NOVEL H1N1 VACCINE TO SWINE INDUSTRY WORKERS

In a letter sent this week, NPPC urged the Centers for Disease Control and Prevention (CDC) to make available to swine workers, swine veterinarians and employees of pork processing plants the vaccine for the novel H1N1 flu. The letter recognized the importance of providing the vaccine to children, the elderly and pregnant women but pointed out that, because of their proximity to swine – and the fact that already there has been human-to-swine transmission of the H1N1 virus – pork industry workers also should be provided the vaccine. NPPC also cited the position of the American Association of Swine Veterinarians on the issue: “To protect both human health and the food supply, the AASV strongly advises that all personnel working in the pork-production industry be vaccinated against seasonal influenza annually and against any novel human influenza A viruses as they emerge. Vaccination enhances protection for personnel while minimizing the likelihood of viral transmission from personnel to pigs. [Emphasis added.]” To read the letter click here.

NEW CLEAN WATER ACT ENFORCEMENT PLAN WILL FOCUS ON CAFOS

EPA Administrator Lisa Jackson last week unveiled a new Clean Water Action Enforcement Plan at a Clean Water Act (CWA) hearing in the House Transportation and Infrastructure Committee. EPA sees this as a first step in revamping the CWA compliance and enforcement program. The plan makes significant mention of CAFOs and has a particular emphasis on them as one of the most important areas of concern for the plan. In proposing the new enforcement action, EPA said it will “pursue new strategies to enforce existing rules limiting pollution from concentrated animal feeding operations (CAFOs) … CAFOs have become larger and more densely located, placing more stress on waters in proximity to these locations. CAFOs result in a large pollution load to the environment … Where facilities with large numbers of animals are discharging without permits or in violation of their permits, they can cause significant pollution problems of concern to communities.” The bottom line: EPA clearly stated it will be very aggressive, and pork producers need to make sure they are managing their manure properly. NPPC will monitor developments around the implementation of the plan and will provide producers with updates as to what that means for them. To read the plan, go to www.epa.gov/oecaerth/civil/cwa/cwaenfplan

CLARIFICATION TO EPA GREENHOUSE GAS REPORTING RULE

Contrary to some information being proffered to pork producers, EPA’s new Greenhouse Gas (GHG) Reporting rule covers only a small number of operations; the vast majority of pork producers will not need to report or submit supporting documentation on GHGs. Under the final rule, facilities that emit more than 25,000 metric tons of GHGs – expressed as the equivalent to CO2 – in 2010, and every year thereafter, will need to report their emissions to EPA the following calendar year. For those facilities that exceed the threshold, the first reports will be due in 2011. The only GHGs that may be covered on a pork operation are the methane (CH4) or nitrous oxide (N2O) released by its manure management system. All other emissions, such as CO2 from manure or animal respiration, N2O from the land application of manure, CO2 from diesel combustion or leaked refrigerants from cooling systems, would not count toward the 25,000 metric ton reporting threshold. EPA’s rule states that pork operations with more than 34,100 hogs will need to determine whether or not they emit more than the 25,000 metric ton reporting threshold. The rule specifies the equations and look-up values to be used in the equations to make the calculations. EPA is planning to make available an even more detailed look-up table to eliminate the need for any calculations. A draft table, for example, indicates that if market hogs are raised using a deep pit manure system, and the average annual temperature is 54-57 degrees Fahrenheit, no emissions report must be filed unless the facility has more than 127,700 hogs at any one time. The same table indicates that 36,900 market hogs produced with an uncovered anaerobic lagoon system for the same temperature conditions may trigger the reporting requirement. NPPC expects EPA to complete its detailed look-up table by Dec. 1, 2009. NPPC will provide the new table to its members and to state pork producer associations to help ensure that producers have the information to determine whether they must report emissions. Should the look-up table indicate that a producer has the requisite number of animals, emissions must be calculated using the equations and look-up values that EPA specifies in Subpart JJ – Manure Management Section 98.360.

DERIVATIVE BILL APPROVED BY HOUSE AGRICULTURE COMMITTEE

The House Agriculture Committee Wednesday approved legislation regulating over-the-counter derivatives, financial instruments used to manage risk. A similar measure was cleared last week by the House Financial Services Committee. The Agriculture panel bill would require standardized derivatives to be cleared through central clearinghouses and traded on an exchange or other regulated platform, subject to rules set by the Commodity Futures Trading Commission and the Securities and Exchange Commission, as a way to bring transparency. Transactions that involve “end users,” such as processors, manufacturers and utilities, would be exempt from clearing. The bill includes a provision requiring foreign exchanges to adopt similar rules if they want access to American customers. The Agriculture and Financial Services committees will need to reconcile their respective measures before a bill can go to the full House. It is expected that a final bill will be combined with other financial reforms and brought to the House floor in late November or early December.

FOOD, AGRICULTURE GROUPS URGE QUICK ACTION ON USTR AG NEGOTIATOR NOMINEE

An ad hoc coalition of food and agricultural organizations, led by NPPC, this week expressed its strong support for Isi Siddiqui as the chief agricultural trade negotiator in the Office of the U.S. Trade Representative. The 46 groups, in a letter to Sens. Max Baucus, D-Mont., and Charles Grassley, R-Iowa, the chairman and ranking member, respectively, of the Finance Committee, which must consider the nomination, urged the lawmakers to take action soon. Siddiqui served for 28 years with the California Department of Food and Agriculture, where he attained the position of chief plant scientist. During the Clinton administration, he served in the U.S. Department of Agriculture as deputy undersecretary and as undersecretary for marketing and regulatory programs and as senior trade adviser to then-Sec. Dan Glickman. He also worked with USTR and represented USDA on bilateral, regional and multilateral agricultural trade negotiations.

SENATE COMMITTEE HOLDS HEARING ON REFORMING FOOD-SAFETY SYSTEM

The Senate Committee on Health, Education, Labor, and Pensions Thursday held a hearing to focus on a Senate bill that would expand U.S. Food and Drug Administration oversight over the nation’s food supply. FDA Commissioner Margaret Hamburg, who testified at the hearing, supported several provisions in the bill but had some concerns with it. She said the bill needs to provide FDA authority to deem food “adulterated,” with more flexibility to seize such tainted food or prevent its importation. She told members of the committee that the Senate version of food-safety legislation lacks several crucial provisions, including giving the FDA better access to company food records during routine inspections, flexibility to target inspections at areas of greatest risk and enough money to do the job. The House food-safety bill, which was approved in July, contains a provision calling for greater FDA access to records at food production facilities, whereas the Senate bill would allow FDA access to company records only in a food emergency. Hamburg urged the Senate panel to adopt some of the same provisions that the House bill contains. Committee Chairman Tom Harkin, D-Iowa, concluded the hearing by stating that he would like to have a food-safety bill on the president’s desk by the end of the year. To read Hamburg’s testimony, click here.

NPPC HOSTS RUSSIAN WTO NEGOTIATOR

NPPC this week hosted a meeting with Russian World Trade Organization (WTO) negotiator Max Medvedkov, which was attended by many Washington, D.C.-based food and agriculture groups. The focus of the meeting was on issues associated with Russia’s accession to the WTO. Nick Giordano, NPPC’s vice president and counsel for international trade policy, raised many issues affecting U.S. pork producers. Over the past year, Russia had “delisted” or failed to relist more than 30 U.S. pork processing and storage facilities, meaning 50 percent of all U.S. pork production is ineligible for export to the country. Most recently, however, Russia lifted all of its H1N1-related restrictions on pork imports, which were implemented in late April after reports of an H1N1 flu outbreak.

MANURE COULD BE VALUABLE RENEWABLE ENERGY SOURCE

Manure from U.S. pork production could be used to generate 5.3 billion kilowatt hours of electricity a year, Iowa State University’s Robert Burns recently told the House Science and Technology Subcommittee on Energy and Environment, which was looking at biomass for thermal energy and electricity. Burns said the pork industry represents the second largest renewable energy production potential from anaerobic manure digestion. But, he pointed out, while Iowa, for example, produces more hogs than any other state, no renewable energy using anaerobic digesters is being generated in the state. Burns also pointed out that while the United States has many more livestock than many other countries, those nations have invested much more in biogas development. Germany, for example, which has nearly 27 million hogs compared with 66 million in the U.S., has 5,000 biogas plants. The United States has just 135. China, which has nearly 447 million hogs, has 16,000 biogas plants. To read Burns’ testimony, click here.

WHAT’S AHEAD

CLIMATE CHANGE HEARINGS IN SENATE SET FOR NEXT WEEK

The Senate Environment and Public Works (EPW) Committee next Tuesday through Thursday will hold hearings on climate change legislation, S. 1733, the “Clean Energy Jobs and American Power Act,” which is being sponsored by Sens. John Kerry, D-Mass., and EPW Committee Chairwoman Barbara Boxer, D-Calif.