There was lots of activity of interest to corn farmers last week – both on The Hill and in the field.
I caught up with National Corn Growers Association Chairman Garry Niemeyer of Auburn, Illinois on Friday as he was busy playing catch up on planting progress. “We are probably about a fourth done with planting corn,” Garry said. “We normally are finished planting corn by the middle of April.” He added that since June 1 is the cutoff date for crop insurance they still have quite a bit of time to get a crop in and “everybody here is feverishly working.” While it has been the longest cold, wet spring that he can remember, Garry says it has really warmed up now in the Midwest and he thinks the corn will probably “come flying out of the ground” now.
Up on Capitol Hill last week, as so many like Garry were busy in the field, two pieces of legislation very important to farmers made significant and long-awaited progress. One was the passage of a new five year farm bill through both the House and Senate Agriculture committees. However, Garry is quick to note that we are still no further along on a new bill than last year at this point. “We never got a House bill to the floor (last year),” Garry noted. “I’m going to hope that the House finishes up, then they go to conference and we get a reasonable bill which will help all American farmers.”
Meanwhile, the Senate finally passed the Water Resources Development Act (WRDA) last week, paving the way for upgrades to the inland waterways system important for farmers. “It’s been a long time, since 2007, since we’ve had a WRDA bill and back before 2000 they used to have a WRDA bill every other year,” Garry says. “Now we just need the funding to get these project moving forward.”
Of specific interest to corn farmers, the bill contains provisions to remove the over-budget and long-delayed Olmsted lock and dam project from the Inland Waterways Trust Fund (IWTF), the remainder of the cost to be paid 100 percent by general treasury revenue and not cost-shared 50-50 through the IWTF. This action will free up around $750 million to the IWTF to complete critical priority navigation projects. An increase in the threshold for major rehabilitation, from the current $14 million to $20 million, was approved.
The bill now goes to the House for approval and Garry says they are encouraging farmers to call their representatives in Congress to tell them how important this legislation is to them.
The term “massive farm bill” has been used repeatedly in the general media this week to describe the bills passed out by the Senate and House Agriculture Committees, and by “massive” they mean the farm portion of the bill, not the nutrition portion which accounts for 80% of the funding called for in the legislation.
“The Senate Agriculture Committee on Tuesday approved a massive five-year farm bill that would cut spending while also creating new subsidies for farmers,” reads the first sentence in an NPR story this week that was picked up and carried verbatim by many other news outlets.
The Senate bill cuts about $400 million out of almost $80 billion spent annually on food stamps, while at the same time cuts $5 billion a year in direct farm payments. The House bill makes deeper cuts in nutrition, about $20 billion over the life of the bill, while the programs for farmers take a hit of more than $18 billion.
“There will be some folks out in the countryside who will say ’80% of the bill is saving $20 billion and 20% of the bill is saving $18 billion, how can that be fair?’” said House Agriculture Committee Chairman Frank Lucas meeting with farm broadcasters Wednesday just before the markup began. “This is the first real reform to the nutrition title in almost 20 years.”
The cuts to the nutrition title caused several members of the House committee to vote against the bill, and Lucas is well aware that will be one of the major sticking points when the bill gets to the floor of the House, which he believes will happen next month. “Whatever we do in the committee, many of the battles – whether it is over dairy, or sugar, or the size of the nutrition reforms, will be fought out again on the floor of the United States House,” he said to the farm broadcasters, echoing that sentiment after the bill was passed out of committee late Wednesday night. “We have an adventure ahead of us in June,” he said before banging the gavel to adjourn.
Agriculture groups seem quite willing to accept the disproportionate cuts for farm programs compared to nutrition programs because they want to see a bill passed that will finally allow them some kind of long term security to keep producing food and fiber for the country and the world. As long as there is just enough of a safety net to protect them from going bankrupt trying to do their job, farmers themselves are likely to agree that the bill is fair enough, but not at all “massive.”
As both the House and Senate Agriculture committees are marking up their versions of a farm bill this week, that was the number one issue for farm broadcasters meeting in the nation’s capitol for their annual Washington Watch.
“We absolutely want to get a farm bill done this year,” said Jon Doggett with the National Corn Growers Association. For corn growers, the top priority is risk management and crop insurance, which is why they joined with a number of other agriculture and environmental groups last week in hammering out a compromise to support tying conservation compliance and crop insurance but oppose means testing or payment limitations. “We worked out some common sense language that makes this a very workable program for growers that offers them plenty of opportunity that if they inadvertently get out of compliance they can quickly get back in,” he said. “In return, we have an assurance from the conservation community that they will be with us to protect the funding for crop insurance.”
“I believe we will have a bill this year because we have to have a bill this year.”
That’s what Agriculture Secretary Tom Vilsack said to agricultural journalists meeting in Washington DC. While he is confident there will be a “food, farm and jobs” bill sometime this year, he’s not sure about exactly when that might be. “I don’t know when Congress is going to act,” said the secretary. “I know what the ag chairs have said and that is that they’re anxious to get started now.”
That seems to be the general consensus among the policy watchers on Capitol Hill but that’s just about the same thing that was being said last year at this time. The committees were starting to work and the industry was feeling confident that the work would be getting done before the 2008 bill expired in September. Obviously, it didn’t happen.
Secretary Vilsack had two main reasons why we “have to have a bill” this year. “Producers need solutions and a five year plan to make decisions, but there are certain parts of the bill that will resolve sticky issues for us” the Brazilian WTO case regarding cotton being the primary example.
Of course, we had those same two reasons last year, but it was still okay to “kick the can” down the road for awhile. Hopefully it will be different this year. There has to be a point where the road dead ends.
Listen to Vilsack’s remarks and Q&A from reporters here: Secretary Vilsack
The chairman of the House Agriculture Committee spoke to farmer and rancher representatives in Washington DC at National Ag Day activities on Tuesday, praising those who work in the agriculture industry.
“The fact of the matter is we’re a critical part of the national economy and the food safety net for the country and the planet,” Congressman Frank Lucas (R-OK) said in an interview after his address to National Ag Day attendees. “We’ve been so successful in agriculture that there’s a tendency to ignore us – and people will ignore us at the peril of their future.”
Lucas explained where Congress is right now on a new farm bill and when he hopes to have it finished. “We are finishing up the budget process in the United States House and the Senate is doing that too,” he said. “Before the end of September, before the one year extension of the ’08 farm bill expires, we’ll have a new one signed into law and on the books. That’s my goal.”
Lucas says there are other issues the House Agriculture committee has on its plate now, such as oversight of the commodity futures trading commission and keeping an eye on how USDA is handling sequestration, especially when it comes to keeping meat inspectors on the job.
Pretty much every farm organization has expressed disappointment over the nine-month farm bill extension included in the New Year’s Day fiscal cliff package, with the hope that Congress will do better in 2013.
“We don’t support an extension of the 2008 farm bill, we worked very hard to see reform,” said National Corn Growers Association president Pam Johnson, noting that the farm bill passed by the Senate in 2012 would have helped to reduce federal spending. “It would have saved $23 billion,” she said. “That’s what makes it so disappointing for us.”
While it was the prospect of the so-called “dairy cliff” that led lawmakers to even think about a farm bill, it’s ironic that the National Milk Producers Federation is among the most unhappy with the outcome. National Milk Producers Federation (NMPF) President and CEO Jerry Kozak called the extension a “devastating blow to the nation’s dairy farmers” that amounts to “shoving farmers over the dairy cliff without providing any safety net below.” He says that the dairy industry will continue to push the 113th Congress to pass a five year farm bill that includes the Dairy Security Act, which eliminates the dairy product price support program, direct payments, and export subsidies, and establishes a voluntary risk management tool for farmers which would cost taxpayers less.
Other groups including the American Farm Bureau, National Farmers Union, and American Soybean Association had similar “disappointed but optimistic” statements. Even Secretary of Agriculture Tom Vilsack said he was “disappointed Congress has been unable to pass a multi-year reauthorization of the Food, Farm and Jobs bill to give rural America the long-term certainty they need and deserve” and that he will continue to work with Congress to pass a new bill.
At the same time, ag groups are pleased with some other parts of the fiscal cliff package, like the estate tax provisions and extension of alternative energy tax incentives. The estate tax was permanently set through the legislation at a rate of 40 percent on estates valued at $5 million, or $10 million per couple – better than the 55% on $1 million or more that was scheduled to become law.
The theme set by all is to continue working with the new Congress and hope that the nine month extension doesn’t mean it will be delayed and down to the wire – or past it – again at the end of 2013.
A highlight of the National Association of Farm Broadcasting annual meeting last week in Kansas City was a panel featuring three former secretaries of agriculture – Bob Bergland of Minnesota who served under President Carter from 1977-81; John Block of Illinois who served President Reagan from 1981-86; and Clayton Yeutter of Nebraska who was agriculture secretary for George H.W. Bush from 1989-91 and also was U.S. Trade Representative for Reagan from 1985-89.
It was nearly two hours with these three outspoken gentlemen who took a variety of questions from farm broadcasters, so I’ll break it down into a few bite-sized pieces.
The former secretaries first took the opportunity to reflect on their time running USDA and tell a few “war stories.” Interestingly, all three talked about how much more bipartisan government was during their times. This was the longest segment of the program at 30 minutes, but that’s really only 10 minutes for each one to sum up some very interesting years they spent as agriculture secretary. Ag Secretaries opening comments
With the panel happening the day after the election, that question was number one and the three had answers that reflected their party affiliations – Bergland being the Democrat of the three. As to when a farm bill might be complete – Bergland said he had no idea, Yeutter expects a temporary fix and Block said the fiscal issues are more important. Ag Secretaries on election and farm bill
How about government regulations impacting agriculture? Block predicts the next four years will bring more regulations, and Yeutter again agreed while Bergland made the case that some regulations are necessary. Ag Secretaries on government regulation
A broad question encompassed the long term viability of current high prices, land values and feeding the world. Bergland said the population demands may force us to eat more cereal and less meat in the future, Yeutter believes feeding the nine billion by 2050 won’t be as big a problem as people are making it out to be, and Block talked a bit about food versus fuel. Ag Secretaries on feeding the world
Asked about the RFS and whether it should be considered a subsidy to corn growers, Bergland said he was dead set against all subsidies and thinks the budget will force the government to eliminate all subsides. Yeutter predicted that EPA will keep the RFS intact and Block agreed. Ag Secretaries on RFS
Did the secretaries have any advice about how to defend modern agricultural practices, specifically GMOs? Bergland recalled hysterical reactions in the 1930s when hybrid corn was first introduced, and Yeutter pointed out the international implications of the GMO debate. Ag Secretaries on GMOs
There was lots more, but those were a few highlights. It was an entertaining conversation!
The newest member of the officer team for the National Corn Growers Association is Martin Barbre, a farmer from Carmi, Illinois. I had the opportunity to get to know Martin a little better at the National Association of Farm Broadcasting (NAFB) annual meeting last week in Kansas City.
Martin has been farming since he was 19 years old and now shares the operation about two hours east of St. Louis with his son. “Right now my passion is making sure that we have a future in agriculture for my son and all the other sons and daughters that are joining on the family farms,” said Martin.
Martin is concerned about the fact that Congress has yet to pass a farm bill. “We just went through a record drought, the need for that has never been more important, and yet Congress has not gotten the job done,” he said. “We’ve gone out this year and we still raised a pretty good job considering the conditions that we had. We’ve done our job, we’ve got the crop harvested, let’s get Congress to do their job and get us a farm bill for the next five years.” He says the corn growers would like to see a revenue-based protection plan tied to crop insurance.
The Barbre farm raised a corn crop this year that was about 30% of normal. “We had a lot of really bad acres,” said Martin. “Really, the heat hurt us more than the drought. We saw that evidenced by our irrigated fields that still weren’t up to par. The heat really affected pollination.”
This was the first year that Martin has attended the marathon interview session that is NAFB Trade Talk, but it won’t be his last. Listen to my interview with Martin from NAFB here: Interview with Martin Barbre
Phone to the ear is the way National Corn Growers Vice President of Public Policy Jon Doggett spends most of his day, so doing interviews at the National Association of Farm Broadcasting just two days after the election was no different than any other. He just had to squeeze in that phone time between the interviews!
Broadcasters were most interested in what now after the election and Doggett told them that getting a farm bill done is a major priority for the upcoming lame duck session, but will they get it done? “I think the chances are excellent – IF there’s a commitment from the leadership that they will move forward, but if there’s not the commitment, I can guarantee what the result will be – it will be nothing,” said Doggett.
Congress will also have to deal with the “fiscal cliff” in the short lame duck session. “If we don’t make our decisions by the end of 2012, we’re gonna jump off a cliff,” said Doggett. “We’re not at the edge yet, but we’re kind of looking over the edge.”
Doggett also talked about other issues, like the RFS waiver and how important it is for farmers to make their voices heard in Washington.
Republican presidential candidate Mitt Romney put his focus on agriculture and rural policy on Tuesday with the release of an agricultural policy white paper and a visit to an Iowa family farm.
Romney pledged to get a farm bill passed as president and blamed President Obama for the failure of Congress to do so yet, despite the fact that Republican leadership held up getting a bill to the House floor while Democratic leadership got one passed on the Senate side. “The president has to exert the kind of presidential leadership it takes to get the House and Senate together and actually pass a farm bill,” Romney said during his speech to over 1000 supporters at the Koch family farm near Van Meter, Iowa.
Romney’s “vision for a vibrant rural America” includes tax policies to support family farms, expanding agricultural trade, achieving energy independence by 2020, and creating a commonsense regulatory environment. “The regulatory burden under this administration has just gone crazy,” said Romney. “I’m going to put cap on regulation and any new major regulation will have to be approved by Congress.”
Under tax policy, the white paper says Romney will permanently eliminate the estate tax while his trade policy for agriculture includes completing the Trans-Pacific Partnership and pursuing new agreements, specifically in Latin America. His agenda for energy independence includes maintaining the Renewable Fuel Standard (RFS), “fulfilling the federal government’s commitment to biofuels growers and refiners and providing them the certainty they need to follow through on their investments in promising technologies.”
While Governor Romney failed to mention biofuels in his speech, he did tell a couple of Iowa Renewable Fuels Association (IRFA) members after his speech that he supported both the RFS and ethanol. The exchange between IRFA President Brad Albin with the Renewable Energy Group (REG) and past president Walt Wendland of Golden Grain Energy and Romney saying “I do support the RFS and ethanol” was captured on video which can be seen below.
I caught up with National Corn Growers Association Chairman Garry Niemeyer of Auburn, Illinois on Friday as he was busy playing catch up on planting progress. “We are probably about a fourth done with planting corn,” Garry said. “We normally are finished planting corn by the middle of April.” He added that since June 1 is the cutoff date for crop insurance they still have quite a bit of time to get a crop in and “everybody here is feverishly working.” While it has been the longest cold, wet spring that he can remember, Garry says it has really warmed up now in the Midwest and he thinks the corn will probably “come flying out of the ground” now.
