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California Association of Wheat Growers (CAWG)

March 31, 2006

WEEKLY UPDATES AVAILABLE FROM CALIFORNIA WHEAT COMMISSION.  For the past two months or so, the California Wheat Commission has been issuing weekly updates on the state’s wheat crop. The idea is to share quick, informal and reliable information about the state's wheat crop and disease conditions. Comments forwarded by Thursday morning of each week will be posted in the bulletin for distribution Thursday evening by email. Information from all sectors of the grain industry is welcome.  If you know of anyone that might be interested in receiving this bulletin directly please contact the Commission directly at bfernandez@californiawheat.org.

 This week’s report included an updated wheat acreage report from National Agricultural Statistics Service USDA Washington, D.C., released today.

"All wheat planted area is expected to total 57.1 million acres, down slightly from 2005.  If realized, this will be the lowest all wheat acreage since 1972.  Winter wheat planted area for the 2006 crop is 41.4 million acres, up 2 percent from last year.  Of the total, about 29.8 million acres are Hard Red Winter, 7.42 million acres are Soft Red Winter, and 4.22 million acres are White Winter. The 2006 other spring wheat planted acreage is expected to total 13.9 million, down 1 percent from 2005.  Of the total, about 13.2 million acres are Hard Red Spring wheat.  Intended Durum wheat planted area is 1.83 million acres, down 34 percent from the previous year.  If realized, this will be the lowest Durum wheat acreage since 1961."

Note:  California planted acreage estimates for Winter Wheat (apparently this estimates includes the spring wheat plantings in the intermountain area of California) remain at 430,000 acres, Durum 70,000 acres.

For a copy of the complete report:

http://usda.mannlib.cornell.edu/reports/nassr/field/pcp-bbp/pspl0306.pdf

HOUSE BUDGET COMMITTEE CALLS FOR RECONCILIATION. The House Budget Committee passed a $2.8 trillion budget resolution Wednesday that included instructions for $55 million in agriculture “savings”. The resolution asked for a total of $6.7 billion in reconciliation savings, also including $4 million in food stamp savings and $51 million from the Export Credit Guarantee Program.

The House Agriculture Committee has not indicated how they plan to proceed with these instructions, though the Export Credit Guarantee Program is under review anyway because a complaint was raised by Brazil at the WTO over the issue. The Brazilians question the U.S.’s commitment to the WTO Step 2 ruling, which requires the elimination of specific export credit programs.

The budget resolution was passed by a 22-17, party-line vote. The full House is expected to look at the measure next week.

SENATE TAKES UP IMMIGRATION REFORM. A controversial bill approved by the Senate Judiciary Committee is currently being considered on the floor as an amendment to an immigration reform bill introduced by Senate Majority Leader Bill Frist (R-Tenn.).

Frist’s bill, S. 2454, includes increased border security and enforcement measures, but lacks provisions for a guest worker program. The amendment, offered by Sen. Arlen Specter (R-Pa.), includes provisions for increased border security and a guest worker program, and a path to legalization for those already in the country illegally.  Under the Specter proposal, illegal immigrants already working in this country could qualify for green cards after six years – and after they paid fines, passed criminal background checks and showed a commitment to learning English.  Five years after earning a green card, an illegal immigrant could be eligible for citizenship.

The proposal also includes a provision to create a “blue card” for agriculture guest workers who can prove they have worked in the agriculture industry for at least 150 days during the last two years, prior to Dec. 31, 2005.  These immigrants would be required to work in the industry for at least 150 days per year for three years, or 100 days per year for five years, and would then qualify for green cards. In addition, the Committee’s proposal includes employer provisions for hiring temporary workers.  These include proving that they tried to find Americans to fill the positions available and paying a prevailing wage to guest workers.  Guest workers could also not be used to replace striking workers.

The Senate is currently divided on how to handle immigration issues.  Some Senators prefer a border security and enforcement-only bill, but many Senators recognize the importance of a guest worker program, especially for labor intensive industries like agriculture. Senator Feinstein (D-CA) recently announced her support for a bill that includes guest worker provisions.

CAWG raised this issue in its many meetings on Capitol Hill earlier this month. We support a comprehensive bill that includes an expanded guest worker program.

CRP SIGN-UP OPEN THROUGH APRIL 14. The Farm Service Agency announced that the Conservation Reserve Program is now open for sign-ups. FSA will determine who gets CRP contracts by comparing all proposed offers using the Environmental Benefits Index, as in previous sign-ups. The EBI is a ranking of the land’s contribution to improving soil retention, water and air quality and wildlife habitat.

Though the EBI has been used in previous sign-ups, the EBI cutoff for this sign-up may be different from in past rounds. Thus, those who met EBI thresholds previously are not guaranteed a contract under this sign-up.

Offers accepted under this CRP sign-up will become effective Oct. 1, 2006. CRP participants voluntarily enroll land in 10 to 15-year contracts.  In exchange for annual rental payments and cost-sharing assistance, participants plant trees, grasses and other vegetation. CRP currently has 36 million acres enrolled.

More information about CRP and this sign-up is available at:

www.fsa.usda.gov/dafp/cepd/crpinfo.htm

WTO MEETING YIELDS LITTLE PROGRESS. (News from WETEC) The failure of trade ministers to make a breakthrough in the global trade talks during the London meeting is calling into question the April 30 deadline set in Hong Kong for agreeing to modalities in agriculture. The major event at the meeting was the tabling of a conditional offer from Brazil on non-agricultural market access in an attempt to jumpstart agriculture negotiations by prompting the European Union to grant concessions on their agriculture proposal. However, this did not occur as trade officials from the European Union rejected the Brazilian proposal.

Despite this setback, World Trade Organization Secretary-General Pascal Lamy remains set on reaching an agreement on modalities by the end of April. In recent press conferences, U.S. Trade Representative Rob Portman has expressed concerns about whether the April 30 deadline for modalities will be reached. This comes as France and other EU member states pressure the EU not to make additional concessions during trade talks.

At a speech at the Agribusiness Club of Washington, Portman suggested that other World Trade Organization member countries take the April 30 deadline seriously. Portman said missing the date would put the entire four-and-a-half-year negotiations in jeopardy. He also indicated that the U.S. must have an aggressive outcome to be able to take whatever agreement is reached at the WTO to Congress in early 2007 as Presidential Trade Promotion Authority expires June 30, 2007.

NEXT CAWG MEETING SCHEDULED FOR APRIL 5^TH IN SACRAMENTO. ALL MEMBERS ARE WELCOME TO ATTEND.