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California Association of Wheat Growers (CAWG)

April 30, 2007

CHANGES AT CAWG. Effective today, California Association of Wheat Growers Executive Director Janice Cooper is stepping down from the position to pursue other interests in international business consulting. Tad Bell is replacing Cooper as Executive Director beginning May 1, 2007.

“CAWG was very fortunate to have Janice running the organization for the past five years,” said Past President Larry Hunn. “She utilized her policy development expertise and her knowledge of Washington, DC to help CAWG accomplish many important goals on behalf of California wheat growers.”

“While we are sorry to see Janice go, we are thrilled that Tad is available to take on the leadership of CAWG, especially as the discussions over the new Farm Bill enter a critical period,” said President Ian Anderson. “Tad’s long history at the California Department of Food and Agriculture and his extensive knowledge of agriculture and key political players will be very valuable to the California wheat industry going forward.”

NAWG PRESIDENT: NOW IS THE TIME TO CONTACT CONGRESS. NAWG President John Thaemert issued a call to action to wheat growers this week, telling them now is the time to contact their Members of Congress on the crucial issue of the direct payment.

 “The discussions in Washington, D.C., concerning the 2007 Food Security Act (Farm Bill) are at a critical point. There are many commodity groups and other interests competing for the attention of your Senators and Members of Congress on this very important legislation. If you do not speak up and make your needs known to your representatives in D.C., someone else may decide your fate for you - and you may not like it.

“There is an attempt by some to reduce or eliminate the fixed direct payment. At this time, I am asking every NAWG member in every member state to contact his or her Member of Congress and his or her two Senators and tell them that you need (not “want” but “need”) a 2007 Farm Bill that:

 1) Provides a fixed payment of $1.19 per bushel, because;

a. The fixed payment has been the only RELIABLE source of income wheat producers have received. Wheat farming is very different from corn and soybean farming. Those crops are grown in areas with either greater rainfall or under irrigation.  Corn and soybean farmers would rather have a high loan rate since they usually grow a crop, but a wheat farmer can’t get a loan or LDP on a crop that failed due to drought, freeze or other circumstances.

b. Direct payments are based on historic production and are considered trade friendly. Since wheat is so heavily dependent on foreign trade, we do not want to place much emphasis on a support mechanism that would likely lead to a WTO lawsuit.

2) Provides a target price of $5.29 per bushel, which is an effective support of $4.10 per bushel ($5.29 - $1.19 = $4.10).

“These support levels were determined after much debate coupled with analysis from FAPRI, Texas A&M and other academic interests. It is a simple formula based on cost of production that makes much more sense than basing support on average historic price. This legislation will dramatically impact your bottom line for the next five years. It is very important that you contact your national legislators ASAP.”

CAWG joins NAWG in urging all California growers to contact their Senators and Representative. Sample letters that can be edited to include your personal story are available at NAWG’s legislative action center at: http://capwiz.com/wheatworld/home/

SUPPLEMENTAL WITH DISASTER AID APPROVED BY CONGRESS, FACES VETO. A $124 billion supplemental spending bill that contains about $4 billion in agricultural disaster assistance was approved by Congress this week, but faces an avowed presidential veto due to language requiring troop withdrawal from Iraq.  

The bill, largely a funding bill for operations in Iraq and Afghanistan, also contains spending for a number of domestic priorities, including crop disaster assistance for 2005 and 2006 for those with crop insurance.

The House approved the bill by a vote of 218-208; the Senate approved it by a vote of 51 to 46.

NAWG has worked on achieving disaster assistance for a number of years and will continue to work to ensure this desperately needed help makes it into any future version of the supplemental.

PET FOOD UPDATE: INDUSTRY ASSERTS SAFETY OF U.S. WHEAT. The U.S. wheat industry asserted the safety and quality of wheat products this week even as more pet food products were recalled and federal officials indicated they are looking into whether melamine was intentionally added to pet food ingredients.

NAWG issued a press release discussing the wheat industry’s efforts to assure consumers that American wheat and wheat products are safe, affordable and wholesome.

 “Congress is debating federal farm policy as we speak. NAWG is also working hard to ensure that the safety net needed by growers is in place and works well, to help cushion the boom and bust cycles inherent in farming,” Thaemert said.

The release also included information from MGP Ingredients, a NAWG Foundation Development Committee member, U.S. Wheat Associates and the Wheat Foods Council, and is available in full at:
http://www.wheatworld.org/html/morenews.cfm 

Almost half of U.S.-produced wheat is exported. However, 70 percent of wheat gluten is imported, mainly from the European Union, Australia and China. Many of these areas produce wheat gluten as a byproduct of wheat starch. In these instances, wheat starch is more commonly used than corn starch, the primary grain starch used domestically. This process allows these countries to sell wheat gluten for less than American producers, generally below U.S. production costs.

Additional pet food that does not contain wheat gluten but does contain rice protein was also recalled this week after owners reported sick pets. Also, the Associated Press reported that the South African Veterinary Association said this week that 30 dogs have died there after eating pet food with ingredients that contained melamine and were imported from China.

The Food and Drug Administration said late this week that they are investigating the possibility that both the wheat gluten and rice protein may have had melamine added intentionally in order to increase protein content.

NAWG continues to answer public and press inquiries about the pet food issue, including about the process domestic wheat growers and processors go through to ensure the safest product possible is used.

For instance, at MGP, which has the largest wheat gluten production capacity in the U.S. and only uses North American wheat, quality control parameters include raw material quality tests as well as in-line product performance testing during the production process. Each production lot is further tested in-house for functionality and microbiological activity before shipment. Proactive outside auditing by the American Institute of Baking and customers also helps ensure the product is safe.

For more information on this issue, please visit the Food and Drug Administration’s Web site at:
http://www.fda.gov/oc/opacom/hottopics/petfood.html