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California Association of Wheat Growers (CAWG)

May 15, 2007

DISASTER ASSISTANCE.  The new agricultural disaster assistance bill, H.R. 2207, passed the house last week as a stand-alone bill, 302-102, more than enough to pass a veto override. 

President Bush wasted no time issuing a statement regarding the bill, calling agricultural disaster assistance “excessive non-emergency spending".  He reasoned, “The 2002 Farm Bill, when coupled with federally subsidized crop insurance, already provides a generous safety net that was designed to eliminate the need for ad hoc disaster assistance.  Consequently, the proposed assistance is unnecessary and unwarranted.” 

The bill may or may not be merged with the Iraq War Funding Supplemental in Conference.  Congressional leaders intend to send either the stand alone disaster assistance and the Iraq Supplemental or the combination legislation to the President before the Memorial Day Recess which begins in two weeks.  Agricultural disaster assistance as passed would provide almost $3.5 billion in aid to producers who lost 35 percent or more of their crop and who were covered by crop insurance.  The assistance would cover eligible losses in 2005, 2006 or 2007. 

FARM BILL.  SENATOR BOXER.  Senator Boxer would like to know what you think about the Farm Bill.  Her office has established a website for you to provide direct comment to the Senator regarding the Farm Bill.  As you know, Senator Boxer was key to opening the Mexican market to California wheat after an almost ten year prohibition due to Karnal bunt.  Again, if you have internet access, let the Senator know: 

1. That of the three Farm Safety Net Programs, wheat growers have only received the direct payment since the 2002 Farm Bill was enacted, please maintain it and consider raising the rate to meet real life situations for wheat growers;

2. That our competitiveness is dependent on continued public investment in Research;

3. That the success of USDA Conservation Programs under California conditions is dependent on real increases in the investment in those programs and recognition that one size does not fit all in regards to implementation;

4. That we cannot afford more unwanted Sanitary and Phytosanitary problems due to invasions of foreign pests and diseases; we need to consider bringing agricultural inspection back to the USDA;  

5. That public investment in Agricultural Trade is highly cost effective, it is shining example of public private partnership and that you support an increase the investment in federal agricultural trade, in the USDA’s Foreign Market Development Program at $50 million annually and the Market Access Program at $325 million annually; and,

6. Keep the food in Food Aid.  The wheat we grow is a fundamental resource for food security, development and humanitarian relief in developing countries.   

The Senator’s website can be found at:  http://boxer.senate.gov/farmbill.

FARM BILL.  NOW IS THE TIME.  NAWG has also established an internet site to painlessly send a letter to your Congressional representatives regarding the Farm Bill, specifically regarding direct payments.  Please take a look at the previous CAWG Update (4/30/07) for detail on the direct payment.  If you have an internet connection, the NAWG site provides a quick painless method to send a message to your Representative and Senators.  Go to:  http://capwiz.com/wheatworld/home/. 

CALIFORNIA STATE BUDGET – WILLIAMSON ACT.  Governor Arnold Schwarzenegger released the “May Revise” on Monday for the state budget year beginning July 1.  The $145.9 billion spending plan revises the budget he released in January; it calls for slightly more spending than the January proposal.  With increasingly high demand for scarce revenues for education and corrections he proposed to cut several existing programs.  A favorite target in past years was put on the block again yesterday, as the Governor proposed to eliminate $40 million in Williamson Act offsets.  The proposed cut is likely a pawn in the larger give-and-take of budget negotiations between the Governor and the legislature.  We’ll be watching and reporting on this item as negotiations progress. 

GLUTEN TURNS OUT TO BE FLOUR; CONGRESS HOLDS SAFETY HEARING.  The U.S. Department of Agriculture and the Food and Drug Administration announced last week that wheat gluten and rice protein imported from China and adulterated with the chemical melamine was actually mislabeled wheat flour.

The agencies also announced that the adulterated product was made into fish feed and distributed within the U.S. and Canada. Earlier, they reported that the adulterated product made it into hog and chicken feed.

None of the suspect ingredients have been used directly in the human food supply and none are thought to pose any risk to human health despite their use in animal feed.

The House Agriculture Committee held a hearing last week to investigate the government’s response to the discovery of the melamine-tainted imports. Representatives of both USDA and FDA testified.

DOE ANNOUNCES SMALL SCALE BIOFUELS GRANT PROGRAM.  The Department of Energy announced this week that it is accepting applications for up to $200 million over five years to support the development of small-scale cellulosic biorefineries. 

The available funding will be for biorefineries at 10 percent of commercial scale that produce liquid transportation fuels, bio-based chemicals and bioproducts used in industrial applications. 

DOE said these projects would complement $385 million awarded earlier for the development of six full-scale biorefineries. The full-scale biorefineries focus on near-term commercial processes, while the small-scale facilities will experiment with new feedstocks and processing technologies. The projects funded by the latest announcement will be operational within three to four years with commercial-sized plants to follow.

Another DOE program that has potential to spur the commercialization of cellulosic ethanol, the loan guarantee program authorized in the 2005 Energy Policy Act, is still in the application-review stage, the Department said in March.