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California Association of Wheat Growers (CAWG)

August 03, 2009

 

In This Issue

House Passes Food Safety Bill With Grain Farm Exemption

Senate Begins Debate on Ag Approps; Vote Set for Monday

House Leaders Release Derivatives Concept Paper

House Subcommittee Approves...Rail Antitrust Legislation

Senate Takes Step Toward Mexican Trucking Resolution

Groups Write USDA Research Head with Welcome, Support

Monsanto Buys Company to Reenter Wheat Breeding.

 

House Passes Food Safety Bill With Grain Farm Exemption

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The House approved food safety legislation this week that will dramatically expand Food and Drug Administration (FDA) authority over all aspects of the food system, but largely exempts grain operations from overly broad records access and traceability standards.

H.R. 2749 passed by a 283 to 142 vote on Thursday after failing to pass under suspension of the rules - which requires a two-thirds majority - just one day before.

The bill grants the FDA authority to oversee everything from food production and processing, to distribution and retail, and to ensure that imported food meets U.S. safety standards.

NAWG and coalition partners have been advocating for changes to the bill to ease the potential burden on grain farm operations, which pose extremely low risk to the health of the food system. House Agriculture Committee Chairman Collin Peterson (D-Minn.) was instrumental in pressing his Democratic colleagues, specifically House Energy and Commerce Committee Chairman Henry Waxman (D-Calif.), to include language appropriate to individual agricultural production sectors, including grains.

NAWG and other representatives of commodity producers wrote Peterson Thursday thanking him for his efforts, saying, "Though we recognize that there may be some outstanding issues remaining as the legislative process continues, we wish to recognize that your work, and that of your staff, was instrumental in easing our concerns and removing our objections to passage..."

 

Senate Begins Debate on Ag Approps; Vote Set for Monday

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The Senate began debate Thursday evening on the FY2010 agriculture appropriations bill, and votes on the bill will begin Monday.

On Friday, Senate Majority Leader Harry Reid (D-Nev.) filed a cloture motion to end debate on a substitute amendment to the bill, which would replace the House-passed version with a Senate version. A vote on that motion and a vote to end debate on the bill itself are scheduled for Monday evening.

The bill would provide $23.7 billion in discretionary funding to USDA, the Food and Drug Administration and other related agencies, an increase of $2.3 billion or 11 percent above 2009 levels and $100 million more than the amount requested by the Obama Administration. More than 80 percent of the bill's funding will go to food stamps and other mandatory programs.

Notable funding increases in the bill include a 25 percent increase for the Commodity Credit Corporation (CCC), which funds farm programs, and a significant funding boost for international food aid programs. PL 480, Title II, also known as Food for Peace, and the McGovern-Dole program would see an increase of 43 percent from 2009, totaling $1.9 billion.

Other increases include a 12 percent increase over 2009 levels for school breakfast and lunch programs, totaling $16.8 billion, and a 15 percent increase for FDA.

The Senate bill also includes $3.5 million to speed efforts to develop Ug99-resistant wheat varieties and $1 million for wheat genetic research at
Kansas State University.

For more on this process, please visit the Senate Appropriation' agriculture subcommittee online at  http://appropriations.senate.gov/agriculture.cfm

 

House Leaders Release Derivatives Concept Paper

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House Agriculture Committee Chairman Collin Peterson (D-Minn.) and House Financial Services Committee Chairman Barney Frank (D-Mass.) released a concept paper on derivatives regulation Thursday as the Commodity Futures Trading Commission (CFTC) continued a series of hearings on position limits.

Both Peterson and Frank, who head the two Committees responsible for financial market regulation, and the CFTC, which oversees $5 trillion in daily trading futures, are reviewing ways to effectively regulate so-called over-the-counter markets and are exploring the wisdom of position limits for commodities to curb possible excessive speculation.

Peterson said in a press release about the concept paper that he was pleased he and Frank "were able to come to agreement on so many principles with regard to OTC derivatives reform."

"I think we have come up with a responsible approach that bridges the differences between those members who want to completely eliminate the over-the-counter market and those who think that just greater transparency is all that is needed," he said. "Neither of those approaches is a real solution; what we are putting forth is."

Separately, at a hearing Wednesday, CFTC Chairman Gary Gensler said the question of if position limits should be set is no longer up for debate, and that his agency must request new authority from Congress to set position limits for all commodities.

NAWG continues to follow discussions about commodity futures regulation across
Washington and to work with U.S. Wheat Associates, which represents the industry on a  CFTC committee examining speculation. Both organizations believe the futures markets need to work effectively and fairly for all participants in the market.

The concept paper released this week is available online at
http://agriculture.house.gov/inside/Legislation/111/otc_principles_final_7-30.pdf

 

House Subcommittee Approves  Rail Antitrust Legislation

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The Courts and Competition Policies Subcommittee of the House Judiciary Committee approved the Railroad Antitrust Enforcement Act of 2009 (H.R. 233) by voice vote on Thursday. 

The bill would effectively remove a current antitrust exemption that enables railroads to gain clearance for mergers from the Surface Transportation Board rather than seeking the approval of the Department of Justice. Before approval, the Subcommittee adopted an amendment that would ensure the bill's provisions would not be applied retroactively to previously-approved transactions.
 
The bill is the House counterpart to a Senate version, S. 146, authored by Senator Herb Kohl (D-Wis.). Kohl and Senate Commerce Committee Chairman Jay Rockefeller (D-W.Va.) agreed in June to work toward comprehensive rail reform legislation, including the antitrust provisions.

Also, the Senate Commerce Committee held a hearing Wednesday to consider a number of nominations, including that of Daniel Elliott III as chairman of the STB. During the hearing, Elliott, an associate general counsel of the United Transportation Union since 1993, noted the relative financial strength of rail companies compared to past decades, and, upon pressing by Rockefeller, alluded that the 1980 Staggers Act is outdated. He also indicated that he would be "proactive" in addressing shipper concerns. Elliott is expected to receive full Senate confirmation as early as next week before the Senate adjourns for August recess.

 

Senate Takes Step Toward Mexican Trucking Resolution

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Language in the FY2010 Transportation/Housing and Urban Development appropriations bill, marked-up by the Senate Appropriations Committee this week, should help to ease a controversy over Mexican trucks on U.S. roads - and $2.4 billion dollars of tariffs imposed on American products by the Mexican government.

Mexico announced the tariffs on almost 90 American products after language in the FY2009 omnibus spending bill, approved earlier this year, ended a pilot program allowing Mexican trucks on U.S. roads.

The bill approved in Committee this week would allocate funds to ensure the safety of cross-border long haul shipments on Mexican trucks and direct the Obama Administration to address outstanding safety concerns. The Committee also urged the Administration to work with Mexican officials to come up with a proposal for full implementation of the cross-border trucking program - work that has been ongoing since the dispute began this spring.

NAWG and others in the agricultural industry have joined with the manufacturing and trucking industries to urge the Obama Administration and Congress to resolve the problem quickly, though, so far, wheat has not been an affected product.

NAWG supports allowing Mexican trucks to operate in the United States as long as they meet
U.S. safety standards.

 

Groups Write USDA Research Head with Welcome, Support

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NAWG and 14 other agricultural organizations wrote USDA Under Secretary for Research, Education and Economics Rajiv Shah this week welcoming him to his new post and committing to work with him as he works to further research agency reorganization efforts.

The groups said, in part:

"Your arrival heralds a new focus on national research priorities when our nation and the world need agriculture to solve immense challenges...The required innovation to grow more and healthier food and fiber will come through better research, including improved management and increased funding.  Competitive research has proven to achieve the best results for each investment.  It is also the area USDA must improve the most."
 
The letter noted that National Institutes of Health will spend $170 this year for every $1 spent by the USDA on competitive, fundamental research, and that since 1990, annual yield growth rates for corn, wheat, rice and soy have fallen compared to the prior three decades.

The groups also offered "full support" as Shah and USDA work toward establishing the National Institute of Food and Agriculture and the Agriculture and Food Research Initiative, created under the 2008 Farm Bill.

Signatories of the letter other than NAWG included American Farm Bureau Federation, the National Farmers Union and commodity organizations representing producers of barley, soybeans, corn, rice, canola, cotton, chicken and pork.

 

Monsanto Buys Company to Reenter Wheat Breeding

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Monsanto has announced that it has acquired WestBred, a Bozeman, Mont.-based company with extensive wheat germplasm assets, and will restart the process of eventually bringing biotech capabilities to the wheat market.
 
The acquisition will allow conventional and marker-assisted breeding in wheat to begin immediately, setting the stage for the development of biotech traits. Monsanto said it plans to initially focus biotechnology work on drought tolerance, nitrogen use and higher yield gains, with expected release in eight to 10 years, consistent with the company's development cycle. The company said it will explore herbicide-tolerant and disease-resistant biotech traits, but does not plan to include its Roundup Ready trait in wheat.
 
WestBred, owned indirectly by Barkley Seed, Inc., is a private company with germplasm assets in all classes of wheat. Monsanto acquired the company for $45 million.
 
The company cited continued work of NAWG, U.S. Wheat Associates and others in the wheat industry to demonstrate support for biotechnology as one reason for its movement. The two organizations, which work together on biotechnology policy through a joint committee, welcomed the announcement in a statement, saying:
 
 "The research challenges facing wheat are well known, as is the importance of this crop to world food supplies. This announcement comes at a time when basic research into agronomic improvements to wheat is critically needed.
 
"Over the past months and years, we have repeatedly voiced our support for biotechnology and outlined appropriate conditions for commercialization. We have also pressed trait providers to examine this issue carefully. 
 
"The industry is pleased that Monsanto and other private technology providers, as well as publicly-funded institutions such as the Kansas Innovation Center for Advanced Plant Design and CSIRO in Australia, have recently announced new wheat research investments, and we urge other organizations to follow suit."
 
Improving research with the ultimate goal of increasing yields 20 percent by 2018 is one of NAWG's four strategic initiatives, and NAWG staff and grower-leaders have worked through a variety of venues to consolidate support for biotechnology in wheat and demonstrate that support to both private and public technology providers.
 
"We have led the charge to increase wheat research dollars and make biotechnology's benefits available to wheat producers," said Karl Scronce, NAWG president and a producer in Klamath Falls, Ore. "We are extremely pleased with this week's announcement and look forward to working with Monsanto and others who might invest in this vital area."