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Business of buying

Checkoff survives

The mandatory pork checkoff survives following an out-of-court settlement between USDA and the National Pork Producers Council (NPPC) and Michigan Pork Producers Association. The two pork groups brought a lawsuit against USDA to keep the checkoff in place even though a referendum among producers struck down the checkoff. The checkoff pulled in $54 million/year to promote pork.

All parties agreed to the settlement that requires another look at the checkoff in 2003. The settlement mandates that USDA conduct a survey of producers after June 2003. If 15% want another checkoff vote, one will then be held.

The biggest change made under the settlement is a clear separation between NPPC and the National Pork Board, which governs the checkoff. NPPC severed its role of running checkoff-funded programs and now works only with non-checkoff duties. These duties include legislative policy and regulatory issues. NPPC employees working on checkoff programs may transfer their employment to the Pork Board.

The agreement also allows the Pork Board to remain at its headquarters in Clive, IA. NPPC owns these headquarters and may lease office space to the board. But NPPC must then move its office elsewhere.

A statement from NPPC reports, “NPPC has agreed to this settlement for a simple but extremely important reason. This settlement fulfills our overarching goal of continuing the highly effective pork checkoff for the benefit of every pork producer.” State pork producer organizations will not change.

For a complete copy of the settlement, go to, click on “Industry News,” then click on “Pork Checkoff Referendum News” and click on “Settlement Agreement Between USDA and NPPC.”

Certified seed

When buying corn seed this spring, ask for a quality verification certifying the seed is clear of StarLink. The American Seed Trade Association (ASTA) is asking its members to provide certification that shows the corn seed has been tested for the unintentional presence of Cry9C protein (StarLink) and found negative. ASTA includes 250 member companies that market the majority of corn seed in the U.S. The organization says the members are committed to not selling any planting seed that tests positive for the protein.

How you buy tractors

Crop farmers tend to buy tractors from their local equipment dealer, according to a recent e-mail poll of 300 Farm Industry News readers. About 48% of these farmers say they always prefer to buy a tractor locally. How far away is the dealer? An average of 20 miles.

When buying a tractor, 35% of our farmer readers say they prefer to buy a new tractor, whereas 43% prefer to buy a used one. Once they buy a tractor, our readers say they keep it an average of 12 years.

The top three factors driving our readers' tractor buying decision are price, performance and service. In addition, the majority want a tractor that is versatile for many jobs around the farm.

Record ag banking profits

The agricultural banking business was good last year. AgriBank FCB and Seventh District Farm Credit associations posted a record $316.4 million in net income on an $18 billion loan volume for 2000. Income a year earlier was $217.7 million. The health of ag banking, however, does not always indicate the health of the farm economy, cautions William Collins, AgriBank CEO. “The U.S. government has played a critical role in stabilizing the farm economy,” he says. The farm assistance package has helped farmers and the banking business.

Mixed profit report

CNH Global (Case and New Holland) reported revenues of $10 billion for 2000. This is down from $10.7 billion in 1999. The company states that the decrease is due primarily to unfavorable foreign exchange on equipment sales.

However, in the fourth quarter of 2000, the company posted an operating margin loss of $11 million, which is a significant improvement over a $114 million loss in the same period of 1999. According to the company, merger-related profits helped reduce the losses.

No super weeds

The threat of super weeds developing through genetic modification may be greatly overblown, according to recent reports from Nature magazine. A study of genetically modified (GM) crops over 10 years shows these crops do not survive well in the wild. The study looked at oilseed rape, potato, maize and sugar beet grown in Britain. None of the GM crops proved to be more invasive or persistent than conventional crops, the magazine reports.

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