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Beef, catfish, FTAs, farm bills and USDA funding

Vlsack speaks to reporters from the road in Vietnam. Topics include: the new farm bill, 2012 USDA funding, U.S. beef exports, free trade agreements and catfish inspections.

The new farm bill, USDA funding for FY2012, U.S. beef exports, free trade agreements and catfish inspections all came up during a Wednesday morning press conference with Agriculture Secretary Tom Vilsack.

On a tour to bolster U.S. agriculture trade, Vilsack spoke from Vietnam following a day of meetings. On Thursday, the U.S. delegation will travel to China for even more.

For more see Vilsack on Asian trade deals, promotion programs.

Earlier in the week, the conference committee announced it had come up with USDA fiscal year 2012 funds (see more here). In addition, committee members also inserted language preventing USDA from doing anything further on the GIPSA (Grain Inspection Packers and Stockyards Administration) rule and some nutrition standards and school lunch programs.

Backers say the GIPSA rule would prevent livestock producers from being subjected to unfavorable market conditions and rules favored by the packing industry.

“I haven’t had an opportunity to look at the appropriations bill …  but am familiar with (it),” said Vilsack. “Let me make a couple of general comments.

On the nutrition funding “we can assure and reassure the parents of school-aged children that USDA is going to do everything it can to implement the Healthy, Hunger-Free Kids Act in a way that encourages and improves nutritional opportunities for children. The language Congress is proposing will not necessarily interfere with that ultimate goal. Our youngsters will have access to more fruits and vegetables, more whole grains, more low-fat dairy, less sodium and sugar and fat.”

As for the GIPSA rule, past legislation “encourages and empowers the USDA to ensure a fair marketplace. As I traveled around the country … listening to concerns expressed by producers around the country, it became obvious we need to do more to ensure fair markets.”

For more on GIPSA, see here.

Following the rule proposal, Vilsack said some 66,000 people “weighed in and we always learn from (such) comments. At the request of the (livestock) industry we extended the comment period … and conducted an evaluation. From (those) we learned more and began the process of addressing some of the concerns raised.

“It’s no secret that we sent a proposal to OMB (Office of Management and Budget) that represented a first step in the finalization of that process. It was focused on 2008 farm bill definitions and … a fairer system for poultry producers who we heard loudly and clearly from in Alabama. The hope is always that both sides – both the executive branch and legislative branch – will respect the process.

“If, in fact, we’re being prevented from carrying out our responsibilities, that’s an unfortunate circumstance. But we’ll do whatever Congress allows and authorizes us to do to ensure, as best we can, fair markets.

“I’d be remiss if I didn’t suggest we’ll be disappointed if we cannot respond to the concerns expressed by producers across the country. But we’ll continue to work at it and do the best job we can to improve the Packers and Stockyards Act I’ll point out that it’s been 70 years since there’s been meaningful evaluation and changes to (GIPSA). There are a lot of producers who feel” that’s far too long.

Vilsack was also asked about reports that the South Korean parliament is having difficulty ratifying the Free Trade Agreement (FTA) recently passed by Congress. Will the deal have to be renegotiated?

“I don’t think it’s appropriate for me to speculate on that status of that agreement. I’ll make a couple of general comments.

“First, (South Korea) President Lee is clearly committed to the free trade arrangement that was negotiated. I’m sure he’s working diligently to get his parliament and congress to approve it.

“Second, we understand and appreciate the challenges that trade agreements can present. That was certainly true as (President Obama) used his goodwill with Congress and the agricultural community, in particular, weighed in to encourage members of our Congress who had questions and concerns, to ultimately ratify or approve these agreements…

“I am confident we’ll have a free trade arrangement with (South) Korea. And when we do it’ll be one beneficial to agriculture.”

Beef, catfish, WTO

Vilsack said one positive to come from the South Korean FTA will be in setting up future deals in the Far East, particularly with U.S. beef exports.

The South Korean FTA “basically provides us a roadmap that can be used to encourage other countries that have had questions or concerns in the past. That roadmap says ‘we can do this in stages. But the ultimate goal here is to have an open market without conditions or restrictions.’

“In discussions with the Vietnamese today, we made some progress (with) their agriculture minister acknowledging that in principle there’s an opportunity for us to expand offal trade. That would mean several million dollars of additional trade.

“As this relates to China: we continue to negotiate and make sure that what is negotiated follows that roadmap of compliance, a science- and rules-based system, and the recognition that this can be done in stages…

“I think the Chinese understand it’s in their best interest to have an agreement. They’re looking for ways to expand food security in their country and they know American livestock, American beef is high-quality and affordable.

“I think the Japanese are also very interested in, hopefully, coming to a better place on beef. We’ll continue to knock on that door and advocate for our cattle producers. Eventually that door will be answered … we just have to be patient.”

Another hot issue involves Vietnamese catfish exports to the United States. While he wasn’t expansive on the conversations, Vilsack did say the subject came up in meetings with Vietnamese officials.

For more on Vietnamese catfish imports, see here.

“Obviously, when we have conversations with ministers from other countries it’s give-and-take. As you’d expect, the issue of catfish was, in fact, raised.

“I reassured the minister we have an open and transparent process, that it’s important for us to open ideas and thoughts to comments and we’re in the process of looking at those comments and considering them carefully.

“I thought the catfish dialogue was important. We were trying to make the same point with the Vietnamese as they redo their food safety regulations (and) are engaged in putting together sanitary and phyto-sanitary standards. We encourage them to be open and transparent in those changes and allow the United States and other countries to weigh in with comments and suggestions. (That way) whatever is decided ultimately doesn’t run afoul of any international agreements and is consistent with our notion of a science-based, rules-based system.”

One of the last questions put to Vilsack involved the way the next farm bill is being written and how it will tackle payments to U.S. farmers. “We’re told leaders of the agriculture committees are writing a farm bill that is a retreat from market-oriented agriculture,” Vilsack was informed. “As we understand it, it would increase target prices for some commodities, it would allow government payments to producers after relatively modest losses. What message should U.S. trade partners take from … such moves that could, if there’s a price downturn, risk violating U.S. agreements to limit trade-distorting domestic farm subsidies?”

Vilsack was unwilling to engage the question as stated. “The most important part of your question is a two-letter word ‘if.’ … I’m not willing to agree to the premise of your question. … The framework and description of what this policy could be once work is completed by Congress. The work isn’t complete, isn’t done. Therefore, it’s premature for me to respond.

“The message we’re conveying to trading partners is we’re open for business, we want to continue to promote bilateral and multilateral trade agreements, we understand responsibilities under WTO and international agreements and expect to be in full compliance. The key for Congress, from my perspective, is in the formulation of a farm bill that they follow the principles I laid out several weeks ago. Part of that involves having an adequate safety net in place – consistent with international responsibilities – that understands and reflects the fact that we have disasters through no fault of producers…

“I anticipate the safety net being constructed … will rely more heavily on risk-management tools than in the past. And it’s one that, quite frankly, is not easy to craft because of the diversity of American agriculture…

“I don’t think we can make judgments today on what this product might look like since it’s still being developed.”  

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