The Department of Justice//USDA livestock competition workshop in Ft. Collins, CO, was the largest of the four workshops held so far this year with estimates of 1,500 in attendance. U.S. Attorney General Eric Holder and Secretary of Agriculture Tom Vilsack opened the session. Secretary Vilsack continued his past comments regarding consolidation in the meatpacking industry and the need for transparency and fairness in the marketplace. There was a wide variance of opinions with some producers stating their concerns about the unintended consequences of the rule, such as negative effects on value-added programs, more vertical integration, and government involvement over free-enterprise. Proponents of the rule argued that there needs to be more fairness and transparency in the marketplace. They noted the top four cattle packers control 80% of the steer and heifer market. Additional concerns included fewer buyers and greater power of the packers. Prior to the workshop, the National Pork Producers Council (NPPC) and the National Cattlemen’s Beef Association (NCBA) held a press briefing expressing their opposition to the proposed Grain Inspection, Packers and Stockyards Administration (GIPSA) rule. NPPC President Sam Carney said, “As written, the GIPSA rule would limit my ability to sell hogs. It's a solution in search of a problem. The markets work, and we don't need the government trying to 'fix' it. The GIPSA rule is overly broad and very vague. It would inject uncertainty into the market, stifle innovation, and lead to less, not more, competition in the livestock industry." R-CALF and other proponents of the rule also held an event the night before the workshop. The next DOJ/USDA competition workshop will be held in December in Washington, DC to focus on the retail sector.

U.S. Agricultural Exports Expected to Rise FY 2011 — USDA released its latest “Outlook for U.S. Agricultural Trade” and estimated fiscal year (FY) ’11 agricultural exports to reach $113 billion – an increase of $5.5 billion over FY ’10. This will be the second-highest level of exports since FY ’08, when agricultural exports reached $115 billion. Much of the increase is due to greater grain and feed shipments with most of the increase due to reduced competition from Russia, Kazakhstan and the Ukraine. FY ’11 livestock, poultry and dairy exports are forecast to increase $600 million over the 2010 forecast to $21.8 billion. Pork exports are forecast to reach $4.5 billion – up $350 million – mostly on greater volumes, especially to Japan and Mexico. Beef exports are unchanged at $3.2 billion, but demand is expected to remain strong in Asia. Poultry exports are forecast up $200 million, to nearly $5 billion, as economic conditions boost global demand. Variety meats are forecast up over $100 million to $1 billion.

Calls for Hearing on E-15 Petition — A group of 39 environmental, agricultural, motor vehicle, energy and power equipment industry groups are calling for congressional hearings on the pending Environmental Protection Agency (EPA) decision to increase the amount of ethanol permitted in gasoline. In letters to the House Energy and Commerce Committee and the Senate Environment and Public Works Committee, the group’s requested that hearings be held regarding the safety of the proposed increase of ethanol in gasoline from the current 10% to 15%. The letter states, “EPA has not released information about the mid-level blend’s impact on different types of road and non-road engines, nor has it released information about how it will prevent harm to consumers from ‘misfueling’ their engines with the incorrect blend.” The Renewable Fuels Association (RFA) said that the groups “already know E15 is effective and are pulling out the last stops to prevent seeing ethanol gain more market share.” Those signing the letter included the Alliance of Automobile Manufacturers, American Meat Institute, American Petroleum Institute, Boat Owners Association of the United States, Engine Manufacturers Association, Environmental Working Group, Friends of the Earth, Grocery Manufacturers Association, National Chicken Council, National Meat Association, National Turkey Federation and the Specialty Vehicle Institute of America. EPA has indicated it will make a decision this year on the petition filed in 2009 by the ethanol industry to raise the level of ethanol in gasoline to 15%.

P. Scott Shearer
Vice President
Bockorny Group
Washington, D.C.