Over 100 congressmen sent a bipartisan letter to Secretary of Agriculture Tom Vilsack asking that USDA’s Office of Chief Economist provide a comprehensive economic analysis of the proposed Grain Inspection and Packers and Stockyards Act (GIPSA) rule on livestock and poultry marketing. The letter said, “Such a broad rule that extends so far beyond Congress’ direction in the farm bill, and that would precipitate major changes in livestock and poultry marketing, requires a vigorous economic analysis. The analysis contained in the proposed rule fails to demonstrate the need for the rule, assess the impact of its implementation on the marketplace, or establish how the implementation of the rule would address the demonstrated need.” The letter, organized by Congressmen Collin Peterson (D-MN), chairman of the House Agriculture Committee, and Frank Lucas, ranking member of the committee, was signed by 115 members. Also, a number of members of the Florida congressional delegation sent a letter to USDA regarding the proposed rule. The Florida letter said, “Upon close review, this proposed rule contains many elements and almost exact wording that was discussed and eliminated by Congress when the farm bill was passed in 2008. It is our opinion that government should not take on the role of manipulating domestic supply, cost or prices. This proposed rule is a clear invasion of the government into the private marketplace.”

Reaction to Congressional GIPSA Letter — The National Pork Producers Council said, “It is imperative that producers know how much the GIPSA rule will cost them. Frankly, it’s unfathomable that a major regulation like this doesn’t have an analysis of its impact on the economy and jobs.” The National Cattlemen’s Beef Association said, “These 115 policymakers took the common-sense approach to rulemaking. To further regulate America’s farmers and ranchers with no aggressive economic analysis of the rule’s unintended consequences is foolish. Those supporting this rule are doing so blindfolded with no facts and figures.” R-CALF, a supporter of the proposed rule, strongly disagrees with the congressional letter asking for an economic analysis. In a press release, R-CALF stated, “The congressmen actually attacked the GIPSA rule on the basis that USDA ‘fails to demonstrate the need for the rule,’ and that the rule is ‘sweeping in its scope.’ We’re dumbstruck by this letter.” The release also said, “The need for the GIPSA rule is all around us; an ongoing exodus of farmers and ranchers from rural America, a shrinking food production system that’s leaving rural communities in shambles, and the fact our country’s dependency on imported food continues to grow.”

Record-High Soybean Crop, Estimated Corn Yields less than 2009 — USDA’s latest crop forecast puts U.S. soybean production at a record-high 3.41 billion bushels. This is up 1% from the previous record set last year. Soybean yield is estimated at 44.4 bu./acre. Corn production is forecast at 12.7 billion bushels, down 3.4% from last year’s record. Corn yield is estimated at 155.8 bu./acre, down 8.9 bushels from 2009, which would rank as the third highest yield on record.

Legislation to Halt E15 — Senator Kay Bailey Hutchison (R-TX) has introduced legislation that would halt the Environmental Protection Agency (EPA) from approving higher level ethanol blends until studies from the Consumer Product Safety Commission (CSPS) and the National Highway Traffic Safety Administration (NHTSA) are completed. Senator Hutchison said it is “irresponsible for the United States government to require an untested mandate, such as an increase in the percentage of ethanol mixed with gasoline, without all tests having been performed to guarantee there are no detrimental consequences on any American.” The Department of Energy has completed its studies of the effects of E15 on vehicle models 2007 and newer. Another study on vehicles 2001-2007 model years will be completed later this year. EPA is expected to announce a decision on the newer models this month.

Huge Agenda for Lame Duck Session — Congress is scheduled to return the week of Nov. 15 for a lame duck session that could see a number of issues addressed. Issues on the agenda include fiscal year 2011 appropriations bills, taxes (including Bush tax cuts, inheritance tax, ethanol blender’s tax credit, biodiesel tax credit, tariff on imported ethanol, research and development tax credit, etc.), Food & Drug Administration (FDA) food safety reform, and child nutrition reauthorization. The results of the November election will determine how many of these items are finalized this year and how many will be considered by the new Congress.

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