Washington Insider-- Monday

By DTN's Washington Insider

Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.

Democratic Senators Call for Longer-Term Renewable Fuels Standard

The Environmental Protection Agency should set long-term Renewable Fuels Standard mandates for biodiesel production covering years up to 2017, according to six Democratic senators. The six also urged EPA to end delays in setting annual RFSs, noting at a news conference last week that the agency currently is nearly 18 months late in announcing the standard for 2014.

Senators attending the event included Sens. Maria Cantwell, Wash., Dick Durbin, Ill., Al Franken, Minn., Heidi Heitkamp, N.D., Amy Klobuchar, Minn., and Jeanne Shaheen, N.H.

The White House Office of Management and Budget is reviewing the EPA’s plan to set three years’ (2014, 2015 and 2016) worth of renewable fuels blending mandates. The agency also says it is proposing and finalizing the RFS biomass-based diesel volume requirement for 2017 “on the same schedule.”

So it appears the Obama administration already was committed to accomplishing the goals outlined by the senators and to do so within the time frame requested by the group. However, last week’s news conference will give each of the six the cover they need to claim that it was their lobbying that pushed the RFS announcement over the line.

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China Boosts Spending on Domestic Agriculture

China last week finally got around to notifying the World Trade Organization of how much the government spent on domestic farm supports back in 2010. The report is likely to receive a great deal of attention from U.S. trade officials.

China spent $4 billion on product-specific farm subsidies in 2010, which is a 30% increase from the year before, while total non-product-specific support was $15.7 billion, a 10 percent increase from 2009, according to the notification. The notification notes an upward trend in China’s subsidies for farmers, with total product-specific support rising from $1.4 billion in 2007 to $2.4 billion in 2008 and to $3.08 billion in 2009. Years 2011 through 2014 remain to be reported to the WTO.

In comparison, U.S. and European Union product-specific domestic support in 2010 was $4.4 billion and $9.3 billion, respectively. U.S. and EU non-product-specific market support in 2010 was $5.5 billion and $913 million, respectively.

At the WTO’s Doha Round negotiations, the United States, among others, has called on China to reduce its trade-distorting agricultural subsidies, a suggestion that China repeatedly has rejected. Given the upward trend outlined above, some might consider it a victory if China were to agree to simply hold the line on its spending.

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Washington Insider: Tyson Adopts Poultry Antibiotic Use Program

There are many battlefields in the fight against antibiotic-resistant bacteria, so it is a positive sign that Tyson Foods has adopted new antibiotic use standards for poultry—and that the new approach includes USDA verification. It was designed to support procurement policies at schools, hospitals and other institutions.

Tyson, the largest poultry producer is going to some lengths to emphasize that it is the first company to adopt the new standards, and suggests that it will limit antibiotic use to controlling and treating diseases under veterinary oversight and prohibit it for growth promotion.

The company and the government believe that the standards will slow the emergence of antibiotic-resistant bacteria on farms for cattle, chickens, pigs and turkeys. Reducing use also may help maintain the drugs’ effectiveness over time in humans and animals.

The approach was developed by the nonprofit organizations Pew Charitable Trusts and School Food FOCUS that work with large school districts to find sources of healthier foods, and it is being verified by USDA. “It recognizes the importance of limiting the use of antibiotics, but also acknowledges that sometimes antibiotics are needed to treat food animals.

Tysons told the press that it has reduced the use of medically-important antibiotics in its chicken business over the past four years and that it expects to phase out the use of human antibiotics from its domestic broiler chicken flocks by the end of September 2017.

The National Procurement Initiative, a collaborative of 15 school districts that spend more than $36 million in annually on chicken, assisted Pew and School Food FOCUS in creating the standards. Kathy Lawrence, director of strategic development at School Food FOCUS, told the press that the organization hopes that this standard will set a new industry-wide expectation for responsible antibiotic use, independently verified by the US government. “We hope to see CRAU-labeled products served in all schools, as well as hospitals, and eventually to the public at large,” she said.

Companies that want to be verified as compliant with CRAU standards will be audited by the USDA Agricultural Marketing Service Quality Assessment Division and revisited several times each year. Poultry producers that meet the standards will be allowed to put a logo on their products.

Tyson Foods said its New Holland, Pa. complex is its primary supplier of chicken products to the national school lunch program received its certification in April. Craig Morris, deputy administrator of the AMS Livestock, Poultry and Seed Program, said the agency audited Tyson’s Pennsylvania plant at every level, including hatcheries, contract farms that raise the company’s chickens, feed mills and processing and packing facilities.

The initial certification was applied to poultry because it is the most frequently served protein in school meals, Gail Hansen, senior officer of Pew’s Antibiotic Resistance Project told the press. Hansen added that Pew and School Food FOCUS hope to establish standards for beef, pork and turkey in the future, but haven’t begun working on them yet. Each species would have separate standards.

“It’s easier for the poultry industry to make changes because companies typically own the birds and control so much of the supply chain,” Hansen said. “For pork and for beef, companies buy from independent farmers and ranchers so it is a different model and needs a different solution.”

It will be important to note how much support the new program receives from industry and interest groups. It is considered a strong step in the right direction by a number of industry observers but likely will be criticized heavily by some consumer organizations as insufficient because it does not ban “human use” antibiotics from livestock entirely. That suggests a continuing public debate on antibiotic policies that producers should watch carefully as it proceeds, Washington Insider believes.

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(GH/CZ)

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