FEDERAL NEWS
Climate Change: “A Work in Progress”.
A group of 22 Senators urged Senate Majority Leader Harry Reid (D, NV) this week to take up comprehensive climate change legislation this year and Reid met with the chairs of the six committees that have jurisdiction over the climate bill to see what’s doable before the end of the session.At issue is the possibility that political ill will generated over the health care reform battles is so deep that a true bipartisan bill is unattainable this year, despite the White House publicly stating climate change it its next big priority issue.
Sens. John Kerry (D, MA), Lindsey Graham (R, SC) and Joe Lieberman (I, CT) continue to work on what they believe is the climate package that can garner 60 votes, and while the actual language of this bill has been promised for a month, by week’s end the trio had still not sent a draft to the Congressional Budget Office (CBO) or EPA for review. The men said this week their goal is to release a draft bill during the third full week of April, which just happens to be the week of Earth Day, April 22.
Other Senators are concerned that Democrat leadership may use the budget reconciliation process to try and move climate change, the strategy it used to move health care reform amendments, and fights have broken out over off-shore energy exploration, cap-and-trade and a host of other components. Sens. Maria Cantwell (D, WA) and Susan Collins (R, ME) have a separate bill that’s starting to get attention from chamber moderates, and Kerry says he’s more than willing to pull components of that bill into his.
EPA Sued by 15 States over Greenhouse Gas Rulemaking.
EPA has been sued by 15 states to stop it from issuing greenhouse gas emissions rules and that number is expected to grow. Thus far Florida, Virginia, Texas, Alabama, Indiana, South Carolina and nine others have filed petitions with the U.S. Circuit Court of Appeals in Washington, DC. EPA’s first move could come later this month when it’s expected to issue emissions rules for cars and light trucks to increase fuel efficiency, with those rules leading to caps on large emitters not using so-called “best available” technology to cut emissions.
The states are asking the agency to reopen its “endangerment” finding, the decision that greenhouse gas emissions are a threat to human health and welfare, contending the agency relied to heavily on erroneous information from the United Nation’s climate panel, now embroiled in controversy over its findings. This week the UN admitted its 2006 report, “Livestock’s Long Shadow,” which claimed world livestock production was responsible for up to 18% of global greenhouse gas emissions – more than the world’s transportation sector – was “exaggerated” and “lopsided” in its findings.
The University of California-Davis also released this week the results of a study showing the UN report’s conclusions are “not relevant” to livestock production in developed nations, such as the U.S., and cannot be applied on a regional basis. UC-Davis said only 2.8% of global greenhouse gas emissions can be attributed to livestock production, while 26% of emissions come from transportation sources. EPA and the White House are confident the rulemaking will withstand the court challenges.
Senate Banking Approves Financial Rereg Bill; Commodity Market Portions still in Play.
While the Senate Banking Committee this week approved on a straight party line vote Chair Chris Dodd’s (D, CT) controversial financial market reregulation legislation – with GOP Senators refusing to offer amendments – the ag community’s attention is on the Senate Agriculture Committee as it works on its share of the overall package dealing with over-the-counter derivatives, swaps, position limit and related regulation. Dodd said the split vote does not signal his bill is in trouble, and his ranking member Sen. Richard Shelby (R, AL) said the bill will not go to the floor “polarized.”
The Commodity Market Oversight Coalition (CMOC), which includes the American Feed Industry Assn. (AFIA) and the Agricultural Retailers Assn. (ARA), sent a letter this week to Senate ag panel Chair Blanche Lincoln (D, AR) and her ranking member Sen. Saxby Chambliss (R, GA) making several recommendations as the ag panel gets ready to reveal draft legislation to regulate derivates and swaps.
This bill would likely be married to the overall financial reregulation package when it goes to the floor. Lincoln said this week she thinks some swaps contracts should be exempt from central clearing as many recommend. She said her bill will “incentivize market participants to clear,” adding clearing would be mandatory for standardized swaps and voluntary for others.
The CMOC recommended mandatory exchange trading for standardized derivative contracts; mandatory clearing requirements for all other contracts not being used by bona fide commercial hedgers to manage risk; a narrow end-user exemption to clearing and collateral requirements that gives true hedgers the needed flexibility and choice in hedging products; additional authority to the Commodity Futures Trading Commission (CFTC) to set speculative position limits; new enforcement authorities to the CFTC, and the budget and manpower the CFTC needs to enforce the new law.
The letter to lawmakers parallels comments filed with the CFTC on a proposed rulemaking on speculative position limits for certain energy contracts. In its comments, AFIA told the commission it supports the CFTC proposal to set boundaries on trading in the energy products, but urged the CFTC to extend the same framework to grains and other agriculture commodities. AFIA also recommended the commission seek additional congressional authority to apply the framework to Commodity Index Funds, and the CFTC should go after new authority to regulate OTC commodity markets trading in U.S. markets.
Battle Over Child Nutrition EQIP Funding Offsets Ramping Up.
The Senate Agriculture Committee this week approved reauthorization of USDA’s child nutrition programs, giving the federal government for the first time authority to regulate all food sold in the nation’s schools. The bill, authored by ag panel Chair Blanche Lincoln (D, AR), has been attacked by more than a dozen national and world environmental groups because it seeks to offset about half of its $4.5-billion cost by pulling $2.2 billion from USDA’s Environmental Quality Incentives Program (EQIP), a move, the environmental groups say will cut the baseline dollars available for conservation programs in the 2012 Farm Bill.
Sen. Charles Grassley (R, IA) said this week he wants to see amendments to the bill to find other ways to pay for the child nutrition programs, and Lincoln called EQIP a critically important program and pledged to work with her committee to find other offsets. However, the ag committee rejected an amendment by Sen. Saxby Chambliss (R, GA), ranking member, that would have taken the $2.2 billion out of the Conservation Stewardship Program, a favorite program of former committee chair Sen. Tom Harkin (D, IA), but a program far less popular than the EQIP program.
Also adding to the controversy surrounding the bill was an amendment approved by the committee from Sen. Sherrod Brown (D, OH) that creates an organic food school pilot program.
Senate Tax Credit Extenders Bill on Hold in House; Ethanol, Biofuel Bill Introduced.
A bill to reinstate thousands of federal tax credits retroactive to January 1, including $1-per-gallon credits for biodiesel and renewable diesel, apparently is a victim of the scramble to find offsets to pay for health care reform and its timing for House action is unclear, according to the chair of the House Ways & Means Committee Rep. Sander Levin (D, MI).
Meanwhile, Reps. John Shimkus (R, IL) and Earl Pomeroy (D, ND) circulated a “dear colleague” letter this week seeking support for a bill that would extend the 45-cent-per-gallon ethanol federal tax credit, as well as boosting other biofuel incentives, through 2015, a move sure to cause heartburn among the anti-ethanol forces.
Levin told the House Rules Committee this week he’s not sure when the bill will be addressed, blaming several Senate provisions that need to be reconciled with the House version. One $24-billion Senate offset – making “black liquor” produced in the pulp and paper industries ineligible for the alternative fuel mixture tax credit – was usurped by leadership as an offset to health care reform. This development signals a much longer time until the tax extenders bill is approved, and it could be late April – at the earliest – before the House acts.
FOOD AND DRUG ADMINISTRATION TO SOON FINALIZE PLAN on how they will sample grain and grain products for the presence of vomitoxin. The agency will collect approximately 200 total samples spit equally between human-grade milled wheat products and feed-grade products.
NATIONAL GRAIN & FEED ASSN TO MEET WITH OSHA ON SWEEP AUGER ISSUE. OSHA earlier sent out a “letter of interpretation” that established a new policy for operating sweep augers inside grain bins that said basically employees cannot work inside a bin while an unguarded sweep auger is in operation. NGFA has asked OSHA to withdraw and reconsider this interpretation.
STATE NEWS
STATE BOARD OF AGRICULTURE ADOPTED SEVERAL RULES at their March meeting. One of the rules increases the rate of the surety fee they charge state licensed warehouse from $10 to $20 per one thousand dollars of surety needed by the warehouseman. This is an option for those state licensed warehouses that chose not to provide a surety bond purchased through the private insurance sector.
GOVERNOR, SENATE AND HOUSE LEADERSHIP working to address the state budget shortfall issue. While some in state government are hopeful the cuts will be around 7%, sources indicate the final cuts to all but education, transportation, public health and public safety could be in the 10-12% range. One problem with the state budget is that these four areas consume about 90% of total funds, while education takes about 50%.
SOME VETS TAKING SCARE APPROACH to the teeth floating issue. A full page ad in the March 29, 2010 issue of the Daily Oklahoman by four veterinarians claim the bill to allow non vet’s to do “teeth floating” on horses will lead to sex offenders, drug dealers and gang members to legally purchase, possess and transport certain prescription drugs. The bill is supported by all of the state’s major producer organizations.
ODDS and ENDS
CONGRATULATIONS TO LEW MEIBERGEN for becoming the 13th member of the Oklahoma Agriculture Hall of Fame. Lew received the award at a special ceremony March 24 at the state capitol.
WHEAT DISEASE UPDATE. OSU’s Dr. Bob Hunger says wheat disease pressure is very light to non-existent in Oklahoma. Texas A & M extension pathologist report, however, that at College Station varieties with Jagger and Jagalene are showing severe symptoms of stripe rust.
UNIVERSITY OF ILLINOIS RESEARCHER SAYS FERTILIZER HARMS THE SOIL claiming that better soil quality was found in plots not fertilized over long periods of time. The Fertilizer Institute, the International Plant Nutrition Institute and others believe the study is fatally flawed and the data was mis-interpreted.
KANSAS STATE SENATE considering 10 year comprehensive transportation plan that would in part increase fuel taxes by 6 cents/gallon, increase car and truck registration fees, overweight fees and the sales tax by 0.2%.
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