Georgia Farm Bureau's Leadership Alert - June 23, 2010

June 23, 2010

www.gfb.org

Vol. 28 No. 25

McCORKLE APPOINTED TO COUNCIL ON TAX REFORM McDuffie County Farm Bureau Vice President D.E. “Skeetter” McCorkle was one of two appointees by Lt. Gov. Casey Cagle to the Special Council on Tax Reform and Fairness, Cagle announced last week.

McCorkle is president and CEO of McCorkle Nurseries, which serves more than 1,800 customers in the Southeastern and Mid-Atlantic states. He is a past president of Southern Nursery Association and past chairman of the Georgia Green Industry Association, and has served on Georgia Farm Bureau’s Environmental Horticulture Advisory Committee.

“It was extremely important to Georgia agriculture that someone with knowledge and background in farming be involved in this process,” said GFB President Zippy Duvall.

“We are delighted that Skeetter has been appointed.”

Duvall visited with Lt. Gov. Cagle and House Speaker David Ralston in late May to request that their appointees to the council include individuals familiar with agriculture and its importance to Georgia. The production of food and fiber and related processing had a total economic impact in the state of $65 billion in 2008, creating more than 351,000 jobs that year.

Duvall also emphasized the importance of keeping sales tax exemptions for farm inputs, noting that many farms would be in jeopardy without the exemptions.

The council was set up under House Bill 1405, which passed the Georgia General Assembly last session in response to the state’s ongoing budget crisis.

Its purpose is to study the state’s tax revenue structure and make recommendations to the General Assembly by January 2011. The council’s recommendations are expected to form the basis of legislation that could be offered by a Special Committee to the General Assembly next year. HB 1405 allows for such legislation to be passed without amendment by an up or down vote.

Cagle’s other appointee is taxation expert Bradford Dickson of Sandy Springs.

The 11-member council was filled out with Speaker Ralston’s appointments of Macon real estate developer Roy Fickling and Mineral Bluff business executive A.D. Frazier Jr. The other seven positions were designated by statute. One is occupied by Gov. Sonny Perdue and two are to be filled by Suzanne Sitherwood, the 2010 chairperson of the Georgia Chamber of Commerce and Gerry Harkins, the 2010 Georgia chairperson of the National Federation of Independent Business. The other seats on the council are to be filled by Dr. David Sjoquist of Georgia State University, Dr. Jeffrey Humphreys of the University of Georgia, Dr. Roger Tutterow of Mercer University and Dr. Christine Ries of Georgia Tech.

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WTO ISSUES RULING IN FAVOR OF CHINA IN POULTRY DISPUTE In the ongoing poultry dispute between the United States and China, the World Trade Organization (WTO) ruled that a U.S. ban on imports of Chinese poultry violates the organization’s Sanitary and Phytosanitary Measures agreement, which outlines how governments can apply food safety, animal and plant health measures.

China filed its complaint with the WTO in April 2009, taking issue with a U.S. law that blocked funding that would facilitate imports of Chinese poultry. The U.S. can appeal.

Meanwhile, China continues tariffs on U.S. poultry imports and Russia continues its ban on poultry rinsed with chlorinated water, which includes virtually all poultry processed in the U.S. In 2009 Russia and China were the top two export destinations for U.S. poultry. Normally, U.S. producers ship 1.5 billion pounds of chicken legs per year to Russia China instituted a series of anti-dumping tariffs on U.S. chicken imports in February, including some that exceeded 100 percent of the product value. The tariffs were put in place after China’s Ministry of Commerce (MOFCOM) ruled that U.S. poultry was being sold at unfairly low prices in China, causing economic harm to Chinese poultry producers.

In late April, China imposed anti-subsidy tariffs on U.S. poultry, though industry analysts said at the time it would have minimal effect since little U.S. chicken was going directly to China.

Members of both houses of the U.S. Congress urged Obama administration officials to broach the subject of the Russian ban on U.S. poultry during an upcoming visit with Russian leaders and during the G-8 summit.

Last week, the United States Department of Agriculture announced its plans to purchase as much as $14 million worth of dark meat chicken products for federal nutrition assistance programs in an effort to alleviate poultry producers’ cold-storage stockpiles of chicken resulting from the Chinese and Russian trade sanctions, a move that could support dark meat pricing.

EPA CANCELS USE OF PESTICIDE ENDOSULFAN After concluding that endosulfan’s use poses risks to wildlife and agricultural workers that outweigh its benefits, the U.S. Environmental Protection Agency (EPA) canceled all applications of the pesticide, which has been in use on a wide variety of cultivated plants since the 1950s.

According to EPA documentation, endosulfan use decreased from 2001 to 2008 and the crops with highest use in the years 2006 through 2008 included tomatoes, cucumbers and squashes, potatoes, apples and cotton.

The pesticide manufacturer, Makhteshim Agan of North America, is in discussions with the EPA to put in place a six-year phase-out period to accommodate growers.

The EPA placed restrictions on endosulfan use in 2002, and the agency now says risks to workers exposed to endosulfan through inhalation and contact with the skin are greater than previously known. Humans and animals who consume aquatic prey that have ingested the chemical also face neurological and reproductive risks.

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BRAZIL AGREES TO RESOLUTION FRAMEWORK IN COTTON DISPUTE Brazil’s Ministers last week chose to support a framework in the South American country’s ongoing cotton dispute with the United States, avoiding the imposition of more than $800 million in countermeasures against U.S. exports and intellectual property, some of which were scheduled to go into effect on June 21.

The dispute centered on government payment and loan programs available to U.S. farmers, specifically the marketing loan and countercyclical payment programs and the GSM-102 Export Credit Guarantee Program.

The framework calls for a limit on cotton subsidies and outlines changes to be made to the GSM-102 program. Under the framework, which the office of United States Trade Representative Ron Kirk anticipates signing soon, the two countries would meet quarterly to discuss related provisions in the 2012 farm bill as that legislation is being developed.

Ambassador Kirk said the framework respects the role of Congress in the formation of the next farm bill while at the same time allowing the two countries to work toward a permanent resolution in the cotton dispute.

In April, representatives from Kirk’s office met with Brazilian officials and worked out a plan for the U.S. to provide $147.3 million per year in funding for technical assistance and capacity building programs for Brazilian cotton producers. The U.S. at that time also agreed to make changes to the Export Credit Guarantee Program.

On May 27, Rep. Jeff Flake (R-Ariz.) introduced HR 5439, which would reduce the Direct Payment rate for upland cotton producers by $147.3 million to offset the assistance to Brazilian producers. Rep. Barney Frank (D-Mass.) agreed to cosponsor the bill, which was referred to the House Committee on Agriculture.

USDA RELEASES FINAL DRAFT OF CROP INSURANCE PLAN The United States Department of Agriculture (USDA) released the final draft of the Standard Reinsurance Agreement (SRA) with the nation's crop insurance industry in what Ag Secretary Tom Vilsack referred to as “doing our part” at reducing the national deficit.

The 2008 farm bill authorized the USDA’s Risk Management Agency (RMA) to renegotiate the SRA effective for the 2011 crop year.

Vilsack said the plan will save the federal government $6 billion over 10 years, $4 billion of which would go toward deficit reduction. The remaining $2 billion will be invested in expansion of the Pasture, Rangeland, and Forage program, as well as providing a performance discount or refund for qualified producers; increasing Conservation Reserve Program (CRP) acreage to the maximum authorized level of 32 million acres and investing in other CRP programs.

The final draft agreement removes windfall government payments based on commodity price spikes by limiting the administrative and operating payments. It also lowered the average long-term return for crop insurance companies to 14.5 percent. The RMA will increase the return in underserved states to provide additional incentives for companies to sell policies in those states.

For more information about the new crop insurance plan, visit www.rma.usda.gov.

Leadership Alert page 4 of 4 UPCOMING EVENTS STRIPLING IRRIGATION RESEARCH PARK FIELD DAY June 29 Stripling Irrigation Research Park Camilla This free annual event begins at 8:30 a.m. and includes field tours of research and extension projects, a presentation from Richard Royal, chair of the Lower Flint-Ochlockonee Water Planning Council and from UGA College of Agricultural & Environmental Sciences administrators. A free lunch will be provided beginning at noon. Contact Heather Hunter with the Stripling Park at sirp@uga.edu or 229-5223623.

VOTE FOR GEORGIA IN THE GREAT PEANUT DEBATE Through June 29 Online The “Great American Peanut Debate� is a competition to see which state has the best peanuts. Voting ends at 5:00 p.m. on June 29, and the state receiving the most votes will be awarded a trophy at the annual Congressional Baseball Game on that day. Get everyone you know to vote for Georgia Peanuts! Cast your vote at www.cqrollcall.com/baseball 2010 SUNBELT AG EXPO FIELD DAY July 8 Spence Field Moultrie Field tours for this annual event begin at 8:30 a.m., but visitors are encouraged to arrive early. Attendees who register by 8:15 a.m. will be entered in an early bird drawing for $100. More than 140 varieties of cotton, peanuts, corn, soybeans and grain sorghum from 25 companies will be on display. The field day will also feature plots of energy grasses and the latest pesticide and irrigation technology research.

Certified crop advisor credits will be given for attending the event. Lunch will be served around noon.

Visit www.sunbeltexpo.com or call 229-985-1968 for more information.

GFB AG IN THE CLASSROOM PLU COURSE July 13-15 FFA/FCCLA Camp Covington July 19-21 GFB Headquarters Macon This fun three-day course, which runs from 8:30 a.m. to 4:30 p.m. each day and is matched to state standards provides two Professional Learning Units for teachers upon completion. It gives teachers a variety of classroom resources. Cost is $39 and includes lunches. To register, contact Donna Rocker at dhrocker@gfb.org or 800-898-1911, ext. 5365.