A news release on Tuesday from the House Agriculture Committee indicated that, “Today, Rep. David Rouzer (NC-7), Chairman of the House Agriculture Committee’s Subcommittee on Livestock and Foreign Agriculture, held a hearing on the market outlook for the livestock, dairy and poultry sectors. This was the final hearing in the Focus on the Farm Economy series, where each of the six subcommittees examined the growing pressures in rural America from the perspective of their subcommittee [note that a summary of the first five hearings can be found here]. Members heard from a panel of witnesses who highlighted the current conditions farmers and ranchers are facing as well as their concerns with recent and proposed regulations.
“‘Many farmers and ranchers across rural America are facing significant financial challenges. Producers are experiencing a decrease in commodity prices with no relief in sight, markets are weak, and over the past three years, net farm income has fallen by 56 percent. Farmers are facing razor tight margins, making them even more vulnerable to any additional regulatory burdens.’ said Subcommittee Chairman Rouzer.
Dr. Scott Brown, a Professor at the University of Missouri, noted at Tuesday’s hearing that, “Extreme livestock market volatility has become expected by all. Long-term survival may depend critically on risk management plans adopted by individual operations. Marketing livestock or milk using a cash market strategy is a risk management strategy that works well in rising markets but provides little help in declining markets.
“Cattle markets have seen the droughts of 2011 and 2012 in major areas of cow-calf production in the United States contribute to the record cattle prices in late 2014 and early 2015. Although cattle markets have fallen substantially from the record highs, 2016 will still be another year of positive returns.”
Dr. Brown added that, “In summary, it remains clear that U.S. meat and milk supplies are going to continue to increase perhaps well into 2017. Global demand and strengthening U.S. meat and dairy exports will be needed to move livestock and dairy market prices higher. Strong domestic demand must continue as well. Federal livestock and dairy policies must address the added volatility that comes as a result of more emphasis on global markets. Weather will remain another big risk for livestock producers and the support provided by federal programs like the Livestock Forage Program (LFP) are a much needed help against catastrophic weather events.”
David Herring, who testified on behalf of the National Pork Producers Council, pointed out on Tuesday that, “Another regulation that could have a profound negative effect on U.S. pork producers is the ‘Waters of the United States’ (WOTUS) rule issued last year by the U.S. Environmental Protection Agency and the U.S. Army Corps of Engineers.
“The rule was promulgated ostensibly to clarify the agencies’ jurisdiction under the Clean Water Act (CWA) over various waters. Historically and based on several U.S. Supreme Court decisions, those waters were limited to navigable waters, their tributaries and adjacent water bodies that are hydrologically connected or that otherwise affect navigable waters.
“Certainly, pork producers are concerned about water quality, and they take a broad view of what it means to be environmentally responsible farmers and business people and have embraced the fact that their operations must protect and conserve the environment and the resources they use and effect. Producers have made major commitments to environmental conservation, including meeting EPA’s stringent zero-discharge standard that is part of the 2008 CAFO (Concentrated Animal Feeding Operation) rule and participating in a historic study of air emissions from farms.
“But the WOTUS rule issued by EPA – over some objections from the Corps of Engineers – is overbroad, vague and fails to let regulated parties know what conduct violates the law. It includes, among other water bodies, upstream waters and intermittent and ephemeral streams such as the kind farmers use for drainage and irrigation. It also encompasses lands adjacent to such waters.”
Also with respect to the WOTUS issue, Politico’s Morning Agriculture reported today that, “For a while it looked like North Dakota District Court Judge Ralph Erickson was champing at the bit to tackle the Obama administration’s water rule, issuing a 13-state stay of the rule just hours before it was scheduled to go into effect, and then moving forward with proceedings even after the 6th Circuit Court of Appeals ruled that the morass of lawsuits belonged with it in appellate court. But after the 6th Circuit declined an en banc review of that decision, Erickson this week threw in the towel, staying his case to avoid ‘duplicative’ proceedings. The move is a blow for opponents of the water rule, who appeared to have a sympathetic ear in the district court judge and had pressed Erickson to take up the case given that his court wasn’t technically bound by the 6th Circuit’s ruling.”
