For The Week Ending Feb. 7, 2014





President Obama today signed into law the 2014 Farm Bill, which the Senate approved Tuesday, following House passage early last week. The $956 billion measure, among other things, replaces direct crop payments with an insurance program that would kick in when farmers suffer losses. For the U.S. pork industry, the five-year Farm Bill includes trichinae surveillance and feral swine control programs, a provision requiring the Secretary of Agriculture to establish an Undersecretary for Trade and one requesting the U.S. Department of Agriculture to study setting up a catastrophic disease event insurance program and reauthorization of export promotion programs. Dropped from a final bill were provisions strongly backed by NPPC, including ones that would have prohibited USDA from doing further work on the so-called GIPSA Rule related to livestock contracts, fixed the Country-of-Origin Labeling law for meat to make it compliant with U.S. international trade obligations and prohibited states from dictating production practices for agricultural goods sold within their borders but produced in other states. NPPC kept out of the legislation the so-called Egg Bill, which sought to codify an agreement between the Humane Society of the United States and the egg industry on cage sizes for egg-laying hens. NPPC argued that allowing the federal government to dictate farm production practices for the egg industry would have set a dangerous precedent.


A bipartisan group of 21 attorneys general from across the country Wednesday filed a brief in the ongoing legal challenge brought by NPPC and a coalition of agricultural groups to the U.S. Environmental Protection Agency’s Chesapeake Bay total maximum daily loads (TMDL) regulation. The regulation sets TMDLs – the amount of pollutants, including otherwise unregulated farm and agricultural storm water runoff – that the bay can receive and still meet federal water-quality standards. EPA is forcing states to meet the standards, threatening the loss of federal financial assistance, among other penalties, to address pollution in the Chesapeake Bay. In its lawsuit pending before the U.S. Court of Appeals for the 3rd Circuit in Philadelphia, the coalition argues that the Clean Water Act does not authorize EPA to set standards for states, the agency’s action is a violation of long-established federalism principles, the regulation is arbitrary and capricious and the TMDLs were based on flawed computer modeling. The agricultural groups fear that the Chesapeake Bay TMDL program will be used as a model for regulating other waterways, including the Mississippi River, and could be used to limit the size of farms, force more burdensome and unnecessary regulations on farmers and restrict the application of manure to cropland. The coalition said such a “pollution diet” will cost taxpayers and farmers billions of dollars by the time it is fully implemented in 2025.


Russia has indicated that it plans to end the ban on imports of U.S. pork products by mid-March and possibly as soon as the end of February, according to Sergei Dankvert, head of Russia’s Veterinary and Phytosanitary Service (VPSS). Last year, Russia implemented a ban on imports of U.S. pork and beef that are produced with beta-agonists. Russia began requiring pork imports from the United States to show documentation that the pork does not contain ractopamine residues. The country also restricted U.S. pork imports through unscientific standards for tetracyclines and pathogens on raw product, standards that no country in the world can meet. The U.S. government, with NPPC and meat industry input, has been working to develop a commercial option for U.S. exporters to ensure beta-agonist-free pork for Russia. NPPC continues to work closely with other industry partners and the U.S. government to ensure Russia abides by World Trade Organization rules and reopens its market to U.S. pork. However, until Russia and the United States come to an agreement on how to meet Russia’s unscientific requirements, U.S. exports to Russia are at a standstill. As a result of the ban on U.S. pork, exports to Russia in 2013 decreased 93 percent. In 2012, U.S. pork exports to Russia totaled $267 million.


The U.S. Department of Agriculture this week released full-year export data, showing the U.S. pork industry shipped $6.1 billion, or about 2.14 million metric tons, of pork in 2013. Exports decreased by 4.3 percent in value and 5.2 percent in quantity compared with 2012 exports. Japan again was the No. 1 export market for U.S. pork, valued at $1.89 billion. Exports to NAFTA partner Mexico increased by more than 8.3 percent in value last year, totaling $1.2 billion in pork export sales. The Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) continues to be a great success for U.S. pork exports as tariff phase-outs continue. U.S. pork exports rose by 14.7 percent in value to participating DR-CAFTA partners last year and are expected to continue to increase. Two DR-CAFTA partners, the Dominican Republic and Honduras, saw significant growth in 2013, with value exports growing by 20.7 percent and 13.4 percent, respectively. Both markets account for nearly $100 million in annual U.S. pork exports. Separate free trade agreements with Colombia and Panama were implemented in 2012, and the value of pork exports to those countries in 2013 increased by 204.5 percent and 57 percent, respectively. Exports to China/Hong Kong grew 2.1 percent in volume on sales of nearly $1 billion. In the coming year, NPPC will continue to press the Obama administration to keep export markets open to U.S. pork and will advocate for the acceptance of new free trade agreements to expand U.S. pork exports abroad.


The Senate on Thursday unanimously approved the nomination of Sen. Max Baucus, D-Mont., as U.S. ambassador to China. Baucus, current Senate Finance Committee chairman, supported China’s 2001 accession to the World Trade Organization (WTO) and has made eight trips to China. “I have become a firm believer that a strong geopolitical relationship can be born out of a strong economic relationship, which often begins with trade,” Baucus said. The nominee cited negotiations for a Bilateral Investment Treaty (BIT) currently taking place between China and the United States and pointed out trade issues such as meat exports and Intellectual Property Rights, among others, as topics that need to be addressed in the negotiations. “The treaty will mark an important step in opening China’s economy to U.S. investors and leveling the playing field for American businesses,” said Baucus. China is the single largest potential market for the U.S. pork industry. NPPC is working closely with the U.S. government and other meat industry groups to preserve and expand trade with China. According to Iowa State University economist Dermot Hayes, if U.S. pork exports to China increase by 1 percent of China’s pork consumption, U.S. pork export values would increase by more than $1 billion and create more than 27,000 jobs in the United States. Senator Ron Wyden, D-Ore., is expected to succeed Baucus as chairman of the Finance Committee.




The 2014 National Pork Industry Forum will be held March 6-8, at the Sheraton Hotel Crown Center in Kansas City, Mo. For more information and to register for the joint NPPC-National Pork Board annual meeting, click here.


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