WEEKLY NEWS HIGHLIGHTS

COMPILED BY THE RED RIVER FARM NETWORK

Farm Bill Influenced by Budgets and Trade — South Dakota State University Economics Professor Tom Dobbs says the ’07 Farm Bill is is not the first one written during world trade negotiations. While the World Trade Organization process will influence the next farm bill, Dobbs believes Congress "will push through whatever subsidies the US government budget will bear; I think the budget is going to be a stronger influence then the WTO."

Input Cost Review — The American Farm Bureau Federation’s Input Cost Review Committee has completed its work. South Dakota Farm Bureau President Scott VanderWal served on the committee and says they didn’t find any silver bullets. "We found that there’s not a real good answer to a lot of the short term problems; fertilizer and fuel prices have come down a little bit from what they were late last year." Long-term, VanderWal is pleased the country is focused on the need for a solid energy policy.

Diesel Dilemma — As spring approaches, the demand for diesel fuel is increasing. Mike Derickson with CHS Energy the market will be volatile this year. "It does look a lot like last year–a lot of world tension and a lot of fund money showing up to help drive prices up." Derickson says there have been a record number of refinery turnarounds for normal mainteneance and to gear up for the production of ultra low sulfur diesel, starting in June.

House Hearing — The House Agriculture Subcommittee on General Farm Commodities and Risk Management reviewed the Federal Crop Insurance System Wednesday. Risk Management Agency Administrator Eldon Gould testified, saying farmers struggle with crop insurance. "With today’s farming margins as tight as they are, it probably takes 100 percent coverage to adequately cash flow; I’m not sure that anybody in the insurance business wants to guarantee 100 percent coverage."

Bipartisan Disaster — A bipartisan disaster bill has been introduced in the Senate. Co-sponsors include both Senators from South Dakota, Minnesota, and North Dakota. Senator Byron Dorgan expects House leadership to continue to oppose disaster relief. "I think there are Republican and Democrats in the Congress that understand the fairness of this issue; if you are going to provide the help that is needed in the Gulf who had weather related disasters and lost their crops, shouldn’t you then provide some help for others in other parts of the country that had weather related disasters and lost their crop?" questioned Dorgan, "I think the answer to that is yes."

Brazil GMO Labels — Within four years, Brazilian exports of biotech crops will bear a label saying the cargo contains GMO’s. Currently, the shipment carries labeling that says it ‘may contain GMO’s.’ Other large exporters, such as the US, Argentina, Canada and Australia have not signed the United Nations protocol, fearing it would allow importers to use it as a de facto trade barrier.

Acreage Mix — According to a survey by Farm Futures magazine, US growers plan to plant two percent fewer corn acres and boost soybean acreage by four and a half percent. State-by-state analysis indicates farmers in the Western Cornbelt will plant less corn and more soybeans in 2006. In Illinois and Indiana, corn acreage will hold steady or increase.

Corn Duty — The $1.65 duty on US corn shipped into Canada will remain. The Canada Border Services Agency issued its final determination, saying US corn is being dumped and subsidized. The antidumping and countervailing duties will continue to be imposed until April 18th, 2006. The US Corn Coalition is disappointed with the ruling. In its testimony to the International Trade Tribunal, the Coalition said the evidence does not show Canadian growers have been injured by imports of US corn.

Cutback — While the USDA is investigating its third case of BSE, the federal government is preparing to reduce the number of cattle tested for the disease. Through the enhanced BSE surveillance program, approximately 1,000 tests are conducted each day. USDA’s budget proposal would limit testing to just over 100 head per day. The higher testing level, which went into place two years ago, was designed to be a temporary system.

BSE Draws Out Comments From Lawmakers — South Dakota Senator Tim Johnson and Representative Stephanie Herseth are using the positive BSE finding to promote mandatory country of origin labeling. The lawmakers say COOL would add transparency and efficiency to US efforts to prevent BSE.

ID Needed — With the latest BSE discovery, there are renewed calls for a mandatory animal ID system. Iowa Senator Chuck Grassley says this has become a divisive issue. In his mind, a mandatory system will happen in one of two ways. "Either you have to have somebody in the USDA with guts enough to make a decision that were moving forward or else Congress is going to have to act."

23, 24 — This past week, Japan confirmed its 23rd and 24th cases of BSE. A 14-year old beef cow was the latest case.

FSA Announces Changes to MILC, DCP and Counter-Cyclical Payments — As part of the Deficit Reduction Act, the maximum advance direct and counter-cyclical payment percentage drops from 50 percent to 40 percent for this crop year, and to 22 percent for the 2007 crop year. The Milk Income Loss Contract Program is extended through August 31st, 2007, but payments are reduced from 45 percent to 34 percent of the difference between $16.94 per hundredweight and the Boston Class I milk price.

Animal Welfare — The Animal Welfare Coalition, which includes livestock producers, packers, and retailers, met last week in Chicago. National Pork Board President Danita Rodibaugh says consumers and retailers are exerting greater influence on livestock production, but they still understand the system must be practical for the producer. "Through our discussions, they have really come to understand what’s practical for producers and what’s creditable for them with their consumers," said Rodibaugh, "McDonalds, Burger King, Safeway and WalMart–they’ve all taken ownership of this type of approach."

SD Eliminates Semen Tax — South Dakota was the only state that had a sales tax for livestock semen sales. This past week, Governor Mike Rounds signed legislation repealing the tax. South Dakota Pork Producers Council President Brad Greenway says this change puts state livestock producers on a more level playing field with the rest of the country.

Preferred Processor — Yield goes beyond the production in the bin, it may also impact the fuel in the tank. Monsanto Processor and Preferred Marketing Manager Steve Peterson says hybrids have been identified that meet the needs of dry grind ethanol plants. "These hybrids will yield anywhere from two to four percent additional ethanol when processed through a dry grind plant, versus commodity corn from that area," said Peterson, "We’ve created a program to provide incentives to growers who produce those hybrids for ethanol plants." Monsanto is working with General Motors to offer discounts on flex-fuel vehicles for those participating in the processor preferred program.

Cuphea Could be a Cash Crop — Proctor and Gamble sees potential in cuphea. Cuphea produces an oil that contains lauric acid—a water-soluble foaming agent used in cosmetics, detergents, and soaps. Approximately 300 acres of cuphea are being planted in North and South Dakota this spring. If the crop does well, USDA researchers claim Proctor and Gamble could eventually want at least one-million acres of cuphea produced.

SD EPA Awards — Six South Dakotans have received the 2006 Friend of the EPA Award. The honorees included four South Dakota State University faculty members; Extension Soil Specialist Jim Gerwing, Extension Farm Machinery and Safety Specialist Dick Nicolai, Extension Swine Specialist Bob Thaler and Extension Beef Specialist Julie Walker. Jeff Hemenway of the Natural Resources Conservation Service and Jeanie Votava with the South Dakota Department of Natural Resources also received the honor. The awards were given in recognition of their work on manure management training for South Dakota producers.

SD Hall of Fame Directors — The South Dakota Hall of Fame Board has elected six new directors. They are Lana Kastens of Chamberlain, Lynn Duling of Dixon, Glenn Jorgenson of Sioux Falls, Roger Kasa of Huron, Gerry Berger-Law of Clear Lake and Richard Ekstrum of Kimball.

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