[Senate Hearing 114-644]
[From the U.S. Government Publishing Office]
S. Hrg. 114-644
A REVIEW OF THE
U.S. LIVESTOCK AND POULTRY SECTORS:
MARKETPLACE OPPORTUNITIES AND
CHALLENGES
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON AGRICULTURE,
NUTRITION, AND FORESTRY
UNITED STATES SENATE
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
__________
MAY 26, 2016
__________
Printed for the use of the
Committee on Agriculture, Nutrition, and Forestry
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Available via the World Wide Web: http://www.agriculture.senate.gov
__________
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COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
PAT ROBERTS, Kansas, Chairman
THAD COCHRAN, Mississippi DEBBIE STABENOW, Michigan
MITCH McCONNELL, Kentucky PATRICK J. LEAHY, Vermont
JOHN BOOZMAN, Arkansas SHERROD BROWN, Ohio
JOHN HOEVEN, North Dakota AMY KLOBUCHAR, Minnesota
DAVID PERDUE, Georgia MICHAEL BENNET, Colorado
JONI ERNST, Iowa KIRSTEN GILLIBRAND, New York
THOM TILLIS, North Carolina JOE DONNELLY, Indiana
BEN SASSE, Nebraska HEIDI HEITKAMP, North Dakota
CHARLES GRASSLEY, Iowa ROBERT P. CASEY, Jr., Pennsylvania
JOHN THUNE, South Dakota
Joel T. Leftwich, Majority Staff Director
Anne C. Hazlett, Majority Chief Counsel
Jessica L. Williams, Chief Clerk
Joseph A. Shultz, Minority Staff Director
(ii)
C O N T E N T S
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Page
Hearing(s):
A Review of the U.S. Livestock and Poultry Sectors: Marketplace
Opportunities and Challenges................................... 1
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Thursday, May 26, 2016
STATEMENTS PRESENTED BY SENATORS
Roberts, Hon. Pat, U.S. Senator from the State of Kansas,
Chairman, Committee on Agriculture, Nutrition, and Forestry.... 1
Stabenow, Hon. Debbie, U.S. Senator from the State of Michigan... 2
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota.... 4
Heitkamp, Hon. Heidi, U.S. Senator from the State of North Dakota 6
----------
WITNESSES
Brunner, Tracy, President, National Cattlemen's Beef Association,
Cow Camp Feedyard, Inc., Ramona, KS............................ 7
Truex, Ronald, Chairman, United Egg Producers, Creighton
Brothers, LLC, Atwood, IN...................................... 8
Hill, Howard, Past President, National Pork Producers Council,
Breeze Hill Farms and H&K Enterprises, Cambridge, IA........... 10
Goggins, Joe, Producer, U.S. Cattlemen's Association, Vermilion
Ranch Co., Public Auction Yards, & Northern Livestock Video
Auction, Billings, MT.......................................... 12
Zimmerman, John, Producer, National Turkey Federation/Minnesota
Turkey Growers Association, P&J Products, Northfield, MN....... 14
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APPENDIX
Prepared Statements:
Leahy, Hon. Patrick J........................................ 42
Thune, Hon. John............................................. 45
Tillis, Hon. Thom............................................ 49
Brunner, Tracy............................................... 50
Goggins, Joe................................................. 57
Hill, Howard................................................. 64
Truex, Ronald................................................ 77
Zimmerman, John.............................................. 81
Document(s) Submitted for the Record:
Roberts, Hon. Pat:
Written letter to Hon. Tom Vilsack concerning rules proposed
by Grain Inspection, Packers and Stockyards Administration
(GIPSA), April 19, 2016.................................... 88
Written letter to Hon. Gene Dodaro concerning Foot-And-Mouth
Disease (FMD), April 28, 2016.............................. 90
``A Review of the U.S. Livestock and Poultry Sectors:
Marketplace Opportunities and Challenges'', written
testimony of Livestock Marketing Association (LMA)......... 92
Question and Answer:
Brunner, Tracy:
Written response to questions from Hon. Pat Roberts.......... 100
Written response to questions from Hon. Joni Ernst........... 101
Written response to questions from Hon. Thom Tillis.......... 101
Written response to questions from Hon. John Thune........... 103
Written response to questions from Hon. Patrick J. Leahy..... 103
Written response to questions from Hon. Robert Casey, Jr..... 107
Goggins, Joe:
Written response to questions from Hon. Pat Roberts.......... 108
Written response to questions from Hon. Joni Ernst........... 108
Written response to questions from Hon. John Thune........... 109
Written response to questions from Hon. Patrick J. Leahy..... 111
Written response to questions from Hon. Robert Casey, Jr..... 114
Hill, Howard:
Written response to questions from Hon. Pat Roberts.......... 116
Written response to questions from Hon. Thom Tillis.......... 116
Written response to questions from Hon. John Thune........... 119
Written response to questions from Hon. Patrick J. Leahy..... 120
Written response to questions from Hon. Robert Casey, Jr..... 125
Truex, Ronald:
Written response to questions from Hon. Pat Roberts.......... 127
Written response to questions from Hon. John Thune........... 128
Written response to questions from Hon. Patrick J. Leahy..... 129
Written response to questions from Hon. Robert Casey, Jr..... 132
Zimmerman, John:
Written response to questions from Hon. Pat Roberts.......... 135
Written response to questions from Hon. Thom Tillis.......... 136
Written response to questions from Hon. John Thune........... 137
Written response to questions from Hon. Patrick J. Leahy..... 138
Written response to questions from Hon. Robert Casey, Jr..... 142
A REVIEW OF THE
U.S. LIVESTOCK AND POULTRY SECTORS:
MARKETPLACE OPPORTUNITIES AND CHALLENGES
----------
Thursday, May 26, 2016
United States Senate,
Committee on Agriculture, Nutrition, and Forestry,
Washington, DC
The committee met, pursuant to notice, at 10:03 a.m., in
room 216, Hart Senate Office Building, Hon. Pat Roberts,
Chairman of the Committee, presiding.
Present or submitting a statement: Senators Roberts,
Boozman, Hoeven, Ernst, Tillis, Sasse, Grassley, Thune,
Stabenow, Brown, Klobuchar, Bennet, Gillibrand, Donnelly,
Heitkamp, and Casey.
STATEMENT OF HON. PAT ROBERTS, U.S. SENATOR FROM THE STATE OF
KANSAS, CHAIRMAN, U.S. COMMITTEE ON AGRICULTURE, NUTRITION, AND
FORESTRY
Chairman Roberts. Good morning. I call this meeting of the
Senate Committee on Agriculture, Nutrition, and Forestry to
order.
We have a variety of farmers and ranchers from across the
country here today to give us their perspectives on marketplace
opportunities and challenges in the livestock and the poultry
sectors. Who better to testify before this committee than
producer leaders representing these industries that play such
an important role in the economic stability of rural America
and certainly in my home State of Kansas and in the state of
every member that is privileged to serve on this committee.
It has been five years since our last committee hearing on
the state of the livestock and poultry sectors. Thank you to
Senator Heitkamp for making this suggestion, and we agreed some
time back that it was time. I know everyone is interested to
hear about the many events that have taken place during this
period that have impacted the economic standing of your
industries as well as future opportunities and challenges for
growth.
Now, the livestock industry and the poultry sectors,
weather ebbs and flows every day. One could argue that recent
years have seen greater volatility and unpredictability than
most. Today's livestock and poultry producers are operating in
a highly cyclical marketplace. One year, they may receive
record prices for their animals, and then the next see a
dramatic drop in value, like we have seen recently in the beef
sector. Other events, like the diseases that have ravaged the
egg, pork, and turkey sectors, can leave our producers with
little to no income for months on end.
Unfortunately, we know there has been significant erosion
in farm equity due to these disease outbreaks and marketplace
volatility. Some producers were unable to weather that storm.
Add into this equation the reality that this is an industry
where the good times are typically composed of margins of just
a few cents or a few dollars per animal and you begin to
understand what a tough business animal agriculture is.
This reality demonstrates just how savvy today's farmers
and ranchers must be in order to make a living, and that this
is a livelihood not for the risk averse or the faint of heart.
Yet I am confident that even in the face of today's challenges,
the industries represented here will continue to lead the world
in delivering safe and affordable meat products to our
consumers.
The importance of this sector to my home State of Kansas is
immense, not to mention the home states of everybody on the
Committee. Eastern Kansas is known for its rolling Flint Hills,
spotted with grazing cattle. Western Kansas is home to some of
the country's largest and most modern beef feedlots. Kansas is
the third largest beef producing state in the country, with
deference to Texas and Nebraska. I hate to say that, really,
but that is true.
Senator Sasse. You are welcome.
Senator Stabenow. Uh-oh.
[Laughter.]
Chairman Roberts. It is also experiencing growth in pork
production, which is a boon to many of our small rural
communities.
These sectors present here today are a significant driver
of our rural economies. In fact, according to the most recent
USDA Agriculture Census, the beef, pork, and poultry sectors
account for 36 percent of the total agriculture sales on an
annual basis, and that number is only going up. Sales of
cattle, hogs, poultry, and eggs also accounted for $141 billion
annually. That is a billion with a ``B'', not an ``M.'' These
are impressive numbers.
Thank you for taking the time away from your farms and your
ranches and your businesses to educate your elected officials
about your industries.
I ask unanimous consent to include in the record, testimony
submitted by the Livestock Marketing Association.
[The statement of the Livestock Marketing Association can
be found on page 92 in the appendix.]
Chairman Roberts. I now recognize the Ranking Member, the
distinguished Ranking Member of our committee, Senator
Stabenow.
STATEMENT OF HON. DEBBIE STABENOW, U.S. SENATOR FROM THE STATE
OF MICHIGAN
Senator Stabenow. Well, thank you very much, Mr. Chairman.
This is a very important hearing and we welcome all of our
witnesses and appreciate the chance to highlight a very
important part of the agricultural economy.
As we know, the last several years have been challenging,
as the Chairman said, for livestock producers, and it is one of
the reasons why the 2014 Farm Bill made many of the important
investments that help support and bolster this important
segment of American agriculture. In fact, one of the first uses
of the 2014 Farm Bill was the activation of the livestock
disaster programs, which have paid out more than $5.8 billion
to date and helped producers across the country when they faced
extreme weather conditions, like droughs, blizzards, and
wildfires.
The Farm Bill also expanded the voluntary conservation
programs that give our farmers and ranchers the tools they need
to address issues on their own instead of regulation. USDA
voluntary conservation programs make it easier for a rancher in
Kansas or a turkey producer in Michigan to improve wildlife
habitat, livestock forage, and water quality through programs
like the Environmental Quality Incentive Program or the
Agricultural Conservation Easement Program. In addition, the
new Regional Conservation Program provides opportunities for
locally led conservation solutions to issues like improving
water quality in our Great Lakes and addressing endangered
species issues like the sage-grouse in the West.
However, for USDA conservation efforts to be successful, I
would ask today for your continued help to encourage more
producers to take advantage of these opportunities and tell
their story about why voluntary conservation is the best way to
address resource concerns.
As we look to other issues impacting our livestock
industry, we know how important it is to make investments in
agriculture research. In fact, this need was underscored by
last year's rapid emergence of highly pathogenic avian
influenza, which affected more than 48 million birds in 15
states, and we know what that meant. This type of animal health
crisis has devastating economic impacts on our producers,
drives up the cost of food for consumers, and threatens
international trade. That is why the investments we made
through the Farm Bill to establish the new Foundation for Food
and Agriculture Research are so important, and I look forward
to seeing the Foundation begin to roll out new programs shortly
to support your efforts.
Despite these challenges, however, there are also plenty of
reasons for the livestock sector to be optimistic. As I look to
my home State of Michigan, I see livestock producers breaking
new ground on processing facilities, expanding into new value-
added markets like organics.
Just last summer, the Clemens Food Group broke ground in
Coldwater, Michigan, on one of the first new Michigan pork
processing facilities in decades. They are expected to create
800 jobs and will source from producers in Michigan and
throughout the Midwest.
Nationwide, the demand for organic eggs has more than
doubled since 2012, and producers like the Herbruck's in
Michigan have continued to step up to meet the need. Now is the
critical time to ensure that we continue to support these
organic producers so organic eggs can continue to be available
and affordable for American families.
Lastly, Mr. Chairman, I want to highlight action by this
committee last year to unanimously pass and get signed into law
a reauthorization of mandatory price reporting, which we did
together. This authorization made important advances that were
supported by producers to increase market transparency, and I
am pleased we are able to do this in an overwhelmingly
bipartisan way.
Mr. Chairman, I appreciate you holding this hearing. Again,
I stand ready to work with you and our colleagues on the
Committee to ensure our farmers and ranchers have the tools
they need to be successful. Thank you.
Chairman Roberts. I thank the Senator.
A study was just conducted a while back saying that members
of the Senate are supposed to be in two or three places at the
same time.
[Laughter.]
Chairman Roberts. That explains a lot.
Senator Klobuchar is supposed to be at the Judiciary
Committee. I note that Senator Grassley is supposed to be, as
well. We have provided him a muffin and a cup of coffee, but he
has not shown up----
Senator Sasse. Can I have his muffin?
Chairman Roberts. --demonstrated by the distinguished
Senator from Nebraska, who took time from reading from the
Constitution to demonstrate that. I am going to get in trouble
for that.
[Laughter.]
Chairman Roberts. Senator Klobuchar, I know that you want
to introduce John Zimmerman, who is a turkey grower, on behalf
of the National Turkey Foundation from Northfield, Minnesota.
Why don't you proceed with that?
STATEMENT OF HON. AMY KLOBUCHAR, U.S. SENATOR FROM THE STATE OF
MINNESOTA
Senator Klobuchar. All right. Well, thank you very much,
Mr. Chairman and Ranking Member Stabenow, and also Senator
Heitkamp for suggesting this hearing. I think it is so
important, and the work that we have done in the Farm Bill on a
bipartisan basis for our livestock and poultry industries has
been key, but also there is a lot of work to be doing going
forward and I am glad we are doing this.
Minnesota is number one for turkeys. I just always like to
say that. We are number one for turkeys, as Mr. Zimmerman
knows, in the country, and number two for hogs, which sometimes
surprises people. So, this is pretty important to us.
John Zimmerman is a second generation Minnesota turkey
farmer who also raises corn and soybeans on his farm with his
wife, Cara, and son, Grant. He has previously served as
President of the Minnesota Turkey Research and Promotion
Council and he is a current board member of the National Turkey
Federation. He is also the current Board Chair of the River
Country Co-Op.
He is a graduate of Iowa State University, which we will
not hold against him, being from Minnesota, where he earned a
Bachelor's Degree in animal science.
Thank you for being here, John, and I know the Committee
will benefit from the expertise that you will bring to a turkey
farmer, and also as a turkey farmer, and also as an industry
leader. We look forward to hearing from you.
Chairman Roberts. I would like to now proceed with the
introduction of the witnesses.
I am very proud to introduce Mr. Tracy Brunner, President
of the National Cattlemen's Beef Association. Mr. President, I
am not going to go any farther with that.
Tracy is a fourth generation rancher from Ramona, Kansas.
He has served as President of his family corporation since its
inception in 1988, where he manages the feed yard, the yearling
grazing operation, cattle and grain marketing decisions,
commodity risk management, and customer relations. He is a busy
guy. Tracy's family also operates a seedstock enterprise,
raising bulls and replacement heifers for many ranchers all
throughout the United States.
Tracy graduated from Kansas State University, home of the
ever-optimistic Fighting Wildcats, with a degree in animal
science and a Master's of agribusiness. He has held many
leadership positions in the U.S. beef industry, including
Executive Committee Member and President of the Kansas
Livestock Association, a member of the Kansas Beef Council
Executive Committee, a member of the Kansas Governor's
Agriculture Advisory Board, as well as Policy Division Chair,
Executive Committee Member, and Board member for the National
Cattlemen's Beef Association for nearly 20 years.
Tracy, you have been a true leader for our Kansas
agriculture and the U.S. beef industry. I am very pleased, very
proud to welcome you to the Committee today.
[Pause.]
Chairman Roberts. We will proceed with your statement in
just a moment. We will introduce the rest of the witnesses.
Ron Truex, who is Chairman of the United Egg Producers,
Atwood, Indiana. Mr. Truex's career in the egg industry began
over four decades ago when he joined Creighton Brothers, LLC,
an egg production, processing, grading, and marketing company.
Ron has held positions in sales and operations and has served
as President and General Manager of Creighton Brothers since
1998.
Ron has held several leadership positions within state and
national agriculture organizations, including President of the
Indiana State Poultry Association, President of the Indiana Egg
Board, past Chairman of the American Egg Board, and as chairman
of several committees within the United Egg Producers.
Thank you so much for being here today Ron, I look forward
to hearing your views of the egg industry.
Senator Grassley was supposed to be here to introduce Dr.
Howard Hill. He is obviously over at the Senate Judiciary
Committee. Dr. Hill is the Past President of the National Pork
Producers Council from Cambridge, Iowa. Dr. Hill is a pork
producer and a veterinarian from Cambridge, Iowa, where he runs
a farrow to finish hog operation, raises Angus cattle, and
grows 2,700 acres of corn, soybeans, and alfalfa.
Dr. Hill earned his Bachelor's and Doctorate of Veterinary
Medicine degrees from the University of California-Davis and a
Master's and Doctorate degree from Iowa State University in
veterinary microbiology and preventive medicine. He has worked
as a veterinary practitioner, a fellow for the National
Institutes of Health, head of the Microbiological Section of
the Iowa State University Vet Diagnostic Lab, head of
veterinary services for Murphy Family farms, and Director of
Production and Chief Operating Officer for Iowa Select Farms.
Dr. Hill is the Past President of the National Pork
Producers Council and the American Association of Swine
Veterinarians, a former Board member for the Iowa Pork
Producers Association, and was recently appointed to serve on
the U.S. Department of Agriculture's Advisory Committee on
Animal Health.
Dr. Hill, that is quite a distinguished career. I look
forward to your testimony.
Senator Heitkamp, I recognize you to introduce Joe Goggins,
a producer on behalf of U.S. Cattlemen's Association from
Billings, Montana.
STATEMENT OF HON. HEIDI HEITKAMP, U.S. SENATOR FROM THE STATE
OF NORTH DAKOTA
Senator Heitkamp. Welcome, Joe. Joe is a rancher and
auctioneer from Billings, Montana. He is a native Montanan who,
in addition to working on his family's ranch, has auctioneered
for some of the top purebred sales in America and remains
directly involved in his family's livestock auction market. He
is the owner of J&L Livestock, which merchandises from 3,000 to
5,000 top bred commercial Angus females annually. His family's
three livestock auction yards and Northern Livestock Video
Auction is often cited as a primary influencer in the cash
cattle market across the nation.
We are proud to have him, because he is not only an active
Montanan, he is also a regular at North Dakota's bull sales,
most notably Ellingson Angus in St. Anthony, Frey Angus in
Granville, Prairie Pride in Enderlin, Schaff Angus Valley at
St. Anthony, and Stuber Ranch in Bowman, and we really
appreciate your involvement in North Dakota, and I know that
you know that we produce some of the best bulls in the world.
His reach into the cattle industry extends nationwide with
his family's widely subscribed publication The Western Ag
Report. Continuing to be an active member in the livestock
industry, he served one term as President of Montana's
Livestock Marketing Association and two terms as President of
Montana Angus Association. He is currently the Director of the
Livestock Marketing Association and a member of the United
States Cattlemen's Association.
Joe remains very involved in the ebb and flow of the cattle
market. With all of that on his plate, he and his family are
still able to help market 600,000 head of cattle annually,
along with his wife, Linda, and his three children and 250
employees who help him through that process. Quite a record of
achievement.
Welcome to the Committee. We look forward to your
testimony.
Chairman Roberts. Thank you, Senator Heitkamp.
We thank you all again for taking the time to join us
today. We appreciate your sharing your expertise, firsthand
experience as leaders of the livestock and poultry sectors.
Mr. Brunner, Tracy, could you tell me in your perspective
how we get past this recent downfall in the beef sector.
STATEMENT OF TRACY BRUNNER, PRESIDENT, NATIONAL CATTLEMEN'S
BEEF ASSOCIATION, COW CAMP FEEDYARD, INC., RAMONA, KANSAS
Mr. Brunner. Well, thank you, Mr. Chairman, members of the
Committee. Good morning to everyone.
Always at the mercy of Mother Nature, our industry is
rapidly recovering from extensive drought. Herd rebuilding and
expansion are taking place at a rate where U.S. cattle numbers
will soon be equal to 2012. Additionally, American cattle
producers continue to be more efficient in producing beef.
Today, we can produce the same amount of beef that we produced
in 1977 at one-third less cattle and land.
The beef supply chain is always focused on the consumer.
Our cow-calf ranchers tell their seedstock suppliers what they
need and also ask their stocker and feeder calf buyers what
they will pay the most for. Cattle feeders, likewise, look to
packer processors for signs of greatest value, who in turn have
an ear for retail and food service needs.
Cattle prices have been a topic of focus for NCBA and our
members. In early 2015, we saw record high cattle prices, but
soon those started back down. One factor was the increase in
overall protein supplies. Last year, U.S. per capita red meat
and poultry supplies increased by nearly ten pounds per person.
In addition, the strong U.S. dollar has impacted our ability to
ship beef to our international customers.
All of this additional supply puts downward pressure on our
markets, but we are used to the ups and downs of the cattle
cycle. In order to manage this cycle, we need risk management
tools that work. We currently rely on market forums like CME
Groups, cattle futures contracts, to add transparency to our
price discovery process. Changing technologies and a transition
to automated trading and commodity futures have increased
market volatility, making interpretation of those price signals
different than what we are accustomed to in the past. The
integrity of our market forums is very important to us, for
without futures contract integrity, our industry will abandon
their use.
We have recognized the volatility and are working directly
with the CME Group to find ways to address it. We have a joint
NCBA-CME working group which is analyzing potential changes,
such as slowing down the market to help ensure a level playing
field for producers who are using these tools to manage their
price risk.
Today, we ask for no direct action from our government in
our cattle marketing systems and forums. In fact, I am
concerned at some of the action that we have seen.
Secretary Vilsack has announced he is going to dust off the
proposed GIPSA marketing rule that resulted from language
included in the 2008 Farm Bill. This is very concerning to us,
because bipartisan efforts already resulted in appropriations
language which defunded any additional work on or
implementation of the ideas included in the draft rule. The
proposed GIPSA rule would have made USDA the ultimate arbiter
on how cattle are marketed. We urge USDA to enforce the Packers
and Stockyards Act as it exists now. We do not need them
dictating how we can or cannot market our cattle.
We have worked for years to find ways, new and innovative
ways to market cattle. Alternative marketing arrangements have
been studied by USDA and independent groups and the results
show that these alternative marketing arrangements benefit
producers and consumers alike. Any Congressional or executive
action to interfere will only add to our price problems, not
solve them.
Solving our price problems relies on addressing the true
issues of consequence in our industry. We have capitalized on
the growing demand for U.S. beef overseas, and Japan has become
our leading export market. But Australia now has a ten percent
tariff advantage over us, resulting in a loss of $300 million.
The tariff advantage for Australia will continue to grow until
we pass TPP.
In closing, I would say you could also help our bottom line
by easing the regulatory burden that our industry is under.
Taking action to reform the Endangered Species Act and helping
us keep the EPA at bay would go a long way in easing the
pressures on our industry.
Again, thank you very much for this opportunity to be with
you.
[The prepared statement of Mr. Brunner can be found on page
50 in the appendix.]
Chairman Roberts. Thank you, Tracy, for a very good
statement.
Mr. Truex.
STATEMENT OF RONALD TRUEX, CHAIRMAN, UNITED EGG PRODUCERS, AND
PRESIDENT, CREIGHTON BROTHERS, LLC, ATWOOD, INDIANA
Mr. Truex. Thank you, Mr. Chairman. My name is Ron Truex
and I am an egg producer from Atwood, Indiana. I am also
Chairman of United Egg Producers and we appreciate being
invited to this hearing.
I would like to talk about two major events that have had a
dramatic impact on our industry in the past year. Then I would
like to mention two current issues where we could use the
Committee's help.
The first event was last year's devastating outbreak of
highly pathogenic avian influenza. I have some statistics in my
written testimony, but I am sure I do not need to tell anyone
on this committee what a difficult experience that was.
Thankfully, my farm was not directly involved, but every single
egg producer was affected one way or another, from much more
stringent biosecurity to a loss in demand for egg products,
which we hope is temporary. We are still dealing with the
aftermath of the HPAI crisis.
This year has brought another challenge. Our customers in
food service, food manufacturing, and retail grocery sales are
announcing their decisions to source only cage-free eggs in the
future. In most cases, they have specified a transition period,
often as much as ten years.
There are about 300 million hens in the U.S. egg laying
flock. Today, about 30 million of those, just under ten
percent, are cage-free housing. Of those 30 million hens, just
under half of those are on organic farms, with the remainder in
non-organic production. The remaining 90 percent of the U.S.
flock is cared for in cages, the vast majority of which comply
with our UEP Certified Program, which provides space
requirements for each hen. A small but important portion are
kept in enriched cages, where space allowances are greater and
enrichments like perches and nest boxes are provided.
According to the estimates by USDA, if you add up the
current egg usage of all companies that have publicly made
cage-free commitments, by 2030, 60 percent of the nation's egg
laying flock, not the current ten percent, but 60 percent, or
174 million birds, will need to be in cage-free housing. USDA
also added up the number of egg producers that have publicly
announced plans to convert some or all of their operations to
cage-free status. However, those commitments only add up to 63
million hens, about a third of the 174 million requested by our
customers.
Our industry is highly competitive and we will always try
to produce what our customers want, but it will be extremely
difficult for us to meet the cage-free demand. The new
construction, capital investment, additional land acquisition,
and higher production costs will all be daunting.
UEP believes, and science shows, that hens can be humanely
housed in a variety of ways, through conventional cages,
enriched cages, and in cage-free environments. Good management,
not production technique, is the most important variable in hen
welfare.
Now, in the time I have left, let me conclude with two
recommendations for Congressional action. Like most other farm
groups, we are hoping for a national standard on GMO labeling
that will override state laws. We appreciate the hard work that
the leaders of this committee are continuing to do and we fully
understand it is not an easy task. We would simply like to
point out that while most of our hens consume genetically
engineered feed, the corn and the soybeans, neither the hens
nor the eggs they lay are genetically engineered. Therefore,
eggs should not have to be labeled as GE or GMO merely because
they were laid by hens that consumed GE feed.
A second way that we hope Congress will help us is by
encouraging USDA to carry out a better economic analysis before
finalizing a new proposed rule on organic livestock and poultry
production. For the egg sector, USDA is proposing to ban
production systems that have been approved by that Department
since 2002. These so-called porch systems provide outdoor
access to hens on solid floor structures that are open to the
air and the sunlight on the sides, but have roofs in order to
keep out predators and avoid contact with wild birds, which are
carriers of avian influenza.
Our farm is not organic, but a number of our UEP members
have entered organic production in recent years and this is a
major issue for them. They believe the economic impact of this
proposed regulation will be well in excess of $100 million and
perhaps more. Besides banning porches, the proposed rule has an
outdoor space requirement that will be impossible for many
producers to meet without expensive new land purchases. It also
requires that outdoor areas be at least 50 percent soil, which
increases the possibility of contact with salmonella as well as
animals that carry it, like rodents.
If this rule is finalized, the supply of organic eggs for
consumers will fall substantially and many producers will exit
organic production. This committee's Chair, Ranking Member, and
other members have already been very helpful in questioning
USDA's factual basis for this rule and we hope you will
continue asking questions, filing comments, and asking USDA for
an extension of the comment period for at least an additional
60 days so the Department will have a better factual basis for
the final rule.
Egg producers appreciate this committee taking a strong
interest in animal agriculture, and thank you for the
opportunity to testify.
[The prepared statement of Mr. Truex can be found on page
77 in the appendix.]
Chairman Roberts. Dr. Hill, you are recognized next, but I
want to just say something on behalf of the Ranking Member and
myself on this latest rule with regards to chickens and this
whole exercise we are talking about, the big yard and sort of
an over-leverage.
Senator Stabenow. Perches.
Chairman Roberts. We have been talking--I think we might
include a requirement that we play Mozart to just sort of calm
the chickens down. I do not know if that would be helpful or
not.
[Laughter.]
Chairman Roberts. On this comment period, I sure hope you
are standing up, and I know we are, to make sure that the
Department hears that this is just--sometimes it is hard to
understand what happens in our federal government. This is one
of those cases. So, thank you for your comments on that, and
all of us are working to solve the GMO problem. I did not mean
to interrupt the flow of the witnesses here, but thank you for
those comments.
Dr. Hill.
STATEMENT OF HOWARD HILL, D.V.M., PAST PRESIDENT, NATIONAL PORK
PRODUCERS COUNCIL, BREEZE HILL FARMS AND H&K ENTERPRISES,
CAMBRIDGE, IOWA
Dr. Hill. Good morning, Chairman Roberts, Ranking Member
Stabenow, and members of the Committee, and thank you for this
opportunity to visit with you. I am Dr. Howard Hill, a
veterinarian and pork producer from Cambridge, Iowa, and Past
President of the National Pork Producers Council.
The U.S. pork industry is in pretty good shape right now
economically. In the past couple of years, it has overcome some
disease issues and weather-related record-high feed grain
prices and now appears to be moving into a period of cautious
calculated expansion.
Pork production is forecast by USDA to increase this year
by two percent, to almost 25 billion pounds, and in 2017 by 2.6
percent, to more than 25.5 billion pounds. Of course,
producers' fortunes can be affected for good or bad by any
number of factors, some controllable and some not so
controllable, such as disease and weather.
I am going to first address an opportunity that would be
very positive for hog farmers like me and that Congress can
control, the Trans-Pacific Partnership, or TPP. But another
issue recently has come up that if not addressed would wipe out
any of the benefits we gain from TPP.
Pork producers are very concerned about the so-called GIPSA
rule, which you have heard about from Mr. Brunner. As many of
you know, the rule was borne out of the 2008 Farm Bill, which
includes five specific issues, mostly related to the poultry
industry, but Congress wanted USDA to address. But the Grain
Inspection, Packers, and Stockyard Administration in 2010
proposed an expansive rule that would have had a significant
negative impact on the livestock industry.
In November 2010, an Informa Economics study of the rule
found it would have cost the pork industry more than $350
million annually. Tens of thousands of comments, including
16,000 from the pork producers, were filed in opposition to the
rule, and Congress several times included riders in the USDA's
annual appropriation bill to prevent it from finalizing the
regulation. Such an amendment was not included in the USDA's
fiscal year 2016 bill.
Now, the agency is moving forward with the rule and we have
grave concern it will mirror the 2010 proposal. If it does, the
livestock industry would be fundamentally and negatively
changed and the increased exports and jobs created from TPP
will be negated.
Additionally, the fact that we have to deal with the GIPSA
rule issue is diverting valuable resources away from the pork
industry's top priority, and that being the approval of TPP.
TPP, the benefits of which will exceed all past Free Trade
Agreements, represents a great opportunity for U.S. pork
producers and for the entire U.S. economy. TPP includes the
United States and 11 Pacific Rim countries, and those nations
include nearly a half-a-billion consumers and represents 40
percent of the world's GDP. The agreement has become the de
facto global trade vehicle and other countries in the region
already are lining up to be part of TPP. Because other Asia-
Pacific trade agreements are being negotiated, such as China-
led 16-nation regional comprehensive economic partnership, the
United States cannot afford either to economically or
geopolitically walk away from the fastest growing region in the
world.
To give you an idea of the importance of Free Trade
Agreement to the U.S. pork producers, the United States now
exports more pork to the 20 countries with which we have an FTA
than it does to the rest of the world combined. Congress must
pass TPA and it must do so soon.
Finally, a challenge that would be out of everyone's
control but that could be tempered through preparedness is a
foreign animal disease outbreak, specifically an outbreak of
Foot and Mouth Disease. A foot and mouth outbreak in this
country would be economically devastating to the pork producers
and other food producers. USDA and the livestock industry has
been working on a plan to combat an outbreak, but the only
practical way is through the use of vaccination. Unfortunately,
we currently do not have the ability to produce the number of
doses needed for an initial outbreak or the capacity to produce
more vaccine.
The U.S. pork industry believes, consistent with Homeland
Security Presidential Directive 9, that an adequate Foot and
Mouth Disease vaccine bank must be established. This would
require, one, an offshore vendor maintained bank that would
have available antigen concentrate to produce against all 23 of
the most common Foot and Mouth Disease types currently
circulating in the world. Two, a vendor managed inventory of
ten million doses, which is the estimated need for the first
two weeks of the outbreak. Third, a contract with an
international manufacturer or manufacturers for the surge
capacity to produce at least 40 million additional doses.
Given the costs of dealing with a Foot and Mouth Disease
outbreak and the economic impact on the livestock industry and,
indeed, on the entire U.S. economy, Congress should appropriate
enough money to set up such a vaccine bank.
Those are a few of the opportunities and challenges pork
producers face and I will be happy to answer any questions at
the appropriate time. Thank you.
[The prepared statement of Dr. Hill can be found on page 64
in the appendix.]
Chairman Roberts. Thank you, sir.
Mr. Goggins.
STATEMENT OF JOE GOGGINS, PRODUCER, U.S. CATTLEMEN'S
ASSOCIATION, AND VICE PRESIDENT, VERMILLION RANCH COMPANY,
PUBLIC AUCTION YARDS, BILLINGS LIVESTOCK COMMISSION COMPANY,
WESTERN LIVESTOCK AUCTION, AND NORTHERN LIVESTOCK VIDEO
AUCTION, BILLINGS, MONTANA
Mr. Goggins. Good morning. It is truly an honor to be here
on behalf of the livestock industry addressing this
distinguished committee and the great people you represent.
In the next 15 to 20 years, when you look at the massive
population growth not only in this country but worldwide, the
deal maker for the United States of America when it comes to
trade with our world partners will not be our technology or our
energy, it will be our food.
The American producer, feeder, and packer have the know-
how, work ethic, and pride to produce the highest quality, most
affordable, and safest protein in the world. This is why we
must demand that we in America do everything in our power to
keep an open, fair, competitive marketplace for our producers
and feeders of all sizes. Another key component is to assure
our domestic livestock herd remains safe and free from both
domestic and foreign diseases.
There have been many success stories in the previous Farm
Bill programs, for example, the voluntary conservation effort
that kept the sage-grouse from being listed, the beginning
farmers and ranchers program, the disaster funding program that
aided the producers in the Dakotas after the Atlas blizzards of
2013, just to name a few.
In the years 2013 and 2014, we all saw our once-in-a-
lifetime up in the cattle market. Since then, in the last year,
I hope we have seen our once-in-a-lifetime down. The last year
represents the largest loss in equity in the history of the
U.S. cattle industry.
Following are some concerns and challenges that need to be
looked at and addressed by this committee. We need to find a
fairer and more competitive way of determining a weekly cash
price on live fed cattle. There are many avenues by which to do
this, but we undoubtedly need to create more transparency and
competitiveness at the fed cattle level.
Volatility in the marketplace is causing huge problems for
everyone in the industry. The Futures Board has always been a
very good tool for producers and feeders to manage risk. At the
present time, it no longer can be used because of violent moves
in the market, mostly due to, in my opinion, the expanded
limits, and high frequency algorithmic trading. It is a
speculator's market. For example, just two weeks ago, we sold
fed cattle at a $134 to $136. The Board the same morning went
near limit down on the front month June to $121-something. That
is a $15 basis Now, that is proof fundamentals do not have much
to do with this market.
However, my biggest concern about the volatility in this
market is how it affects the average producer and young
producers that have to borrow most of their money from the bank
to purchase and feed these cattle. The lenders, in turn, are
almost 100 percent of the time requiring these people to hedge
75 percent of those cattle they buy in order to acquire such a
loan. These massive, violent moves on the Futures Board cause
people to pay huge margin calls, which drains their available
cash, forcing them to get out of the hedge at a very
unfavorable position.
I know in our own family feeding operation, currently, we
background and feed near 50,000 head of calves a year. The
Futures Board is no longer a viable tool for us due to the
volatility of the market and the amount of money it takes to
hold a position. This may allow us only to feed half as many
cattle going forward.
We need to modernize and update the Packers and Stockyards
Act of 1921. This 95-year-old Act needs to be modernized.
Another challenge I would encourage the Committee to be
conscientious of is the concerns that come with over-
regulation. Too much government on the farm and ranch is a
major concern in the country. One example is the uncertainty
surrounding the EPA's Waters of the U.S. rule.
I would also suggest caution on making too stringent
requirements on the trucking and interstate movement of
livestock. Livestock are a highly perishable commodity. If we
hamper the ability to move livestock quickly and efficiently,
we might actually limit opportunities for producers in parts of
this country.
In closing, as a producer of protein, I challenge this
committee to address the concerns and issues I have just laid
out. Restructure restrictive laws. Update outdated laws. Ensure
that we have some transparency and competitiveness in our
industry. Last but not least, put some sideboards on the
futures market and the influence the Board has on the cattle
market.
Keep in mind, in the years to come, trade policies and
currency values will heavily play on our markets and the
nations with the capabilities to produce an abundant quality,
high quality safe and affordable food supply will be the
powerhouses in the global economy.
[The prepared statement of Mr. Goggins can be found on page
57 in the appendix.]
Chairman Roberts. We thank you, Mr. Goggins. Thank you for
the challenge. We accept it.
I would just note that I have been to 18 Kansas counties
here recently. I was way out there in Western Kansas, in St.
Francis, and a good friend of mine who I have known a long time
put on a cowboy hat like Tracy has there, pulled it down, and
said, ``Pat, you have done a good job, but I have got news for
you. I am done.'' He just said, ``I feel ruled. I do not feel
governed.''
I think that pretty well sums up some of the concerns that
you raised. Those of us who serve on this committee in a
bipartisan fashion want to address all of these concerns, and I
thank you for pretty well summing them up.
Mr. Zimmerman.
STATEMENT OF JOHN ZIMMERMAN, PRODUCER, NATIONAL TURKEY
FEDERATION/MINNESOTA TURKEY GROWERS ASSOCIATION, P&J PRODUCTS,
NORTHFIELD, MINNESOTA
Mr. Zimmerman. Good morning, Chairman Roberts, Ranking
Member Stabenow, and members of the Committee. I appreciate the
opportunity to testify on behalf of the 63,000 men and women
who put their boots on every day to keep the turkey industry
working. Our industry raises approximately 238 million pounds
of turkey annually, and USDA's latest forecast puts 2016 turkey
production at an all-time record of 6.4 billion pounds, 14
percent above 2015.
This year, the turkey industry has made significant strides
and learned a lot in recovering from high path avian influenza
after suffering through the worst animal disease outbreak in
U.S. history last year. However, our preparation was tested
earlier this year in Indiana when a small outbreak occurred in
a commercial turkey flock. This outbreak was small precisely
because of the lessons we have learned.
The important lesson is that immediate action needs to be
taken at the local level to limit virus spread. No matter how
good the intentions are at the state and federal level,
industry must be given clear permission to act within minutes,
not hours or days, to protect other nearby farms from becoming
infected. I must emphasize the need for rapid stamping out
procedures and methods that ensure humane treatment while
eliminating virus spread. Currently, there is no one method
that achieves perfect results in all circumstances.
NTF is deeply appreciative of the indemnification program
implemented by USDA/APHIS, strongly supported by Congress, that
helped us manage through this crisis, and I would be remiss if
I did not take a moment to personally thank my fellow
Minnesotan, Senator Klobuchar, on behalf of myself, the NTF,
and the entire turkey industry for all you did to help us last
year. Thank you.
Finally, the billion dollars in losses are well documented.
In order to prevent future outbreaks, the U.S. needs to adopt a
forward looking mandatory animal pest and disease prevention
program designed to limit the impacts of foreign zoonotic
diseases on livestock and poultry producers, and we look
forward to working with Congress to get this accomplished.
All poultry exports were severely damaged by the trade
restrictions that resulted from the 2015 outbreak.
Specifically, last year's turkey exports declined 34 percent
and over 33 countries enacted some form of ban on U.S. poultry.
Without the hard work of APHIS, it could have been a lot worse.
They reopened closed markets as well as continue to establish
protocols that will limit bans to regional levels in the
future.
We also continue to see high path outbreaks in Europe,
Asia, and South America, and now is the time to reengage with
our trade partners to discuss how HPAI can be treated moving
forward. This is a global disease, and working with the
government, we can develop a plan that minimizes export
disruptions now.
With regard to non-scientific trade barriers, it is
important that USDA's FAS continue to work with both APHIS and
the turkey industry to fully understand how we differ from
chicken and livestock production. For example, while never
covered under U.S. COOL regulations, turkey has now been
subjected to COOL-like regulations by both Korea and South
Africa, who banned U.S. turkey raised and processed in the U.S.
just because it was hatched in Canada. This is not science-
based and is a problem for many companies that hope to expand
sales into these promising growth markets.
Finally, we support TPP as an important step forward in
reducing trade barriers and opening new markets for the turkey
industry and we encourage Congress to approve this agreement as
soon as possible.
Recently, USDA proposed a rule to amend the organic
livestock and poultry production requirements based on
recommendations by the National Organic Standards Board. NTF is
concerned about the potential disruption to existing organic
producers and their supply chains as well as the impacts this
proposed rule may have on ensuring animal health. Before moving
forward with the rule, the turkey industry feels that USDA
should conduct a thorough assessment of the costs of
compliance, increased animal health and welfare risks, and
alternatives for existing organic growers, producers, and
supply chains to ensure minimal impact.
Six years ago, USDA proposed sweeping rule changes on
farmer contracting. With the expiration of a Congressional
prohibition on implementing these changes, USDA is once again
threatening to fundamentally change the rules by which our
members operate. We believe that the changes would increase
costs, reduce productivity, and possibly lead to increased live
production ownership by integrated poultry companies to the
detriment of independent farmers. We support the continued
prohibition of USDA's implementation of these proposed changes.
A recent report by the National Academy of Sciences found
that foods made from genetically engineered crops are as safe
to eat as those made from conventional crops. Regarding food
labeling, NTF actively supports two critical components of any
GMO bill. One, that the bill maintains federal preemption for
meat and poultry labeling, which is already regulated by USDA/
FSIS, and two, that it ensures that animals fed GE feed should
not have to be labeled GE. We look forward to a bill that
prevents a patchwork of state rules that create a labeling
nightmare for food producers, but these two conditions must be
met.
Finally, we have a worker shortage all across this country
and meat and poultry producers are no different in feeling the
pain of this shortage. The turkey industry supports immigration
reform that addresses the needs of year-round meat and poultry
producers and processors. Our members need access to a pool of
legal general labor immigrant workers and a visa program that
can address these needs. However politically difficult it
seems, we must get this job done.
Once again, thank you for the opportunity to testify today
on behalf of the U.S. turkey industry and I would be happy to
answer any questions.
[The prepared statement of Mr. Zimmerman can be found on
page 81 in the appendix.]
Chairman Roberts. We thank you all for taking the time to
join us today and appreciate your sharing your expertise, your
first-hand experience as leaders within the livestock and
poultry sectors.
Tracy, tell me, in your perspective, what is the best thing
we can do to get this recent downfall in the beef sector
addressed?
Mr. Brunner. Well, Mr. Chairman, the current situation, as
I have said, is one of growing supplies and we need growing
markets, growing market access for our beef to match. Trans-
Pacific Partnership is the trade agreement of the day. As was
said earlier, 40 percent of the world's economy. It will level
the playing field. Currently, we are paying 11 percent higher
tariff going in to our best customer, Japan, $300 million loss
already, and that is only going to continue to grow until we
pass TPP.
Then, very briefly, the increasing regulatory burden from
EPA, Endangered Species Act, and other government agencies.
Chairman Roberts. I would also like to hear your
perspective on what you have already brought up, along with
many of the witnesses here, on the real world impacts of the
proposed GIPSA rule. I have sent a letter to the Secretary, I
think it has been about a month ago. Maybe the letter was too,
a little too much for him to take, but anyway, we have not
gotten a reply back. In the House, they have taken action on
the GIPSA rule and I would expect the same effort when we
consider agriculture appropriations on this side.
But, I have heard value-added programs stand to face a lot
of legal threat due to the premiums they pay to producers
potentially being considered as unfair. In your business, do
you utilize any unique or niche marketing that you think could
be jeopardized by the implementation of the GIPSA rule, or do
you have other examples like this that you could share?
Mr. Brunner. Mr. Chairman, the GIPSA rule as it was written
into the 2008 Farm Bill would have severely restricted our
ability to participate in alternative marketing arrangements.
As I had said earlier, research has shown that those
alternative marketing arrangements, value-based marketing, if
you will, has encouraged our industry and allowed individual
producers to meet and be rewarded for consumer demand.
As a very brief example, our family actively participates
in marketing most of our cattle through a value-based marketing
system. Over time, this has allowed us to not only meet
consumer demand by developing and producing products that
consumers want and are willing to pay for, but also receive an
average of $50 a head premium to the cash market.
Chairman Roberts. Dr. Hill, can you describe in a little
more detail some of the recent outbreaks of FMD that have
occurred in other countries, how your industry and the
Department came to the conclusion that the best way of
addressing an FMD outbreak here in the United States is to
vaccinate animals rather than trying to stamp out the disease.
Dr. Hill. Two of the most notable outbreaks have been the
recent outbreak in Korea and then several years ago the
outbreak that was in Great Britain. In the past, APHIS has used
the approach of destroying animals and disposing of the
carcasses, and if you look at the recent outbreak of high path
AI, that was one of the big challenges, was how they got rid of
the carcasses. So, working with APHIS, the industry has come to
the conclusion that slaughtering these animals, killing these
animals and burying them or burning them or however you dispose
of them is not practical.
We have about a million pigs on the road in the United
States every day and about 400,000 cattle. If we have an
outbreak of Foot and Mouth Disease, we do not think it is going
to be an isolated, small outbreak.
Chairman Roberts. No, it will not.
Dr. Hill. So, the only really practical way to try to
control the disease is to have available vaccines. Fortunately,
this is a disease that does not affect the humans, so the meat
is usable, and if we had a vaccine bank available, we could
have an aggressive vaccine program and try to limit the losses
to producers and basically live for another day.
Chairman Roberts. I thank you for that. I had a little
experience with that as Chairman of the Intelligence Committee
when we were discussing agroterrorism. Not many people wanted
to hear about that. We had an exercise exactly as you have
described. Acting as President at that particular time--there
was not anybody else in town--but in doing that exercise, all
hell broke loose and all of our exports stopped. Then we faced
the dilemma of what to do with the diseased animals. I am not
going to go into the rest of it. It just turned into an
absolute disaster. But one thing happened. People discovered
that their food did not come from grocery stores and there was
panic everywhere. It shows you just how important this research
is.
I am over time here. I will get back to some of the rest of
you later.
Senator Stabenow.
Senator Stabenow. Well, thank you very much, Mr. Chairman,
and welcome again. We appreciate your testimony.
Let me start with Mr. Truex. I wonder if you might speak a
little bit more about what you talked about in your testimony
in terms of the organic livestock standards rule, and if you
could share some of the additional potential costs and impacts
beyond purchasing additional land. When we look at those
issues, I know that the producers most impacted are those that
are actually producing 70, 80 percent of the organic eggs, and
do you think there will be a sufficient number of new egg
producers transitioning into organics to meet the rising
demand?
Mr. Truex. Thank you. I do not. What we are concerned about
is that, as you said earlier, a large majority of the organic
production is relatively new. The facilities are new because of
the great increase in organic consumption in the past few
years. So, the producers have a significant investment in
relatively new facilities that was totally accepted by USDA
until this proposed rule. So, they are going to be faced with a
lot of changes.
The other thing that we are concerned about is this rule
that protects the birds from rodents and birds and all the
other things, our current practice supports the FDA Egg Safety
Rule, and we have concerns that if you put the birds out on the
ground, let them out where they can get access to other birds
and rodents, it is going to be a real challenge to protect
those birds.
In addition to that, you have the thought that, well, if
there is an avian influenza problem, we will just put them back
inside, but unfortunately, as we learned in Indiana this
spring, sometimes you do not know you have avian influenza
until the second day and then it is too late.
So, if you take that in, all those things and add it
together with the problems in local permitting and building and
cost, our members are telling me, and, of course, I am not in
organic production. In a commercial for your state, I buy my
organic eggs from Herbrucks----
Senator Stabenow. Great.
Mr. Truex. But, the problem is, to maintain the production
you have, will be impossible with the added space. So even the
producers that are in organic are going to have to build
additional buildings and get additional land, and I think it is
going to be very challenging for the others that are not
currently doing it to get the funding and the land purchases
and the buildings and the permits to build that. So, I believe
we would limit the amount of organic eggs for the consumer.
Senator Stabenow. Thank you very much.
Dr. Hill, the Iowa Pork Producers Association is a leading
member, I know, of the Iowa Ag Water Alliance, and working with
the Iowa Corn Growers and Soybean Association, you are working
to improve farm conservation and water quality through the
locally led efforts that we have put together. I wonder if you
could explain how the Iowa Pork Producers and Iowa Ag Water
Alliance have worked with other partners using the new Regional
Conservation Partnership Program to further your water quality
goals.
Dr. Hill. Yes. Well, thank you. The Iowa Pork Producers, of
course, have worked closely with that group and also with the
Department of Agriculture. There are state funds that help
producers with some technologies, like cover crops. In my area,
five, six years ago, we saw very few farmers using cover crops.
Today, it has just had an exponential growth. Some of that is
partially supported by government funds, but most of it is, I
believe, just producers trying to do the right thing,
especially on highly sensitive soil.
If there is an ask, I would say the ask would be for more
funding for research to develop new technologies, different
technologies, maybe things that we are not doing today that we
had not thought about. I think there is a big need to--you are
not going to solve the water quality thing with one technology.
Cover crops is not going to do everything we want it to do. So,
added funding for research, I think, is very, very important,
and we appreciate the support you have given us so far.
Senator Stabenow. Well, thank you, and I hope we are going
to be able to see more producers get involved in these efforts.
I think that is very, very important.
Finally, let me ask, for everyone on the panel, and maybe I
will start--Dr. Hill, you are a veterinarian, I understand----
Dr. Hill. Yes.
Senator Stabenow. --so let me start with you, as well,
again. The FDA has taken several steps, as we know, like the
Veterinary Feed Directive that goes into effect in December, to
ensure that antibiotics are used judiciously and only when
appropriate for animal health. This is going to require more
regular relationships between veterinarians and producers and
this is an area I have worked a lot in, supporting efforts to
get more people into veterinary medicine.
When you look at this, large producers may very well have
veterinarians on their staff. I am concerned about smaller cow-
calf producers or people in remote areas and so on. So, when we
look at--earlier this month, the USDA announced $2.4 million
available through a new Veterinary Services Grant Program that
I authored in the last Farm Bill to support veterinarians in
underserved areas, and Senator Crapo and I have just introduced
another bill, a Veterinary Medicine Loan Repayment Program, to
provide even more incentives.
But, I am wondering what you think. I mean, what is
happening here? I continue to hear concerns about not enough
veterinarians to serve the need, and what more should we be
doing to help with that?
Dr. Hill. Yes. Well, first of all, our industry has fully
supported 209 and 213 and producers have already, for the most
part, reduced or eliminated feed additives that are of medical
importance from the diets.
The concern you have is a real concern, not necessarily in
Iowa, where I am, because we have a lot of veterinarians. Your
concern is valid in more remote areas, particularly, I think,
in the cattle industry out West. I think any support that you
can give for veterinarians working in these under-supply areas
would be very, very important.
We work closely, though, to get some of the things with the
Feed Directives in place, like electronic rather than hand-
written things. So, there are some ways that we have, working
with the government officials, that we expedited the process
that will make it easier. But I think there are still some
challenges.
The groups that are working on this on the pork side are
the American Association of Swine Veterinarians, the National
Pork Board and NPPC all working together to try to help
producers. There is a lot of education going on right now about
what to expect and be ready for January 2017.
Senator Stabenow. I do not know, Mr. Chairman, if I might
just ask--Mr. Brunner.
Mr. Brunner. Yes. I just might briefly add, our
organization worked hand-in-hand with FDA in the formulation of
the Veterinary Feed Directive to try and make it as workable as
possible for the cattle and beef industry. I would also like to
point out that our even larger concern is with the jeopardy
that is being placed on some very important technologies that
are classified as antibiotics but are not--have no application
in human medicine, specifically ionophores. Ionophores are very
important to increasing the efficiency in beef production, but
they have been classed as antibiotics. We are working with FDA
to get clearer interpretation on that, as well.
Then I might summarize by saying that it seems that over
time, an increasingly higher share or percent of veterinarians
seem to be going into companion animal practice versus large
animal practice and a more robust and growing animal
agriculture should show more opportunity for veterinarians
there, as well.
Senator Stabenow. Thank you.
Thank you, Mr. Chairman.
Chairman Roberts. Senator Grassley.
Senator Grassley. Thank you, Mr. Chairman. It is very
important that you have a hearing like this. A big industry,
agriculture, it is very important.
So, I would first welcome my fellow Iowan, Howard Hill. He
has been involved with the pork industry probably most of your
life.
Dr. Hill, in your testimony, you mentioned the Waters of
the U.S. rule, that is a major concern to the pork industry. It
is also a major concern to most every agricultural group in
Iowa and every agricultural organization. Could you share with
the Committee a few examples of just common practice within
your industry that you--where there is uncertainty regarding
the Waters of the U.S. rule.
Dr. Hill. Thank you, Senator Grassley. We do have a lot of
concern about it. You know, the swine industry and the cattle
industry is highly regulated with state requirements with
manure application. The way we interpret what the EPA is
proposing, it would impact severely how we would be applying
manure. It, depending on how far they go, it could impact crop
production just because of waterways that we use, setbacks. So,
in our opinion, it is an overreach by EPA that we would
strongly oppose.
Senator Grassley. Mr. Brunner, I have a question for you,
because I have heard from numerous Iowans about what has been
going on in the beef market, and some of these people in Iowa
would blame industry structure. Others would blame futures
contracts. In your testimony, you state that only five or six
percent of cattle are owned by packers. In addition, we know
that nationally, only about 21.3 percent of the cattle are
traded in the cash market, according to USDA data. The percent
of cattle traded in the cash market has dropped significantly
since 2005, when 52 percent were traded cash. While cash traded
cattle have dropped 30 percent since that 2005, the formula
based sales with packers are up 23 percent.
Do you have any concern that the drop in the amount of cash
traded cattle has contributed to that contract being more
volatile, since it is less liquid and represents such a small
percentage of the overall cattle market today?
Mr. Brunner. Well, thank you, Senator. The increased
volatility in the futures market, we believe, comes from the
advent of and administration of new technology, high frequency
trading. As I said before, our organization is working directly
with the CME Group, trying to identify possibilities of
dampening the effects of the high frequency trading on the
cattle market. You know, you cannot deny the application of an
emerging technology. Technology will go on regardless and
practices will move beyond borders. So, we have to be cognizant
that we cannot stop progress.
What we do believe is that we need some data. We need to
have information from CME. We have asked them to share data and
information with us the effects of high frequency trading and
are working to get that information so that we can better work
with them on what changes might need to be made in the cattle
contract.
Senator Grassley. Okay. That is my last question, but I
have a minute left. Let me take a couple seconds for summation.
In the cattle market today, only 21 percent of the market
is traded on the cash market, even though the price discovery
from that 21 percent is utilized for nearly 60 percent of the
cattle that are marketed through formulas. So, to me, it seems
like the cattle market has experienced a structural change over
the last decade where the tail wagging the dog situation has
developed. So, I will continue, Mr. Chairman, to watch this
situation. I have heard a great deal from cattle producers in
Iowa about the current structure of the beef industry.
Thank you, Mr. Chairman. I yield.
Chairman Roberts. I thank the Senator.
With apologies to Senator Klobuchar, it is your time----
Senator Klobuchar. Okay.
Chairman Roberts. --but on WOTUS, I think everywhere we go
in farm country, whether it be Kansas or wherever we are, the
number one issue that comes up, Waters of the U.S. I am talking
about dry creek beds and farm ponds where no self-respecting
duck would ever land, and it goes on and on.
I remember the meeting that we had with the Administrator
of EPA, Gina McCarthy. There were two pages in this bill where
it said normal farming operations are exempt. Then it had
parentheses and it said, see regs, and then there were 88 pages
of regulations, probably eight-point. You can hardly read it
without a magnifying glass. I defy anybody in this room, any of
you, any of us, any farm organization and any commodity group,
any CPA, any lawyer, to define what the heck was in those regs.
We were not successful in the Senate with what we thought
was an answer to it. We have not given up and we will continue
that effort. It is before the courts. But, it is the number one
issue that has been brought up all throughout farm country. We
are very cognizant of this and we are trying very hard to find
an answer.
Senator Klobuchar.
Senator Klobuchar. Thank you very much, Mr. Chairman.
I was proud to introduce Mr. Zimmerman earlier, and I guess
I will address my first questions to you and Dr. Hill, and it
is about the importance of investment in animal health
research. We have seen some issues with our turkeys. You
brought up the scourge, the health scourge that we had where so
many producers were hit.
But, Mr. Hill, you spoke about the need for more investment
in the vaccine bank. Can you elaborate on how the industry has
worked with APHIS to address this need and how APHIS has--and
if APHIS has engaged at all with the Department of Homeland
Security, as you suggested in your testimony?
Dr. Hill. Well, I believe APHIS has engaged. Right now, the
amount of money that is in this bank is a drop in the bucket
compared to what is really needed.
Dr. Roth at Iowa State University has done extensive
studies on what would happen in an outbreak and how much
vaccine we would need. The current bank of, not vaccine, but of
the virus that would make the vaccine, is held at Plum Island.
There are 23 strains that circulate in the world, and I think
Plum Island has about 14 of those available.
What would happen is, because we cannot have a live virus
in the United States, there is a contract to ship that to
Europe. They would make the vaccine there and ship it back to
the United States. The company that has that contract says that
they can do that in a matter of four days. But we are talking
about basically two million doses.
Dr. Roth's study says we would need ten million doses in
the first two weeks and we would need an expansion of that to
40 million doses within the first month to try to control the
disease. This is based off of studies that say that we are not
going to probably have a small little outbreak.
Senator Klobuchar. Okay. All right. Thank you.
Mr. Zimmerman, could you just bring me up to speed quickly
on what is happening with the flocks and the repopulation of
flocks since last year.
Mr. Zimmerman. We are almost approaching normal now. It
took about a year to get our breeder flocks back online, and as
of this spring, I would say we are back to close to 100 percent
production in the turkey industry.
Senator Klobuchar. Yes.
Mr. Zimmerman. I would like to just take a moment to echo
Mr. Truex's thoughts on the organic rule. We talk about avian
influenza and all we did with APHIS to limit the possibility of
introduction of this virus into our barns, and here AMS brings
up a rule to increase the outdoor requirements of our birds,
which flies in the face of everything we have been doing with
APHIS to try to limit the exposure of our birds to waterfowl
and other diseases, so it is----
Senator Klobuchar. Right, which appeared to have been one
of the factors. I was just going to ask you about that, so
thank you.
One last topic here, and I think I will put some questions
about beginning farmers, which has been important, on the
record. But Cuba, I am carrying the bill in the Senate, along
with Senator Flake and many others, Senator Heitkamp has worked
on this issue, lifting the embargo and ways to lift the embargo
to Cuba. While Cuba is by no means our biggest export market,
it is 11 million people 90 miles off our shore. Estimates are
five million Americans a year would visit, and my fear is that
if we do not lift this embargo, our five million Americans are
not only going to be sleeping in Spanish hotels, but they are
going to be eating food from China and Venezuela and other
places.
Could you comment about how--the beneficial effect lifting
the embargo could have on the industry and poultry in general,
as well as, I know, beef and other forms of food that we want
to send over there.
Mr. Zimmerman. To reiterate what you said, it is a very
close market, and any time you can open up a new market to
our--turkey is the perfect protein and we would be happy, more
than happy to sell that product to a new market, such as Cuba.
So, my understanding is there needs to be some infrastructure
put into place and building their tourist industry would help
tremendously to get more people to that country that would,
therefore, eat our turkey.
Senator Klobuchar. Yes. Does anyone else want to comment on
Cuba?
Dr. Hill. I recently visited Cuba, and the big--after the
2004 hurricane, the government allowed food and medical
supplies to be exported to Cuba. The big problem we have right
now, we can export pork, we can export beef, but the problem is
the credit, because our government does not let----
Senator Klobuchar. That is part of the embargo, right?
Dr. Hill. Yes. So, that is why we are not exporting pork
there right now.
Senator Klobuchar. Exactly, and Senator Heitkamp has a
targeted focus on that, on the financing, and, obviously, the
easiest way to do it overall would be to just lift the embargo,
but we are looking at compromises to try to get some of our
fellow Senators on board, although there is just growing
support. Representative Emmer, who is a Republican over in the
House from Minnesota, is carrying one of the bills in the
House. So, we just see a lot of growing support for this effort
and I want to thank you.
Thanks.
Chairman Roberts. Dr. Hill and Senator, I just want to say
I have been to Cuba here recently and talked to the Ag Minister
there, whose main concern was access to our export programs,
which I would agree that if that would work, certainly it would
work out very well. However, they are not receiving any help
from Russia, and I do not think that is going to start any time
soon. On Venezuela, my question to him is, will you pay it
back, and that was never answered. So, that is one of the
concerns that I have. I think we ought to proceed on the best
way possible, but that is a worry that I have.
Senator Tillis.
Senator Tillis. Thank you, Mr. Chairman. Thank you for
holding this important hearing. I know that committees
pertaining to this subject matter are few and far between and I
think it is very important. We can talk about trade
opportunities, we can talk about a number of other things, but
if we do not start lifting this regulatory burden and the
additional barriers that we have, trade expansion will be a
moot point because our farmers will not be able to produce
protein and export it. We are reaching a very dangerous point.
That is something I want to focus on.
When I travel across North Carolina, back in the day, you
would be talking about the cost of feed, you would be talking
about the prices of beef and pork and poultry. Now you talk
about EPA regulations. You talk about FDA regulations. You talk
about USDA regulations and all the impediments that are making
it virtually impossible for farmers to continue to do what they
want to do, which is to produce the most abundant, safe food
supply in the world.
If I appear to be a little bit angry about it, I am. I
mean, we have had a few committee hearings that almost focus on
who is in Grant's tomb. We know who is in Grant's tomb. We know
what regulations need to be changed. We know a number of things
we have to get focused on and Congress has to act.
Dr. Hill, I want to start with you on the GIPSA rule. I
would like for you, if you could, to explain it in kitchen
table terms, so people can understand how this rule affects
farmers and potential consumers.
After you do that, I would like for you to tell me whether
or not the USDA has reached out to you and your organization
about the latest livestock marketing practices and how the 2010
rule, which we successfully pushed back, will be updated for
2016 modern practices.
Also, if you have an opportunity, give me an idea of
whether or not USDA has indicated to you or your organization
what will be included in the rule.
Dr. Hill. Well, thank you. Anticipating this might be a
question, I contacted the CEO of the National Pork Producers
Council and asked him if USDA had contacted our organization or
the National Pork Board, and to his knowledge, we have not had
any direct contact with USDA----
Senator Tillis. So we have a sweeping regulation, and have
not consulted with major organizations to understand what the
modern rule would need to look like to not be disruptive.
Dr. Hill. Does that surprise you?
Senator Tillis. Not at all.
Dr. Hill. No.
Senator Tillis. It angers me, but it does not surprise me.
This is just another example of why these regulators need to
get out. They need to go and talk to farmers and understand
that this regulation is disruptive in a time when we have so
many other disruptive forces. They need to actually go and talk
to the people that are producing safe food and modernizing
their practices because they cannot continue to disrupt what
our farmers are doing.
We will submit another question for the record for you to
follow up.
Mr. Brunner and Dr. Hill, I also want to talk about biotech
with regards to the Vermont law and the patchwork of another 20
or 30 states that could come into effect. I'm afraid that if
proteins are not exempted from these labeling practices the
food companies are going to reformulate. Can you give me some
sense of what this is going to do to the industry in terms of
reformulation practices? You know, we had to beat down the COOL
regulations last year. This could be another mandatory product
labeling initiative that will place another burden on our
farmers. If we do not act, can you give me an idea of how this
is going to affect your business operations and future prices?
Mr. Brunner, we will start with you.
Mr. Brunner. I think that is a very good example. The
mandatory country of origin labeling, failed experiment, left
us with increased industry costs and facing $1.1 billion in
tariffs from our two best trading partners. I believe there is
a huge lesson to be learned there, from trying to furnish
something to consumers that they are not willing to pay for.
Specifically to the beef industry, it takes somewhere in
the neighborhood of 70 to 100 bushel of corn per animal to
finish those animals----
Senator Tillis. 90-plus percent of the corn produced in the
United States is a product of biotech engineering, is that
correct?
Mr. Brunner. Exactly, sir.
Senator Tillis. So you are not going to reformulate since
there is not enough non AE corn grown to feed these cows.
Mr. Brunner. There is no way to identify preserve without
adding very significant cost. It would--it is just commercially
impossible.
Senator Tillis. Dr. Hill, do you have anything to add to
that?
Dr. Hill. Well, I would think it would have the opposite
effect on what I think the USDA wants. It would cause--the
packers would be so fearful of all these regulations, they
would increase their own production. So, we have a lot of
programs, as Mr. Brunner pointed out, that add value for the
producer, antibiotic-free, ractopamine-free, housing, all
different kinds of, like, genetics that we get premiums for,
and if the GIPSA was--if they implemented what was in 2010,
that would be a huge problem for those kind of programs and
would be detrimental to the profitability of not only large
producers, but small producers, because small producers are the
ones that really take advantage of some of these niche markets.
Senator Tillis. Well, thank you.
Mr. Zimmerman, I am going to submit for the record some
questions on HPAI for you. I know that my state's Agriculture
Commissioner, Steve Troxler, sent officials to Minnesota, to
learn from practices that were established up there during the
outbreak. I have got a couple of questions that I will follow
up on, but I want to personally thank you for your leadership
and dedication in this area.
Mr. Chairman, if I appear to be a little bit frustrated, it
is because I think that time is running out. We have had enough
discussions and we know what the issues are. We have got to
solve the biotech labeling issue in the near future. We have
got to beat back GIPSA again. All of these disruptive forces
that do not add value, do not do one thing to accomplish any
progress on food safety. Instead, it puts another burden on our
farmers that they cannot possibly afford to have lopped on
them. Thank you.
Chairman Roberts. Senator Tillis, I have not noticed any
change in your demeanor at all.
[Laughter.]
Chairman Roberts. Senator Stabenow has a brief question.
Senator Stabenow. Mr. Chairman, I want to follow up on
this----
Chairman Roberts. Senator Heitkamp, you are next.
Senator Stabenow. --if my colleagues would indulge me,
because, obviously, the issue was raised and biotech is a very
difficult issue for all of us who support biotechnology and
production agriculture, and at the same time, through no
creation of ours, there is a growing demand and actions coming
from consumers.
So, I just think it is important as we are wrestling with
this to be clear, and Mr. Brunner, maybe you can tell us how
you are affected by the Vermont law.
Mr. Brunner. You know, I would not be expert on the Vermont
law. We have not spent a lot of time studying it. I do know
very----
Senator Stabenow. It is my understanding you are exempt.
Meat is exempt, correct?
Mr. Brunner. That would be a very important aspect of any
efforts into genetic labeling. You know, as I----
Senator Stabenow. But I just think it is important to know
that you are exempt, so there is a different kind of urgency
around this because you guys are exempt from Vermont.
Mr. Brunner. Well, we might also be concerned about what
might follow, and the press----
Senator Stabenow. No, I understand. I just think this
complicates the issue for us as we are looking.
But, I also wanted to just ask anyone who would want to
respond, I think there is a general exemption around feed that
is very important, the feed exemption, but the challenge that
is being debated is from a consumer standpoint. If we have a
can of soup that is vegetable soup or a can of soup with beef
broth and meat in it, one would be labeled and one would not
be, which I think is probably more of a challenge if we were
following the Vermont labeling law, which from a consumer's
standpoint or from a grocery manufacturer's standpoint is a
different issue, when you are having to go through and sort of
figure that out with two cans of soup and one is exempt and one
is not exempt.
So, I wonder if anybody would want to speak to how we deal
with that or why that is a good idea.
Mr. Brunner. Senator, very briefly, could not the voluntary
labeling program that we already have serve that need and find
out if there is a willingness for a significant enough portion
of the market to pay for the cost?
Senator Stabenow. Well, Mr. Chairman, I am not going to go
on and debate this more at this point in terms of voluntary and
mandatory. I think what we are trying to do is how to figure
out at this point what is coming at us, which is something that
is a requirement, and how do we put together a balanced
coalition that is going to allow us to get something done in a
reasonable way that addresses very different requests and very,
very different needs, and this is a tough one. So, just wanted
to get your perspective on this one issue that has been an
issue of concern and trying to work through. Thank you.
Mr. Goggins. Senator, if I may add----
Senator Stabenow. Yes, sir.
Mr. Goggins. I think, speaking in that regard, I think we
should--I mean, something needs to be done to get some
uniformity----
Senator Stabenow. I agree.
Mr. Goggins. --and less confusion for the consumer.
I think as far as the beef goes, on probably a different
note here, but I do think we have to remember that these cattle
that do eat GMO feed are not genetically modified themselves by
eating it.
Senator Stabenow. I agree, and I think there is general
agreement on that, so thank you.
Chairman Roberts. Well, Tracy and Mr. Goggins, thank you so
much for your commentary. It is exactly what I think is
appropriate. If any of you are into wine production, maple
syrup, ice cream, dairy, meat, you do not have to worry about
it. So, that is an example of what happened in Vermont, which
means every state could exempt their home products and have
about 30 or 40 labels and the entire food industry would
collapse. We are trying our very best to reach an accommodation
and the Committee has already spoken to this and we have
already had an attempt on the floor of the Senate. The House
has already spoken. So, we hope that we can find an answer just
as soon as we possibly can. Tempus is fugiting. Time is a
factor. So, thank you for your commentary.
Finally, Senator Heitkamp.
[Laughter.]
Senator Heitkamp. Thank you, Mr. Chairman and Ranking
Member. It has been an interesting dialogue.
I want to make maybe a couple points before I start getting
into high frequency trading, and one of the reasons why I
particularly was interested in this hearing, which is the
cattle market.
First off, a lot of the challenge here is your relationship
to your consumers, whether we are talking about new regulations
on organics, whether we are talking about antibiotic
regulations, we have got to have more informed consumers and
that has been one of our challenges, which is try and maintain
a readily available, high quality food source in this country
that people accept as high quality and accept as available to
them.
You know, I would challenge you that as we are dealing with
these challenges, you need to deal directly with consumer
challenges, because even if we eliminate the regulation, I have
a feeling that consumers are going to continue to demand a
label that then becomes voluntary and takes us to a place where
we erode the availability of high quality food. I think there
are some real challenges in all of this.
But where everybody points a finger at government, I would
suggest that this movement did not start at USDA. It did not
start in this committee. This movement started as a consumer
information movement. If your only response to this is, ``you
do not need to know,'' I will tell you, as producers, you will
lose. You know, if we said that to our constituents, well, you
do not really need to know what our position is on that, we
would probably lose, too.
These are challenges. I have supported the Chairman and I
have supported trying to get to some kind of preemption for a
label. But, I remain frustrated that we have not been able to
really drill down and do a better job involving consumers in
this discussion.
I also, Mr. Brunner, would tell you I held a hearing, or a
meeting last week, and one of the answers to the concerns about
the cattle market was reestablishing COOL. So, we know that is
not a unanimous opinion within the cattle industry.
But, my main focus, I hope, will be on how do we get trust
back into the cattle market. I know you have just been--your
organization, Mr. Brunner, has done yeoman's work with Chicago
Mercantile. They are trying some things right now that they
think may help kind of correct the market. I think, Mr.
Goggins, you know what this has cost cattlemen in my country
and in Montana. You understand what these fluctuations have
meant.
What else should we be doing with the cattle markets to
bring people back into the markets and stop what I think is
speculation and start getting to a real cash price that
reflects fundamentals? I am going to start with you, Mr.
Brunner.
Mr. Brunner. Well, as I said in my opening comments, we are
in the situation of growing cattle numbers, growing beef
supplies, and not access, not competitive market access to the
markets that we need. Trans-Pacific Partnership would increase
our ability to compete on a competitive basis with Australia
into Japan. We have already lost $300 million into that market
and the disparity will continue to grow, because Japan and
Australia have a bilateral agreement that grants them
preferential treatment. So----
Senator Heitkamp. I start every one of my discussions about
trade saying 95 percent of all potential consumers in the world
do not live in this country.
Mr. Brunner. I believe that is very accurate.
Senator Heitkamp. If you think we can continue to be a
country that is a dominant economic power without accessing
markets, we are wrong. If you do not think we need to lower
trade barriers, you are wrong, especially for the products that
we grow in North Dakota.
Mr. Goggins, can you just offer some insights on the
current problems that we have in the cattle market and what we
should be doing to fix them.
Mr. Goggins. I think there are quite a few things that are
contributing to what we have gone through. I mean, I think the
strength of the U.S. dollar right now has prohibited our
ability to export our product, not just beef, but commodities
in general. I think there is--a huge problem has been the
volatility in the Futures Board market. I just----
Senator Heitkamp. So, how do we fix that?
Mr. Goggins. I am not really sure. I think we do things
like NCBA and people within the industry are doing as far as
working with CME and coming up with some way to slow the market
down.
Senator Heitkamp. So, would you not agree that it is a
problem when--I think the number that was used was about a
fourth of all cattle actually move through the market this way
on a cash basis but yet establishes the price, and that is a--
when you have a thin market, there is always room for mischief
in a thin market when you do not have enough participation. So
my question is, how do we expand participation?
Mr. Goggins. I think there are several things going on.
Today, right now when we are having this hearing, they are
having their first Internet sale. There are feedyards putting a
certain percent of their show list on the sale today and they
will be sold across that video auction, trying to get a truer,
more immediate, more transparent way of seeing what these
cattle are actually worth. Hopefully, we can get more cattle
sold on a cash basis, because it is--the cash basis then
forwards on to the Futures Bond and that is how we are supposed
to make our market on the Futures Board.
Right now, there is--the Futures Board just does not follow
the fundamentals of what cash is bringing. It is really
becoming a serious problem, I think, especially from a risk
management side, because I think there has been--I do not think
any of us know the amount of equity that is going to be lost
and has been lost, but it is going to be unbelievable----
Senator Heitkamp. Yes. When----
Mr. Goggins. --what we see in this deal. These bankers,
when I go in or a young person goes in and wants to get a loan,
these bankers, the lenders are definitely going to make them
get a hedge position on that Board. So we have to make it a
more stable market.
Senator Heitkamp. Well, I do not think there is any doubt
about it, or people are going to move out of the cattle
business, which is just going to compound this.
Mr. Brunner, I will give you the last comment, but I do
want to applaud your work and your Association's work with the
market. You suggested in the beginning of your testimony that
you were not interested in any changes. You guys are going to
watch it. But I want you to know that we are watching it very
closely. I associate myself with Senator Grassley's remarks. We
want to know what more we can do to push for a fair and open
market so that we do not lose equity and that we do not lose
producers.
This is a tough business. Anyone who thinks it is easy
being a rancher in North Dakota, you are wrong. I mean, when
you are pulling a calf at 2:00 in the morning and there is a
snowstorm on the way, that is not an easy life, but it is a
life they want to continue living. But if they cannot make a
living, that is bad for all consumers, it is bad for America,
so----
Mr. Brunner. Senator, very quickly, I think one thing that
we are discovering is high frequency trading is utilized
throughout all financial markets and the CFTC has told us that
they have been observing it, as well. I think in many other
markets, it gets covered up, because cattle are a somewhat
unique commodity. We are a perishable commodity. We cannot put
the grain back in the bin and wait until the market stabilizes.
I would also like to give due respect to Senator Grassley's
figures, or information that he supplied. I would not directly
contest any of those, but those are symptoms of an evolving
industry that is trying to maintain and increase its
competitiveness in the global economy. As we work to try and
achieve efficiencies within our industry, relationships develop
as we coordinate up and down the value chain. So those
decreasing number of animals trading on a cash market or spot
market is bound to diminish.
But, it is an industry question. We are very concerned
about it. I have been thinking about this, worrying about it.
It has been going on for 20 years and we are going to continue
to work on it and we will solve it.
Chairman Roberts. Senator Hoeven.
Senator Hoeven. Thank you, Mr. Chairman. I appreciate our
witnesses being here today.
First question, just--well, actually, the first one is for
Mr. Brunner and Mr. Goggins. What is the number one thing we
can do to help our cattle producers right now with low prices?
What is the number one thing we can do to help them?
Mr. Goggins. I think the number one thing would be, I
really think, passing of the TPP will open up our trade with
Japan and lower our tariffs. I really think that would be a
huge thing.
I also think helping us with stabilizing this market as far
as the Futures Board would--some way or another, getting it to
where it is a more viable risk management tool, I think would
be huge for this industry and for the way we can go forward.
Senator Hoeven. Meaning what when you say stabilize the
futures market? That would mean doing what?
Mr. Goggins. Well, I think maybe getting the limit--right
now, the feeder cattle limits are four-and-a-half, and I
personally, and a lot of us within the industry that trade it
every day, believe that limit does not fit the industry. The
algorithmic trading along with that, it causes huge violent
moves and it--I mean, when feeder cattle move $13 in one week
one way or the other, it might go $15 one way or the other,
there is no way these feeder cattle move that much on a cash
basis consistently the way it has done the last year.
Senator Hoeven. Mr. Brunner.
Mr. Brunner. What Mr. Goggins has proposed might help and
it might not. Our organization believes that it would be
fruitless and maybe foolish to try something without really
studying what effect it might have, and that is why we need the
data. We need data from the CME on what is going on in the
futures market, what the high frequency trading is really doing
to the market, how prevalent it is, and how it is moving the
market on these large move days.
So, in direct answer to your first question, though, I
agree with Mr. Goggins. The one thing that you could do is help
us pass TPP. We need expanded markets for the expanding
supplies that we have in our industry.
Senator Hoeven. So, my next question is for whoever wants
to take a swing at it, but whether it is cattle or poultry or
other livestock, we are seeing growing exports, but at the same
time, we are seeing prices continuing to go down. So we have
low inputs, so you have got low feed cost. You have got growing
export. How come our price continues to go down? We are down
about 15 percent, I think, since the start of 2015. But think
about it. You have got cheap feed and you have got growing
exports. Why is the price going down?
Mr. Brunner. We do not have----
Senator Hoeven. It is not just cattle now, you know.
Mr. Brunner. I think I said earlier, we had ten pounds of
total protein available to the domestic consumer last year than
we had the year before, and this year it will be even an
increase. We have growing supplies of all proteins, pork,
poultry, as well as beef, and our export markets are not
growing fast enough to take those up. Part of the reason, the
value of the dollar has been cited. I cannot help but go back
to TPP. We are on unlevel playing field. Australia has----
Senator Hoeven. I think the value of the dollar is the
biggest problem in terms of our--all exports, certainly ag
exports, but all exports. The dollar being so strong is really
tough on us.
Mr. Goggins. Senator, may I add, according to the USDA,
through 2015, as far as beef production goes, we had a 500
million pound increase over 2015 in our imports. We had a 250
million pound decrease in our exports. That is 750 million more
pounds that is being put on the domestic----
Senator Hoeven. So you are saying import volume is part of
this price depression, import volume.
Mr. Goggins. I really do.
Senator Hoeven. Well, that is important.
Mr. Goggins. I think that is about a three percent
increase. So, it takes, according to the USDA, it takes--for
every one percent sway one way or another in supply, it affects
your price one-and-a-half to two percent. So, I really think
that extra 750 million pounds of beef product that we had on
the domestic, it is our trade deficit.
Senator Hoeven. Let me--one final question. I am about out
of time. WOTUS, Waters of the U.S., how does it affect your
producers? I would like all of you to take a swing at that one.
Mr. Brunner. It affects our producers' ability to enjoy
their private property rights in the most efficient, economical
manner for their operations. It is a massive federal government
overreach. It goes far beyond clean water and navigable waters
of the United States. It is an intrusion into private property
rights.
Mr. Truex. I agree with that. In our industry, it limits
the amount of land we can apply manure on. It has all kinds of
restrictions. There is a lot of overreaching burden that goes
with the current regulations.
Dr. Hill. Yes. The only thing I would add is that I think
it will be a boom for environmental lawyers because we will be
sued until who knows what happens.
Senator Hoeven. Mr. Goggins.
Mr. Goggins. It affects every sector of agriculture, the
rule, and it is basically--it touches every state, every corner
of this country, and I think it takes--it will take due
consideration and time for the review. I mean, the voluntary
conservation has been a really good success. I think the best
stewards of the land are those of us on the land. I think it
really affects our property rights, as well.
Senator Hoeven. Mr. Zimmerman.
Mr. Zimmerman. I would concur. Manure management plans will
be much more difficult and still the unknowns. We really do not
know how it is going to affect us. There is too much
uncertainty there.
Senator Hoeven. Thank you.
Chairman Roberts. Senator Donnelly.
Senator Donnelly. Thank you, Mr. Chairman.
I would like to thank Mr. Truex for being here. He is a
leader in Indiana agriculture. He is someone we are very, very
proud of, and I will tell you, Mr. Truex, since you told the
Ranking Member, Senator Stabenow, that you buy your organic
eggs from Michigan, she has become a big fan of yours, as well.
[Laughter.]
Senator Stabenow. That is right.
Senator Donnelly. I know you have had your hands full with
the avian flu outbreak. I am very, very proud of how we
responded in Indiana, how we have worked on this. Can you tell
us some of the things that you think that were done right in
responding to that.
Mr. Truex. Yes. I think government, USDA, and the industry
learned a lot of lessons from the Iowa situation, and as we
were preparing for this, we had our state vet, Dr. Marsh, speak
to the entire UEP organization in October of last year about
how Indiana is prepared for this in our state. Then,
unfortunately, as this spring, Indiana had its own high path AI
outbreak in Southern Indiana, and I think it is a testimony to
the lessons that USDA learned, that the states learned, that we
were able to control that outbreak rapidly. It was put away.
I think the lessons learned are there is a way to control
it, and I think as Mr. Zimmerman said, the key is instant
response. You have got to have a plan. You have got to know
what you are doing. You have got to have it all prepared so you
do not get the different agencies fighting with each other over
what you can do in a state, what you can do in a county, and
what needs to be done.
So, I think the industry and USDA is much more prepared to
deal with any future outbreaks and keep it contained in a much
smaller area with fewer bird numbers.
Senator Donnelly. So, do you think, and it sounds like this
is one of the keys, that it is not the moment that you learn
about the fact that avian flu has arrived as it is, in effect,
almost preparing for the worst, hoping for the best, but having
every single thing you can think of lined out and ready to go.
Mr. Truex. Absolutely. Our state Poultry Association and
our state vets' office have worked together very, very hard and
they have really put the effort in and we are prepared in the
State of Indiana too, when we find we have a problem, we will
deal with it quickly, rapidly, and control it.
Senator Donnelly. Let me ask you just to pick up on some of
the other questions that have come before us so far. I was just
wondering the difficulties that you will face and the industry
will face logistically if we cannot find a federal solution to
the labeling of GE materials as we move forward, if we are not
able to get that done.
Mr. Truex. Well, our industry is very concerned, and as the
Ranking Member pointed out, thankfully, meat, milk, and eggs
are exempt at this point in time and we hope it continues that
way. A patchwork of different states would be a nightmare when
it comes to--we sell our product in probably 40 or 50 different
states, along with export. So, a standard has to be set. You
cannot label your cartons on 30 or 40 different standards. So,
a federal level that overrides all state regulations has to
happen.
Senator Donnelly. Thank you.
Thank you, Mr. Chairman.
Chairman Roberts. Senator Thune.
Senator Thune. Thank you, Mr. Chairman.
Thank you to the panel for being with us today. I
appreciate your testimony and your responses to all the
questions, and I am sure a lot of these issues have been
probably beat to death by now, but I did want to just follow up
a little bit on the labeling issue.
As you know, and I am sure it has been discussed that the
Senate is considering a path forward on biotech labeling, and
the question I guess I have is does anyone on this panel
believe that animal products should be included in mandatory
labeling of biotech products, or should meat, dairy, and other
animal products all be exempt from biotech labeling?
Let me just say that I know that there has been this
argument made that consumers really want meat to have mandatory
biotech labeling, but I guess my question is, is that what they
really want or is that what they are being told they want by
labeling supporters, because that strikes me as that is not
something that I certainly hear from my constituents out there.
But, tell me what you all think about whether or not the
labeling issue that we are having the discussion about here
ought to apply to meat, dairy, and other animal products, or
whether they ought to be exempt.
Mr. Brunner. Well, very quickly, our organization does
significant consumer market research and the consumers that we
talk to, they are not telling us that, either.
Senator Thune. Okay. Anybody else?
Mr. Truex. We would just like to say that the science of
the animals that eat genetically modified grains, there is no
scientific evidence that passes through the meat or the
product, the egg or the milk. So, we would like to stand behind
that very firmly.
Senator Thune. All right.
Dr. Hill. Yes, and that is a view that the Europeans take,
too. So, I think that tells us a lot right there----
Senator Thune. Yes.
Dr. Hill. --because they tend to be more reactive on these
issues.
The other thing is that, the more and more sorting that we
ask the packing industry to do, the less efficient they become,
and there is just so much sorting that they can do. If we had
non-GE and GE meat, it would be a nightmare for them to try to
track that product through the whole meat chain. That would be
a disaster.
Senator Thune. Well, it strikes me that, yes, I guess that
pretty much answers the question. When we are getting to the
left of Europe on some of these issues, we are probably out of
the mainstream when it comes to this country.
One of the things when I visit with cattle producers in
South Dakota, one concern I hear quite often is regarding the
consolidation across the beef industry. So, I guess I would
direct this to Mr. Goggins. What role does consolidation play
in the competition in the markets, and what trends and producer
marketing strategies are you seeing in response to
consolidation?
Mr. Goggins. Well, I think as far as our organization, I
mean, with our auction markets, with our video company, we are
promoting the highest--and actually in this part of the world,
the United States, we raise the highest quality, as good of
beef cattle as there is in the world, and we are putting a
pretty good show list up. I mean, I grew up in the auction
business, not only the ranching business, but went to the
stockyards every morning and kind of grew up there, and as my
father always said, competition is good. We need competition in
the marketplace. We promote it every day and we do the best we
can to get competition and buyers in the seats every day. We
work at it. I think we need to move that up the chain as we go,
at the fed cattle level, as well. But, we do everything in our
power to do that.
Senator Thune. On a scale of one to ten, regulatory burden
of government. I know it has all been talked about probably at
some length today. In terms of the issues that you have to deal
with or the issues that concern you with regard to the future
of the livestock industry in this country, where would that
rank?
Mr. Goggins. Twelve.
[Laughter.]
Senator Thune. Okay.
Mr. Brunner. Ten.
Mr. Goggins. It is high. Since you brought that regulatory
up, in the feeder cattle business, especially in your part of
the world, South Dakota, Montana, you get especially our way
West and South, you get further away from the corn belt. You
get in the East Coast, Florida, where a lot of feeder cattle
are, I think we need to be real conscious of--we have had the
livestock haulers exempt, I mean, the movement of these--the
interstate movement of these feeder cattle, livestock in
general. If you load a set of cattle in Western Montana and go
clear to Kansas with them, it takes more than ten hours----
Senator Thune. Right.
Mr. Goggins. --and I think if you get those cattle loaded
up, you have got to unload them somewhere ten hours down the
road and then let them stand in a dry old lot, not taken care
of very well for another ten hours, load them back up. I mean,
we always base our death loss as far as the feeder cattle that
we buy from one to two percent. Now, we start unloading these
things, because the trucker has got to have ten hours of sleep,
I think it becomes a real animal welfare issue. I think these
cattle are--instead of a one or two percent death loss, we are
going to be looking at ten, 20, 30 percent death loss on these
cattle, which, in turn, it is going to affect the value of
these feeder cattle in those areas that are quite a way from
the feed, and I think it is something that we really need to
address.
Senator Thune. You referenced, I think, in your testimony,
the commercial livestock hauling, and I want to point out,
because I serve as Chairman of the Commerce, Science, and
Transportation Committee, that we were involved in leading the
successful effort to make hours of service exemption from rest
breaks permanent for those who are carrying livestock and bees
and it--the provision takes into account the health of the
livestock, which--and the practical reality that these animals
should not be left on the roadside.
So, the exemption was granted, I think, on multiple
occasions by the FMCSA, the trucking agency, and we made it
permanent to prevent the need for repeated consideration of
these same facts. So, there is--it is in Section 5206 of the
FAST Act and hopefully that will provide some relief on that
front.
But, I know that in terms of regulations, and I am sure it
has been covered, as I said, at length, Mr. Chairman, but I
just have to say that when you are trying to make a living in
production agriculture these days and the government is
constantly your biggest enemy, something is wrong. We just see
it on every front, and I hope that changes. Obviously, we are
going to do everything we can at this branch of the government
to keep that from becoming the biggest liability to making a
living in agriculture. But we could certainly use some help
from a lot of the agencies who evidently have way too much time
on their hands around here, because it just seems like every
day, there is something new coming out that makes it more
expensive and more difficult to do what you do and to help us
feed the world. So, that has got to change.
Thank you. Thank you, Mr. Chairman.
Chairman Roberts. Senator Ernst.
Senator Ernst. Thank you, Mr. Chairman.
I would like to thank all of our witnesses today for being
here, especially Dr. Hill. Thank you for coming out from Iowa.
It is really good to see you again, so thank you. We have got a
lot of important topics that have been discussed today and I
want to thank all of you for your input.
I am glad that you have highlighted the challenges that
your sectors are facing right now, whether it is from market
volatility, burdensome agency regulations--jeepers, how many
times have we talked about WOTUS--foreign animal diseases,
international trade barriers--I am going to come back to that--
or labeling requirements that would disparage our products. Let
us talk a little bit about--I know everybody has wanted to talk
about it, TPP.
About a year ago, I was in Vietnam and Singapore and the
topic of discussion there, of course--and this was a defense
conference that I had traveled to in that region--but they
wanted to talk about TPP, because a number of those world
leaders, the military leaders, they really wanted to have the
United States as a primary trade partner, and the push-back was
that if you are not our primary trade partner, there is another
country in the region that does want to be our trade partner,
and that, of course, is China.
So, I would like to hear your thoughts on that in relation
to if we are not stepping up to the plate, what are the other
players out there that might fill in the gaps if the United
States is not involved in trade with these nations, or expanded
trade with these nations. Mr. Brunner, if you could start,
please.
Mr. Brunner. Well, China has their own 16-nation potential
trade agreement that they are actively promoting in the advent
that the United States does not go forward with TPP. As has
been said, TPP would include 40 percent of the world's
economies. It is also based on ethical standards and sanitary
standards that are dictated by the United States and I do not
believe we want to abdicate our role in the global community
and the Pacific Rim to China. You know, it has been pointed out
to me, and I firmly agree, that we do not maintain world peace
and competitive position in the world economy by shirking our
responsibility. So, we firmly believe TPP now.
Senator Ernst. Very good.
Mr. Truex.
Mr. Truex. I really do not have a comment on that because
of our industry does not really play into that so much. Thank
you.
Senator Ernst. Wonderful.
Dr. Hill, of course.
Dr. Hill. Well, I would agree with what Mr. Brunner said.
You know, it is obviously important from an economic
standpoint, but I think it is equally important from a
geopolitical standpoint. Countries that work together, trade
together, are going to be able to sit down and talk and work
out problems a lot better than if they are not trading. So, I
think it--I do not know if you could say the economic impact or
the geopolitical impact of TPP is more important, one than the
other, but they are both very, very important, and----
Senator Ernst. Very good.
Dr. Hill. --we would encourage the Senate to work hard to
get it passed as soon as possible.
Senator Ernst. Absolutely.
Mr. Goggins.
Mr. Goggins. Yes. I think it is a very positive thing, if
we do get it passed, for the U.S. cattle producers. I mean, I
think it opens up the export market back to Japan and reduces
our tariffs. I do think we need to--there need to be measures
in place, though, to address the cyclical and the perishable
nature of the cattle and beef in addition to protections
against dumping.
Senator Ernst. Very good.
Mr. Zimmerman.
Mr. Zimmerman. Well, I have a specific trade barrier
example that we are dealing with currently and it involves
Canada. A lot of our poultry, baby turkeys, come from Canada.
They are hatched in Canada, but then they cross the border and
are raised and processed in the United States. Currently, that
poultry, when it comes in the United States, can no longer be
exported to South Africa. But if that poult, baby turkey, stays
in Canada and is raised and processed in Canada, it can be
exported to South Africa.
So, technically, it bans all U.S. turkey from the South
African market and it is just an incredibly silly rule, and we
mix our birds. One of my flocks may be ten percent Canadian and
90 percent U.S. hatched, but they are all no longer eligible
for South African use. So, it is an incredibly silly trade
barrier that we would really appreciate your help in revisiting
and removing.
Senator Ernst. Absolutely. Thank you.
I see that my time is expiring, but I do appreciate it. I
think we do need to look very carefully at the TPP, not only as
trade, but also as a way to leverage cooperation with other
nations out there. So thank you very much, Mr. Chairman.
Chairman Roberts. Thank you, Senator Tillis for another
round.
Senator Tillis. I am not going to ask any questions, just
maybe a comment, and Mr. Chairman, I hope, without objection, I
can submit my opening statement for the record.
[The prepared statement of Senator Tillis can be found on
page 49 in the appendix.]
Chairman Roberts. Without objection.
Senator Tillis. Thank you. I just want to go back and maybe
lower the temperature a little bit, but maybe focus on the one
theme that I hope comes out of this meeting.
First, the TPP and trade with Europe and Africa is
absolutely essential to our future in farming, and I completely
get that. I voted for TPA. I hope that we can get the TPP to a
point where we get support and I will be working to that end.
Mr. Zimmerman, I will be submitting a question that touches
on a comment or an answer that you gave to Senator Ernst on the
sort of barriers to entry with South Africa. I think we have
another issue with Korea, where the HPAI seems to be used as a
pretext for them putting up protectionist measures. We will be
submitting a question for you so that we can better educate our
staff and other members on those challenges.
But, I want to go back again to the biotech labeling and
something Mr. Brunner said. Mr. Brunner, you said you have not
had a chance to study the Vermont law in particular. It does
turn out that in the Vermont law, beef, poultry, milk and eggs
have been exempted. As a matter of fact, a piece of pizza that
has meat on it is exempted, but its vegetarian equivalent is
subjected to the rule.
This is the sort of mentality that is being used by the
states to create a patchwork of regulations that will be
absolutely burdensome on food companies if Congress does not
act. Back to the point that Senator Heitkamp made, regarding
labeling but doing it in a consistent, high value way for the
consumer, but with a low impact to the producer. That can only
be done if Congress does its job and acts on preemption.
On GIPSA, we need to work very hard to see if we can
accomplish this Congress what was accomplished in 2010. Either
get the regulations to a point that you think are fair and can
be dealt with or do our very best to try and disallow them so
that we are not adding just another burden on an industry that
really cannot afford more burdens.
Thank you, Mr. Chairman.
Chairman Roberts. I thank the Senator.
I think both the distinguished Ranking Member and myself
have additional comments we would like to make with regards to
the agriculture biotechnology situation. It is called ABT. It
is not called a GMO.
We had a hearing with the USDA. We had a hearing with FDA
and the EPA, all three. I raised the question, is our food
safe? Are GMOs safe? The answer was yes, yes, yes. This is not
a human health problem. This is not a safety problem. This is a
marketing challenge, and you all know what I am talking about.
But, it has been very difficult to get this pulled together. We
had over 800 organizations come to this committee and ask us to
settle this.
We passed a bill 14 to six in this committee.
Unfortunately, we were not able to go to the bill. That takes
60 votes in the Senate and that has posed--our Founding Fathers
wanted us to go a little slow as opposed to those folks who
were closest to the people, the House of Representatives. I
understand that, and that is not going to change, I hope.
So, we have 60 votes to overcome to at least go to the
bill, which was the second bill that we introduced that we
tried to draw some folks over. The distinguished Ranking Member
and I have been meeting overtime on this issue. So, I want you
to know that this committee wants to get an answer.
I also want you to know that every person on this
committee, I do not know of any exception, are standing behind
efforts to get TPP done. Tough atmosphere. Every trade bill
that I have ever been associated with has been over-criticized
and it has been oversold, and it takes hard work.
Senator Tillis and I were in Australia, Indonesia,
Singapore, Japan, did not have time to get to South Korea
before we could get back. That was the number one issue. By the
way, the second issue was do you have our back, but that is
another whole discussion.
So, with regards to TPP, and now we call it agriculture
biotechnology, or just biotech, we are determined to get an
answer and we will keep working on it.
I want to thank you all for sharing your experiences
related to the opportunities and challenges that your
industries face. You are all leaders of the livestock and
poultry sectors and your testimony today has been invaluable to
this committee.
To my fellow members, we ask that any additional questions
you may have for the record be submitted to the Committee Clerk
five business days from today, or 5:00 p.m. next Friday, June
3.
This concludes our hearing----
Senator Stabenow. Could I say something?
Chairman Roberts. --except for the comments by the
distinguished Ranking Member.
Senator Stabenow. Well, thank you, Mr. Chairman.
I just want to say thank you to everyone again and to the
Chairman for the hearing and just indicate we are working very
hard on a difficult issue that both Democrats and Republicans
voted no on when it came to the floor. There was bipartisan
support and bipartisan opposition. Because of the nature of the
Senate, we are looking for that common ground and magic number
to be able to get to 60, and I remain, as I have been saying
now for I do not know how many years now, that from my
perspective, this is about making sure that we stop a 50-state
patchwork. We know biotechnology is safe. Thirdly, we have
consumers that are moving at the state level and are asking for
transparency and we have to find that, as well.
This is not an easy issue, because, frankly, we have people
coming from very different worlds. Depending on who you talk
to, it is like a totally different issue, which is one of the
challenges as we move through all of this. But in the interests
of agriculture in our country and production agriculture, we
need to find a way to come together and have common ground and,
frankly, be willing to compromise in order to be able to get
there, and that is what the Chairman and I are working on and
we need everybody here being willing to do that, as well.
Otherwise, it is going to be very difficult to get there.
We are willing to do that and we are working hard and we
are being asked to basically step up and take on the consumers
on behalf of the industries involved and wrestle back and forth
with this. I am hopeful that part of what happens long term is
that we have an education effort I have been suggesting to
folks for years, to be able to truly talk about what
biotechnology is so that people understand that. Ignoring that
discussion, or not having it in a way that addresses the world
we live in, in terms of communicating with people, it is just
not going to work.
We have to engage people so we understand the positive
side, what has happened in terms of moving agriculture forward
and the positive benefits of biotechnology in that process. I
would just encourage everybody to make a commitment to tell
that story, because if that story is not told, this is going to
be very difficult going forward, I think. So, thanks.
Chairman Roberts. I thank the Senator for her comment. I
would offer only one observation. The best, most effective form
of communication from consumers is their pocketbook, perhaps
not government mandates.
Senator Stabenow. Sure.
Chairman Roberts. That concludes our hearing. The Committee
is adjourned.
[Whereupon, at 12:10 p.m., the Committee was adjourned.]
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QUESTIONS AND ANSWERS
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