1/22/01

By Jeff Wilson.

BridgeNews.

ORLANDO, FL (B)--The nation's largest farm organization moved to the forefront of the farm policy debate after adopting a comprehensive set of resolutions at its annual convention Jan. 10. The American Farm Bureau said improving net farm income, enhancing the economic opportunity for farmers, preserving property rights and conserving the environment were its most important goals.

Unless commodity prices rebound unexpectedly, agriculture will need a "substantial increase" in government support over what the federal budget now calls for, said Farm Bureau President Bob Stallman.

He urged Congress to increase the funding baseline for agriculture and make farm policy "augmentation" an early priority.

"Whether a new farm bill is written in 2001 or not, there will be policy changes that will influence our management plans," he told AFBF members in his first address as president of the largest and most diverse farm organization.

It is the diversity of the membership that makes the policy resolutions adopted by the AFBF eagerly looked to as a blueprint by policy makers on Capitol Hill, industry insiders noted.

The Farm Bureau resolutions reaffirmed support for many programs and policies written into the 1996 FAIR Act. Among those policies supported, the AFBF voted for continued planting flexibility, no mandatory government supply or acreage reduction programs and no government--owned stock building.

One policy initiative the AFBF voted to pursue was to make adjustments to field crop loan rates.

Clearly, the higher level of soybean loan rates has helped to shift additional acreage out of other crops into soybeans in the past several years.

The AFBF voted to continue the marketing loan program but adjust all loan rates to be in historical realignment with the current soybean loan rate. The group is not calling for lower soybean loan rates but to raise other crops' loan rates.

The organization also is calling for farmers to be able to lock in a published loan deficiency payment rate after planting.

The AFBF supports changes in the Loan Deficiency Payment program to allow all producers of program crops to be eligible for payments, regardless of whether a farmer has a contract for regular farm program payments under the Agricultural Marketing Transition Act.

Also, when producers have purchased crop insurance, they should LDP on "actual production or established yield, whichever is greater," the Farm Bureau's resolution noted.

Delegates also voted for market loss assistance payments for all commodities and livestock to continue until trade--negotiating authority becomes law and agricultural trade improves.

The Agriculture Secretary should have "discretionary authority" to provide assistance to producers during times of economic disaster, the Farm Bureau suggested.

The group also is advocating development of risk management tools to deal with inherent fluctuations in revenue and income associated with farming.

AFBF voted to pursue policies that will allow producers of all crops to gain access to crop insurance that accurately reflects individual crop risk. It also said revenue insurance tools should be expanded to include a program for livestock producers.

The AFBF does not want crop years affected by natural disasters to hurt a farm's production history for crop insurance.

Overall, the AFBF said agricultural policies must ensure enhanced funding for research, reduce regulatory burdens, provide a fair and equitable tax structure and continue to improve the environment through voluntary initiatives.

One of the most important tax policies AFBF wants is the total elimination of estate taxes. While the group debated language about pushing for a $10 million estate tax cap, the final policy paper left no room for misinterpretation.

"Farmers and ranchers will settle for nothing short of an all--out repeal of the death tax," one delegate said during the debate.

AFBF favors increased U.S. Department of Agriculture authority on mergers in the industry, including the ability to challenge proposed mergers if the Justice Department fails to investigate. The group also is calling for the Justice Department to look at market competition and price discovery whenever an agribusiness controls a 25% or greater share of its market sector.

Agricultural biotechnology was another hot--button topic that AFBF supports because of the benefits to producers, consumers and the environment.

"We are not willing to be dictated to by the EU (European Union) on what we can and cannot produce," Stallman told a closing press conference.

"Biotechnology will be an important technology for agriculture," he said.

AFBF voted to require tags on seed bags to warrant the genetic purity of seed and any marketing or planting restrictions for biotech seed should be provided to producers in writing.

Legislation also was called for to allow farmers to recover damages when seed does not conform to the stated genetic purity.

The next farm bill will have to address numerous concerns ranging from providing adequate support levels to farmers and meeting international trade obligations to enhancing the environment and justifying farm spending to an ever--skeptical public.

It will be tricky, but not impossible, for the next farm bill to provide a new counter--cyclical support program that does not exceed limits on domestic support that the United States negotiated with the EU and other nations, said Paul Drazek of DBT Associates, a Washington D.C.--based agricultural trade consulting firm.

"The question is whether a counter--cyclical program can be fashioned to conform with World Trade Organization requirements and still allow the United States to press for other nations to reduce trade--distorting payments," Drazek said.

Drazek said his firm has developed for discussion purposes a plan that would provide counter--cyclical payments based on historical average gross receipts, which would comply with WTO guidelines because payments would not be tied to current prices or production.

Several members of the Farm Bureau, including Stallman, are members of the 21st Century Commission. A final draft of the commissions report is expected to be approved next week, and is scheduled to be presented to members of Senate and House Agriculture committees on Jan. 30.

Assuming Agriculture Secretary--designate Ann Veneman wins confirmation, the report will be presented to the White House.

There are a lot of similarities between the AFBF policy resolutions and the 21st Century Commission," Stallman said. "We're both going down the same road," he said.

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