Monitoring Corporate Agribusiness From a Public Interest Perspective
Aside from learning the hard way of never carrying a wallet with all your cash and credit cards in your back pocket when in a foreign country as an obvious visitor, this editor also learned in my recent journey to Brussels, Belgium (see story below) that now more than ever farmers and consumers worldwide need to have a source which can monitor corporate agribusiness from a public interest perspective on a regular basis.
That, of course, is my goal with THE AGRIBUSINESS EXAMINER and through your continued financial support of THE AGRIBUSINESS EXAMINER and the work of the Corporate Agribusiness Research Project I will hopefully be able to continue to have the means to provide the readers of THE AGRIBUSINESS EXAMINER with such a service.
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TYSON FOODS, POULTRY INDUSTRY SUBJECT OF
NATIONWIDE WAGE & HOUR PRACTICES INVESTIGATION
A nationwide audit of wage and hour practices in the poultry industry by the U.S. Department of Labor is in the offing, according to Tyson Foods Inc., the world's largest chicken and poultry producer.
Reuters News Service reports that news of the impending examination, was revealed in a filing by Tyson with the Securities and Exchange Commission (SEC). The filing also includes notes that the study will examine practices that are the subject of a lawsuit against Tyson in which employees have alleged that the company failed to pay them for all hours worked and has not properly paid them for overtime hours.
A federal lawsuit against Tyson was filed June 22 in Alabama by 11 current and former employees. The case is in the discovery stages, and the plaintiffs are currently awaiting a request for class-action certification.
The Labor Department began its audit February 9 at 17 poultry plants, including five facilities owned by Tyson, and will eventually include 51 plants, the filing said.
Neither Labor Department representatives nor Tyson spokesman Ed Nicholson were available for comments beyond the details in the filing.
UNC STUDY REVEALS FACTORY HOG FARMS
ADVERSELY AFFECT COMMUNITY'S HEALTH,
QUALITY OF LIFE
Industrial hog farms both reduce the quality of life for people living near them and adversely affect their health.
These are the conclusions of a recent University of North Carolina at Chapel Hill study compiled from 155 interviews with people living near a 6,000-head hog operation, two adjacent cattle farms and, as a control, a farm area without large livestock operations. The study of three of the state's rural communities was funded by the National Institute of Environmental Health Sciences' Environmental Justice program.
"In particular, headache, runny nose, sore throat, excessive coughing, diarrhea and burning eyes were reported more frequently in the hog community," Dr. Steven Wing, associate professor of epidemiology at the UNC-CH School of Public Health, told David Williamson of the UNC-CH News Services.
"Quality of life, as indicated by the number of times residents could not open their windows or go outside even in nice weather, was similar in the control and the community in the vicinity of the cattle operation but greatly reduced among residents near the hog operation."
Wing and his colleagues research appeared in the March issue of Environmental Health Perspectives, a scientific journal. The N.C. Department of Health and Human Services, which also supported the studies, released preliminary findings last year, but researchers have added further analyses. Others involved include research associate Susanne Wolf and graduate research assistant Dana Cole, both at UNC-CH, and Gary Grant, director of Concerned Citizens of Tillery, a community group.
"Dr. Wing's research on how hog operations are affecting the health of our communities in eastern North Carolina contributes greatly to our understanding of how large animal operations impact our environment and public health," said Irene McFarland, staff attorney for the North Carolina Public Interest Research Group.
"In North Carolina there are approximately 2,500 intensive hog operations, and they are located disproportionately in areas that are poor and nonwhite," Wing notes. "The public health and environmental injustice implications of this geographical pattern extend beyond the physiologic impact of airborne emissions to issues of well-water contamination and the negative impact of noxious odors on community economic development."
"While those living near hog operations have long known that their health was being impacted," McFarland adds," until Dr. Wing's study, the affected communities lacked the documentation to prove the extent to which their health has been jeopardized. Now that we have data establishing the scope of the harms communities are experiencing we need to take action by enacting stronger laws to protect our health and the environment from agricultural pollution."
The UNC researchers' goal was to choose three eastern N.C. areas with similar economic and social characteristics where local residents and groups would cooperate in the study. They chose sites with 80 to 100 households within a two-mile radius of livestock operations so they could interview people in about 50 households in each community.
Hog community residents could have reported more symptoms because of their feelings about the negative impact of the hog operation on their community, Wing said. However, if that had occurred, researchers would have expected excess reports of most symptoms, not just some.
"In fact, the eight symptoms in the miscellaneous category, none of which were expected to be related to exposure to airborne emissions, occurred with about the same frequency in the hog and control communities," Wing said. "This suggests that there was not a tendency for over-reporting among residents of the hog community."
About two-thirds of people questioned by trained interviewers were women. Just over 90% were black, with the rest being white and other nationalities. Average annual family income was about $20,000.
By far the biggest differences between the communities were seen in the quality-of-life questions, researchers found. More than half of respondents in the hog community, as compared to fewer than a fifth in the other two areas, reported not being able to open windows or go outside even in nice weather 12 or more times over the previous six months.
MORE, MORE AND COUNTING
IBP, Inc., the nation's largest meat packer and often referred to also as the nation's "number one corporate outlaw," has become the object of still yet another lawsuit.
The law firm of Milberg Weiss Bershad Hynes & Lerach, LLP recently announced that it has filed a class action lawsuit in the United States District Court for the District of Nebraska on behalf of all purchasers of the securities of IBP, Inc. between March 25, 1999, and January 12, 2000, inclusive charging IBP and certain of its senior officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule10b-5 promulgated thereunder.
The complaint alleges that defendants issued a series of materially false and misleading statements concerning the Company's compliance with state and federal protection laws applicable to the Company's beef and pork production facilities.
Because of the issuance of a series of materially false and misleading statements the price of IBP securities was artificially inflated during the aforementioned dates. The action further alleges that prior to the disclosure of the adverse facts described above, defendants intended to use millions of shares of artificially inflated IBP common stock as currency for a proposed corporate acquisition.
Recently the U.S. Department of Justice filed a lawsuit that prosecutors say could affect IBP plants throughout the entire Midwest. (See Issues #61 & #65) The Justice Department lawsuit accused IBP of violating federal air, water and hazardous waste laws at the company's flagship plant and former headquarters in Dakota City. Acting on behalf of the Environmental Protection Agency, the DofJ alleges IBP emitted up to 1,800 pounds of hydrogen sulfide a day in Dakota City without notifying federal regulators. Disclosure is required for hydrogen sulfide emissions greater than 100 pounds a day, the government says.
The lawsuit also alleged that IBP exceeded the federal Clean Water Act by dumping excessive ammonia into the Missouri River since at least 1988. The Justice Department says it intervened after state officials failed to stem the company's tide of environmental abuses.
"This case presents a pattern of activity for which the common thread is IBP's avoidance of environmental regulations," U.S. Attorney Thomas Monaghan told USA Today's Elliot Blair Smith. "We will hold them accountable."
IBP denies the charges. In response to questions from USA Today, IBP spokesman Gary Mickelson said the Justice Department cannot prove IBP's hydrogen sulfide emissions were excessive. "During the period in question," Mickelson said, "IBP was not required to measure air emissions from . . . non-specific, non-point sources such as lagoons and manhole covers within its operations. Without such data, it was impossible to know if any air-quality exceedances were taking place."
The 48-page lawsuit by the U.S. Department of Justice charging IBP with violating five federal environmental laws with numerous incidents of air and water pollution and with improper handling of hazardous waste in the latest in a series of lawsuits against a company already being sued for price fixing (See Issue #32) and for covering up job-related injuries in its plants (See Issue #60).
In the Cattlemen's Legal Fund price fixing suit, IBP sustained another setback recently when Federal Judge Lyle B. Strom in the ongoing class action Pickett vs IBP case ordered that IBP failed to meet its burden of showing good cause for blocking depositions by its board of directors. To prevent the depositions from inconveniencing the schedules of IBP's outside directors, the depositions have been ordered for the week around the normally scheduled IBP board of directors meeting.
IBP objections to its board members testifying under oath were soundly rejected on February 8, 2000 by Judge Strom.
IBP directors slated to testify included Robert Peterson, IBP Chairman and CEO; Eugene Leman, President of IBP's Fresh Meats Division; Wendy Gramm, former Chairman of the Commodity Futures Trading Commission and wife of Texas U.S. Senator Phil Gramm; Michael Sanem, past ConAgra-Monfort executive, the third largest U.S. meat packer; JoAnn Smith, past National Cattlemen's Association President and former Assistant Secretary for the U.S. Department of Agriculture; John Jacobsen, member of the Jacobsen family, which was the former owner of National Beef, now Farmland-National, the fourth largest U.S. meat packer; along with John Chalsty, President and CEO of Donaldson, Lufkin & Jenrette; and Martin Massengale, President Emeritus of the University of Nebraska. Richard Bond, IBP President of Fresh Meats, has already been deposed.
The case has been scheduled for trial in September 2000. Cattlemen are complaining that IBP, through various anti-competitive practices, has violated the Packers and Stockyards Act. According to the cattlemen plaintiffs, damages in the case including 1994 through 1998 could very well exceed IBP's total assets of $3.7 billion.
Pork producers filed a similar suit against IBP and Smithfield, the nations two largest pork packers, December 28, 1999. The suit alleges illegal market practices to manipulate and depress hog prices. Hog prices fell as low as seven cents, driving large numbers of producers out of business. According to a statement by the National Pork Producers Council on October 22, 1999, "Producers have lost $4 billion in capital in the last 22 months." In contrast, consumers of pork continued to pay high retail prices while according to the Wall Street Journal IBP's earnings more than quadrupled.
Meanwhile, IBP in just released figures reports a year of record earnings. Net earnings in 1999 were $321 million or $3.44 per share compared to 1998 earnings of $205 million or $2.19 per share, an increase of 57% in net earnings in one year.
As Les Messinger, Market analyst for Barnes Brokerage in Chicago, Illinois, comments: "Logic tells us that IBP and other packer profits are a result of the difference between the price paid for live cattle and the price they receive for beef and beef by-products."
Having documented IBP's earnings Messinger suggests examining cattle prices for the last two years and how they have compared with the beef industry. In 1997 the average live cattle price was 64.2% of the average lightweight choice boxed beef price. In 1999 the average live cattle price fell to 59.1% of the same boxed beef price. To put this in a clearer perspective, note that this 5%+ difference of a $114.00 boxed beef price amounts to a difference of $5.70/cwt. or a little over $68.00 per head loss to the producer.
According to USDA data, Messinger continues, over 42% of the cattle purchased in Texas and Kansas were acquired through either formula or contract (captive supply).
"I am sure that the packer aligned feeders who are receiving preference when provided with the $10.00 or $20.00 per head incentive over the cash market were very pleased with themselves, even though common sense shows us that their actions created that $68.00 per head loss in the live cash market. Reflect for a moment on what an additional $68.00 per head would have meant to the independent cattle rancher operation," he adds.
USDA STUDY SHOWS STRONG CONNECTION
BETWEEN "CAPTIVE SUPPLIES" & LOW CATTLE PRICES
Another strong connection between increased "captive supplies" and lower cattle prices has been established in a recent USDA report which indicates that the controversial cattle marketing practice may be costing farmers and ranchers more than a billion dollars per year.
The Texas cattle study, according to the Western Organization of Resource Councils (WORC), an organization of family farmers, ranchers and consumers, now gives Secretary of Agriculture Dan Glickman the conclusive evidence he needs to restrict the use of the marketing practice, known as captive supplies.
"We have a proposal on Secretary Glickman's desk to fix this problem," Shane Kolb, a Meadow, South Dakota, rancher speaking for WORC, said. "The billion dollar question is, `Will Dan Glickman adopt WORC's proposal and stop the secret cattle deals?'"
USDA's Grain Inspection, Packers & Stockyards Administration (GIPSA) released the results of its Investigation of Fed Cattle Procurement in the Texas Panhandle in late December. Last year, Secretary Glickman said that he would act on WORC's proposal to regulate captive supplies after the Texas study was completed.
The Texas study examined tens of thousands of cattle transactions in Texas from 1995 and 1996. It found that a one percent increase in the use of captive supplies by packers was associated with a decrease of $0.08 per hundredweight in the market price of cattle. "At today's level of captive supplies, that means lower cattle prices, which cost producers more that $1 billion per year for fat cattle alone," Kolb said.
Just over 42% of fat cattle delivered to packing plants so far this year have been captive supplies, according to statistics from USDA's Agricultural Marketing Service. If cattle prices are lowered 8 cents for every percent of captive supplies, today's captive supply levels would be associated with a $3.44/hundredweight drop in cattle prices, or $41.28 per head. That works out to $1.23 billion for the 29,836,000 head of fed steers and heifers sold to packers in 1999.
"Our proposal is a moderate, common-sense response to this billion-dollar problem," Kolb said. "It would restore competition to the industry without resorting to a flat prohibition on captive supplies. We've said before, and we say again today: it is time for Secretary Glickman to act."
Three years ago, the USDA asked for public comment on a petition for rulemaking filed by WORC. The petition asked USDA to limit the use of captive supplies of cattle by beef packers. Cattle that packers own and feed in their own feed lots are called "captive" because the packers control them. Packers also sign contracts with feedlot owners to buy some or all of their cattle, which are also
called "captive." Many farmers and ranchers say that beef packers' use of captive supplies limits open competition and lowers the price they get for their cattle without lowering the price of beef to consumers.
The minority report of Secretary Glickman's Advisory Committee on Agricultural Concentration endorsed WORC's proposal, and the majority report concluded that his authority to adopt such measures under existing law was clear. The National Commission on Small Farms unanimously recommended adoption of the proposal in its January, 1998, report, A Time to Act.
Organizations supporting adoption of the rules proposed by WORC represent hundreds of thousands of producers and consumers. They include the National Farmers' Union, National Farmers Organization, American Corn Growers Association, Corporate Agribusiness Research Project, National Contract Poultry Growers' Association, New England Milk Producers Association, Campaign for Family Farms and the Environment, Farm Aid, Western Livestock Digest, Center for Rural Affairs, National Family Farm Coalition, U.S. Catholic Conference, United Methodist Church, and the National Campaign for Sustainable Agriculture.
WORC's petition for rulemaking asks the Secretary of Agriculture to adopt rules to:
(1) Prohibit packers from procuring cattle for slaughter through the use of a forward contract, unless the contract contains a firm base price that can be equated to a fixed dollar amount on the day the contract is signed, and the forward contract is offered for bid in an open, public manner.
(2) Prohibit packers from owning and feeding cattle, unless the cattle they feed or own are sold for slaughter in an open, public market.
The Western Organization of Resource Councils (WORC) is an association of grassroots organizations in six western states: the Dakota Resource Council (North Dakota), Dakota Rural Action (South Dakota), the Idaho Rural Council (Idaho), the Northern Plains Resource Council (Montana), the Powder River Basin Resource Council (Wyoming) and the Western Colorado Congress (Colorado). The members of these groups are farmers, ranchers, small business and working people who seek to protect natural resources, family farms, and rural communities.
Currently IBP, ConAgra and Cargill the Big Three beef packers slaughter 81% of all U.S. fed cattle (those that end up as steaks, roasts, and other nice cuts in grocery stores and steakhouses). In seeking to end their unfair, monopolistic practices of underpaying producers and overcharging consumers, WORC is advocating that cattle ranchers and consumers contact Secretary Glickman:.
The Honorable Dan Glickman, Secretary,
U.S.Department of Agriculture, 1400 Independence Ave, SW
Washington, D.C. 20250.
People can also send him a message that is ready to go from WORC's website:
Or call him at 1-202-720-3631 asking him the billion dollar question: "Will you adopt WORC's captive supply rules?"
For more information on WORC's proposal, go to
BRUSSELS MEETING OF EUROPEAN, U.S. FARMERS
BRAND FREEDOM TO FARM, AGENDA 2000 A FAILURE
Growing world-wide opposition to agriculture being subjected to the jurisdiction of the World Trade Organization (WTO), while demanding that they receive a fair price for what they produce based on cost of production, were the dominate topics in Brussels, Belgium recently at a meeting of family farmers from the U.S., Europe, United Kingdom, Scandinavia, Latin America and Africa.
Sponsored by the Coordination Paysanne Europeenne (CPE) the gathering, through a series of round table sessions and debates, focused their attention on the questions:
* Is the U.S.'s Freedom to Farm Act and Europe's Agenda 2000 well-adpated answers to the world agricultural stakes?
* Are the production methods in the U.S. and the European Union beneficial on the economic, food safety, environmental and social levels?
Attending the February 24-26 sessions from the U.S. were Bill Christison, a Missouri farmer and President of the National Family Farm Coalition, Sophia Murphy, from the Institute of Agriculture and Trade Policy, and this reporter.
Discussing their common problems, the farmers meeting in Brussels clearly demonstrated that family farm agriculture world-wide sees the content of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT), Freedom to Farm, Agenda 2000, living beings patenting, genetic engineering pressure by the U.S. and European governments all as an effort by the world's two major economic powers, through industrialization and corporate power, to control the flow of food throughout the world.
In a conference working paper the CPE declares: "Who is going to control food, oil, communications --- human beings? In Seattle at the WTO ministerial meeting what was expressed was a refusal to entrust the fate of the population, the destiny of the planet and the human species to some powerful entities. The present reorientation of the world concentration process of food/chemical/seeds/genetic industries, linked to the poor sales of GMO's (genetically modified organisms), shows very well the battles which are taking place, where populations have not yet said their last word."
By way of illustration the gathering noted that the U.S. and Europe cannot maintain their recent trade agreements without "confessing their real objectives" which are:
* "Decreasing the agricultural prices for providing food industry and super markets with low prices, the lowest possible prices on the planet; the direct support to farmers since 1992 are therefore a support to the agro-industry and commercial sectors.
* "Sharing between them the world markets, imposing growth, by forcing the penetration of the U.S. and EU surpluses into the third countries (dumping and compulsory access to the market by five percent)."
Comparing Christison's explanation of the ruinous effects on U.S. family farm agriculture, stemming from the passage of Freedom to Farm in 1996, European farmers point out that likewise Agenda 2000, while allegedly focusing on the defense of a "European agricultural model," has instead adopted an agricultural policy that is hastening the decrease in agricultural prices, eliminating large numbers of family farmers, favoring the enlargement of the bigger farms and the development of industrial cattle breeding.
In explain the U.S. situation IATP's Murphy noted that "in the U.S., 1996 domestic farm legislation shifted the basis for making payments to grain farmers from the types and quantities of crops produced to so-called `decoupled' payments. This was expected to break the production enhancing element of government support. In practice, however, farmers have increased production in response to both high and low world prices, against the expectations of trade theorists. The new payments remain as a subsidy to agriculture, without the benefit of controlling production levels."
At the same time Freedom to Farm was being sharply attacked by the American representatives the EU was being accused of not honoring the stated purposes of its Common Agricultural Policy (CAP) as the European speakers at the Brussels conference pointed out that CAP is not merely a food production policy, but is more comprehensive in that it was originally designed to support the social and environmental priorities of the EU.
This fact, the speakers noted, is seldom recognized by those who criticize it, mainly the U.S., and who compare the financial outlay under the CAP to expenditures on their own agricultural policies which usually are merely economic in nature.
The CAP differs from such policies in that it was designed to support:
* the incomes of 7.3 million farmers, who have an average farm size of 17.5 hectors;
* promote rural development and avoid rural depopulation;
* compensate farmers for fulfilling demands of society such as the protection of the rural environment which often warrants action beyond good agricultural practices;
* help farmers overcome their loss in competitiveness due to the ever increasing restrictions on their production methods in response to society's concerns and demands such as: environmental constraints, use of certain technological applications (hormones ban, antibiotics as a feed additive ban, ever more restrictive animal welfare rules, GMO's, etc.)
The EU has argued that agriculture is specific in nature and cannot be treated in the same way as other economic sectors, either in terms of domestic or international policies, due for example to the diversity of agriculture, the influence of climate on production and the extreme fluctuations in production and prices if left totally independent on market forces.
Yet, the CPE notes that while the EU claims to focus on the "multi-functional dimension" of agriculture, the CAP has in fact been "specializing the farms for 40 years," i.e., destroying multi-functional agriculture.
A quick examination of European agriculture underscores the CPE arguments and dispels many of the myths being perpetrated by corporate agribusiness in their effort to lower farm prices to U.S. farmers and promote their own self-serving trade policies.
* While the EU agriculture policy was designed to fulfill the aforementioned objectives, as opposed to the U.S.'s almost strictly economic concerns, the EU farmer is subject to more restrictions and farms on the average an area which is one-tenth that of the U.S. farmer, who received on the average in 1999 some $11,000 per farm in government support, double that provided to the EU farmer.
* The EU and U.S. agricultural budgets as a percentage of the Gross National Product (GNP) are similar, with the U.S. slightly higher at 0.6%.
* The EU agriculture budget has been largely stable for the last few years and is fixed at the 1999 level for the next seven years while the U.S. Federal support to agriculture has increased by 300% since 1995.
* The assumption by CAP critics like the U.S. that the EU export refund expenditure --- a compensation to the exporter for the fact that purchases take place on a market which has a higher price than that on which the products are sold --- accounts for the major part of the value of EU agricultural exports is false. In 1992, prior to the EU's policy reform, the expenditure was 55% of the value of agriculture exports, but in 1998 the figure had declined to 9.4%. While the EU has imposed even greater disciplines on export assistance than obliged to by the WTO agreement, the U.S. expenditures on export assistance is not subject to any WTO discipline or limitation.
* Through its set-aside scheme, the EU has reduced potential production exports of grain since 1993 equivalent to one year's production in the EU.
* The EU is the largest importer of agricultural products in the world, much of which enters at zero or low tariff levels and in 1997 imported $24 billion (Euro) more than the U.S. EU imports have increased by 250% between 1991 and 1997, compared to a 68% increase to the U.S. The EU has always had a trade deficit in agricultural goods while the U.S. has always shown a trade surplus.
It is against this background that Europe saw the loss of 200,000 farmers in 1999, while it has lost some 600,000 beef producers in the past five years. Finland and Sweden alone last year lost a total of 10,000 farmers and the United Kingdom, in a recent report by the nation's National Farmers Union reported 22,000 farmers quit in 1999 as farm incomes fell 16% from 1998 with the annual value of Britain's farming output down by 25% from 1996.
Clearly as Dijon French economic professor Jean-Christophe Kroll told the Brussels meeting the myth of a "world market" needs to be dispelled as a large measure of that so-called market is simply made up of "buyers who have no money." while the food production sector is faced with lower prices while producing more and earning less. By the EU's own admission some 80% of its support is going to only 20% of its farmers.
Christison also noted that in the U.S. of the nation's 1.9 million farmers some 330,000 currently produce 83% of the nation's agricultural products and receive the largest support of government supports.
CANADIAN NATIONAL FARMERS UNION:
MARKET FAILURE DUE TO IMBALANCE IN MARKET POWER
"The market is failing farmers, it is failing worldwide, and it has been since at least the late 1970s. The market is failing to return a fair and adequate share of the consumer dollar to farmers. And it is failing to allocate to farmers a reasonable return on labour, management, and equity from our agri-food system's huge revenue stream.
"The EU spent approximately $90 billion in 1999 to protect its farmers from chronic market failure. The U.S. spent approximately $24.5 billion to protect its farmers. In Canada, federal and provincial governments have chosen not to protect farm families from this market failure. Federal agricultural spending has fallen to half the levels of ten years ago. The result is widespread bankruptcy, the rapid loss of family farms, decimated rural communities, and damaged regional economies.
"Market failure is apparent to anyone who wishes to look. Moreover, it is entirely predictable. It is a direct result of dramatic market power imbalances between agri-food industry multinationals and the family farms that must do business with these firms.
"Most executives, journalists, economists, and politicians point toward false problems and encourage farmers toward false solutions. Farmers are encouraged to blame themselves, farmers across the border or across the sea, their marketing agencies, their own government, or foreign governments. Thus, farmers have dissipated their energies fighting among themselves, bewailing their governments, and attacking agencies which give farmers some power in the marketplace."
--- Excerpted from: The Farm Crisis, EU Subsidies, and Agribusiness Market Power - Presented by the Canadian National Farmers Union to the Senate Standing Committee on Agriculture and Forestry, Ottawa, Ontario, February 17, 2000
The complete report is available at:
FARM COLUMNIST GUEBERT
CHALLENGES USDA ERS'S CHINA TRADE ESTIMATES
Thanks to our ever-observant colleague farm columnist Alan Guebert we learn not only that the USDA's Economic Research Service (ERS) recently pumped out a cheery report titled "China's World Trade Organization (WTO) Accession To Significantly Boost U.S. Agricultural Exports," which forecast that "the value of China's net imports of major commodities . . . would increase by $1.6 billion in 2005" if and when the U.S. grants China the coveted Permanent Normal Trade Relations status.
Likewise, according to the ERS, "by 2005, the largest increases in the annual value of China's net agricultural imports are likely to be for corn ($497 million), wheat ($484 million), and cotton ($456 million)," while "the total value of U.S. exports of wheat, rice, corn, cotton, soybeans and soybean products would increase by $1.6 billion in 2005."
It all sounds good, as Guebert notes, "but it sounds good because the report makes it sound like all these big dollars will flow to US farmers. Not so," says Guebert, simply because China's net import of major commodities would be split by all global ag sellers, not just U.S. farmers.
Which leaves farmers with the question: Just how much more U.S. farm goods will China actually buy if it receives a Congressional and WTO blessing? "We don't exactly know," an economist who helped prepare the report told Guebert. "There is no one in the world that has the staff and system to model for that type of hard number."
Any estimates by U.S. agriculture about trade with China, Guebert reminds us, should keep in mind that on March 8, 1999, ERS confessed it had over-estimated China's cattle herd by 21%, its hog numbers by 20%, and its need to import grain in the coming decade by 50%.
Yet, now we see corporate agribusiness and farm politicians currying Congress to grant China U.S. trade privileges based on the prediction that U.S. ag trade will grow worldwide by $1.6 billion; or a puny 3% increase over last year's dismal U.S. ag export total. "That's a $1.6 billion bang US farmers could lose without China in the WTO," an ERS economist told the farm columnist.
"Given ERS's previously erroneous estimates, `could' seems to be the operative word," Guebert emphasizes and correctly goes on to add, "it also means, according to a critic of freer U.S. trade with China that `U.S. multinationals can move U.S. capital into a highly skilled, low wage dictatorship. That ability will bring far more profits to them than to US farmers.'"
"RALLY FOR RURAL AMERICA"
SLATED IN NATION'S CAPITAL MARCH 20-21
Thirty national and state farm, labor, rural development and religious groups have signed on as sponsors of the Rally for Rural America, an event planned for March 20-21 in Washington, D.C., to call for congressional action on America's deepening farm and rural crisis.
"National support for this event continues to grow," said Jodi Niehoff, National Coordinator for the Rally for Rural America. "The diversity of organizations backing the rally signals how widespread the concern is over the future of rural America. These groups all recognize they have a stake in rural America and that Congress must take a new direction in farm policy."
Sponsors of the rally include: AFL-CIO, National Association of Farm Service Agency, American Agriculture Movement, County Office Employees, American Beekeeper Alliance, National Catholic Rural Life Conference, American Corn Growers Association, National Family Farm Coalition, American Sugar Alliance, National Farmers Organization, Burley Tobacco Grower Cooperative, National Farmers Union, National Rural Electric Cooperative, Campaign to Reclaim Rural America, Evangelical Lutheran Church in America, Presbyterian Church (USA), Rural Coalition, Rural Action Caucus, Farm Aid, Rural Telephone Finance Cooperative, Federation of Southern Cooperatives, Southwest Peanut Growers, Institute for Agriculture and Trade Policy, United Methodist Board, Mennonite Central Committee Church and Society, National Association of County Officials, Virginia and Carolina Peanut Growers, National Association of Agriculture Educators, and Women Involved in Farm
The rally is scheduled for Tuesday, March 21 at noon on the west front steps of the U.S. Capitol. Other events include a "Farmer's Share" barbecue on Monday, March 20, followed by a town hall meeting on the rural crisis. March 20 is also National Agriculture Day.
More information on the rally can be found on the Internet at
CORPORATE AGRIBUSINESS RESEARCH PROJECT
WEB SITE POSTED ON WORLD WIDE WEB
The Corporate Agribusiness Research Project (CARP) web site is now posted on the World Wide
Web featuring: THE AGBIZ TILLER, THE AGRIBUSINESS EXAMINER and "Between the
THE AGBIZ TILLER, the progeny of the one-time printed newsletter, now becomes an on-line
news feature of the Project. Its initial essay concerns one Hillary Rodham Clinton, the newly
declared candidate for a U.S. Senate seat in New York State.
In "HILLARY RODHAM CLINTON'S $99,537 MIRACLE: IT'S THE PITS!!!" now available
through THE AGBIZ TILLER you'll learn some of the messy details behind her cattle futures
"miracle." You will also find in this section the archives for past editions of the THE AGBIZ
By popular reader demand THE AGRIBUSINESS EXAMINER section includes not only an
issue-by-issue and verbose index of this weekly e-mail newsletter, but an archive of all the past
In "Between the Furrows" there is a wide range of pages designed to inform and educate readers on
the inner workings of corporate agribusiness. In addition to CARP's "Mission Statement,"
"Overview" and the Project director's "Publication Background," the viewer will find a helpful "Fact Sheet" on agriculture and corporate agribusiness; a "Fact Miners" page which is an effort to assist the reader in the necessary art of researching corporations; a "Links" page which allow the
reader to survey various useful public interest, government and corporate web sites; a Feedback"
page for reader input, and a page where readers can order directly the editor's The Corporate
Reapers: The Book of Agribusiness.
The CARP web site was designed and produced by ElectricArrow of Seattle, Washington.
Simply by clicking on either of the addresses below all the aforementioned features and information
are yours to enjoy, study, absorb and sow.