Groups see common ground in feed, fuel debate

Jul 29, 2011

Several major farm, commodity and livestock groups see some common ground in a list of principles and policy planks to ensure the biofuels industry grows while enhancing needed feed for livestock.

The white paper lays out different policy options, and yet reflects continuing tension given that a couple of key livestock and poultry groups that worked on the proposal in the end opted not to sign on. DTN received a copy of the twopage principles and policy paper from members 25x’25 coalition attending the Ag Media Summit in New Orleans, LA.

Groups have been meeting over the past year to talk about issues in feed, food and fuel and looking for policy solutions that could be sustainable for both grain and livestock producers, according to members of the 25x’25 working group that helped facilitate the talks. Members were presented with some specific recommendations at a meeting last month in Maryland, said National Farmers Union President Roger Johnson in a phone interview last Tuesday.

“A lot of what was agreed to are items various groups have been raising for awhile,” Johnson said. “We’ll take this language and compare it to our policy book. Pretty much what’s in there, our policy speaks to.”

In laying out some policy recommendations, the groups stated several proposals that “represent the majority thinking” of the group. High on that list are proposals to open more land to production, including changes to the Conservation Reserve Program (CRP). Enrollment criteria in CRP should be tightened, “allowing early outs for land that can be returned to production in an environmentally sound manner,” and targeting the programs to environmentally sensitive lands.

For land coming out of the program, the group stated policies should ensure “any environmentally sensitive land that comes out of CRP is farmed under best management practices that control erosion, protect water quality and wildlife habitat.”

Currently, the 45-cent Volumetric Ethanol Excise Tax Credit, commonly known as the blenders’ credit, is set to expire at the end of the year, along with the 54-cent ethanol import tariff. Senators have proposed a plan to reduce and overhaul ethanol subsidies, but legislation has not been able to move while

Congress is gridlocked on the budget deficit and debt ceiling. The agricultural groups support restructuring the tax credits to invest in ethanol infrastructure. Along with that, the groups propose a “counter-cyclical” tax credit that would kick in based on oil falling below certain levels.

While proposing to overhaul the blenders’ credit, the groups stated that the Renewable Fuels Standard should be maintained. That recommendation, however, was a sticking point that caused at least two livestock and poultry groups to reject signing the document.

The groups would also like some restrictions on biomass conversion changed under the Energy Independence and Security Act of 2007 that banned biomass from some forestry from being factored into the Renewable Energy Standard. Further, production of livestock and renewable energy feedstocks should be allowed on public lands, the proposal stated.

Other recommendations by the working group promote more research and technology advances on energy as well as expanding on-farm energy efficiency and conservation programs to help reduce farm operating costs. Such investments could be problematic, especially given that the current energy programs in the farm bill do not have funding authorization after 2012 and would require billions of dollars to maintain in the next farm bill.

Moving forward on energy policies, the agricultural groups agreed on some broad guiding principles that energy policies should be transparent, shaped by national security demands, and framed in the context of economic opportunity across the board while increasing renewable energy production. Further, new energy policies should ensure that one sector of agriculture does not benefit at the expense of another sector.

Groups that participated in the yearlong dialogue and signed on to the principles and policy plank include: American Farm Bureau Federation, American Farmland Trust, American Soybean Association, National Association of Conservation Districts, National Cattlemen’s Beef Association, National Corn Growers Association, National Farmers Union, National Institute for Animal Agriculture, and the National Milk Producers Federation. — Chris Clayton, DTN