Bill Huffman
Director - Government Relations

The Friday Report

October 2, 2009

House-Senate conferees finalize USDA and FDA spending bills and the Senate’s climate change bill has been introduced.

USDA and FDA Spending Bills

House-Senate conferees have reached final agreement on the FY 2010 spending bill for the U.S. Department of Agriculture and the Food and Drug Administration. The spending bill must be approved by both the House and the Senate before being sent to President Obama for his consideration. The spending bill provides $121.1 billion in spending for USDA and FDA. Importantly, the bill includes $200 million for the USDA market access program, $34.5 billion for the foreign market development program and $1.69 billion for the international food aid program. The U.S. rice industry participates in the market access program and the foreign market development program; both programs help expand export demand for U.S. rice.

Senate Climate Change Bill

The Senate Environment and Public Works Committee unveiled its climate change bill Wednesday. The bill sets a green house gas reduction target of 20% by 2020. This is more aggressive than the House bill, which set a target reduction of 17% by 2020 from the base year 2005.  It is interesting that the authors, Senator’s Barbara Boxer and John Kerry left many key provisions open by including “placeholder” language which will allow negotiations with affected industries, interest groups and other lawmakers as the bill evolves during hearings. Markup of this bill will occur later this fall and is expected to be completed by December. If that is the case, it would likely mean that the legislation will not be ready for a Senate floor vote until 2010.

It appears that the Boxer-Kerry bill doesn’t provide any special exemption for agriculture from greenhouse-gas emission caps, at least in the draft language.  Instead, language in the bill states that USDA would set up and fund programs and projects to reduce agriculture-related emissions and “to the maximum extent practicable” allows all parts of agriculture to participate in such emission reductions.  Clearly, the bill does not provide for credits for carbon-storing practices, something that appears to be very important to Midwestern agriculture. 

We can expect that farm-state Democrats will want to “sweeten” this bill with key provisions beneficial to agriculture.

U.S. Rice Imports

The U.S. Department of Agriculture predicted this week that rice imports into the U.S. for 2009-10 would reach 21 million hundredweight, up nine percent from last year.  Aromatic rice from Asia accounts for almost all of the U.S. imports. Imports of aromatic rice have grown sharply over the past two decades.