Bill Huffman
Director - Government Relations

December 12, 2008

The economy and the financial bailout of the U.S. automobile industry dominated much of the news these past two weeks. Even though Congress was in session this week, they focused solely on the automobile bailout.  As we know, the U.S. Senate failed to agree on a bailout plan, so Congress has adjourned and the new Congress will convene in early January.

In the meantime, Congress has been working on the reorganization of its various committees as a result of the November election. For the Democrats, there will not be much change in committee assignments and chairmanships; however, there will be some key changes for the Republicans.

House Agriculture Committee Realignment

Colin Peterson, D-Minnesota, will continue as Chairman of the House Agriculture Committee in the 111th Congress. There will be three or four freshmen Democratic members assigned to the Agriculture Committee to replace those not reelected or those moving on to new committee assignments. For the Republicans, a significant change will involve Representative Frank Lucas, R-Oklahoma, becoming the ranking Republican on the House Agriculture Committee replacing Representative Bob Goodlatte, R-Va. Mr. Goodlatte could not serve a fourth term under party rules. Mr. Goodlatte previously chaired the House Agriculture Committee during Republican’s control. Mr. Goodlatte worked closely with Chairman Peterson on the 2008 Farm Bill.  His leadership will be missed!

Representative Lucas, a lifelong farmer and rancher, is entering his 9th term in the House of Representatives. The FRC Board Officers and Senior Staff met Congressman Lucas last February at an FRC fundraising event in Washington. We found him to be very knowledgeable about the Federal farm program and very interested in the California rice industry. Congressman Lucas said his initial priorities will be addressing the controversies surrounding the Commodity Futures Trading Commission, monitoring the implementation of the 2008 Farm Bill and adjusting to President-elect Obama’s new USDA team.

Our friend, Representative Jerry Moran, R-Kansas, moves up to the number two Republican position on the House Agriculture Committee.  Mr. Moran formerly chaired the Subcommittee on General Farm Commodities which has jurisdiction over the Federal rice program. Congressman Moran, by the way, has formed a political committee and intends to run for the U.S. Senate seat in Kansas to be vacated by Senator Sam Brownback in 2010.

We should also note that Representative Dave Camp, R-Michigan, was elected ranking member of the House Ways and Means Committee. Camp won out over the more senior Congressman Wally Herger, R-Calif., who was next in line and was seeking the position.

Senate Agriculture Committee Alignment

Earlier we reported the possibility of a change in the Chairmanship of the Senate Agriculture Committee. Senator Tom Harkin, D-Iowa, is Chairman and it now appears that he will continue in that capacity. 

With the reelection of Senator Saxby Chambliss, R-Georgia, we are pleased that he will continue to be the ranking Republican on the Senate Agriculture Committee. A good friend of the U.S. rice industry, Senator Chambliss will play an increasing role along with Senator Blanche Lincoln, D-Arkansas, in protecting and preserving the Federal rice program.

Secretary of Agriculture

There continues to be a great deal of speculation as to who will become Secretary of Agriculture in the Obama Administration.  Earlier this week we thought Congressman John Salazar, D-Colorado, would be named to that position by the President-elect, however, the Denver Post newspaper reported yesterday that Congressman Salazar has just been appointed to the powerful House Appropriations Committee, a coveted position.  This does not rule out Congressman Salazar, a popular cattleman, potato and wheat grower from south-central Colorado, from getting the appointment but it is beginning to look unlikely.There continues to be a long list of others seeking the appointment, however, it remains to be seen who will get the job.  Dennis Wolff, Pennsylvania’s agriculture commissioner, was in Washington this week making the rounds of commodity groups, introducing himself. He very well could be the number one candidate or perhaps a candidate for the Deputy Secretary position.

We’ll just have to wait for this important announcement.

Secretary of Interior

We are pleased to report that California Congressman Mike Thompson, D-Napa, is a leading candidate for Secretary of Interior. Mike has all the credentials for the position and is being heavily supported by Speaker Pelosi and other key members of the California congressional delegation. 

Rice Outlook Conference

The annual Rice Outlook Conference was held this week in Little Rock, Arkansas.  A keynote speaker was Senator Blanche Lincoln, D-Arkansas, a member of the Senate Agriculture Committee. Senator Lincoln pledged to work closely with the Obama Administration and she said “It is important that the farm bill be implemented as intended, and I will work to see that happens”.

Nathan Childs, senior rice market analyst for the U.S. Department of Agriculture’s Economic Research Service told the attendees that “Global usage of rice may be the highest on record due to a larger population and the effect of the overall economic downturn on global food purchases”.  Childs said he expects to see a modest acreage increase for next year’s rice crop accompanied by a continued trend toward higher yields. He said “The trending of prices downward from recent record highs should continue”.

Long grain prices, of course, have declined significantly from their level earlier this year.

Washington, D.C. farm writer and insider Jim Wiesemeyer gave attendees a report on the economic and political climate in Washington marked by protectionist trade policies and the possibility of overzealous regulations. One important point he made is that the Obama Administration likely will “change the clock” on agricultural trade with Cuba, which would be very important to the Southern U.S. rice industry.

We are pleased to see two young California rice growers join the USA Rice Federation’s 2009 Rice Leadership Development Class. Those California producers are Tom Butler and Josh Sheppard.

Japan Rice Tender

Farmers’ Rice Cooperative was successful on the latest Japanese rice tender. FRC will supply one cargo.  FRC sold two cargoes to Japan in late November and one cargo earlier to Korea. These orders are being milled now at our West Sacramento milling complex.