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Climate Issues; Trade; Ag Economy; Crop Insurance; Rural Broadband Hearing; and the Corn Genome
Climate Issues
Elisabeth Rosenthal reported in today’s New York Times that, “With less than three weeks remaining before negotiators gather in Copenhagen to hammer out a global response to climate change, a rapid-fire succession of countries are unveiling national plans that serve as opening bids for reining in heat-trapping emissions.
“‘The list of what is on the table is rather long,’ said Yvo de Boer, executive secretary of the United Nations Framework Convention on Climate Change, the sponsor of the meeting, which runs from Dec. 7 to 18 in Copenhagen.
“But, speaking at the United Nations headquarters on Thursday, he seized on the latest pledges to take aim at the United States, which has not yet played its hand.
“‘We now have offers of targets from all industrialized countries except the United States,’ Mr. de Boer said. He emphasized that he was looking to the United States for ‘a numerical midterm target and commitment to financial support.’”
The Times article indicated that, “In an interview, Todd Stern, the chief climate negotiator for the United States, said that the Obama administration was trying to decide whether to release a proposal in the coming days.
“‘What we are looking at is whether we feel that we can put down a number that would be provisional in effect, contingent on getting our legislation done,’ he said. ‘Our inclination is to try to do that, but we want to be smart about it.’
“He noted that bills pending in Congress involved cuts of around 17 percent in emissions by 2020, increasing to much deeper cuts by 2030.”
“This week, South Korea said it would cut emissions by 30 percent from ‘business as usual’ by 2020. Russia’s president, Dmitri A. Medvedev, said his country would try to reduce emissions by 25 percent by then, instead of 15 percent as announced earlier. Last week, Brazil promised reductions of about 40 percent below current projections by 2020,” the Times article said.
Dow Jones writer Alessandro Torello reported yesterday that, “The international summit on climate change in Copenhagen in December must deliver a political agreement that contains precise CO2 emission reduction targets and binding rules, French President Nicolas Sarkozy said Thursday.
“‘We decided to push extremely hard for Copenhagen to be a success,’ Sarkozy said in a joint press conference with German Chancellor Angela Merkel and Danish Prime Minister Lars Loekke Rasmussen, after the three leaders met to discuss the Copenhagen conference, ahead of a summit of all European Union leaders in Brussels later Thursday.”
The AP reported yesterday that, “The U.N. climate chief has a message for naysayers about the Copenhagen climate conference next month: It will succeed.
“Yvo De Boer, the U.N. official who is shepherding the talks, sought to assure reporters Thursday that the long-anticipated United Nations-led meeting Dec. 7-19 isn’t a failure even before it’s started. In large part, he said he was responding to news coverage that increasingly emphasized the long-shot odds for a deal, particularly given the lack of U.S. commitment to any specific targets.
“He vowed Copenhagen ‘will be the turning point’ when words turn to action globally to begin reducing carbon dioxide and other heat-trapping greenhouse gases – and a fuller treaty can be worked out by six months after the meeting.”
Meanwhile, Lisa Lerer reported yesterday at Politico that, “When President Barack Obama arrives in Oslo on Dec. 10 to pick up his Nobel Peace Prize, he’ll be just an hour’s flight from Copenhagen, where approximately 40 world leaders will be gathered for the United Nations Climate Change Conference.
“Don’t count on him to join them.
“Trapped between international pressure to curb greenhouse gas emissions and a Senate unready to act, the White House is playing coy about the president’s plans. And while environmentalists and operatives would love to see him in Copenhagen, they also see the political peril in his making the trip.”
However, John M. Broder reported yesterday at the Green Inc. Blog (The New York Times) that, “President Obama is undecided as to whether to attend the Copenhagen climate meetings.”
“In an interview this morning, [Sen. John Kerry], the Massachusetts Democrat who co-sponsored climate and energy legislation in the Senate, argued emphatically that Mr. Obama should speak to delegates at the climate meetings.
“Mr. Kerry said that he suspected that the White House had already decided that Mr. Obama would take the short detour to the Danish capital after he accepts the Nobel Peace Price in Oslo on Dec. 10, but was waiting for more clarity on what the Copenhagen meeting might accomplish before announcing the president’s intentions.”
Yesterday’s update added that, “Mr. Kerry said that he believed that the climate summit — despite downgraded expectations — would achieve significant progress toward a binding global agreement that could be concluded next year.”
In other Senate perspectives on climate issues, Lisa Lerer reported today at Politico that, “Sens. Lindsey Graham and Joe Lieberman have been working overtime to craft a climate bill that can attract significant GOP support. But they aren’t exactly scoring points with their mutual best friend in the Senate, John McCain.
“‘Their start has been horrendous,’ McCain said Thursday. ‘Obviously, they’re going nowhere.’
“McCain has emerged as a vocal opponent of the climate bill — a major reversal for the self-proclaimed maverick who once made defying his party on global warming a signature issue of his career.”
As the domestic debate moves forward, the “Washington Insider” section of DTN reported yesterday (link requires subscription) that, “USDA reportedly has finished an updated study on the likely effects that the climate change bill approved by the House would have on production agriculture in the United States. However, it is unclear when that report might be transmitted to Congress and issued to the public since sources say the document is still going through an interagency clearance process.
“Earlier this week, Senate Majority Leader Harry Reid, D-Nev., said the Senate would not be taking up its version of the legislation until some unspecified time this spring. That schedule takes some of the pressure off USDA to complete and issue its updated report at the earliest possible time.”
American Farm Bureau Federation President Bob Stallman issued a statement yesterday regarding climate change, which indicated in part that; “We applaud the decision by Senate leadership to delay consideration of climate change legislation until the spring of 2010. This move offers a great opportunity for lawmakers to go back to the drawing board and re-assess the need for this legislation and the impact it will have on all Americans.
“Legislation previously approved by the House, and a similar bill approved on a party-line vote by a Senate committee, would impose higher energy and food costs on consumers…[T]he timing for this announcement by Senate leaders could not be better. We now know there will be no international agreement resulting from the upcoming meeting in Copenhagen.”
Australia’s domestic climate change debate is also currently unfolding.
Bloomberg writer Ben Sharples reported today that, “Australia’s carbon-reduction plans are ‘fatally flawed’ and shouldn’t become legislation before December’s global climate change summit, amid fading hopes for a binding international accord, an opposition senator said.
“‘Given how Copenhagen seems to be collapsing, there doesn’t seem to be any real need to rush,’ Eric Abetz, deputy leader of the opposition in the country’s upper house, told the Australian Broadcasting Corp. today.
“Prime Minister Kevin Rudd wants a vote on the legislation by the end of next week, when parliament’s final sitting for the year concludes.”
Rachel Pannett reported today at The Wall Street Journal Online that, “A senior Australian government minister said Friday that Prime Minister Kevin Rudd could call an early election if Parliament fails to pass his carbon trading program.”
Trade
In other international developments impacting agriculture, Reuters writer Jonathan Lynn reported yesterday that, “The World Trade Organization authorized Brazil Thursday to impose trade sanctions on the United States over its support for cotton, as Brazil ratcheted up pressure on Washington over the illegal subsidies.
“But Brazil is not yet ready to levy the sanctions, as it considers which U.S. products to target and analyses U.S. data on subsidies which will determine the size of retaliation.”
The Reuters article explained that, “Brazil’s request to go ahead and impose sanctions, following an award by WTO arbitrators on August 31, responds to the U.S. failure to comply with earlier WTO rulings condemning the subsidies, which distort the world market for cotton, hurting farmers in poor countries.
“But U.S. WTO diplomat Juan Millan told the dispute body that Washington did intend to comply with the rulings and so Brazil would not need to levy the sanctions.
“‘While the United States understands that the DSB will today be authorizing the suspension of concessions or other obligations, we do not believe that it will be necessary for Brazil to exercise that authorization,’ he said in a statement.
“He said imposing sanctions could hurt the economies of both the United States and Brazil.”
Bloomberg writer Jennifer M. Freedman reported yesterday that, “The WTO gave Brazil permission in August to impose $294.7 million in sanctions against U.S. goods — the second-highest amount ever permitted by the Geneva-based trade arbiter — and Brazil’s government earlier this month released a list of 222 products that may be subject to increased duties. The list includes cotton and other agricultural and textile products as well as U.S. exports such as electronics, cosmetics, ketchup, cars, chewing gum, medical equipment and pharmaceuticals.”
The Bloomberg article added that, “Jay Hardwick, chairman of the National Cotton Council of America, a U.S. growers’ group, said in a statement it was ‘astonishing’ that ‘anyone would conclude today that U.S. cotton production is damaging Brazilian cotton interests.’
“The Cordova, Tennessee-based producer organization will work with trade officials ‘to ensure that the many changes previously made to the U.S. cotton program and the export-credit guarantee program are fully understood and considered by the WTO,’ Hardwick said.”
Ag Economy
In the latest edition of the AgLetter, the Federal Reserve Bank of Chicago indicated this week that, “The agricultural sector continued to deal with challenging circumstances in the third quarter of 2009, as evidenced by agricultural land values falling 4 percent below those of the third quarter of 2008 in the Seventh Federal Reserve District. However, the value of ‘good’ farmland increased 2 percent relative to the second quarter of 2009, according to 225 replies by agricultural bankers to the October 1 survey. Forecasts for farmland values in the fourth quarter of 2009 were down, with respondents expecting lower demand to purchase farmland by both farmers and nonfarm investors.
“Agricultural credit conditions in the third quarter were weaker than a year ago. Lower demand for non-realestate loans in the third quarter of 2009 contrasted with increased funds availability at District banks. Loan payment rates declined compared with the July through September period of 2008, whereas loan renewals and extensions rose. Farm operating and real estate loan interest rates were a bit lower. The banks’ loan-to-deposit ratios averaged 75.3 percent, the lowest level in over a year.”
The report added that, “A key factor in the anticipation of lower demand for farmland was the diminished stream of earnings that farms would produce under current market conditions. Respondents expected lower net cash earnings for both crop and livestock operations this fall and winter compared with a year ago. For crop farms, the combination of lower corn and soybean prices and relatively less relief from high input costs led 85 percent of responding bankers to predict decreases in net cash farm earnings over the next three to six months compared with earnings the previous year. Only 4 percent foresaw increases.”
The Chicago Fed report follows a report released last month by the Federal Reserve Bank of Minneapolis, which stated that, “Many agricultural producers are having a tough time. The Minneapolis Fed’s third-quarter (October) agricultural credit conditions survey indicates that ranchers and farmers are facing lower income and have cut back on capital expenditures and loan repayments in the third quarter. Loan demand was flat, but collateral requirements increased slightly. Few banks reported fund shortages, and interest rates stayed nearly constant from the second quarter. Farmland values and cash rents decreased slightly. The outlook for the fourth quarter is similar to the results for the third quarter, and lenders expect a decreased rate of loan repayments.”
Marcia Zarley Taylor noted earlier this week at the Minding Ag’s Business Blog (DTN) that, “In Minnesota, the state’s mandatory farm debt mediation services are reporting a tripling in the caseload just since spring, and most all of those 400 borrowers involve dairy and pork producers. Michael Stewart, an agricultural lawyer specializing in debt restructurings with Faegre & Benson LLP in Minneapolis, thinks more farmers are declaring it quits rather than opting for Chapter 11 or 12 bankruptcies. ‘Bankruptcy [reorganizations] only help if you can make money after you’ve received some debt concessions. A lot of these producers just can’t cash flow at current prices, so they liquidate their assets and there’s one less family farmer.’”
Crop Insurance
National Crop Insurance Services issued a news release yesterday which noted in part that, “With the wet weather continuing to wreak havoc on the Midwestern corn and soybean harvest, National Crop Insurance Services (NCIS) is urging farmers to contact their crop insurance agent as soon as possible.
“‘With the ‘End of the Insurance Period’ just around the corner, it is important that farmers submit their notice of loss promptly,’ said Bob Parkerson, President of
NCIS. (December 10th is the EOIP for most spring‐planted crops.) ‘The ability to manage risk through crop insurance is their best asset when facing the uncertainties inherent with farming.’”
The release included several important reminders for insured producers who are facing a delayed harvest.
Rural Broadband Hearing
A news release issued yesterday by the House Ag Committee stated that, “Today, Congressman Mike McIntyre, Chairman of the House Agriculture Committee’s Subcommittee on Rural Development, Biotechnology, Specialty Crops, and Foreign Agriculture, held a hearing to review the progress made by the U.S. Department of Agriculture and Department of Commerce to award grants to expand broadband access in rural areas.
“The American Recovery and Reinvestment Act of 2009 provided the USDA’s Rural Utilities Service (RUS) and the Department of Commerce’s National Telecommunications and Information Administration (NTIA) with $7.2 billion to expand access to broadband services. Currently, RUS and NTIA are reviewing applications for these funds.”
Jonathan S. Adelstein, the Administrator of the USDA’s Rural Utilities Service and Lawrence E. Strickling, the Assistant Secretary for Communications and Information, National Telecommunications and Information Administration at the U.S. Department of Commerce provided testimony at yesterday’s hearing.
Jon H. Harsch reported yesterday in an article posted at Agri-Pulse Online that, “Administration officials confirmed in a House hearing Nov. 19 that awards will be announced beginning this December for the $4 billion first round of stimulus-bill funding for improving broadband internet service in unserved and underserved rural areas. USDA Rural Utilities Service Administrator Jonathan Adelstein and Commerce Department Assistant Secretary for Communications Lawrence Strickling added that a second round to complete the total of $7.2 billion in broadband funding is expected to begin next January.
“Adelstein and Strickling were testifying in a broadband program hearing held by the House Agriculture Subcommittee on Rural Development, Biotechnology, Specialty Crops, and Foreign Agriculture. Subcommittee Chair Mike McIntyre (D-NC) warned that USDA and Commerce need to eliminate confusion over the definitions of ‘rural’ and ‘remote’ being used in allocating funding. He said that unless the departments find a way to ensure that funding doesn’t go to already served areas, the program could increase rather than shrink the ‘digital gap’ which disadvantages large parts of rural America.”
To listen to a brief exchange from yesterday’s hearing with Rep. McIntyre and the two witnesses regarding the “rural,” and “remote” definition issue, click on this FarmPolicy.com audio link (MP3-3:13).
Corn Genome
David Brown reported today at The Washington Post Online that, “If a biologist had to pick one living thing as the textbook of how genes work, what would it be?
“Corn seems to be a good answer.
“Now the scientific world has at hand the complete genome sequence of corn, announced by researchers who have collaborated over the past four years and published their results Thursday. A package of 14 research papers in Science and PLoS Genetics accompanying the genome release suggests corn still has some useful secrets to reveal.
“Many agronomists hope the information buried in corn’s 32,000 genes and 2.3 billion letters of DNA may help sustain the century-long improvement in yield and hardiness into an era of climate change and, possibly, food shortage.”
Keith Good
