June 26, 2008

Groups Urge USDA to Act Promptly to Permit Early Releases From CRP

With tight crop supplies and increasing demand for grains and oilseeds, the Alliance for Agricultural Growth and Competitiveness (AAGC) urged U.S. Department of Agriculture Secretary Edward T. Schafer to act quickly to grant penalty-free early releases from the Conservation Reserve Program (CRP) for non-environmentally sensitive crop land. The request follows reports of crop loss and decreased yields due to flooding in the Midwest. The devastating floods have eroded the outlook for grain and oilseed stocks and prices in this crop year and beyond.

Failing to permit penalty-free early release will place even greater economic pressure on major sectors of U.S. agriculture that are heavily and traditionally dependent upon competitive supplies of grains and oilseeds, especially livestock, poultry, and dairy producers. The case for penalty-free early release is made even stronger given the ever-greater demand for grains and oilseeds from world export markets and renewable fuel production.

Those were among the core messages conveyed in a letter delivered to the Secretary on June 25 and signed by over 130 organizations. AAGC is an organization of national and state organizations representing a broad cross-section of meat, livestock and poultry production; agricultural input; and grain marketing, handling, processing and exporting interests.

AAGC applauded Secretary Schafer's decision to allow penalty-free haying and grazing on certain CRP land but noted that the decision "will not adequately alleviate the direct pressure on the livestock industry or the increased feed cost pressures on other segments of agriculture and food industries." The statement, which was presented on behalf of the AAGC by Chairman Bill Roenigk, senior vice president of the National Chicken Council, emphasized the need for a timely decision from the Secretary so that producers can be better positioned to prepare the released land for planting.

AAGC reiterated that the current supply/demand situation for basic agricultural commodities continues to be precarious. "Corn/wheat for feed usage are forecast to decrease by more than 12 percent for 2008/09. For animal agriculture to cut production by 12 percent will require severe economic hardship on these producers while further pressuring consumer food prices to move even higher," the statement said.

AAGC also noted that the tight crop supplies are a factor in the increase in food inflation. "Since February, USDA raised its forecast for food inflation from 3.5 percent to 5 percent and many credible, independent analysts forecast the food inflation rate will approach double-digits," the statement said.

"An early-out, penalty-free release of non-environmentally sensitive CRP cropland would be a significant positive step to encourage increased supply which would allow producers to more fully benefit from strong market demand," the Alliance stressed in their letter to Secretary Schafer.


The following organizations expressly co-signed the Alliance for Agricultural Growth and Competitiveness' statement:

 Ag Partners LLC Agricultural Retailers Association Agribusiness Association of Iowa American Bakers Association American Feed Industry Association American Meat Institute Arkansas Poultry Federation Aviagen Bartlett Grain Company L.P. Brookneal Milling Company Bunge North America California Grain and Feed Association Case Farms Central Washington Grain Growers Cereal Food Processors CGB Enterprises CHS Cobb Vantress Commodity Markets Council Culpeper Farmers Cooperative Dakota Mill & Grain DeBruce Grain Demeter LP DFS, Inc. Elkhart Grain Exotic Wildlife Association Falmouth Cooperative Company Farms Technology LLC Fieldale Farms Flowers Foods Foster Farms Gavilon LLC Gavilon Grain LLC George's Georgia Poultry Federation Grain and Feed Association of IL Gold'n Plump Poultry Grainland Cooperative GrainStore Elevators Hain Pure Protein Hamilton Farm Bureau Harrison Poultry Independent Bakers Association Independent Cattlemen's Assn. of Texas Indiana BioFuels Alliance Indiana Grain and Feed Association Indiana Plant Food & Ag Chemicals Association Jamesway Incubator J.D. Heiskell & Company Joyce Foods Kansas City Board of Trade Kansas Agribusiness Retailers Association Kansas Association of Ethanol Processors Kansas Grain and Feed Association Kentucky Feed & Grain Association Land O'Lakes Purina Feed Laymac Lortscher Agri Service Louis Dreyfus Commodities Maplehurst Farms Marshall Durbin Companies Midsouth Grain Association Michigan Agri-Business Association Michigan Agricultural Commodities Michigan Allied Poultry Industries Michigan Bean Shippers Association Minneapolis Grain Exchange Minnesota Grain and Feed Association Mississippi Poultry Association Missouri Poultry Federation Montana Agricultural Business Association Montana Grain Elevator Association Morris & Associates Mountaire Farms National Chicken Council National Grain and Feed Association National Oilseed Processors Association National Pork Producers Council National Poultry & Food Distributors Association National Turkey Federation Nebraska Grain and Feed Association North American Export Grain Association North American Millers' Association North American Processor Inspection North Carolina Poultry Federation North Dakota Agricultural Association North Dakota Ethanol Producers North Dakota Grain Dealers Association Novus International O.K. Foods Oklahoma Agribusiness Retailers Association Oklahoma Grain and Feed Association Oklahoma Poultry Federation Pacific Northwest Grain & Feed Association Park Farms Pet Food Institute Pilgrim's Pride Poultry & Water Solubles Rabo AgriFinance Ritzville Warehouse Company Rockingham Mill Rocky Mountain Agribusiness Association RPMG Safe Foods Corporation Sara Lee Corporation Simmons Prepared Foods South Carolina Poultry Federation South Dakota Grain and Feed Association Stratford Grain Company Syracuse Cooperative Exchange T. Lowry Tate and Lyle Ingredients Americas Team Marketing Alliance LLC TEGMA Tennessee Feed & Grain Association Texas Grain and Feed Association Texas Poultry Federation The Andersons The Fertilizer Institute The Long Company The Scoular Company Townsends Tyson Foods United Egg Association United Egg Producers U.S. Poultry & Egg Association Virginia State Feed Association W.B. Johnston Grain Company Wenger Feeds Weston Foods Wisconsin Agri-Service Assn. Zeeland Farm Services