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NAMA News November/December, 2011

TOP NEWS – NAMA releases flour production report for the first time











NAMA releases flour production report for the first time

On December 12, NAMA released the third quarter 2011 wheat flour production number of 100,561 (1,000 cwt). This report covered the months of July, August, and September. NAMA provided this service after the Census Bureau abruptly announced it would end reporting earlier this year.

NAMA retained Veris Consulting, Inc. to survey the top 24 U.S. wheat, durum and rye milling companies on their flour production. All 24 companies surveyed responded.
The capacity share of these companies is given as 95.4 percent (as listed in the 2010 Grain and Milling Annual); therefore, total industry volume presented in the third quarter NAMA production report is less than 100 percent.



NAMA supports use of Dietary Guidelines for school meals

NAMA continues to insist that guidelines for school meals and other federal feeding programs be based on the Dietary Guidelines for Americans, the “gold standard” for nutrition policy. In a victory for millers and bakers, language in the FY 12 Agriculture Appropriations Bill restricts funds to the U.S. Department of Agriculture (USDA) if they impose any whole grain requirement for school meals without first defining “whole grain”, and prohibits implementing sodium reduction targets beyond the two-year target identified in USDA’s proposed updated standards.

In April 2011, NAMA and other organizations in the grain chain submitted comments in response to USDA’s proposed school meal standards rule, citing the need for a uniform definition of “whole grain” before any requirements are mandated, and urging any grain requirements be based on the Dietary Guidelines. NAMA members reiterated this position to lawmakers during the May 2011 Leadership Meeting.

USDA had proposed a one-cup-per-week limit on white potatoes in their school meals proposal, however, this proposal did not follow the Dietary Guidelines, and would decrease flexibility for school food service providers. The bill prohibits the USDA from limiting servings of any vegetable and also bars USDA from requiring a new nutrient density standard for tomato paste that would have eliminated pizza in schools and would eliminate a source of enriched grains that is a favorite with kids.



NAMA calls on Congress to restore confidence in the futures markets

On December 7 NAMA sent a letter to the House and Senate Agriculture Committees expressing concern that millers and other futures contract participants are experiencing a crisis of confidence in the markets as a result of MF Global, a major global financial derivatives broker, filing for bankruptcy. NAMA called on Congress to restore confidence in the futures markets with immediate responsive acts, including:

  • Direct CFTC (U.S. Commodity Futures Trading Commission) to immediately enact rules requiring customer segregated funds be kept in escrow accounts, in cash or very liquid government-backed instruments.
  • Affirm that legislative intent underlying relevant statutes in this area call for the first priority for funds from segregated accounts is they be distributed to the customers that deposited them.
  • Direct the CFTC to conduct an immediate audit, or the agency should request third party audited statements of all brokers and Futures Commission Merchants to ensure confidence that customer funds remain segregated.
  • Study the creation of an industry insurance fund to cover commodity futures contracts.
  • Conduct a complete review of CFTC audit procedures.

Read the letter on the NAMA website: https://www.namamillers.org/pdf/Ltr_MFGlobalBankruptcyImpact.pdf.



United Nations approves NAMA’s 2013 methyl bromide exemption

At its recent meeting in Bali, Indonesia the parties to the United Nations (UN) Environment Program approved NAMA’s methyl bromide exemption request for 2013. The U.S. government had requested 40,126 pounds in behalf of NAMA member companies. (NAMA provides a list of members to the U.S. government.) The UN delegates agreed to the request. This quantity reflects substantial cuts over the years, but observers find it remarkable that any amount is still available more than 20 years after the fumigant was originally scheduled to be eliminated completely.

NAMA visits member mills

NAMA president Mary Waters and Vice President Jim Bair recently visited several member mills. In November they visited Snavely’s Mills in Lititz, PA.

In the third week of December they visited mills in Michigan, including Chelsea Milling, Knappen Milling Company, King Milling Company, and Star of the West Milling Company.

The visits were an excellent opportunity for NAMA staff to visit one-on-one with members and to hear about issues important to the members.



Cooperation, collaboration key themes in ARS workshop attended by NAMA

Sherri Lehman, NAMA Director of Government Relations participated in an all-day meeting designed to inform the U.S. Department of Agriculture Agricultural Research Service (ARS) of stakeholder priorities as they move forward on writing their 2012-2016 action plan for National Program (NP) 301. NP 301 deals with plant genetic resources, genomics and genetic improvement. It is the single largest project within ARS and accounts for $180 million dollars of research funding investment. The need to manage the huge amounts of data being generated into a user-friendly format was a key topic of discussion in the breakout session attended by NAMA. A variety of crops were represented at the meeting which created tension at times when defending commodity specific projects, however the agency was clear that a shrinking budget will require cooperation among all crops. ARS customers/stakeholders were invited to attend the workshop.



Karnal bunt restrictions on wheat planting in California dropped

NAMA Vice President Jim Bair participated in a conference call with wheat stakeholders and the U.S. Department of Agriculture (USDA) Animal and Plant Health Inspection Service (APHIS) to discuss Karnal bunt (Kb) – a fungal disease of wheat, durum, and triticale.

Some countries in the international wheat market regulate Kb as a fungal disease requiring quarantine. Upon detection of Kb in Arizona in March of 1996, Federal quarantine and emergency actions were imposed in parts of Arizona, Texas, New Mexico and California to prevent the interstate spread of the disease to other wheat-producing areas in the U.S.

APHIS is amending the regulations to remove the portions of California still regulated. Then, USDA regulations will still regulate wheat production in 232,807 acres in Arizona. In the near future, USDA said, it will be releasing an additional 9,439 acres in Maricopa and Pinal counties in Arizona.

NAMA has consistently maintained that Kb is a wheat disease of only minor agronomic importance and is of little or no consequence from a food quality standpoint. Therefore, NAMA has advocated elimination of the Kb restrictions to ease the shortage of high quality durum often faced by U.S. users and exporters.

The milling industry spent tremendous resources building durum production in the desert southwest. Those efforts paid off as durum plantings there increased by nearly two-thirds between 1993 and 1996. However, with the discovery of Kb and the imposition of the planting restrictions, desert durum plantings plummeted by one-half.



President signs FY 2012 Agriculture Appropriations Bill

The President signed a bill to fund agriculture spending for FY 12. Items of interest to millers:

  • ResearchThe appropriations measure provides more than $2.5 billion for agricultural research programs, including the Agricultural Research Service and the National Institute of Food and Agriculture. While this is a $53 million reduction from FY 11 levels, it is significantly more generous than what the original House language contained.
  • FDAFDA was provided with an FY 12 appropriation of $2.5 billion, a $50 million increase over FY 11. The additional funds are to be spent on implementing the new food safety law.
  • Food AidThe Bill provides $1.466 billion for Title II of PL 480, which is the mainstay of the U.S. food aid programs. This is down from the previous year’s $1.6 billion, but far larger than the House proposal of $1.0 billion. The McGovern-Dole Food for Education and Child Development program, which funds global school feeding also took a reduction from $210 million in 2011 to $194 million.Outside of the appropriation number, there was considerable controversy over the so-called “safebox,” which set-aside $400 million of Title II funds for development programs carried out by Private Voluntary Organizations (PVOs). NAMA has supported development initiatives based on the higher nutrition focus that should come with that priority. However, more than 70 percent of the development programs are actually ‘monetized’ or sold on the market. This means they are primarily using wheat or vegetable oil, which are easily sold, but lose the nutrition focus.

    In the end, the appropriators compromised and agreed to put less money in the safebox ($350 million) and defer the policy issue to the next Farm Bill. NAMA’s International Trade Committee will discuss this issue soon.

    USDA announces plans to cut the timeline of reviewing and approving petitions to deregulate biotech traits

    The U.S. Department of Agriculture (USDA) announced plans to streamline several APHIS (Animal and Plant Health Inspection Service) processing times. The USDA initiative includes plans to cut the timeline of reviewing and approving petitions to deregulate (approve) biotech traits to 13-15 months – a cut of more than 50 percent. This will be accomplished by standardizing and streamlining process steps. APHIS, the agency that reviews petitions, will also solicit public input on pending petitions earlier in the review process.

    More than 130 petitions to deregulate a biotech trait have been received by USDA since 1992. USDA says that process now takes three years or more to complete. There are 22 petitions backlogged and waiting for USDA action. USDA has been under pressure from biotech trait developers to accelerate the review and approval process.

    The initiative also includes streamlining the risk assessment and approval of petitions to import plant products.

    Mandatory cuts in government spending to heavily impact discretionary programs

    Congress tasked the Joint Select Committee on Deficit Reduction to recommend $1.2 trillion in deficit reductions over the next ten years. They were unable to do this and as a result $1.2 trillion in mandatory cuts in government spending will be triggered beginning on January 1, 2013. This process, known as sequestration, will most heavily affect discretionary programs. FDA budget cuts could be about 7.8% in FY 13, which would amount to a cut of approximately $150-$250 million. Agricultural Research Service officials are still trying to deal with the $38 million reduction in their FY 12 budget and have been asked to start thinking about scenarios for what programs would look like under a sequestration situation. International food aid would also take a cut of about $116 million in Title II and an additional $14 million from the McGovern-Dole international school feeding program.

    Dietary fiber amounts in whole-grain soft wheat flours newly examined

    The amounts of dietary fiber in soft wheat whole-grain flours have been newly examined by scientists at the Soft Wheat Quality Laboratory in Wooster, Ohio and by the Ohio Agricultural Research and Development Center. The scientists determined that soft wheat whole-grain flours have, on average, about 14.8 grams of dietary fiber in each 100 grams of flour. Only slightly higher than the most widely used U.S. estimate, the new estimate should be of interest to food makers, dietitians and shoppers because of the scope of the study and the precision and accuracy of the analytical method used. Read more at http://www.ars.usda.gov/is/noi/111102.htm.

    Clinton nominates Cousin for WFP executive director post

    Secretary of State Hillary Clinton nominated Ertharin Cousin to be the next World Food Program (WFP) Executive Director. Cousin is presently the U.S. Ambassador to the United Nations (UN) Agencies for Food and chief of the U.S. Mission to the UN Agencies. Before that, she worked in a variety of public and private sector positions, specializing in the food industry and related charities from the late 1990s on. The appointment of the WFP executive director is made by the UN secretary general and the UN Food and Agriculture Organization director general in consultation with the WFP board.

    Japan and Canada indicate interest in joining TPP trade agreement

    During the APEC (Asia Pacific Economic Cooperation) meeting in Honolulu last week, Japan and Canada each said they were interested in joining the Trans-Pacific Partnership (TPP) trade negotiations, which are already near completion.

    TPP negotiators recently concluded their ninth round of talks between countries that are currently part of the process, including the U.S., Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam. Current members have said that once the agreement has been set, other countries will be welcome to join, but that the agreement will not be reopened. This is widely seen as the reason for Japan and perhaps Canada’s late arrival – to get on the train before it leaves the station. As Japan and Canada enter into bilateral discussions with current negotiating nations, it will become clearer whether these late-comers will be invited to help negotiate, or wait until the agreement is finalized and then accede to it.

    Several difficult matters remain to be discussed in the agriculture section of the TPP, including dairy and sugar in the U.S., which are priorities for New Zealand and Australia. How those sensitive issues are dealt with may inform how the TPP group handles rice with Japan and the government managed poultry and dairy sectors in Canada.



    Save the dates –

    March 10-13, 2012

    Mark your calendars and set aside March 10-13, 2012 for the NAMA Division Meetings to be held at the Naples Grande Resort in Naples, Florida. Registration will open December 15, 2011.

    May 9-10, 2012

    The NAMA Leadership Meeting will be held May 9-10, 2012 at The Madison Hotel in Washington, DC. Members of NAMA’s Board of Directors will receive invitations to attend in March 2012. The Executive Committee will meet on May 10. There will not be a meeting of the Board.

    Bair speaks at oat growers convention in Winnipeg

    NAMA vice president Jim Bair spoke at the December 1 convention of the Prairie Oat Growers Association in Winnipeg, Manitoba. This was the fifth year NAMA has been a co-sponsor of the convention.

    Bair congratulated and thanked the growers for joining with industry to support oat development research, and challenged them to partner with industry to promote oat foods as heart healthy components of a diet rich in whole grains.

    NAMA member Art Loeffler appointed to the newly created Michigan Wheat Promotion Committee

    On November 8 Michigan Governor Rick Snyder appointed NAMA member Art Loeffler, president, Star of the West Milling Company, and eight others to the newly created Michigan Wheat Promotion Committee. The committee overseas the wheat marketing program and consists of wheat farmers from across Michigan. Congratulations Art!

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