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Thursday, May 27, 2010

A Whole-Farm Crop Disaster Program: Supplemental Revenue Assistance Payments(SURE)

Dennis A. Shields
Specialist in Agricultural Policy

In an effort to end the ad-hoc nature of emergency crop disaster assistance to farmers, Congress authorized a new Supplemental Revenue Assistance Payments Program (SURE) in the Food, Conservation, and Energy Act of 2008. The program provides payments to producers for crop revenue losses due to natural disaster or adverse weather incurred on or before September 30, 2011. It essentially compensates eligible producers for a portion of losses that are not eligible for an indemnity payment under a crop insurance policy. The program departs from both traditional disaster assistance and crop yield insurance by calculating and reimbursing losses using total crop revenue for the entire farm (i.e., summing revenue from all crops for an individual farmer). 

Under SURE, a farmer's revenue from all crops in all counties is compared with a guaranteed level that is computed mostly from expected or average yields and prices. As a result, the program considers the disaster's impact on a farmer's entire enterprise and not on just the crop(s) that were adversely affected. If the actual farm revenue (including farm program payments and insurance indemnities) is less than the farm's guaranteed level, the producer receives a payment, calculated as 60% of the difference between the two amounts. In contrast, if actual whole farm revenue does not fall below the guarantee, whereby losses for one crop are offset by revenue gains for another, no disaster payment is made. Payments are limited so that the guaranteed level cannot exceed 90% of expected farm income in the absence of a natural disaster. 

On December 28, 2009, USDA issued regulations for SURE. Previously, farm groups had been calling for their publication so that farmers could learn program details, sign up, and consider related business issues such as appropriate insurance coverage levels. Farmer signup for 2008 crop losses began January 4, 2010, and USDA began making payments shortly thereafter. 

USDA officials say that SURE is the most complex program USDA's Farm Service Agency (FSA) has undertaken. It has faced a number of implementation challenges in terms of program administration, such as collecting and tabulating a significant amount of data for individual farmers, as well as crop price data that are not readily available. Another issue has been accounting for various insurance products when determining the farmer's guarantee level. 

Part of the motivation behind SURE was to provide a pre-designed program that farmers could incorporate in their risk management planning. Also, payments would be presumably more timely because legislation would already be in place when disaster strikes. However, disaster payments under SURE arrive well after the crop loss because some of the data needed to compute payment rates become available more than one year after harvest. Computing actual farm revenue requires season-average prices, which USDA publishes after the market year ends. Also, government commodity payments, which are also needed for the revenue calculation, can occur 1½ years after the crop is harvested. Thus, SURE program payments may not be as timely as some farmers and policymakers would like. In fact, legislation was introduced in late 2009 in both chambers (S. 2810 and H.R. 4177) that would make emergency payments for losses in calendar 2009. 

In the next farm bill debate, Congress will likely be interested in program effectiveness. Major questions are likely to be (1) whether the SURE program in fact eliminates the need for ad-hoc crop disaster legislation for crop farmers, and (2) how well this whole-farm approach helps manage farm-level risk. Some farmers have already complained that the whole-farm approach typically does not result in disaster payments for diversified operations. In contrast, where farmers have qualified for payments, the initial reaction has been generally favorable.


Date of Report: May 20, 2010
Number of Pages: 13
Order Number: R40452
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A New Farm Program Option: Average Crop Revenue Election (ACRE)

Dennis A. Shields
Specialist in Agricultural Policy

Farm commodity programs over the decades have focused on protecting farmers against declines in farm prices and not declines in revenue (price times production). Traditional programs for field crops provide benefits to producers when farm prices drop below specified levels. To help farmers manage their revenue risks, Congress included the Average Crop Revenue Election (ACRE) program in the Food, Conservation, and Energy Act of 2008 (P.L. 110-246) as a revenuebased program option for farmers who enroll in traditional farm commodity programs. 

The ACRE program pays a farmer when two conditions are met: (1) state-level revenue for a crop falls below a guaranteed level, and (2) the farmer experiences an individual crop revenue loss. (Payments for each crop are calculated separately.) If farmers select ACRE, they forgo 20% of their direct payments under the Direct and Counter-cyclical Payment Program (DCP), and commodity loan rates under the Marketing Assistance Loan Program are reduced by 30%. Also, ACRE participants are not eligible for counter-cyclical program payments under DCP. 

Once a farm is enrolled in ACRE, the program applies to all eligible crops on that farm. A farmer who operates more than one farm may elect to enroll one or all of the farms in ACRE. Importantly, once a farm is enrolled in ACRE, it must remain in the program for subsequent crop years (the program covers crop years 2009 through 2012). For the 2009 crop year, approximately 8% of the total number of farms elected to participate in ACRE, representing nearly 13% of base acres (total program acreage). Based solely on farm prices projected by USDA as of May 11, 2010, ACRE payments are likely for 2009 crops of wheat, barley, oats, several minor oilseeds, dry peas, and small chickpeas. 

When deciding to participate in ACRE, producers must consider the trade-off between reduced benefits under traditional programs and the expected increase in revenue risk protection and potential payments provided by ACRE. Analysis of the trade-off requires assumptions about the next year's prices and historical crop yield variability at both the state and individual farm levels. Farmers also need to consider expected price trends for the life of the program. 

In its March 2009 baseline, the Congressional Budget Office estimates that ACRE program payments will total $4.9 billion during FY2010-FY2014, with corn, soybeans, wheat, and sorghum accounting for nearly all of the total. These five-year figures compare with $22.1 billion for direct payments, $3.6 billion for counter-cyclical payments, and $0.8 billion for marketing loan program benefits. The estimates account for reduced traditional program payments for farmers who participate in ACRE. 

Results from the ACRE program for 2009 crops will become available once season-average prices (used for payment rate calculations) are determined after the crop market year ends in 2010. At that time, program effectiveness will likely be measured in part by whether payments in fact reach farmers who experience revenue losses. 

Beyond the program itself and potential effectiveness, the introduction of ACRE to U.S. farm policy provides a unique opportunity for farmers to trade benefits in one program for those in another. In the next farm bill debate, policymakers may find different trade-offs with other agricultural programs or policy objectives. This may be particularly relevant as concerns about the federal deficit mount.  


Date of Report: May 21, 2010
Number of Pages: 13
Order Number: R40422
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Tuesday, May 25, 2010

Reductions in Mandatory Agriculture Program Spending

Jim Monke
Specialist in Agricultural Policy

Megan Stubbs
Analyst in Agricultural Conservation and Natural Resources Policy

Many agricultural programs receive mandatory funding through the U.S. Department of Agriculture's Commodity Credit Corporation (CCC). Mandatory funding is made available by multiyear authorizing legislation and does not require annual appropriations or subsequent action by Congress. However, mandatory funding can be reduced in the appropriations process or by the authorizing committees themselves. In contrast to mandatory funding, discretionary funding is made available by annual appropriations acts on a year-by-year basis through a different process originating in the appropriations committees. 

While mandatory spending in agriculture historically was reserved for the farm commodity programs, the authorizing Agriculture Committees have expanded its use to conservation, rural development, and energy programs in the recent farm bills passed by Congress. Mandatory spending creates funding stability and consistency compared to that of the appropriations process. Some argue, however, that this use of mandatory spending has moved beyond the statutory purpose of the CCC. This has created tension between authorizers and appropriators, leading to actions by appropriators that are called "changes in mandatory program spending" (CHIMPS). CHIMPS usually reduce or block mandatory outlays, but sometimes appropriators replace some of the blocked funding with discretionary appropriations. Nonetheless, CHIMPS generate savings that appropriators can use to offset increases in discretionary spending. 

Between FY2003 and FY2010, CHIMPS by appropriators to mandatory agricultural programs have totaled $7.5 billion. CHIMPS to eight conservation programs are among the most notable, accounting for $3 billion of this total. Among individual programs, the Environmental Quality Incentives Program (EQIP) has the highest multiyear total of CHIMPS, at $1.2 billion. 

Authorizing committees also have reduced mandatory program spending to generate savings after a farm bill has been enacted. The reason may be to offset spending increases for other programs within their jurisdiction or to comply with budget reconciliation directives. 

Notable among changes to authorizing laws (not CHIMPS), the Conservation Security Program was reduced in FY2003 and again in FY2005 to offset agricultural disaster assistance ($3.1 billion and $2.9 billion, respectively). Authorizers also received credit for $2.7 billion in budget reconciliation savings (over five years) across 12 programs in 2005, many of which had been reduced by appropriators in prior years through CHIMPS. 

More recently, the Senate Agriculture Committee's current funding plan for the Healthy, Hunger- Free Kids Act of 2010 (S. 3307) proposes to use $2.2 billion of reductions from EQIP over 10 years to offset the cost of increases for child nutrition. A proposed alternative to use an offset from the Conservation Stewardship Program (CSP) would have similar budgetary effects, and would likewise affect a mandatory program. 

The Administration also can take actions that reduce mandatory outlays. In renegotiating the Standard Reinsurance Agreement for the crop insurance program, the Administration has proposed changes that would reduce the baseline available for crop insurance by about $7-8 billion over 10 years. This has raised a debate over whether such reductions should wait so that Congress can get credit for any reduction, especially for future farm bills or possible budget reconciliation. 
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Date of Report: May 19, 2010
Number of Pages: 18
Order Number:R41245
Price: $29.95

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Sunday, May 23, 2010

Sugar Market Developments and Policy Issues

Remy Jurenas
Specialist in Agricultural Policy

The sugar program, as reauthorized by the 2008 farm bill (P.L. 110-246), is designed to guarantee that growers and processors of sugar beets and sugarcane receive a minimum price. To do this, the U.S. Department of Agriculture (USDA) limits the amount of domestically produced sugar that processors can sell under "marketing allotments" and restricts imports. These decisions to control supply are aimed at keeping market prices above support levels, so that USDA can operate the sugar program at "no cost" to the U.S. Treasury. Separately, trade law authorizes the Secretary of Agriculture to allow additional imports if the domestic sugar supply is not adequate to meet domestic demand at reasonable prices. 

The United States is the fifth-largest consumer of sugar in the world. Consumption in food has increased in recent years, reflecting population growth and a shift back to sugar from corn syrup, an alternative and cheaper sweetener. Adverse weather significantly reduced beet sugar output in FY2009 and contributed to tight sugar supplies as FY2010 began. USDA projects a continued tight outlook at the end of FY2010 and also for FY2011, with ending stocks relative to demand at the low end of the range compared to earlier this decade. Reflecting this, the raw sugar futures price and the refined beet sugar spot price in April 2010 were 43% higher than year-ago levels. These prices were considerably above their support levels and 10-year market averages. 

Since early 2009, food manufacturers that use sugar have called on USDA to allow for additional sugar imports to head off sugar "shortages" and to restore supplies to more normal levels. Sugar crop growers and their processors maintain that the domestic market is adequately supplied, with the processing of the 2009 crops now complete. Though these contrasting views spotlight the issue of sugar availability, the debate has more to do with the future level of the price of sugar. Sugar processors seek to maintain their advantage in negotiating higher sales prices with users. Sugar users want lower refined sugar prices that are closer to the historical average. 

The debate over additional sugar imports centers around a provision in the 2008 farm bill that prescribes USDA's authority in administering the import quotas established to meet U.S. commitments under the World Trade Organization. It requires USDA at the beginning of each fiscal year to set the quotas for raw sugar and refined sugar at the minimum levels laid out in this obligation. The Secretary of Agriculture, however, is directed to increase imports before April 1 of any year if there is an "emergency shortage of sugar" due to war or a natural disaster. Sugar users have argued since summer 2009 that circumstances warranted additional imports before April 1. Processors urged USDA to wait until the supply picture became clearer. On April 23, 2010, USDA announced an increase in the raw sugar import quota. Over the last year, Members of Congress have weighed in to USDA in support of each side's position. 

Differing estimates of U.S. sugar use for food have implications for USDA's management of the sugar program—in particular for import quota decisions. Some analysts view USDA's projection of FY2010 sugar use as too low. They argue that available data suggest consumption of sugar for food is actually higher, and that additional imports are needed. 

Free trade in sweeteners with Mexico now introduces considerable uncertainty as to how much sugar Mexico might export in any year to the U.S. market. This, in turn, complicates USDA's effort to administer the sugar program. Sugar processors advocate increased coordination between the U.S. and Mexican governments on sugar policies. Sugar users oppose their "managed-trade proposal," arguing that it would result in inadequate domestic supplies and hurt U.S. jobs.


Date of Report: May 11, 2010
Number of Pages: 32
Order Number: R40995
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Friday, May 21, 2010

The U.S. Trade Situation for Fruit and Vegetable Products

Renée Johnson
Specialist in Agricultural Policy

Over the last decade, there has been a growing U.S. trade deficit in fresh and processed fruits and vegetables. Although U.S. fruit and vegetable exports totaled more than $10 billion in 2009, U.S. imports of fruits and vegetables were nearly $16 billion, resulting in a gap between imports and exports of almost $6 billion. This trade deficit has widened over time—despite the fact that U.S. fruit and vegetable exports have continued to rise each year—because growth in imports has greatly outpaced export growth. As a result, the United States has gone from being a net exporter of fresh and processed fruits and vegetables in the early 1970s to being a net importer of fruits and vegetables today. 

A number of factors shaping current competitive market conditions worldwide, and global trade in fruits and vegetables in particular, partially explain the rising fruit and vegetable trade deficit. These include: 

• a relatively open domestic import regime and lower average import tariffs in the United States, with products from most leading suppliers entering the U.S. dutyfree or at preferential duty rates; 

• increased competition from low-cost or government-subsidized production; 

• continued non-tariff trade barriers to U.S. exports in some countries, such as import and inspection requirements, technical product standards, and sanitary and phytosanitary (SPS) requirements; 

• opportunities for counter-seasonal supplies, driven in part by increased domestic and year-round demand for fruits and vegetables; and 

• other market factors, such as exchange rate fluctuations and structural changes in the U.S. food industry, as well as increased U.S. overseas investment and diversification in market sourcing by U.S. companies. 

In the buildup to the 2008 farm bill (Food, Conservation, and Energy Act of 2008, P.L. 110-246), the trade situation contributed to demands by the U.S. produce sector that Congress consider expanding support for domestic fruit and vegetable growers in farm bill legislation. Historically, fruit and vegetable crops have not benefitted from the federal farm support programs traditionally included in the farm bill, compared to the longstanding support provided to the main program commodities (such as grains, oilseeds, cotton, sugar, and milk). The 2008 farm bill provided additional support for specialty crop programs, as well as organic programs. The farm bill also included provisions intended to address existing trade barriers and marketing of U.S. specialty crops, including (1) provisions under USDA's Market Access Program (MAP) reauthorizing MAP funding to encourage domestic exports; and (2) Technical Assistance for Specialty Crops (TASC), reauthorizing the TASC program to address sanitary and phytosanitary (SPS) and technical barriers to U.S. exports, and providing mandatory funding.


Date of Report: May 12, 2010
Number of Pages: 19
Order Number: RL34468
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Friday, May 14, 2010

An Overview of USDA Rural Development Programs

Tadlock Cowan
Analyst in Natural Resources and Rural Development

More than 88 programs administered by 16 different federal agencies target rural economic development. The United States Department of Agriculture (USDA) administers the greatest number of rural development programs and has the highest average of program funds going directly to rural counties (approximately 50%). The Rural Development Policy Act of 1980 designated USDA as the lead federal agency for rural development. The Federal Crop Insurance Reform and Department of Agricultural Reorganization Act of 1994 created the Office of the Undersecretary for Rural Development and consolidated the rural development portfolio into four principal agencies responsible for USDA's mission area: the Rural Housing Service, the Rural Business-Cooperative Service, the Rural Utilities Service, and the Office of Community Development. 

Beginning with the FY2008 Consolidated Appropriations Act (P.L. 110-161), funding for the three Rural Community Advancement Program (RCAP) accounts is reported under their respective administering agencies, the Rural Housing Service, the Rural Business Service, and the Rural Utilities Service, respectively. 

This report provides an overview of the various programs administered by the four USDA agencies, their authorizing legislation, program objectives, eligibility criteria, and FY2005- FY2010 funding for each program.


Date of Report: May 3, 2010
Number of Pages: 41
Order Number: RL31837
Price: $29.95

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Thursday, May 13, 2010

Generalized System of Preferences: Agricultural Imports

Renée Johnson
Specialist in Agricultural Policy

The Generalized System of Preferences (GSP) provides duty-free tariff treatment for certain products from designated developing countries. Agricultural imports under the GSP totaled $2.2 billion in 2009, about 11% of all U.S. GSP imports. Leading agricultural imports include processed foods and food processing inputs, sugar and sugar confectionery, cocoa, processed and fresh fruits and vegetables, beverages and drinking waters, olive oil, processed meats, and miscellaneous food preparations and inputs for further processing. The majority of these imports are from Thailand, Brazil, Argentina, India, and the Philippines. Some in Congress have continued to call for changes to the program that could limit GSP benefits to certain countries, among other changes. Opinion within the U.S. agriculture industry is mixed, reflecting both support for and opposition to the current program. Congress made changes to the program in 2006, tightening its requirements on imports under certain circumstances. 

In the past few years, Congress has extended GSP through a series of short-term extensions. Currently, the GSP is set to expire December 31, 2010 (P.L. 111-124). Also, broader reform of the GSP and other U.S. trade preference programs is expected in 2010, which will likely continue to make the GSP a legislative issue in the 111th Congress. Leaders of the House Ways and Means Committee and the Senate Finance Committee continue to express an interest in evaluating the effectiveness of U.S. trade preference programs, including the GSP.


Date of Report: May 4, 2010
Number of Pages:9
Order Number:RS22541
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The FDA’s Authority to Recall Products

Vanessa K. Burrows
Legislative Attorney

The Food and Drug Administration (FDA) has fielded increasing numbers of questions regarding recalls of unsafe imports, including jalapeño peppers, pet food, the blood thinner heparin, and toothpaste. Additionally, several domestic drug and food products—such as over-the-counter children's medications, adult pain relief and allergy drugs, spinach, chili, and peanut products— have been voluntarily recalled by businesses in the last few years. Recalls may decrease consumer confidence in the recalling company, food imports, or product safety agencies such as the FDA. The products later subject to a recall may have sickened or killed people or pets. The FDA has the authority to order recalls of four types of products: infant formula, medical devices, human tissue products, and tobacco products. The agency may request that a company voluntarily recall other FDA-regulated products, such as food, drugs, and cosmetics. 

Congress has demonstrated a significant interest in the issue of food safety, holding several hearings and introducing many pieces of legislation. The 110th Congress passed P.L. 110-85, the FDA Amendments Act of 2007 (FDAAA), which contained provisions addressing communications and information postings during a food recall. Among other items, FDAAA directed the FDA to establish an electronic registry through which companies are required to report food for which there is a reasonable probability that the use of, or exposure to, such article of food would cause serious adverse health consequences or death to humans or animals. 

The 111th Congress passed the Family Smoking Prevention and Tobacco Control Act, P.L. 111-31, which provided authority for the Secretary of the Department of Health and Human Services, acting through the FDA, to order a recall of tobacco products if there is a reasonable probability that the tobacco product contains a manufacturing or other defect not ordinarily contained in tobacco products on the market that would cause serious, adverse health consequences or death. 

Additionally, the 111th Congress has introduced several bills that would grant the FDA the ability to order recalls of food and other products, including H.R. 841, the Protect Consumers Act of 2009; H.R. 875, Food Safety Modernization Act of 2009; H.R. 999, Keeping America's Food Safe Act of 2009; H.R. 2726, Counterfeit Drug Enforcement Act of 2009; H.R. 2749, Food Safety Enhancement Act of 2009; and S. 510, FDA Food Safety Modernization Act. H.R. 2749 is a revised version of H.R. 759, the Food and Drug Administration Globalization Act of 2009. 

In July 2009, the House passed H.R. 2749, a comprehensive food safety measure that would provide the FDA with authority to require recalls of food products after issuing an order to immediately cease distribution of a food (either after an opportunity for an informal hearing or on an emergency basis if there is credible evidence that a food presents an imminent threat of serious adverse health consequences or death), require facility food safety plans to describe their procedures for recalling articles of food, and enable the FDA to assess and collect fees from entities for the fiscal year in which the entity is subject to a food recall. S. 510 would similarly enable the FDA to order a recall of a food product and would require the FDA to assess and collect fees to cover food recall activities associated with a recall order. It has been reported by the Senate Committee on Health, Education, Labor, and Pensions and is expected to see floor action this year. 

This report provides an overview of the FDA's statutory authority with regard to the products that the agency can recall, as well as FDA regulations for designating the particular class of recall, publicizing and monitoring the effectiveness of recalls, and carrying out recalls.


Date of Report: May 6, 2010
Number of Pages:18
Order Number:RL34167
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Wednesday, May 12, 2010

What Is the “Farm Bill”?

Renée Johnson
Specialist in Agricultural Policy

The 2008 farm bill (P.L. 110-246, Food, Conservation, and Energy Act of 2008) was enacted into law on June 18, 2008. It contains 15 titles covering support for commodity crops, horticulture and livestock, conservation, nutrition, trade and food aid, agricultural research, farm credit, rural development, energy, forestry, and other related programs. It also includes tax-related provisions to offset some new spending initiatives in the rest of the bill. The bill succeeds the 2002 farm bill (P.L. 107-171) and is to guide most federal farm and food policies through FY2012. 

The farm bill undergoes review and reauthorization roughly every five years. The 112th Congress likely will consider reauthorization of the 2008 farm bill, because much of the current law expires in 2012. Increasingly tight budgetary resources are prompting the chairman of the House Agriculture Committee to initiate hearings starting as early as spring 2010. The Administration already has submitted budget proposals to reduce farm supports, an approach at odds with that of many farm sector advocates, who support the status quo.


Date of Report: May 6, 2010
Number of Pages: 10
Order Number: RS22131
Price: $29.95

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Friday, May 7, 2010

Consolidation and Concentration in the U.S. Dairy Industry

Dennis A. Shields
Specialist in Agricultural Policy

The changing structure of U.S. agriculture has generated concerns about reduced competition in a wide variety of agricultural products markets, including dairy. Two primary areas of concern in the dairy industry are consolidation—the shift to fewer and larger firms—and industry concentration—the extent to which a small number of firms control most of the sales. On August 5, 2009, the Obama Administration announced that the U.S. Department of Agriculture (USDA) and the Department of Justice would hold several public workshops to consider competition issues affecting agriculture and the appropriate role for antitrust and regulatory enforcement. A workshop on the dairy industry is scheduled for June 25, 2010, in Madison, WI. 

Consolidation has been a long-term trend in agriculture. Across the industry, including the dairy sector, rising productivity has led to fewer and larger operations along the production and marketing chain, including farms, cooperatives, processors, and retailers. Larger operations tend to have lower per-unit costs. As firms reduce their costs, they become more competitive and can increase sales and market share at the expense of less profitable firms. As a result, fewer dairy farms are needed to produce the same amount of milk. Firm size is a limiting factor for growth, however, once the gains to economies of scale have been exhausted. 

At the farm level, the number of farms continues to decline, although at a much slower pace during the last decade than in previous periods. Consolidation at the cooperative and processor levels has followed a similar path, in order to offset market power of large downstream entities and to satisfy demands from retailers to serve them more efficiently. 

Concentration has also been increasing in the dairy industry. Nearly all segments of the industry have become more concentrated over time. The primary concern many have with concentration is that it may reduce competition in the marketplace for agricultural and food products and result in market power (i.e., the ability of a firm to influence prices), putting at a disadvantage some segment of the population, such as producers or consumers. However, concentration may also result in efficiency gains, whereby cost savings are passed on to consumers through lower retail prices, which in turn can generate additional demand for commodities and benefit farmers. Another concern is how concentration affects price transparency in markets for dairy products and milk. 

In summarizing research findings for several agricultural industries, including the dairy industry, the Government Accountability Office concluded that most of the studies it reviewed found either no evidence of market power, or efficiency effects that were larger than the market power effects of concentration. However, the agency said experts generally agreed that concentration is likely to increase in the future, potentially raising greater concerns about market power and the manipulation of commodity or food prices. 

U.S. antitrust laws (specifically the Sherman Act and the Clayton Act) are concerned with competition in markets and not the protection of any individual competitor. These laws proscribe unlawful mergers and business practices in general terms, leaving courts to decide which are illegal based on the facts of each case. Two current court cases against Dean Foods, the largest fluid milk processor in the United States, highlight the ongoing concern about consolidation in the U.S. dairy industry. 
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Date of Report: April 27, 2010
Number of Pages: 24
Order Number: R41224
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Thursday, May 6, 2010

Nitrous Oxide from Agricultural Sources: Potential Role in Greenhouse Gas Emission Reduction and Ozone Recovery

Kelsi Bracmort
Analyst in Agricultural Conservation and Natural Resources Policy

Gases other than carbon dioxide accounted for nearly 15% of total U.S. greenhouse gas emissions in 2008, yet there has been minimal discussion of these other greenhouse gases in climate and energy legislative initiatives. Reducing emissions from non-carbon dioxide greenhouse gases, such as nitrous oxide (N2O), could deliver short-term climate change mitigation results as part of a comprehensive policy approach to combat climate change. 

Nitrous oxide is 310 times more potent than carbon dioxide in its ability to affect climate change; and moreover, results of a recent scientific study indicate that nitrous oxide is currently the leading ozone-depleting substance being emitted. Thus, legislation to restrict nitrous oxide emissions could contribute to both climate change protection and ozone recovery. 

The primary human source of nitrous oxide is agricultural soil management, which accounted for two-thirds of the N2O emissions reported in 2008 (approximately 216 million metric tons CO2 equivalent). One proposed strategy to lower N2O emissions is more efficient application of synthetic fertilizers. However, further analysis is needed to determine the economic feasibility of this approach as well as techniques to measure and monitor the adoption rate and impact of N2O emission reduction practices for agricultural soil management. 

As Congress considers legislation that would limit greenhouse gas emissions (both H.R. 2454 and S. 1733 would require that greenhouse gas emissions be reduced by 83% in 2050), among the issues being discussed is how to address emissions of non-CO2 greenhouse gases. Whether such emissions should be subject to direct regulation, what role EPA should play using its existing Clean Air Act authority, whether the sources of N2O should be included among the covered entities of a cap-and-trade system, whether N2O reductions should be considered offsets to be purchased by the covered entities of a cap-and-trade system, and what role USDA should play in any N2O reduction scheme are among the issues being discussed. How these issues are resolved will have important implications for agriculture, which has taken a keen interest in climate change legislation. 
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Date of Report: May 3, 2010
Number of Pages: 12
Order Number: R40874
Price: $29.95

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Tuesday, May 4, 2010

Earmarks Disclosed by Congress: FY2008-FY2010 Regular Appropriations Bills

Carol Hardy Vincent
Specialist in Natural Resources Policy

Jim Monke
Specialist in Agricultural Policy

In 2007, both the House and the Senate established new earmark transparency procedures. They provide for public disclosure of approved earmarks and the identification of their congressional sponsors. These procedures currently are contained in House Rule XXI, clause 9, and Senate Rule XLIV. Under both chambers' rules, an earmark is a provision in legislation or report language that is included primarily at the request of a Member, and provides, authorizes, or recommends a specific amount to an entity or to a specific state, locality, or congressional district. 

This report summarizes the earmarks disclosed for the 12 regular, annual appropriations bills for each of FY2008, FY2009, and FY2010. For these bills, a list of earmarks was typically included in the explanatory statement accompanying the final version of the bill under the heading "Disclosure of Earmarks and Congressionally Directed Spending Items." This report does not pertain to any earmarks disclosed in supplemental appropriations or authorizing legislation. 

This report directly analyzes the data in the earmark disclosure lists, without additions or deletions. For individual earmarks, the disclosures typically identify the federal agency, project name, amount, and requester. In some cases, other information also has been included, such as an account within an agency, or the purpose or location of the earmark. 

In FY2010, Congress identified 11,320 earmarks with a total value of $32.0 billion. Some appropriations bills account for more earmarks than others (Table 2). For instance, about fourfifths of the 11,320 earmarks in FY2010 are in five of the 12 appropriations bills. The Energy and Water Development and Related Agencies appropriations bill contains the greatest number of FY2010 earmarks—2,293, about 20% of the total number of earmarks. 

The distribution of the value of earmarks is more concentrated, with about $27.5 billion, or 86%, of the value of earmarks in four of the appropriations bills. The Military Construction and Veterans Affairs and Related Agencies appropriations bill contains the greatest value of FY2010 earmarks—$14.5 billion, about 45% of the total value. Some appropriations bills account for fewer earmarks but have a greater share of the value, or vice versa. 

House and Senate rules do not require congressional disclosure of presidentially requested earmarks. However, nine appropriations bills in FY2010 list the President as a requester, either solely or with a Member of Congress, for 2,039 earmarks worth $21.8 billion (18% of the total number and 68% of the total value of earmarks in the disclosure lists). It is possible that there are more presidential earmarks than those disclosed by Congress. There were 9,281 Member-only earmarks worth $10.2 billion (82% of the total number and 32% of the total value, Table 3). 

From FY2008 to FY2010, the total number of appropriations earmarks in all 12 bills decreased 12%, from 12,810 to 11,320. However, the total value of earmarks increased 11%, from $28.9 billion to $32.0 billion (Table 5). The percentage of the total appropriation that was earmarked decreased from 1.8% in FY2008 to 1.5% in FY2010. Excluding mandatory spending, the percentage of non-mandatory appropriations that were earmarked fell from 2.9% to 2.4%. Both the number and value of President-only earmarks increased since FY2008 (from 819 earmarks worth $4.2 billion in FY2008, to 1,265 earmarks worth $9.5 billion in FY2010; up 54% by number and 126% by value). Conversely, the number and value of Member-only earmarks decreased since FY2008, from 11,117 earmarks worth $12.5 billion in FY2008, to 9,281 earmarks worth $10.2 billion in FY2010, down 17% by number and 19% by value (Table 6). 
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Date of Report: April 16, 2010
Number of Pages: 24
Order Number: R40976
Price: $29.95

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Monday, May 3, 2010

The Federal Food Safety System: A Primer

Geoffrey S. Becker
Specialist in Agricultural Policy

Numerous federal, state, and local agencies share responsibilities for regulating the safety of the U.S. food supply, which many experts say is among the safest in the world. Nevertheless, critics view this system as lacking the organization, regulatory tools, and resources to adequately combat foodborne illness—as evidenced by a series of widely publicized food safety problems, including concerns about adulterated food and food ingredient imports, and illnesses linked to various types of fresh produce, to peanut products, and to some meat and poultry products. 

A number of comprehensive food safety proposals aimed at addressing perceived shortcomings in the U.S. food safety system were introduced but not enacted by the 110th Congress. These included measures to reform the Food and Drug Administration's (FDA's) oversight of food and other imports, to create a new independent food safety agency, and to impose a variety of new requirements on food manufacturers, handlers, and producers (including farms), such as mandated risk-based safety plans, recordkeeping for product tracing purposes, more rigorous registration requirements, and performance standards. The adequacy of inspection resources also has been at issue, and appropriators have been ramping up funding for the major agencies, particularly FDA. 

Bills with similarly broad goals (such as H.R. 759, which was revised and reintroduced in June 2009 as H.R. 2749; H.R. 875; H.R. 1332; and S. 510) re-emerged in the 111th Congress. On the one hand, food safety reform is a relatively complex, controversial matter competing for attention with a long list of domestic priorities. On the other hand, there has been a growing consensus that changes are needed. 

Lawmakers took the first step toward new legislation on June 10, 2009, when the House Energy and Commerce Subcommittee on Health approved an amended version of H.R. 2749. The full committee approved the bill, with additional changes, on June 17, 2009, and the full House passed a further-modified H.R. 2749 on July 30, 2009. Senate work on a comprehensive, but differing, food safety bill (S. 510 by Senator Durbin) commenced with a November 18, 2009, markup by the Health, Education, Labor, and Pensions Committee. Floor action was pending, but widely anticipated by stakeholders, in spring 2010. (For more details see CRS Report R40443, Food Safety: Selected Issues and Bills in the 111th Congress.)


Date of Report: April 20, 2010
Number of Pages: 14
Order Number: RS22600
Price: $29.95

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Food Safety: Selected Issues and Bills in the111th Congress

Geoffrey S. Becker
Specialist in Agricultural Policy

The combined efforts of the food industry and government regulatory agencies often are credited with making the U.S. food supply among the safest in the world. Nonetheless, public health officials have estimated that each year in the United States, many millions of people become sick, and thousands die from foodborne illnesses caused by any one of a number of microbial pathogens and other contaminants. At issue is whether the current food safety system has the resources, authority, and structural organization to safeguard the health of American consumers, who spend more than $1 trillion on food each year. Also at issue is whether federal food safety laws, first enacted in the early 1900s, have kept pace with the significant changes that have occurred in the food production, processing, and marketing sectors since then. 

In the 111th Congress, several food safety bills have been introduced, and wide-ranging legislation (H.R. 2749) has passed the House. The Senate also has a comprehensive bill (S. 510). Both of these bills mainly focus on the U.S. Food and Drug Administration's (FDA's) food regulation rather than that of the U.S. Department of Agriculture (USDA, which has oversight of most meat and poultry). The bills would use the agency and its existing FDA authorities rather than create a new food safety structure or authorities. H.R. 2749 is a revised version of H.R. 759, and was amended and approved by a House Energy and Commerce subcommittee on June 10, 2009. The full committee further amended and approved H.R. 2749 on June 17, 2009, and the full House approved the bill on July 30, 2009, with a number of additional amendments intended to satisfy the concerns of agricultural interests. The Senate Health, Education, Labor, and Pensions Committee amended and approved S. 510 on November 18, and reported it December 18, 2009. Floor action is anticipated in 2010. In mid-April potential amendments to the bill were being discussed, aimed at addressing issues of continued interest to various Senators. A number of these could be proposed by floor managers when the full Senate takes up the measure. 

Food safety legislation is a response to a number of perceived problems with the current food safety system. For example, a growing consensus is that the FDA's current programs are not proactively designed to emphasize prevention, evaluate hazards, and focus inspection resources on areas of greatest risk to public health. Given its widely acknowledged funding and staffing constraints, and no explicit requirement on the frequency of inspections, the agency rarely visits food manufacturing and other facilities to check sanitary and other conditions. In response, the bills would require (although in different ways) food processing, manufacturing, shipping, and other regulated facilities to conduct an analysis of the most likely safety hazards and to design and implement risk-based controls to prevent them. The bills envision establishment of sciencebased "performance standards" for the most significant food contaminants. To help determine such risks and hazards, the bills propose improvement of foodborne illness surveillance systems. 

The bills seek to increase frequency of inspections, tighten record-keeping requirements, extend more oversight to certain farms, and mandate product recalls if a firm fails to do so voluntarily. Major portions of the bills are devoted to more scrutiny of food imports, which account for an increasing share of U.S. consumption; food import shipments would have to be accompanied by documentation that they can meet safety standards that are at least equivalent to U.S. standards. Such certifications might be provided by foreign governments or other so-called third parties accredited in advance; again, the major bills differ in how to accomplish these objectives. The bills have provisions for certifying or accrediting laboratories, including private laboratories, to conduct sampling and testing of food for various oversight purposes.


Date of Report: April 21, 2010
Number of Pages: 38
Order Number: R40443
Price: $29.95

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Sunday, May 2, 2010

Food Safety: Selected Issues and Bills in the111th Congress

Geoffrey S. Becker
Specialist in Agricultural Policy

The combined efforts of the food industry and government regulatory agencies often are credited with making the U.S. food supply among the safest in the world. Nonetheless, public health officials have estimated that each year in the United States, many millions of people become sick, and thousands die from foodborne illnesses caused by any one of a number of microbial pathogens and other contaminants. At issue is whether the current food safety system has the resources, authority, and structural organization to safeguard the health of American consumers, who spend more than $1 trillion on food each year. Also at issue is whether federal food safety laws, first enacted in the early 1900s, have kept pace with the significant changes that have occurred in the food production, processing, and marketing sectors since then. 

In the 111th Congress, several food safety bills have been introduced, and wide-ranging legislation (H.R. 2749) has passed the House. The Senate also has a comprehensive bill (S. 510). Both of these bills mainly focus on the U.S. Food and Drug Administration's (FDA's) food regulation rather than that of the U.S. Department of Agriculture (USDA, which has oversight of most meat and poultry). The bills would use the agency and its existing FDA authorities rather than create a new food safety structure or authorities. H.R. 2749 is a revised version of H.R. 759, and was amended and approved by a House Energy and Commerce subcommittee on June 10, 2009. The full committee further amended and approved H.R. 2749 on June 17, 2009, and the full House approved the bill on July 30, 2009, with a number of additional amendments intended to satisfy the concerns of agricultural interests. The Senate Health, Education, Labor, and Pensions Committee amended and approved S. 510 on November 18, and reported it December 18, 2009. Floor action is anticipated in 2010. In mid-April potential amendments to the bill were being discussed, aimed at addressing issues of continued interest to various Senators. A number of these could be proposed by floor managers when the full Senate takes up the measure. 

Food safety legislation is a response to a number of perceived problems with the current food safety system. For example, a growing consensus is that the FDA's current programs are not proactively designed to emphasize prevention, evaluate hazards, and focus inspection resources on areas of greatest risk to public health. Given its widely acknowledged funding and staffing constraints, and no explicit requirement on the frequency of inspections, the agency rarely visits food manufacturing and other facilities to check sanitary and other conditions. In response, the bills would require (although in different ways) food processing, manufacturing, shipping, and other regulated facilities to conduct an analysis of the most likely safety hazards and to design and implement risk-based controls to prevent them. The bills envision establishment of sciencebased "performance standards" for the most significant food contaminants. To help determine such risks and hazards, the bills propose improvement of foodborne illness surveillance systems. 

The bills seek to increase frequency of inspections, tighten record-keeping requirements, extend more oversight to certain farms, and mandate product recalls if a firm fails to do so voluntarily. Major portions of the bills are devoted to more scrutiny of food imports, which account for an increasing share of U.S. consumption; food import shipments would have to be accompanied by documentation that they can meet safety standards that are at least equivalent to U.S. standards. Such certifications might be provided by foreign governments or other so-called third parties accredited in advance; again, the major bills differ in how to accomplish these objectives. The bills have provisions for certifying or accrediting laboratories, including private laboratories, to conduct sampling and testing of food for various oversight purposes.


Date of Report: April 21, 2010
Number of Pages: 38
Order Number: R40443
Price: $29.95

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.