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Wednesday, March 30, 2011

Agricultural Conservation: A Guide to Programs


Megan Stubbs
Analyst in Agricultural Conservation and Natural Resources Policy

The Natural Resources Conservation Service (NRCS) and the Farm Service Agency (FSA) in the U.S. Department of Agriculture (USDA) currently administer over 20 programs and subprograms that are directly or indirectly available to assist producers and landowners who wish to practice conservation on agricultural lands. The number, scope, and overall funding of these programs has grown in recent years. This growth can cause some confusion over which problems and conditions each program addresses, and specific program characteristics and performance. The programs are as follows: 

  • Agricultural Management Assistance (AMA) Program 
  • Chesapeake Bay Watershed Program 
  • Cooperative Conservation Partnership Initiative (CCPI) 
  • Conservation Operations (CO); Conservation Technical Assistance (CTA) 
  • Conservation Reserve Program (CRP) 
  • CRP—Conservation Reserve Enhancement Program (CREP) 
  • CRP—Farmable Wetlands Program 
  • Conservation Security Program 
  • Conservation Stewardship Program (CSP) 
  • Emergency Conservation Program (ECP) 
  • Emergency Watershed Program (EWP) 
  • Environmental Quality Incentives Program (EQIP) 
  • EQIP—Agricultural Water Enhancement Program (AWEP) 
  • EQIP—Conservation Innovation Grants (CIG) 
  • Farmland Protection Program (FPP) 
  • Grassland Reserve Program (GRP) 
  • Healthy Forest Reserve Program (HFRP) 
  • Resource Conservation and Development (RC&D) Program
  • Voluntary Public Access and Habitat Incentive Program 
  • Watershed and Flood Prevention Operations 
  • Watershed Rehabilitation Program 
  • Wetland Reserve Program (WRP) 
  • Wildlife Habitat Incentive Program (WHIP) 

This tabular presentation provides basic information introducing each of the programs. In each case, a brief program description is followed by information on major amendments in the 2008 farm bill (P.L. 110-246); national scope and availability; states with the greatest participation; the backlog of applications or other measures of continuing interest; program funding authority; FY2010 spending; FY2011 estimated spending; the FY2012 Administration budget request; statutory authority; the authorization expiration date; and a link to the program’s website.


Date of Report: March 16, 2011
Number of Pages: 30
Order Number: R40763
Price: $29.95

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Tuesday, March 22, 2011

Biomass Crop Assistance Program (BCAP): Status and Issues


Megan Stubbs
Analyst in Agricultural Conservation and Natural Resources Policy

The Food, Conservation, and Energy Act of 2008 (P.L. 110-246, 2008 farm bill) created the Biomass Crop Assistance Program (BCAP). The two main purposes of BCAP are (1) to support the establishment and production of eligible crops for conversion to bioenergy in selected areas, and (2) to assist agricultural and forest land owners and operators with collection, harvest, storage, and transportation of eligible material for use in a biomass conversion facility. BCAP is intended to assist with the bioenergy industry’s hurdle of continuous biomass availability.

The U.S. Department of Agriculture’s (USDA’s) Farm Service Agency (FSA) implemented one portion of BCAP—the Collection, Harvest, Storage, and Transportation (CHST) matching payment program—on June 11, 2009, through a Notice of Funds Availability in the Federal Register. The partial implementation created a possible unintended consequence of market competition for wood shavings, wood chips, sawdust, and other wood “scraps” between traditional purchasers—namely landscapers and particleboard manufactures—and facilities that convert biomass to energy. The issuance of the BCAP proposed rule on February 8, 2010, suspended CHST program enrollment and proposed rules for the implementation of the remainder of the BCAP program.

USDA issued the BCAP final rule on October 27, 2010, implementing both program components. The two main components of BCAP are split into two forms of payments: annual and establishment payments, which share in the cost of establishing eligible biomass crops and maintaining production; and matching payments, which share in the cost of the collection, harvest, storage, and transportation of biomass to an eligible biomass conversion facility. The payments have different eligibility and sign-up requirements, payment rates, and contract lengths. Funding for the program is mandatory through the Commodity Credit Corporation (CCC) and was originally authorized at a “such sums as necessary” level. Recent congressional actions have caped the program in FY2010 and FY2011.

While BCAP is in the early stages of implementation, concerns regarding eligibility, sustainability, and funding continue to be discussed. These issues could shape future congressional action on the program in the context of budgetary measures and possible reauthorization in the next farm bill.



Date of Report: March 9, 2011
Number of Pages: 17
Order Number: R41296
Price: $29.95

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Friday, March 18, 2011

Previewing Dairy Policy Options for the Next Farm Bill

Dennis A. Shields
Specialist in Agricultural Policy

Financial stress encountered by dairy farmers in recent years has led Congress and the industry to reconsider how to deal with fluctuations in milk prices and financial prospects for dairy farmers. Some Members have voiced interest in alternatives to current federal programs (which expire in 2012). Alternative policies could either be incorporated into the next omnibus farm bill or enacted separately before expiration.

The dairy industry is currently developing or advocating a variety of policy changes. All of the proposals discussed in this report—loosely categorized as either supply management, marketbased, or tiered-pricing—have implications for U.S. dairy farmers, competitiveness of the U.S. dairy industry, and international trade.

Supply management proposals such as H.R. 5288 and S. 3531, introduced in the 111
th Congress, are designed to prevent depressed farm milk prices while reducing price volatility through supply management. The National Milk Producers Federation (NMPF) also has proposed a market stabilization component as part of its comprehensive package of suggested reforms to dairy policy. Supporters of price stabilization and supply management say that inherent incentives to overproduce need to be offset by a program to manage supplies in a measured way. Critics of supply management, including dairy processors, contend that such measures could reduce the competitiveness of the U.S. dairy industry, limit its incentive to innovate, and raise consumer prices, because, they argue, a pricing system based on supply control and/or cost of production potentially rewards inefficiency.

The market-based approach, including a separate element of the NMPF package, represents an opposing view on how the federal government should address the problem of farm milk price volatility and periodic financial stress for dairy farmers. This approach contends that, because it is difficult to manage milk supplies and prices administratively, the best approach is to provide a government program that helps farmers manage risk associated with volatile prices of milk and feed. Specifically, a new “safety net” would be established to protect a dairy farmer’s “margin”— that is, the farm price of milk minus feed costs—regardless of current price levels. Critics expect that incentives to overproduce will aggravate the financial woes of the dairy industry indefinitely, and thus argue that controlling potential price variability and combating depressed farm prices with supply management is necessary for the long-term financial health of producers.

The third area of potential policy change is to alter the current pricing approach used in federal milk marketing orders (FMMOs) to directly increase dairy farm revenue. For example, one potential change to base milk pricing in FMMOs on the cost of milk production (i.e., S. 1645, introduced in the 111
th Congress) would imply higher prices received by dairy farmers. However, some are concerned that the long-run competitiveness and stability of the U.S. dairy industry could be at risk because of the unknown effectiveness of provisions to discourage overproduction.

On March 3, 2011, the U.S. Department of Agriculture’s Dairy Industry Advisory Committee approved its final report to the Secretary, who established the committee to make recommendations on how USDA can best address dairy farm profitability and milk price volatility. Many of the group’s 23 recommendations fall into the market-based approach, including a recommendation for margin insurance on quantities of milk that exceed the cap for the Milk Income Loss Contract Program (MILC) and a tax-deferred savings accounts for dairy farmers. The committee narrowly passed a recommendation for a supply management program.



Date of Report: March 04, 2011
Number of Pages: 29
Order Number: R1141
Price: $29.95

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Wednesday, March 16, 2011

U.S.-South Korea Beef Dispute: Issues and Status

Remy Jurenas
Specialist in Agricultural Policy

Mark E. Manyin
Specialist in Asian Affairs


U.S. beef access to South Korea has been one issue left for the Obama Administration to resolve before the Korea-U.S. Free Trade Agreement (KORUS FTA) goes to Congress for debate. While Korea committed in the FTA to reduce its 40% tariff on imported U.S. beef over a 15-year period, its limits on such imports for human health reasons threatened to undercut this preferential benefit for U.S. exporters. In 2003, South Korea was the third-largest market for U.S. beef exports, prior to the ban its government imposed after the first U.S. cow infected with mad cow disease, or BSE (bovine spongiform encephalopathy), was discovered. U.S. efforts to regain full access became intertwined with the subsequent KORUS negotiations, but did not yield results by the time those talks concluded. Since then, some Members of Congress have stated that their consideration of, and support for, KORUS depends on South Korea fully opening its market to U.S. beef.

On April 18, 2008, U.S. and South Korean negotiators reached a protocol, or agreement, on sanitary rules that Korea will apply to beef imports from the United States. It allows for imports of all cuts of U.S. boneless and bone-in beef and certain beef products from cattle, irrespective of age, as long as specified risk materials known to transmit mad cow disease are removed and other conditions are met. Though the U.S. beef industry and U.S. policymakers welcomed this deal, Korean TV coverage and Internet-spread rumors that questioned the safety of U.S. beef resulted in escalating protests and calls for the beef agreement to be renegotiated or scrapped. U.S. officials countered that measures already in place to prevent the introduction of BSE in U.S. cattle herds meet international scientific standards. To address rising public pressure, the Korean government twice pursued talks with the United States to find ways to defuse these concerns without “renegotiating” the beef agreement. This culminated in the June 21, 2008, confirmation by both governments of a “voluntary private sector” arrangement that allows Korean firms to import U.S. beef produced from cattle only under 30 months of age. Both governments view this as a transitional step until Korean consumer confidence in the safety of U.S. beef improves.

Since the resumption of U.S. beef exports in July 2008, U.S. exporters have worked to recapture this key overseas market. Beef exports to South Korea in 2010 totaled $518 million, about twothirds of the record 2003 level. Promotional efforts to rebuild consumer confidence in U.S. beef, aggressive marketing efforts by large store chains, and much lower retail prices for imported beef than for Korean beef account for the continued growth in U.S. beef sales.

Following President Obama’s mid-2010 decision to present the KORUS FTA to Congress in 2011, Administration officials worked to resolve the beef and auto issues with South Korea. When bilateral talks concluded on December 3, 2010, the beef issue reportedly had received little discussion as both sides focused on revising the auto provisions. Korea’s position was shaped by the memory of the size and intensity of the 2008 anti-beef agreement protests. President Obama, in discussing this outcome, stated that the United States will continue to work toward “ensuring full access for U.S. beef to the Korean market.” Congressional reaction to the lack of additional movement on the beef issue was mixed. One Senator said he will not support the KORUS FTA until South Korea fully opens its beef market in accordance with international scientific standards. A few other Senators, though concerned with the lack of progress on beef, viewed the outcome positively and look forward to congressional consideration of the KORUS FTA. Beef and meat industry groups welcomed the progress made to bring KORUS up for debate, expressed their support, and urged Congress to move quickly to ratify it. Since the 2008 protocol is not part of the text of the KORUS FTA, it could be amended easily if both countries later agree to changes that allow for full access for U.S. beef in the Korean marketplace.



Date of Report: March 3, 2011
Number of Pages: 18
Order Number: RL34528
Price: $29.95

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Friday, March 11, 2011

Deregulating Genetically Engineered Alfalfa and Sugar Beets: Legal and Administrative Responses


Tadlock Cowan
Analyst in Natural Resources and Rural Development

Kristina Alexander
Legislative Attorney


Monsanto Corporation, the developer of herbicide-tolerant varieties of genetically engineered (GE) alfalfa and sugar beet (marketed under the name of Roundup Ready alfalfa and Roundup Ready sugar beet), petitioned USDA’s Animal and Plant Health Inspection Service (APHIS) for deregulation of the items. Deregulation of GE plants is the final step in the commercialization process. Monsanto filed a petition for deregulation of its GE alfalfa in 2004, and for sugar beets in 2005.

As part of the deregulation process, APHIS conducts an environmental review under the National Environmental Policy Act (NEPA) to determine whether any significant environmental impacts will result from deregulating the item. APHIS conducted a limited review, known as an environmental assessment (EA), of the GE plants to assess the impacts of growing them on a commercial scale. APHIS issued a “finding of no significant impact” (FONSI) for GE alfalfa and for GE sugar beet.

Lawsuits subsequently challenged the adequacy of the EAs. The courts agreed that APHIS should have prepared a more analytically thorough environmental impact statement (EIS) for both deregulation decisions. APHIS was directed by the court to complete an EIS on the effects of deregulating both of the GE varieties.

The court in the GE alfalfa case halted planting of the genetically modified seed, and nullified the deregulation. The injunction was appealed to the U.S. Supreme Court, which held that the injunction was too broad and that the court should have considered partial deregulation. The Supreme Court did not discuss the appropriateness of the environmental review. In the meantime, APHIS completed the environmental review directed by the lower court, releasing a final EIS for GE alfalfa on December 16, 2010. On January 27, 2011, Secretary Vilsack announced that APHIS was granting GE alfalfa full deregulation.

The court in the GE sugar beet case did not formally prohibit planting sugar beet, but it voided APHIS’s deregulation decision in August 2010, undoing the five-year-old approval of GE sugar beet, from which nearly half of U.S. sugar is derived. APHIS issued four permits authorizing seedling production that would not allow flowering or transplanting without additional authorization. In November 2010, a judge ordered those seedlings pulled from the ground, holding that APHIS had violated NEPA in issuing the permits. The Ninth Circuit temporarily halted that decision in December 2010, ultimately holding in February 2011 that the seedlings did not have to be removed.

APHIS anticipates that an EIS for GE sugar beet will be completed in May 2012. In the interim, APHIS announced on February 4, 2011, that the agency would partially deregulate GE sugar beet root crop production, but continue full regulation for sugar beet seed crop production. That regulatory status will remain effective through December 31, 2012. An EA-FONSI was issued. Suits have been filed either challenging the EA or seeking to establish its legality.

The cases of GE alfalfa and sugar beet highlight continuing policy questions about the adequacy of APHIS’s deregulation protocol, particularly regarding the environmental review process. In their suits against APHIS, plaintiffs cited the EAs’ failure to assess the impact on non-GE alfalfa growers (particularly those who export to Japan, Korea, and Taiwan) and on producers of commercial table beet and chard seeds (species that can cross-pollinate with GE sugar beet).



Date of Report: March 2, 2011
Number of Pages: 18
Order Number: R41395
Price: $29.95

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