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April 18, 2008

NATIONAL AFFAIRS:

Rising Food Prices Making Headlines Regularly - Media outlets are devoting increasing time and space to rising food costs and related issues. A front-page, "news analysis" article in the April 15 edition of The New York Times reports, "The idea of turning farms into fuel plants seemed, for a time, like one of the answers to high global oil prices and supply worries. That strategy seemed to reach a high point last year when Congress mandated a five-fold increase in the use of biofuels. But now a reaction is building against policies in the United States and Europe to promote ethanol and similar fuels, with political leaders from poor countries contending that these fuels are driving up food prices and starving poor people. Biofuels are fast becoming a new flash point in global diplomacy, putting pressure on Western politicians to reconsider their policies, even as they argue that biofuels are only one factor in the seemingly inexorable rise in food prices." The article adds that farmers "are having trouble keeping up with the surge in demand." Also, "While there is agreement that the growth of biofuels has contributed to higher food prices, the amount is disputed." An article in last Monday's edition of The Wall Street Journal also looked at the issue. The article begins, "For all the economists and consumers who hope high food prices are temporary, here's one reason why they probably won't be: Farm costs are skyrocketing, making permanently higher prices essential for farmers to keep expanding production." Also on Monday, an Associated Press article reports the United States is "wrestling with the worst food inflation in 17 years, and analysts expect new data due on Wednesday to show it's getting worse." In addition, President Bush last Monday directed Agriculture Secretary Ed Schafer to draw down the Bill Emerson Humanitarian Trust to meet emergency food aid needs abroad. With this action, about $200 million in emergency food aid will be made available through the U.S. Agency for International Development, according to the White House. The United States is the world's largest provider of food aid, providing more than $2.1 billion of food aid for 2.5 million metric tons of commodities to 78 developing countries last year. The United States also is the world's largest provider of emergency food assistance, delivering 1.5 million metric tons of emergency food aid valued at $1.2 billion to 30 countries last year.

AFBF Basis Meeting - American Farm Bureau Federation (AFBF) held a meeting April 8 to discuss concerns over basis convergence and other grain marketing issues. The discussion will be helpful to AFBF as it prepares for an April 22 public meeting called by the CFTC to examine similar issues. In addition to Farm Bureau leaders from a number of states, speakers included representatives from CME/CBOT, the Commodity Futures Trading Commission, University of Illinois and grain marketing consultants. Among the topics discussed were factors impacting basis, agricultural and nonagricultural interests in the marketplace, trends in global demand, status of state elevator indemnity programs, and the credit health of elevators and farmers. Both OFBF and AFBF are monitoring the issue. OFBF was represented at the meeting.

STATE AFFAIRS:

Ag Plate Awaits Floor Vote in Senate - Adam Ward, legislative liaison for the Ohio Department of Agriculture testified in the Senate Agriculture Committee explaining the changes made to HB 293 (Goodwin) under the substitute version. The changes, requested by ODA, will establish two license plates, the "Ohio Agriculture" and "Sustainable Agriculture" plates. The funds generated by the "Sustainable Agriculture" plates will be used by ODA to promote all aspects of agriculture and leverage federal dollars for first-time farmers. Funds generated from the sale of the "Ohio Agriculture" plate will be used for scholarships for students studying agriculture or a related field in Ohio.

The Senate Agriculture Committee voted to adopt the substitute version of the bill and unanimously voted the bill out of committee.

Road Status Bill Reported Out of Committee - The House Infrastructure, Homeland Security & Veterans Affairs Committee unanimously voted Rep. Bob Gibbs' bill, Substitute HB 318, out of committee. The bill requires county commissioners and township trustees to have at least two public hearings before a road can put on "non-maintained status." In addition, townships and counties must obtain an advisory opinion from the county engineer.

During the previous hearing, the committee voted to adopt the substitute version of the bill. According to the substitute bill, "passable" roads cannot be placed on non-maintained status, and no paved road could be added to the list.

Line Fence Bill Reported Out of House Committee with Support of Ohio Township Association- Sponsored by Rep. Bob Gibbs, HB 323, was unanimously reported out of the House Agriculture & Natural Resources Committee.  A brief testimony was given by the Ohio Township Association informing the committee that its board voted to endorse HB 323 two weeks ago.

Under this bill, a landowner who wants to construct a fence where none existed will be responsible for the cost of building and maintaining the fence. However, if a neighbor should use the fence to maintain livestock within 30 years, that landowner must reimburse 50 percent of the cost of building and maintaining said fence. The bill also creates a cost sharing mechanism for neighbors, allows neighbors to agree that no fence is needed, prohibits the removal of a fence without notification and establishes liability for damages caused by trespassing livestock. The bill also defines a "preferred partition fence," which is the type of fence the law could mandate when owners disagree

Ohio Farm Bureau Supports Bee Task Force - Rep. Mark Okey introduced HB 501 which received its second hearing in the House Agriculture & Natural Resources Committee. If the bill is adopted into law, it will establish the Ohio Beekeepers Task Force. The task force will be composed of a representative from Ohio Farm Bureau Federation, Ohio Department Agriculture, Ohio Department of Natural Resources, and the Ohio State Beekeepers Association among others. Members of the task force will be charged with providing an overview of the honeybee crisis in Ohio and an emergency action plan.

Testifying on behalf of the Ohio Farm Bureau Federation was Margaret Reid, who runs an apiary in Lawrence County.

Ohio Farm Bureau Supports STOLI Prevention Bill - Introduced by Reps. Jay Hottinger and Matthew Barrett, HB 404 is now working its way through the Senate committee process after receiving an unanimous vote in the House. The bill is designed to prevent transactions in which investors offer to pay aging Ohioans for their life insurance policies. These transactions are referred to as Stranger Originated Life Insurance (STOLI) transactions. With certain exceptions, the bill will pass a five-year moratorium on the transfer of a life insurance policy. The bill sponsors testified these STOLI transactions can have adverse tax consequences for the policy holder, and many times elderly Ohioans are victimized in these types of transactions.

It was suggested in committee that this bill would have adverse affects for Ohio farmers. In response, Ohio Farm Bureau Federation wrote a letter of support for the bill. OFBF explained that protecting Ohioans and their life insurance policies is essential for farmers to pass along their farm to their family when they pass away.

CONTACT

Niki Clum

Director of Constituent Action

nclum@ofbf.org