C44—Lancaster Fanning, Saturday, March 29,1980
Demand needed, not production soybean group says
WASHINGTON, D.C. -
The American Soybean
As&ociation has asked
Congress to help create
ezr>anded demand for
soybeans rather than accept
supply proposals that could
artifically stimulate soybean
production.
“The short-term outlook
for soybeans is not as bright
as it has been but we
strongly believe the free
market forces must continue
to be the prime determinant
of U.S. soybean production
and demand,” ASA First
Vice President Frank Ray, a
Baker, Florida, soybean
grower, testified at Mon
day’s Senate Agriculture
Committee hearing.
“We believe the federal
government should expand
its market development
assistance to help m ASA’s
efforts to expand world
demand for soybeans and
soybean products. We feel
Congress should avoid ‘quick
cures’ which in the long run
will damage the soybean
industry and cost taxpayers
milhons of dollars. ”
The Senate hearing was
called to determine possible
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changes in the U.S. farm
program as a result of
President Carter’s embargo
of shipments of grain and
soybeans to the Soviet
Union.
In an effort to boost
soybean demand to replace
the Soviet market, ASA
urged Congress to ap
propriate an additional $2
million for USDA funding of
soybean market develop
ment efforts.
“While the additional $2
million is no small amount, it
is much less than the $35
million that USDA seems
determined to spend on
storage payments for a
soybean reserve that
growers do not want,” Ray
testified.
“This additional $2 million
combined with the current
$2.8 million simply means
that the government will
match the $4.8 million
growers invest. Expanded
international markets for
soybeans and soybean
products are the best in
surance against price
declines m the future and we
urge USDA to increase its
assistance in developing
those markets.”
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ASA< also requested
Congress to expand direct
Commodity Credit Cor
poration export credits
program beyond the $BOO
million authorized m the
current fiscal year.
“The direct CCC export
credit program has been an
important tool in expanding
foreign markets without any
net cost to U.S. taxpayers,”
Ray said.
“Yet, no additional direct
loans have been authorized
in the current fiscal year and
the president’s FYI9BI
budget calls for the
elimination of such loans in
lieu of a less effective loan
guarantee program. It
makes little sense to soybean
growers for the federal
government to cut back
funding for a money-making
loan program at a time when
the need to expand foreign
markets is greatest.”
In its testimony, ASA
asked Congress to determine
why the administration had
failed to implement in
termediate-term credit
provisions authorized by the
Agricultural Trade Ex
pansion Act of 1978.
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Theses loans would, be
used in key importing
countries for construction of
facilities that would enhance
agricultural imports.
ASA’s Ray said the
organization supports
Senator Herman
Talmadge’s resolution that
would allow soybean
producers not complying
with the 1979 feed gram set
aside to be eligible to par
ticipate in the soybean loan
program.
“ASA in January, asked
Secretary Bergland to
eliminate this cross
compliance provision,” Ray
said.
“To date, however, the
Department of Agriculture
has not chosen to take this
step in providing soybean
producers with an important
marketing tool.
“ASA believes removal of
the cross-compliance
provision is justified because
soybean producers should
not be penalized by over
production in the feed grain
sector. Removal of this
provision would allow
thousands of soybean
growers to obtain needed
financing while maintaining
marketing control over their
soybeans.”
The soybean association
repeated its opposition to
both a federally-financed
soybean reserve program
and a high soybean loan
rate.
“ASA strongly opposed the
establishment of a -soybean
reserve program similar to
those in effect for feed grams
and wheats,” Ray told the
Senators.
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“ASA is convinced such a
reserve program is neither
justified by current market
conditions nor would it
provide any long-term
benefits to soybean
producers. In fact, we
believe a reserve program
would distort normal
soybean production and
marketing and result in
increased soybean
production in the U.S. and
around the world.
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“We also oppose any in
crease in the soybean loan
rate. We feel the current
$4.50 level is sufficient to
provide soybean producers
with sufficient capital to
cover the current out-of-.
pocket expenses for their
1980 crop. A higher loan rate,
as proposed by Senator
McGovern, would stimulate
overproduction and allow
our foreign competitors to
undersell U.S. soybeans.”
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RD 3 Ephrata PA 17522
(717) 354-4631
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