DENVER - The U.S.
agricultural economy has reached
a crisis of such proportion that
improving it must now top the
Congressional budget resolution on
the nation’s priority list, members
of the National Farmers Union
Board of Directors said. And, they
said, they will press that point in
meetings they have requested with
Agriculture Secretary John Block
and the chairmen of the House and
Senate agriculture committees.
“Without improved farm in
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Farm crisis tops budget as priority, NFU says
come, the Farm Credit System and
other lending institutions will fail
and the cost to the budget will be
even greater than the projected
overruns caused by any Farm Bill
proposal under consideration,”
they said. “Because of its enor
mity, this one aspect of the farm
financial crisis alone is enough to
cause agriculture to supercede the
Congressional budget resolution as
a national priority.”
The budget cannot be the
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that restores at least the cost ot
production-including debt
retirement, management costs
and a return on investment-to
farmers, they said.
Congressional agriculture
committees are now backing
proposals for lower farm market
prices. The Farmers Union leaders
predicted that this would have a
devastating effect on international
money markets as countries like
Argentina and Mexico would lose
their ability to repay their world
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debt.
“We predict that if that hap
pened, the shock value would
finally force policy makers to wake
up to the need for improved farm
income when people in financial
centers like New York City and
London find low commodity prices
to be the root of the problem," they
said.
The state Farmers Union
.presidents acknowledged that
improved farm income and
commodity supply management
will mean federal expenditures.
But, it will not require the record
$l9 billion federal budget exposure
incurred by the Reagan Ad
ministration for its one-time
Payment-in-Kind program.
“This administration is the
prime stumbling block now to a
Farm Bill that will improve farm
income. Yet when the ad
ministration faced an election two
years ago and dealt with its own
farm program mismanagement,
money was no object and PIK was
instituted,” they said.
Trading nations around the
Com growers criticize
customs’ ethanol ruling
ST. LOUIS - The National Corn
Growers Association (NCGA) has
filed an injunction with the U.S.
Court of International Trade in
New York protesting the U.S.
Customs Service ruling which
allows any and all shipments of
ethanol fuel blends from Brazil to
enter this country free of the 60
cents per gallon duty.
"We’ve also written President
Reagan,” says Harold Cutler,
NCGA acting president from North
Carolina, “opposing in the
strongest terms possible this
illegal ruling by the Customs
Service which creates a massive
loophole in U.S. law that the
Congress mandated an import fuel
tariff. This allows speculative
importers to avoid completely the
60 cents per gallon import duty
causing irreparable harm to U.S.
corn growers, refiners and
processors.
world, including the European
Economic Community and
Canada, have indicated a
willingness to go along with im
proved farm prices on the world
market, but the U.S. must take the
lead. Other good customers for
U.S. farm exports, such as Japan,
have publicly stated that quality
product and reliable supply are
more important than low price.
To accomplish these goals, NFU
recommends commodity loan
and/or target prices in harmony
that will allow a return to the
farmer based on cost of produc
tion. Parity prices will help
maintain the family structure of
agriculture and the rural com
munity, they said. NFU urged
strong supply management
programs to keep production in
line with demand and to protect the
nation’s soil and water resources.
Several hundred NFU members
and unemployed workers, bankers
and rural business people from
across the nation will lobby for
those goals m Washington when
Congress returns next month.
It is again evident this Ad
ministration’s trade policy is
nothing but lip service to American
agriculture and industry. When
we’ve been working hand in hand
with the domestic ethanol in
dustry, pubhcally supported by
this Administration, to promote
ethanol made from corn, then the
Administration turns and supports
this action which would effectively
shut down” the domestic demand
for U.S. corn in the U.S. ethanol
fuels industry.
“The consequences of the
Customs Service ruling on August
27 will not only create irreparable
damage to U.S. com farmers but it
will also result in lost revenues to
the U.S. Treasury Department and
ultimately the U.S. taxpayer,”
says Cutler. “Should the projected
300 million gallons of highly sub
sidized Brazilian ethanol fuel
blends be allowed to be imported
into the U.S., the following impact
would be felt:
• The U.S. Treasury would lose
$330 million in import duties.
• 200 million bushels of com now
used for ethanol production would
be displaced and added to our
current burdensome surplus.
• Assuming an average yield of
110 bushels of com per acre,
1,820,000 acres of land will now be
in surplus.
• Assuming an average of 100
acres of com per farmer, 18,200
fewer farmers are needed.
• Cash receipts from com sales
of at least 15 cents per bushel
would be lost-or about $1 billion.
•To acquire the corn which
would be displaced and put it in
storage, the U.S. Department of
Agriculture would pay $5lO million
to farmers plus future storage
charges and interest costs.
“The potential loss in jobs and
revenue to an already depressed
farm economy and to this country
is a high price to pay for the illegal
rulings of the Customs Service
which benefit our competitors.
We’ve asked President Reagan in
the strongest terms possible to
reverse the U.S. Customs Service
August 27 ruling immediately,”
says Cutler,
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