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New energy is focus in 2007 farm bill talks
By ANN HINCH
Tennessee Correspondent

WASHINGTON, D.C. — Based on the debate, so far, farm-based renewable energy will be key to the 2007 farm bill.

Nearly 50 farmers in and around Nebraska, California, North Carolina and Alabama have articulated their desires in a series of four public hearings conducted by the House of Representatives’ Agriculture Committee since early February.

They won’t get answers until at least next year, since the current bill doesn’t expire until Oct. 1, 2007; some legislators even speculate the bill could be extended into 2008, especially if current World Trade Organ-ization (WTO) talks force U.S. lawmakers to further restructure price supports.

“I think we have to take a real, serious look at agriculture in general,” said Rep. Lincoln Davis (D-Tenn.), who owns a beef cattle operation with his brother and grew tobacco until recently. “I think keeping our farmers in business is a national security issue.”

Though the world ag trade community frowns upon government subsidies for farmers and producers in the United States and western Europe, Davis sees financial support as a critical necessity to ensure “a continuous flow of food and fiber” for U.S. consumers. It is better, he contends, to pay a little more to keep the local farmer in business and U.S. consumers safe and fed, than to depend heavily on the viability and favor of foreign sources.

This comparison mirrors the state of gasoline prices. Finding alternative fuel sources have been a key American issue since at least the early 1970s, but only recently has Congress been serious about what Andy Fisher termed, “transition from research into reality.” Energy incentives will likely be a popular carryover from the 2002 farm bill.

Fisher, press secretary for Sen. Richard Lugar (R-Ind.), explained the senator pushed legislation in 2000 for cellulose plant research - culling energy sources from harvested plant stalks and switchgrass. In addition to corn, these are proven sources for ethanol, either pure or blended with petroleum.

“Under any oil price scenario, the demand for ethanol is going to go up,” Fisher said.

Making alternative fuels economically viable is the trick. To that end, Lugar believes it might be good to offer farmers more financial incentive through the new farm bill to not only grow the crops, but to invest in and operate the rural facilities which process them, such as the small ethanol and biodiesel plants now springing up through the Midwest.

In fact, these could be just the economic stimulant rural America needs.

“There are other things that may co-locate with an ethanol plant,” Fisher said, adding they create jobs. “It’d be better to be buying our fuel from the Midwest than the Middle East.”

Fuel in the tank isn’t the only benefit of alternative energy research. Before passage of the 2002 Farm Bill, Lugar worked with Iowa Sen. Tom Harkin, ranking Democrat of the Senate Agriculture Committee, to write a provision encouraging the manufacture of bio-based products, wherein federal agencies would be directed to buy such products if they were “available, perform well and are not unreasonably priced.”

Examples might include drinking cups made from cellulose biomass instead of plastic (which uses petroleum), according to Dave Townsend, Ag Committee press secretary for Harkin.

The provision passed as part of that farm bill, he explained, but until recently putting it into practice was largely ignored by the White House.

“We’ve been really fed up with the pace the administration has gone,” Townsend said.

On March 9, though, Harkin announced USDA Secretary Mike Johanns informed him bio-based products will finally be given preference for purchase in the Federal Register in six categories: mobile equipment hydraulic fluids, roof coatings, water tank coatings, diesel fuel additives, penetrating lubricants and bedding materials.

So far, this covers about 125 different items moving to the top of the federal government’s list, and Johanns indicated this could go up to 1,000 by the end of the year. As the largest potential customer for such products, Harkin stated government purchases may eventually help reduce the products’ prices for sale to the general public.

Townsend added financial incentives for farmers to use their land to advance energy production should not violate current WTO subsidy restrictions. “If you want to keep investment in our rural community, you have to do it in a way that’s agreeable to our trade partners,” he said.

This farm news was published in the March 22, 2006 issue of Farm World.

3/22/2006