GIPSA Rule Could Result in $1.56 Billion GDP Loss

P. Scott Shearer, Vice President

November 16, 2010

3 Min Read
GIPSA Rule Could Result in $1.56 Billion GDP Loss

A recent study concerning the proposed Grain Inspection, Packers and Stockyards Administration rule on buying and selling livestock and poultry found that the annual drop in gross domestic product (GDP) would be as much as $1.56 billion. The annual loss in tax revenues is estimated at $359 million. The study found that the rule would result in “ongoing and indirect” costs to the livestock and poultry industries, borne by producers and consumers, of more than $164 billion. This would include nearly $880 million to the beef industry, more than $401 billion to the pork industry, and $362 million to the poultry industry. Informa Economics, which conducted the study, said, “Effects will have a very long tail. The affected industries will still be feeling an impact a decade or more into the future. All signs point to detrimental outcomes for small producers, the very ones the rule is designed to help.” The study was conducted on behalf of the National Cattlemen’s Beef Association, National Meat Association, National Pork Producers Council and the National Turkey Federation.

Lawsuit Filed Against E15 — A group of farm and food trade associations filed a lawsuit in the U.S. Court of Appeals for the District of Columbia to overturn the Environmental Protection Agency’s (EPA) recent decision to allow for gasoline blends of 15% ethanol (E15). According to the coalition, EPA’s decision to grant a “partial waiver” of the Clean Air Act, allowing E15 to be used only in cars built after model year 2006, is not within the agency’s legal authority. The coalition said, “In approving E15, which is compatible only with certain, later-model automobile and other types of engines, the EPA has clearly exceeded its authority under the Clean Air Act. The EPA has unlawfully interpreted the statute to achieve a particular outcome.” Those joining in the lawsuit are: Grocery Manufacturers Association, American Meat Institute, National Council of Chain Restaurants, National Meat Association, National Turkey Federation, National Chicken Council, National Pork Producers Council, Snack Food Association and American Frozen Food Institute.

Soybeans Set New Production Record — USDA’s latest 2010 crop forecast has set a new production record for soybeans at 3.38 billion bushels. Soybean yields are estimated at 43.9 bu./acre. Corn production is forecast at 12.5 billion bushels, down 4.4% from the 2009 record. The yield estimate is 154.3 bu./acre, which is down 1.5 bu./acre from USDA’s previous forecast.

Agricultural Trade Advisory Committees — USDA has announced that it is accepting nominations to reestablish the Agricultural Policy Advisory Committee for Trade (APAC) and the six Agricultural Technical Advisory Committees for Trade (ATAC). These committees, comprised of private sector members, advise USDA and U.S. Trade Representative (USTR) on overall agricultural trade policy objectives and positions prior to entering trade agreements, the operation of trade agreements and other trade matters. The six ATACs include: animals and animal products; fruits and vegetables; grains, feed, oilseed and planting seeds; processed foods; sweeteners and sweetener products; and tobacco, cotton and peanuts. Nominations must be received by Dec.17. For further information or to request forms, e-mail [email protected].

About the Author(s)

P. Scott Shearer

Vice President, Bockorny Group, Inc.

Scott Shearer is vice president of the Bockorny Group Inc., a leading bipartisan government affairs consulting firm in Washington, D.C. With more than 30 years experience in government and corporate relations in state and national arenas, he is recognized as a leader in agricultural trade issues, having served as co-chairman of the Agricultural Coalition for U.S.-China Trade and co-chairman of the Agricultural Coalition for Trade Promotion Authority. Scott was instrumental in the passage of China Permanent Normal Trade Relations and TPA. He is past chairman of the USDA-USTR Agricultural Technical Advisory Committee for Trade in Animals and Animal Products and was a member of the USAID Food Security Advisory Committee. Prior to joining the Bockorny Group, Scott served as director of national relations for Farmland Industries Inc., as well as USDA’s Deputy Assistant Secretary for Congressional Affairs (1993-96), serving as liaison for the Secretary of Agriculture and the USDA to Congress.

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