E-mail this article to
yourself or a friend.
Enter address:


Asian rust battle; ag and trade issues on Lou Dobbs show; creamery bans BST use; other news

(Monday, Feb. 28, 2005 -- CropChoice news) --

1. Agriculture issues divide U.S. and Europe
2. Farmers prepare for Asian rust battle
3. Next year country wears a little thin
4. Farmers discusses agriculture and trade issues with Lou Dobbs on CNN
5.Milking the label 'organic'
6. Groups file complaint against dairy
7. Farms vs. wildlife
8. Local economy loses millions to rice dumping 9. Tillamook Creamery bans BST use

1. Agriculture Issues Divide U.S. and Europe

By PAUL MELLER, NY Times, February 26, 2005

BRUSSELS, Feb. 25 - The United States and the European Union, the world's two biggest trading blocs, are disagreeing over agriculture positions adopted last year, casting doubt on progress made earlier.

In one spat, the United States has threatened sanctions on a range of European food exports, from cheeses to olives, in retaliation for Europe's decision in September to raise import tariffs on rice.

In an interview Thursday, Europe's new agriculture commissioner, Mariann Fischer Boel, said she hoped to avert sanctions and her office later announced that a deal had been reached. But the United States trade representative's office quickly denied that.

"Good efforts were made, but there are issues that still need to be resolved," said Richard Mills, a spokesman for the United States trade representative.

Sanctions, slated for March 1, would affect $33 million in imports from Europe. The United States, however, plans to ask the World Trade Organization, which is arbitrating the dispute, for an extension of the deadline.

Europe's position in the rice dispute does not bode well for efforts to reach agreement on agriculture in the Doha round of trade talks, Allen Johnson, the United States chief agriculture negotiator, said in a phone interview.

"It's not a good sign that Europe is going back on commitments it made in the Uruguay round," Mr. Johnson said, referring to talks concluded in the mid-1980's, in which Europe and the United States promised to reduce tariffs.

Two weeks ago, in another skirmish, the European Union started paying wheat producers export refunds to encourage them to sell their produce outside of the union after a bumper harvest last year.

American officials have criticized the new export refunds, which are designed to compensate farmers by paying them the difference between the price of wheat in Europe and the lower world price.

"I understand their concerns," Ms. Fischer Boel said, but insisted that under existing rules Europe had the right to impose that type of measure.

Last year, Europe offered to scrap all export assistance it pays its farmers, and the United States said it would reciprocate by scrapping export credits and no longer using food aid as a way of subsidizing its farmers. These promises were designed to resuscitate global trade talks, which had broken down at a meeting of the World Trade Organization in Cancún, Mexico, in 2003.

The move seemed to work. Progress in the global trade talks is fastest in agriculture, according to European trade officials, while progress on services and manufacturing is slower.

Ms. Fischer Boel and Mr. Johnson will be attending a small ministerial meeting of trade officials next weekend in Nairobi. Agriculture talks will focus on technical details, like how to compare tariffs imposed on 8,000 different farm products by the 148 members of the World Trade Organization.

2. Farmers ready for rust battle
Despite preparations, there's no way to know how hard soybeans might be hit

By ANNE FITZGERALD, DesMoines Register, February 27, 2005

As spring planting ap- proaches, U.S. farmers, agronomists, seed companies and chemical suppliers are bracing for combat against Asian rust.

A fungus found last fall for the first time in the United States, the disease can decimate soybeans, one of Iowa's two top crops and a commodity used widely in food, livestock feed and industrial products. No one knows whether the wind-borne disease will spread into the Upper Midwest this year, but there are growing fears that that could happen.

Iowa State University Extension researchers and private-sector specialists want to be ready.

Earlier this month, a delega- tion of Iowa State University Extension crop specialists visited Brazil, where soybean rust has caused widespread damage since first appearing there in 2001.

This week, a group of scientists from Pioneer Hi-Bred International Inc. will be in Brazil to learn more about the disease.

The Iowa State group, which returned from Brazil on Feb. 20, saw the disease's impact at various stages of development, including fields destroyed by the disease.

"It's the worst I have ever seen it," said Palle Pedersen , soybean agronomist with ISU Extension in Ames and coordinator of the trip. "It was really bad. . . . Farmers have been spraying two, three, four times."

So far, the only known treatment to prevent crop loss is to spray soybean plants with a fungicide.

Crop specialists are warning Iowa farmers that they will have to monitor their crops closely to detect the disease early in its development.

"Timing on spraying is the key," Pedersen said.

Even then, yield losses may occur, and costs will mount quickly, especially if multiple spraying applications are needed, experts said.

The ISU Extension field crop specialists visited areas where two to three applications of chemicals to combat the fungus had been done. Each trip across a field costs Brazilians from $10 to $12 per acre for the chemical alone.

"There's widespread concern today in Brazil about soybean profit margins," said Robert Wisner , an ISU Extension economist who was part of the Iowa State study group. The cost of combating Asian rust is a key contributor to that concern, he and others said. In Iowa, pressure is building to be ready in case the disease hits.

3. Next Year Country Wears a Little Thin

by Paul Beingessner
Canadian farmer, writer

The manager of a prairie seed company recently posed an interesting question to me. "What can you foresee in the next five years that can be expected to improve farm incomes substantially?"

It was one of those questions I would rather not have heard, because, as my friend well knew, there is no answer. But for a farmer to admit that is like an unrepentant alcoholic admitting he has a drinking problem. Admitting it means you are almost obligated to do something.

Denial, on the other hand, is an easier row to hoe. Denial takes the form of blind faith in next year. Next year we will have both good yields and good prices. Next year, there will be no cases of BSE found anywhere. Next year, it will rain all summer, at nicely spaced intervals, ending on August 25. Then it will be dry until November.

The foregoing is, of course, an unsophisticated form of denial. It would help to add a few more features. Next year, Australia, Argentina, Brazil, the U.S. and the entire Former Soviet Union will have mediocre crops, both in quality and quantity. Next year, the Canadian dollar will fall back to 65 cents American. Next year, the price of oil will plummet and the price of diesel fuel will follow in lock step. Next year, there will be huge payments from farm support programs in Canada, and consumers will be stricken with an uncontrollable urge to buy only Canadian food.

Will all this be enough to return farm incomes to decent levels? Likely not. If all these things happened, next year, the grain companies would use the opportunity to make back some of their multi-year losses. The basis on open market grains would widen considerably. Next year, the implement manufacturers and dealers would raise the price of machinery and parts to match farmers' newfound wealth. Next year, chemicals, fertilizers and seed would reach new price highs. Next year, the U.S. would launch some new trade action aimed at punishing us for our prosperity.

The truth, and it bears repeating, is that there are no short-term answers. And even the long term ones we once held dear, have lost their sheen. Most farmers no longer believe trade agreements will produce anything useful in their lifetimes. Most farmers no longer think rising world populations will eat us into affluence. Most farmers no longer think good prices are the norm and we've just been suffering an extended streak of bad luck.

My friend knows this. He says we should concentrate research on non-food uses for our crops. Our production costs are too high to compete with the Argentinas and Kazakhstans in producing food crops. He also knows that finding new non-food uses will only help. It will not solve the problem.

Potato growers in Idaho have a simple idea. Potato prices are low because there are too many potatoes. They want to implement a form of supply management. They know, however, that reducing production in the U.S. will allow Canada to export more potatoes to the U.S. thus wiping out the effect of lower supply. They need to include Canada in their plan. It does complicate things.

Oversupply of food crops is a major problem for farmers and a boon to processors and marketers. Recently, grain companies were said to be lobbying the U.S. government to take more land out of the Conservation Reserve Program. More corn, wheat and soybeans will ensure they never have to pay a fair price.

One solution to oversupply would be a concerted effort to get food into areas suffering famine. Most farmers would rather see the government buying surplus grains to feed starving people than see measures to restrict production. Wealthy countries, Canada included, have shown little interest in feeding hungry people. There are also ethical implications to disrupting the agricultural systems of other countries.

The farm crisis would lessen if Canada had a larger population, one not centered mainly in Toronto, Montreal and Vancouver. Our immigration policy does nothing to encourage people to settle in rural or under populated regions like Saskatchewan. Perhaps we need an immigration and settlement policy like the one that settled the west a century ago. One that would bring in people with farm backgrounds from poorer countries. People with a love of the land looking for a better life. If Saskatchewan had two million people, our agriculture sector would be more diversified and prosperous. A policy like this could see the transfer of those millions of acres from the 70-plus farmers to a new generation. Is it so hard to imagine?

(c) Paul Beingessner (306) 868-4734 phone 868-2009 fax beingessner@sasktel.net

4. National Family Farm Coalition president discusses farm and trade issues with CNN's Lou Dobbs

DOBBS: For the first time in our history, the United States will import more food than we export. The agriculture industry, one of the last few remaining areas of our economy, still running a trade surplus. But now the Department of Agriculture says we're losing that edge as well. Some lawmakers say our so-called free trade policies are solely to blame.

Lisa Sylvester reports from Washington.


LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Once considered the bread basket of the world, the United States is poised to become a net importer of food. For the first time since the 1950s, the country is expected to not record an agricultural surplus this year.

GEORGE NAYLOR, NATIONAL FAMILY FARM COALITION: It's a wake-up call, and family farmers should be producing the food in this country, and doing it in a way that's good for our environment and provides economic opportunity in rural America. And that's not going to happen as long as we have free trade agreements like CAFTA or NAFTA or the World Trade Organization.

SYLVESTER: While agribusiness run by large corporations have thrived under the trade agreements, family farmers have been pinched. Until 1996, the United States set a minimum price for agricultural goods, including corn and soybeans. Since then, in the face of global competition, U.S. farmers have had to sell their goods at below the cost of production.

In 2003, the United States had a $10.5 billion surplus. In 2004, a $9.6 billion surplus. This year, the surplus is expected to be zero.

SEN. BYRON DORGAN (D), NORTH DAKOTA: Our trade policies are off track, and nobody seems to care about it. The administration snores through it. The Congress sleeps through it. And meanwhile, we are the largest debtor nation in the country, our manufacturing businesses are being hollowed out. Now farmers and ranchers are discovering that they've lost the trade surplus they've had as well.

SYLVESTER: A weak dollar was expected to be the saving grace for the family farmer because it would have made U.S. exports relatively cheaper. But that has not proven to be the case.


SYLVESTER: Senator Dorgan is among those calling for a moratorium on new trade agreements, including the Central American Free Trade Agreement that the Bush administration is hoping to push through Congress -- Lou. DOBBS: Hoping now to push through Congress, Lisa, after lacking the political courage to put it before Congress and to move it before the presidential elections. Thank you very much, Lisa Sylvester.

As we become increasingly reliant upon cheap foreign imports of food, we also continue to export hundreds of thousands of American jobs to cheap foreign labor markets each year. Erie County in Upstate New York has been devastated by the loss of manufacturing jobs to cheap foreign labor competition. Now the county can no longer afford to provide basic services to its residents. And the residents can no longer afford to pay the taxes.

5. Milking the label 'organic'

By Harold Brubaker, Philadelphia Inquirer

Even in the cold of winter, Roman Stoltzfoos sends his organic dairy cows tramping out to pasture after milking them.

That constant effort on his 200-acre Lancaster County farm is at the heart of a battle over the meaning of "organic" - a term that can add $6 or $7 to the price of every hundred pounds of milk Stoltzfoos and other organic farmers sell.

At retail, organic milk can cost nearly twice as much - $2.99 a half gallon recently at a supermarket in Roxborough, compared with $1.57 for ordinary milk.

The U.S. Department of Agriculture says that to be called "organic," milk must come from cows that have access to pasture. But it does not specify exactly how much of a cow's food must come from grazing, and how much can come from organic grains and other feed.

Stoltzfoos and other farmers are troubled by gigantic dairies out west that call their milk organic, even though they keep thousands of cows in open-air pens, feeding them organic hay and grain and letting them out to pasture only when they are not producing milk.

Stoltzfoos and others say consumers expect organic dairy products to come from cows that spend lots of time out in the pasture. If the cows are usually penned up, they worry, consumers could get turned off to the whole industry.

Marci Stern, who had a gallon of Natural by Nature organic milk in her cart last week at Essene Market & Cafe in Philadelphia, said she was surprised that pasture access would even be an issue. She just assumed it was essential, for any milk to be labeled organic.

The National Organic Standards Board, which advises the U.S. Department of Agriculture on organic regulations, is expected to discuss the issue of pasture standards at a meeting that starts Monday in Washington.

Commercial success has heightened the tension. Organic food sales rose at an average annual rate of 19.5 percent between 1997 and 2003, according to the Organic Trade Association's most recent manufacturers' survey. Sales of organic dairy products increased by an average of 22.5 percent a year during that same period, to $1.4 billion.

Such rapid growth - compared with less than 4 percent for the food industry as a whole - is attracting ever more attention from large food companies with no organic legacy.

"There's real concern about the dilution of the organic mission," said Greg Bowman, online editor of Newfarm.org, a publication of the Rodale Institute in Kutztown.

Traditional advocates of organic food view the industry as a social movement tied to small operators with a passion for ecologically sensitive farming.

Others see organic food as simply a business opportunity created by consumer demand. An example of this approach is Campbell Soup Co.'s 2003 decision to sell organic tomato juice.

For Stoltzfoos, organic farming is not only ecologically sustainable, it has also made farming financially sustainable, thanks to the premium he receives for every hundred pounds of milk he sells.

Organic dairy farmers have been getting about $23 per hundred pounds - about 12 gallons - compared with about $16 for conventional milk.

In defense of Stoltzfoos and other small organic dairies, the Cornucopia Institute, a Wisconsin advocate for family-scale farming, has filed complaints with the Agriculture Department against three large dairies in Colorado, Idaho and California, alleging violations of organic regulations.

The department, which has opened an investigation into at least one of them, a 5,600-head Aurora Organic Dairy in Colorado, declined to comment.

A spokeswoman for Aurora said company officials were too busy preparing their comments for next week's meeting to be interviewed. The privately held company said in a statement last month that it "is fully committed to the organic mission."

Even among smaller organic dairy farmers who consider pasturing pivotal, there are differences in approach.

One day last week, Stoltzfoos' cows were gathered on a sloping meadow eating hay harvested last fall.

Stoltzfoos practices a form of seasonal dairy farming, managing his herd of 100 cows so they reach their production peak in the spring when his pastures burst with food.

Stoltzfoos is tempted to stop milking when there is no fresh grass on his farm near Gap, because he believes cows' milk is more nutritious when most of their food comes from grazing.

But he keeps producing a small amount of milk - about a fifth of peak production - to maintain supplies through the winter. "We need milk in the winter just like we do in the summer," he said.

David Martin, president of the 20-member Lancaster Organic Farmers Cooperative to which Stoltzfoos also belongs, manages his own herd so that cows' peak production periods - which come 60 to 90 days after they give birth - are distributed evenly throughout the year.

And near Kirkwood, in southern Lancaster County, C. Arden Landis stops milking altogether during January and February. Landis keeps his cows on pasture all year, with the woods offering their only shelter.

Ned MacArthur, whose Natural Dairy Products Corp. buys milk from the Lancaster cooperative and sells it from Virginia to Massachusetts, sees trouble ahead for the industry if the term "organic" becomes diluted.

"The biggest danger I see in these big corporate dairies is the potential for the development of two different types of organic milk," he said: milk from cows whose diet is based on grazing, and milk from cows fed organic hay, grain and other feed.

"I think it will ultimately confuse consumers."


6.Group files complaint against dairy: Wisconsin advocacy group says Case Vander Eyk Dairy violated organic rules.

By Dennis Pollock, The Fresno Bee, Wednesday, February 23,

A Wisconsin advocacy group has filed a complaint with the U.S. Department of Agriculture saying that the Case Vander Eyk Dairy near Pixley has violated national organic rules that require pasture feeding of cows.

Case Vander Eyk Jr. would not comment about the complaint lodged by the Cornucopia Institute, a nonprofit farm policy research group based in Cornucopia, Wis.

USDA spokeswoman Joan Schaffer said the complaint is still being reviewed. She also pointed out that a livestock committee of the National Organic Standards Board has developed "a clarification" of organic dairy requirements that will be considered when the board meets next week.

The committee is seeking to clarify such terms as "pasture" and "temporary confinement," those periods when animals may not be able to graze on pasture land. Federal rules state cows can be fed certified organic feed at times, but a significant portion of what they eat must be from pasture land.

Mark Kastel, senior farm policy analyst with the Cornucopia Institute, said the board's actions are aimed at developing guidelines for those who certify dairies as organic. He believes the standards have been clear and enforcement has been lax.

The Vander Eyk operation is one of three huge organic dairy operations that the institute has targeted on allegations of not meeting pasture requirements. The institute also has complained about a 4,000-head Idaho farm and about the Aurora dairy, a 5,700-head operation in Colorado.

All three supply milk for Dean/Horizon, which Kastel terms "the nation's largest organic dairy marketer."

Kastel said the Vander Eyk dairy is "a split operation" that includes about 7,000 conventional cows and about 3,000 organic animals.

"As demand for organic milk has skyrocketed, investors have built large industrial farms mimicking what has become the standard paradigm in the conventional dairy industry," Kastel said. "It is our contention that you cannot milk 2,000 to 6,000 cows and offer them true access to pasture as required by the Organic Foods Production Act of 1990."

Unlike beef cattle, Kastel said, dairy cows must be pulled together two or three times a day for milking. "That would mean walking miles a day" over pasture land, he said.

Kastel contends that smaller organic farms that operate by national guidelines are placed at a disadvantage.

"Real organic farms have made great financial investments in converting to pasture-based production, while it appears that these large corporate-dominated enterprises are happy just to pay lip service to required organic ethics," he said.

The institute says Vander Eyk has access to 10,000 acres of pasture, but that is located near Ducor, miles from the dairy's main operation. "The dairy reportedly trucks cows to the Ducor pasture, but the Cornucopia Institute contends that this approach is not used with lactating animals [those being milked]."

Last month, Case Vander Eyk Dairy paid $360,000 to settle a lawsuit brought by milkers who said they worked unpaid overtime, were not given rest and meal breaks and were not reimbursed for equipment that they purchased for use in their jobs.

7. Farms vs. Wildlife

Dennis Anderson, Star Tribune

University of Minnesota Professor Emeritus Richard A. Levins retired from that school's Department of Applied Economics in 2003. Growing up in Forida, Levins worked in extension farm management for almost 25 years. He moved to Minnesota in 1988 to teach economics and agriculture history. Most recently, Levins wrote the book "Willard Cochrane and the American Family Farm," (2003, University of Nebraska Press) with a foreword by John Kenneth Galbraith. Levins still teaches part-time at the university and consults and speaks on farm economics, farm management and related issues. In the interview below, Levins outlines the evolution of U.S. farm policy, its impact on farmers, wildlife and the environment.

Q: What is your general assessment of farming in Minnesota?

A: Farming here has slowly evolved into a system that has relatively few very large farms that are often plagued by prices so low they have trouble being profitable. We also have evolved into a farm system in Minnesota that relies heavily on government payments to be economically sustainable.

Q: One effect of this evolution is that the state's farmland is less diverse and that wetlands and other wildlife habitats have been lost.

A: That's correct. There has been a shrinking of biological diversity on the land and increasing concerns for environmental problems resulting from farm policy. It's easy to lay these problems at the feet of farmers, saying it is entirely their responsibility. But I've had the privilege of speaking first-hand with some of the famous Minnesotans who have shaped U.S. farm policy in the past 50 years, and I can say there's much more going on here than any individual farmer could possibly hope to influence.

Q: Who are some of the Minnesotans who shaped current U.S. agricultural policy, and what roles did they play?

A: Present policy was heavily influenced by the thinking of Orville Freeman, Willard Cochrane and Robert Bergland. Bergland and Freeman were agriculture secretaries. Cochrane -- like me, retired from the university -- was agriculture advisor to President Kennedy, and at age 91 is still active in these issues. Also, of course, Hubert Humphrey had significant influence.

Q: Did the thinking of any of these men include land and water conservation?

A: Not nearly as much as we think about these issues today. The goals of a diverse landscape weren't among their ideas, at least not at the time. I will add that Cochrane has since become a strong environmentalist as an agricultural economist, and believes U.S. agriculture policy has been wrong, continues to be wrong and is unsustainable.

Still, when our basic agriculture policy was shaped in the 1960s, the primary goals were protecting farm income, competing in a global economy and keeping domestic food prices relatively low.

Q: Your recent book about Cochrane and the family farm explores Cochrane's misgivings about U.S. farm policy. Are Cochrane's beliefs that current farm policy isn't sustainable -- either economically or environmentally -- correct?

A: Professor Cochrane has become an advocate of some fairly radical changes in the way we farm. The changes he would make would, in addition to other things, address in a very direct way the environmental problems that have accompanied U.S. farm policy.

My view is somewhat different. I have come to see farmers as people who care deeply about the environment and the communities in which they live. At the same time, they're just like everyone else, in that they must make business decisions in an economic environment that is beyond their control. Our policies have moved us in a direction that is causing some unintended problems, among them the lack of a diverse landscape.

Q: Ultimately, are the interests of conservation and modern farming in conflict?

A: Sometimes, but not always. In my view, most farmers would qualify as modern conservationists. What needs to be changed is not so much attitudes as the system we have created in which farming occurs.

Q: How could that happen?

A: It would have to happen with some serious and aggressive changes in federal farm policy. As policy stands now, we tend to pass conservation legislation but not fund it. Meanwhile we continue to fund programs that lead us in the direction we're going. It should be no surprise we're getting what we pay for.

Q: Is what is happening today on Minnesota farmlands -- generally speaking -- so bad, environmentally, that, in the end, change will be forced on the system?

A: At some point we have to face the fact that it is often cheaper to prevent environmental problems than to fix them once they've occurred. I'd like to see prevention become a bigger part of our federal expenditure and cleanup be less.

Q: Certain farmers today who own land that traditionally has been untillable, can -- through the use of chemicals and genetically modified crops -- plant that land with the reasonable expectation it will be profitable relatively quickly, assuming that government support payments are made. This puts at risk some of the relatively few remaining unbroken wild lands we have.

A: Correct. What we have are situations that sometimes make sense for individuals but might not make any sense at all in the larger picture. That individual farmer you speak of, expanding his or her production of grain crops, today is not competing so much with a neighbor as with a farmer, say, in South America. The only way that battle can be won is by being the absolute lowest-cost producer in the world, which -- by the way -- is unlikely for an American farmer, or by depending on continued government supports -- which is also appearing to be less and less likely. Unfortunately, that farmer oftentimes does not have the option of government supports to use the land in ways that would meet some of our environmental goals. That's where the problem lies.

Q: The current farm program has a number of conservation components, some of which, as you suggest, have not been fully funded. That aside, was this program structured in a way that induced farmers toward conservation, at least in certain instances? Or are there better ways that conservation should be incorporated into the next farm bill?

A: There are two ways you can do this: Consider conservation as an add-on to a commodity program, which is basically what we have now. Or put conservation first and let the commodities be the add-on. I think until we put conservation as a high priority, we won't see much progress.

Q: Is it reasonable then for conservationists to have hope in Minnesota?

A: For a Minnesotan to be discouraged makes no sense at all. As I said earlier, Minnesota has been the leader in farm policy. I don't see why Minnesotans would want to give up that position.

Dennis Anderson is at danderson@startribune.com

8. Local economy loses millions to rice dumping
Loss to state could be as high as $1 billion.

For Immediate Release

Media Contact: Greg Massa 530-519-8628 Email: RPCnews@yahoo.com

California's rice farmers are losing hundreds of millions of dollars to a marketing practice known as "dumping," says the farmer group Rice Producers of California. Moreover, financial losses to the state may be much higher.

Dumping occurs when US commodity traders export rice at prices below what it cost farmers to produce the crop. While this practice has greatly benefited global food companies by providing raw materials for their products at bargain prices, farmers around the world are going out of business.

RPC decided to look into the issue of dumping after a reading a report released this month by the Institute for Agriculture and Trade Policy, a Minnesota based think tank that focuses on documenting the underlying causes of America's rural crisis. According to government data analyzed in the report, U.S.-based companies have engaged in high levels of agricultural dumping in their global sales of the five most exported commodities (rice, wheat, corn, soybeans, and cotton).

"What we found with our own crop was pretty disturbing," said Greg Massa, communications director for Rice Producers of California (RPC). "Over the last five years, we estimate that marketers exported our rice at prices up to 35% below the farmers' cost to produce it. And it's getting worse-rice was sold to Japan this month at an estimated price 38% below cost. That one sale, which comprises less than one-tenth of California's annual rice exports, will cost us over $5 million. And worse yet, it didn't have to happen, as we are currently experiencing record demand for our rice."

While that number seems high, the effect on the regional economy is staggering. RPC estimates that dumping during the four years from 2000 to 2003 cost Sacramento Valley rice farmers almost $200 million in lost revenue.

"Farmer income has a multiplying effect throughout the state. California is quite possibly losing several times that amount through job losses and tax revenues," said Chip Struckmeyer, a rice farmer from Arbuckle. "We could be talking about one billion dollars in unattained income for the people of California over the last decade.

With the local and national budget crisis, this is also a loss of a much needed income source for government. This must not be tolerated any longer by the industry, or the state."

Rice Producers of California, the only group that speaks solely in the interest of California rice farmers, believes that a major factor in dumping is California's bizarre marketing system. In what is called the pool system, the marketer sells the crop after harvest, and trickles money back to the farmer over a period of 15 months or more. "We wait over a year to be paid, and our production costs are not factored into our return," noted Kelly Ornbaun, RPC's interim leader. "The farmer is assuming not only his own risk in producing the crop, but also the economic risk of the marketer."

Getting income out of the market is becoming increasingly important for farmers as Federal budget pressures squeeze farm program benefits. Currently, rice farmers are being required to reimburse the government for farm subsidies received for the 2003 crop year.

RPC believes farmers need to band together and withhold their rice from pool marketers until they guarantee a price above production costs. According to Mr. Ornbaun, "They must be made to realize that paying farmers a fair price for their product is what keeps local economies afloat. The current system is hurting this entire region of the state and it will only get worse as farm program benefits are reduced."

The IATP report is available online at iatp.org. Rice farmers wishing more information may contact Kelly Ornbaun at 530-908-3146, or send an email to RPCnews@yahoo.com.

9. Tillamook Creamery Bans Use of Artificial Growth Hormones Unit 8 Investigation Uncovers Secret Decision

By VINCE PATTON, KGW-TV, Portland, OR, February 17, 2005

TILLAMOOK, Ore. -- A barrage of consumer questions and complaints has convinced the Tillamook Creamery Association to force all of its dairies to abandon the use of genetically engineered growth hormones in its cows. The move is sparking a rebellion by some farmers, re-ignites a decade-old controversy and puts Tillamook on the national stage by spurning the biotech giant, Monsanto, which makes the growth hormone.

Tillamook's 147 member dairy farmers have been told to sign an affidavit before a notary public swearing they do not use rBGH (recombinant Bovine Growth Hormone). Reflecting Tillamook's concern about publicity, the affidavit also swears the farmer to secrecy.

However when confronted by KGW, the creamery confirmed the dramatic change and reluctantly agreed to discuss it.

"We've seen a lot of feedback from our consumers," says Tillamook Creamery Association President Jim McMullen, "When eight percent of your customers are talking about that issue, that's substantial and we need to listen."

Tillamook dairy farmer Dick Heathershaw decided to try the synthetic hormone 4 years ago. The biotech giant Monsanto wanted him to add "Posilac" to his cows' routine: a bi-weekly syringe full of genetically engineered growth hormone. Heathershaw says, "They (Monsanto) were just really relentless in pushing it, you know. They'd visit you continually."

One injection every 14 days kept the cows' hormones artificially inflated. As a result, they ate more and produced more milk. He says he saw milk production in rBGH-treated cows rise about five percent, not the 10 to 15% Monsanto touts for its product.

The artificial growth hormone was approved more than a decade ago by the Food & Drug Administration, but Heathershaw was late to try it.

Now he strongly supports the unanimous vote of Tillamook's board to ban the growth hormone. He used it for two years but did not like what he saw. "We started to see some health problems we didn't like with our cows," he says. "They're just under a lot more stress."

Animal welfare and human health issues have prompted more than 22 consumer groups to call for the ban of Posilac in milk production.

For years when consumers asked Tillamook if its dairies used artificial growth hormones, the Creamery replied with an evasive form letter simply stating that it only accepted milk "that meets or exceed U.S. health standards." McMullen concedes it never answered the question directly.

"I just thought, why can't you give me a straight answer?" asks Rick North, the former head of the American Cancer Society in Oregon. Today he leads a consumer campaign in Oregon for Physicians for Social Responsibility trying to ban rBGH.

Monsanto Director of Public Affairs Jennifer Garrett emphasized the findings of the Food & Drug Administration that there is no impact on human health and that milk is exactly the same from natural cows and cows on Posilac.

However the countries of Canada, Australia, New Zealand, Japan and the 25 countries of the European Union all have banned the use of Posilac due to concerns about animal health and unanswered questions about human impacts.

Human Health Concerns

In Portland, Dr. Martin Donohoe, a board member of Physicians for Social Responsibility, is not convinced by FDA reassurances. He's most concerned by studies that indicate Posilac inflates the levels of another hormone called IGF-1 in the milk produced and other studies which associate IGF-1 with cancer in humans.

Donahoe says, "When the data are strong and suggestive and the consequences are enormous - we're talking about cancer, then one should proceed with caution."

Monsanto and the FDA say the amount of IGF-1 is insignificant and it does not affect people.

In response to a petition five years ago to stop the use of Posilac, the FDA "reviewed the issues raised" and said they did "not demonstrate any human food safety issue."

Animal Welfare Concerns

Monsanto's synthetic hormone comes with a set of warnings that cows can suffer side effects including large swellings, significant foot problems and infected udders producing visibly abnormal milk. Donahoe explains, "The use of rBGH in the cattle results in infections in the udder. Those infections transmit pus, or dead bacteria, white blood cells into the milk." That ruins the milk so it cannot be sold to consumers.

According to the FDA, since Posilac was approved in 1994, more than 53-thousand cows had adverse reactions to Posilac. 376 died.

Monsanto will not say how many cows are on the artificial growth hormones. It says only that there are 9 million dairy cows in America and one third of the herds use Posilac on at least some of the cows.

Tillamook farmer Dick Heathershaw did not lose any cows but he says they got sick more often. After two years of using the artificial hormone, he dropped it, and believes his cows are now healthier. "We've never looked back," he says. "We think it's one of the best things we did was to get our animals off of it."

With the Tillamook Board's vote to ban artificial growth hormone from all its member dairies, consumers who ask Tillamook now about their policy will finally get a straight answer. "Yes," says McMullen, "they'll get a very distinct answer."

Heathershaw is pleased. "They want a yes or no," he says of Tillamook's customers, "and we're trying to give them that. And without customers, we have nothing."

What's next?

While Tillamook says it is dropping growth hormones to satisfy customers, it has no plans to tell customers about that by changing the labels of its products.

We'll explore that -- and why a small group of farmers is rebelling against the new rules - Friday on NewsChannel 8 at 6 p.m.