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News from the Minnesota Association of Wheat
Growers for Friday, June 2,  2000

WHITE HOUSE WANTS SENATE CHINA VOTE
The Clinton administration on Thursday urged U.S. Senate leaders to schedule a vote the week of June 12-16 on legislation granting permanent trade benefits to China, warning that foot-dragging could jeopardize passage, REUTERS reports. "Our hope is that the Senate will act quickly, beginning the debate in earnest by the week of June 12 and, if possible, bringing the bill to a vote by the end of that week," U.S. Trade Representatives Charlene Barshefsky told the U.S.-China Business Council at a dinner ceremony. "The more we delay, the more we place the achievements to date at risk," she said. Sixty-three lawmakers in the 100-member Senate said in a REUTERS poll they would vote in favor of legislation granting permanent normal trade relations (PNTR) to China. That is enough to override a vote-blocking filibuster and ensure passage of the bill, which would end the annual ritual of reviewing China's trade status and permanently guarantee Chinese goods the same low-tariff access to U.S. markets as products from nearly every other nation.

 

 

CHINA TRADE BILL CALLED SURE THING IN SENATE
A landmark China trade bill is assured final passage in the U.S. Senate, according to a REUTERS poll showing President Bill Clinton with enough votes to overcome last-ditch hurdles thrown up by opponents. Sixty-three lawmakers in the 100-member Senate said in the poll they would vote in favor of legislation granting permanent normal trade relations (PNTR) to China. That would be enough to override a vote-blocking filibuster and ensure passage of the bill, which would end the annual ritual of reviewing China's trade status and permanently guarantee Chinese goods the same low-tariff access to U.S. markets as products from nearly every other nation. China in turn would open a wide range of markets, from agriculture to telecommunications, to U.S. businesses under the terms of a landmark trade agreement signed in November 1999 ushering Beijing into the World Trade Organization (WTO). The only question was when the Senate would vote.

 

 

EU UNHAPPY WITH U.S. WHEAT GLUTEN DECISION
The European Union is "extremely disappointed" with a U.S. decision to divide an annual import quota for wheat gluten into four quarterly allocations, an EU agricultural official said on Wednesday, REUTERS reports. Tassos Haniotis, agricultural counselor at the European Commission Delegation office here, said the action would unfairly penalize shipments from the EU. "The decision is extremely disappointing because it is one that clearly hurts EU trade interests in a manner that is unreasonably biased," Haniotis said. The new quota year begins Thursday, June 1. Wheat gluten is a key ingredient used in a variety of baked goods. In addition to allocating the import quotas on a quarterly basis, the White House announced late last week that it would add to Poland to the list of "other" countries subject to annual quota restrictions. Poland was previously exempt because its shipments totaled less than 3% of total U.S. imports. However, since June 1998, when the United States first began restricting wheat gluten imports, shipments from Poland have risen sharply. During the first quota year, imports from Poland rose to a little more than 5.0 million pounds, about 11 times the previous year .

 

 

U.S. WHEAT OFFICIALS TO VISIT CUBA
U.S. wheat industry officials will visit Cuba next week to assess whether its mills and ports could process potential U.S. wheat imports efficiently, U.S. Wheat Associates said Wednesday. REUTERS reports the team will meet with Cuban ministers of foreign trade, investment and agriculture during a five-day trip starting Sunday. Dozens of U.S. farm state lawmakers have stepped up efforts to ease 40 years worth of U.S. sanctions against Cuba and lift restrictions on food and medicine sales to the communist-controlled country. They contend the House vote last week to normalize trade with China underscores the need to use trade to encourage democratic change in Cuba as well. Republican leaders and other opponents of the measure say easing U.S. trade with Cuba would benefit only President Fidel Castro's regime, not ordinary Cuban citizens. The House of Representatives could vote on the controversial issue next month. "If Congress lifts its embargo, Cuba has told us they want our wheat," said Dawn Forsythe, spokeswoman for U.S. Wheat Associates. The group, which represents American wheat farmers, has offices in more than a dozen countries to promote U.S. exports.

 

 

BURNS  WANTS MORE DROUGHT RELIEF
Sen. Conrad Burns (R-MT) wants USDA to provide Montana farmers additional drought relief by helping them improve wells and access to additional grazing lands. Burns says the Conservation Reserve Program should play a larger role in offering drought relief to producers. Burns called on Agriculture Secretary Dan Glickman to re-evaluate the process used by USDA to determine drought status which is done on a county-by-county basis. Burns said many Montana counties are so large that a few scattered monitoring stations may not accurately reflect the amount of precipitation different parts of the county receive. He hopes that changing the process could open CRP land for grazing in more Montana counties than the seven where grazing now is permitted. He also asked Glickman to revise rules for the Environmental Conservation Program which helps farmers improve needed wells.

 

 

U.S. WINTER WHEAT CROP CONDITIONS REPORTS
U.S. crop observers indicate the continued deterioration of US hard red winter wheat conditions are closely tied to warmer and drier weather in the central and southern Plains and to short soil moisture levels in Montana.  USDA's weekly estimate indicates US hard red winter wheat conditions declined slightly in Colorado, Kansas, Nebraska, Texas and especially Montana.  Whereas, conditions slightly improved in the state of Oklahoma.  Sources suggest most of the US winter wheat crop in the US varies in development from the boot to heading stage in the northern crop areas to the maturation and harvest stage in the southern areas.  Moreover, according the recent USDA estimate, seeding of the US spring wheat and barley crop are nearly complete.  Some late planting is being reported in Minnesota, North Dakota and South Dakota.  However, Montana has the most spring wheat crop seeding to complete, estimated at nearly 16% of the crop yet unplanted.  Observers estimate the same dryness that is hurting Montana's winter wheat crop conditions, is starting to negatively affect the spring wheat crop as well.  Unfortunately, weather conditions are not expected to improve much over the upcoming week as local weather forecasters anticipate a drier and warmer weather pattern through the first half of next week.

 

 

NEW DIETARY GUIDELINES CONTINUE TO KEEP GRAINS AT THE BASE
Statement of Judi Adams, President, Wheat Foods Council

For more information, contact:
Sarah Delea at (816) 512-2388
or Sherry Frey at (816) 512-2376

PARKER, Colo. (May 26, 2000) —  The new Dietary Guidelines for Americans continue to recognize the important role grain foods play in the diet by separating the grain recommendation from the fruit and vegetable guideline. Released on May 27, the new grain guideline recommends consumers "choose a variety of grains daily, especially whole grains." In previous years, the Guidelines lumped grain foods with fruits and vegetables. 

"We are pleased the new Dietary Guidelines emphasize the importance all grain foods play in the diet by establishing a separate grain recommendation," said Judi Adams, M.S., R.D., president of the Wheat Foods Council, an organization dedicated to educating consumers about the healthful benefits of grain foods. "Separating the grain guideline from fruits and vegetables emphasizes the need for consumers to eat the recommended six to 11 daily servings of grains, with at least three coming from whole grains.  It also highlights the health and nutrition benefits grain foods provide, that may not be attained from consuming fruits and vegetables."

 Grain foods include many nutrients needed for health; and whole grains in particular help reduce the risk of many major diseases.  In addition the new guidelines recognize enriched and fortified grain foods as important sources of folic acid, an essential nutrient in preventing neural tube birth defects and protecting against coronary heart disease and some cancers. 

"Studies show consumers aren't getting the recommended daily servings of grain foods, let alone consuming enough whole grains," added Adams. "This new emphasis on grains will help increase awareness about the benefits of all grains — whole, fortified and enriched — in the diet."

For more information on grains and whole grains, visit the Wheat Food Council's Web site at www.wheatfoods.org

 

 

NATIONAL ASSOCIATION OF WHEAT GROWERS REPORT FROM WASHINGTON

NAWG ON THE GO

COALITION BUILDING
In an effort to forge alliances and present a unified agriculture message when possible, NAWG looks towards membership in various coalitions. This work has intensified under the leadership of NAWG President Terry Detrick who continues to stress the need for agriculture to speak with one voice.

Of recent fame and success was the Ag Coalition for China Trade. This specific coalition was able to organize and develop a cohesive strategy in which passage of China PNTR in the U.S. House of Representatives might not have been possible.

The following list will provide an overview of the various coalitions that NAWG staff are active members in.

Ag-Earth Partnership
Agricultural Biotechnology Forum
Agricultural Trade Coalition
Agriculture Clean Water Working Group
Agriculture Coalition for US-China Trade
Agriculture Global Climate Change Working Group
Alliance for Rail Competition
Aluminum/Magnesium Phosphide Working Group
Business Coalition for US-China Trade
CFTC Agricultural Advisory Committee
Coalition for Financial Responsibility
Coalition for Food Aid
Conservation Partnership Forum
Council for Biotechnology Information
Family Business Estate Tax Coalition
Health Tax Deduction Alliance
Jones Act Reform Coalition
Methyl Bromide Working Group
National ESA Reform Coalition
National Waterways Alliance
Rail Customer Coalition
Seattle Round Agricultural Committee
U.S. Wheat and Barley Scab Initiative Network

TAX REQUIREMENTS FOR FOREIGN HARVESTERS
It is important to know that it is necessary when negotiating with a Canadian or Mexican custom harvester for custom combining services that the IRS may require the U.S. farmer to withhold taxes. At a minimum, U.S. farmers must report the transaction to the IRS via Form 1042-S.

In order to relieve U.S. farmers from withholding taxes, the Canadian or Mexican harvester must present a Form-W8ECI (Certificate of Foreign Person's Claim for Exemption from Withholding on Income Effectively Connected with the Conduct of a Trade or Business in the United States). This form verifies that the foreign entity has established an identity within the U.S. tax system. However, if Form-W8ECI is not presented, U.S. farmers must withhold 30 percent of the total amount and submit these withholdings immediately to the U.S. Federal Treasury.

For additional general information please contact Brad Fay, U.S. Custom Harvesters, Executive Director at 701-250-1036 or pasta4u@btigate.com. For more specific information contact your individual tax professional.

 

 

NEW DIETARY GUIDELINES CONTINUE TO KEEP GRAINS AT THE BASE
Statement of Judi Adams, President, Wheat Foods Council

The new Dietary Guidelines for Americans continue to recognize the important role grain foods play in the diet by separating the grain recommendation from the fruit and vegetable guideline. Released on May 27, the new grain guideline recommends consumers "choose a variety of grains daily, especially whole grains." In previous years, the Guidelines lumped grain foods with fruits and vegetables. 

"We are pleased the new Dietary Guidelines emphasize the importance all grain foods play in the diet by establishing a separate grain recommendation," said Judi Adams, M.S., R.D., president of the Wheat Foods Council, an organization dedicated to educating consumers about the healthful benefits of grain foods. "Separating the grain guideline from fruits and vegetables emphasizes the need for consumers to eat the recommended six to 11 daily servings of grains, with at least three coming from whole grains.  It also highlights the health and nutrition benefits grain foods provide, that may not be attained from consuming fruits and vegetables."

Grain foods include many nutrients needed for health; and whole grains in particular help reduce the risk of many major diseases.  In addition the new guidelines recognize enriched and fortified grain foods as important sources of folic acid, an essential nutrient in preventing neural tube birth defects and protecting against coronary heart disease and some cancers. 

"Studies show consumers aren't getting the recommended daily servings of grain foods, let alone consuming enough whole grains," added Adams. "This new emphasis on grains will help increase awareness about the benefits of all grains — whole, fortified and enriched — in the diet."

 

 

THIS WEEK ON CAPITOL HILL

HOUSE PREPARES FOR VOTE ON DEATH TAX REPEAL
When the House of Representatives returns to work next week, it will begin consideration of H.R. 8 - the Death Tax Elimination Act of 2000.  The NAWG backed bill cleared the House Ways and Means Committee prior to the Memorial Day congressional recess.  A vote on the bill's passage is planned for Thursday, June 8.

H.R. 8 was introduced by Congressmen Michael McNulty (D-New York), William Jefferson (D-Louisiana) and John Tanner (D-Tennessee) and would repeal the tax on inherited estates, the so-called "death tax."  Repeal of this federal tax is NAWG's highest tax policy priority.

The bill would begin a phase-out of the tax immediately and eliminate it completely in 2010.  It would also maintain stepped-up basis on up to $5.6 million of assets.  If the bill were to become law, all estates would retain stepped-up basis for $1.3 million of assets and heirs to larger estates could choose which assets retain the step-up in basis.

NAWG and other farm and commodity groups have prepared a letter that will be sent early next week encouraging each member of the House to vote for H.R. 8.  Each state association and individual members are encouraged to contact their Members of Congress in support of the bill.

SENATORS CALL FOR DROUGHT RELIEF
On Thursday, June 1, two leading Senate Republicans called upon USDA Secretary Dan Glickman to allow emergency haying and grazing of CRP acres to relieve drought stricken cattlemen. Senators Chuck Grassley (R-Iowa) and Conrad Burns (R-Montana) both published press statements in which they warn of the long-term effects that warm weather is having on their states.

"Foot-dragging by the administration has left Iowa farmers without a valuable tool they need for emergency haying and grazing," stated Grassley. He continued, "The delay is unacceptable, and our farmers deserve an immediate response."

Grassley and Burns join other Members of Congress in calling for drought relief. Forecasts made by USDA and NOAA scientists a week ago suggest that producers in the Midwest, Montana and the South can expect dry conditions to continue.

As the summer heats up, NAWG and other farm and commodity organizations will work with their allies on the Hill to provide weather related disaster assistance if necessary.

 

 

Special Article

THE MUTUAL BENEFITS OF SUPPORTING COMPETITIVE RAILS POLICIES
By Diane Duff, Executive Director of the Alliance for Rail Competition

According to Paul Tellier CEO and President of the Canadian National railroad (CN) "The Surface Transportation Board (STB) exists to protect competition from what a railroad might do, not to protect railroads from what competition might do." In spite of the well-documented fact that the STB interprets and practices its mandate in the converse, the Alliance for Rail Competition (ARC) applauds Tellier's enlightened assessment of the STB's true purpose. Nonetheless, until he and his merger partner, Burlington Northern Santa Fe (BNSF) Chairman and CEO Rob Krebs, also support system-wide policy changes that would produce more competition among railroads, it's hard to imagine that this is not simply empty rhetoric that will dissipate once the fate of the proposed merger is determined. But then again, maybe now is the right time for them to live up to that rhetoric.

Let's consider the situation at hand. The opposition being mounted by virtually every other Class I railroad, paired with the negative views expressed by rail customers and others, will undoubtedly provide the STB with more than enough "evidence" to do what may be best politically – namely to slow down or even stop a merger proceeding from taking place now.

There's little down side in the STB granting a delay in the CN – BNSF merger. If CN and BNSF are as competitive as they claim – Tellier claims that CN and BNSF had the first and second best performance records of all the major North American railroads – then they ought to be well-prepared to start competing for customers in the limited ways that have been advocated by ARC and other rail customer representatives. Remember, we're not talking about radical changes here. In addition to addressing some of the most basic flaws in the existing regulatory system, rail customer-supported legislation would provide competition among railroads in terminal areas and enable rail customers to get a rate over the "bottleneck" segment of a route.

What would be so terrible about applying the most basic of competitive policies to the rail industry? Being able to get a rate for a specific service, or being able to choose between two carriers where their networks intersect is basic fare for virtually every other industry in this country? Furthermore, conservative estimates show that the increased service levels produced by competition among railroads would result in an increase in net revenues for the industry.

If the rail industry chooses the path laid out by those CEOs opposing the timing of the CN-BNSF merger, then the outcome of our ongoing policy debate will inevitably be more of a revolution requiring major restructuring than the modest evolution rail customers are seeking to achieve today.

On the other hand, Tellier and Krebs have the opportunity to set a new path that would achieve their merger objectives and their customers' objectives to increase competition among railroads. Doing so would begin to restore some of that customer confidence that all railroad representatives claim to covet so much. Tellier has already been a leader among his peers in offering up customer-friendly rhetoric. With so much on the line, let's see if Tellier and Krebs are prepared to take the next step and support pro-competitive, system-wide policy changes that will really be of benefit to rail customers.

 

 

TRADE NEWS FROM WETEC

U.S. – EU SUMMIT
The United States and the European Union issued a joint statement during a summit meeting in Lisbon, Portugal, on Wednesday on the potential for a new round of World Trade Organization (WTO) negotiations. The statement focuses on positive steps taken in the U.S.-EU relationship to "rebuild confidence in the WTO and the multilateral system, with particular reference to developing countries."

Regarding the potential for a new round the statement reads, "The U.S. and EU reaffirm their conviction that the early launch of an inclusive new round of WTO trade negotiations would offer a major boost to global economic growth, employment and sustainable development, but must address in a balanced way the concern of all WTO members."

Despite the statement, several outstanding issues still aggravate the U.S.-EU trade relationship. Issues such as the EU banana export policy, the EU ban hormone treated beef, and the U.S. Foreign Sales Corporations (FSC) program remain unsettled.

Both sides have been trying to downplay their differences as they "pledge to build on the constructive work of the last six months to try to launch a new round during the course of the year."

In addition to the WTO statement, the U.S. and EU agreed to the establishment of a "Consultative Forum" that will assess the risks and benefits of biotechnology. A report from the Forum will be prepared for a scheduled December 2000 U.S.-EU summit.

The Forum will include a wide range of occupations and perspectives from outside the government. Those included will be "people with backgrounds in labor, academia, and business, including scientists, ethicists, environmental interests, farmers and consumers." The Forum is tasked with looking at issues such as food security for developing countries, food safety, health and the environment.

 

 

NEWS FROM USDA/EPA/USTR

RMA PUBLISHES PROPOSED CHANGES TO WHEAT CROP INSURANCE
On April 20, the Risk Management Agency (RMA) published proposed rules that would amend the Common Crop Insurance Regulations by revising the small grains and winter wheat endorsement regulations (7 CFR 457.101 and 102).  Comments on the proposed changes will be accepted until close of business on June 19, 2000. Wheat producers can obtain a copy of the proposal on the RMA web site (www.rma.usda.gov/regs) or by contacting the NAWG office.

The proposal makes thirty-four changes to standing RMA regulations.  Those most directly impacting wheat producers are: 1) Allowing initially planted durum or club wheat to qualify as a separate unit than other wheat acres;
2) Changing the December 31 contract change date for spring crops to November 30;
3) Changing the April 15 cancellation and termination dates for spring wheat to March 15 in some counties;
4) Changing the April 15 cancellation and termination dates for winter wheat to the fall in some counties;
5) Requiring that farmers must replant any fall planted barley or wheat that is damaged prior to the spring final planting date with a winter type of the crop where practical;
6) Allowing farmers in counties with only a spring final planting date to request insurance for fall planted barley or wheat;
7) Changing from 3 to 4 the number of bushels used to compute the amount of a replanting payment for wheat (leaves barley and oats at 5 and flax and buckwheat at 2);
8) Increasing the coverage amount from 30 to 50 percent of the production guarantee under Option A of winter wheat coverage; and
9) Reducing the coverage amount from 100 to 70 percent of the production guarantee under Option B of winter wheat coverage.

Wheat producers who might be impacted by the proposed regulations are encouraged to contact RMA before the June 19 deadline.

POLAND LOOSES WHEAT GLUTEN EXEMPTION
Poland will no longer be exempt from the quota on imports of wheat gluten into the United States.  President Clinton's decision to add them to the list of countries subject to quota came last week. 

The determination was based on the dramatic increases in Poland's imports to the U.S. over the past year. Poland supplied nearly 7 percent of the wheat gluten that entered the U.S. in 1998 after only accounting for 2.9 percent the previous year.  It has increased their imports as a way to decrease surpluses.  The President found that if this was allowed to continue, it could have caused substantial injury to the U.S. industry.

Corrections from last weeks Report from Washington
In the article titled, "Wheat Breeder Remembered," it should have stated that Dr. Kronstad had enjoyed a 30-year career at OSU not a 3-year career.

In the article titled, "Crop Insurance/Assistance Package Update," it should have stated that the increase in MAP funding was dropped from the final conference report before its passage.

 

 

NAWG FUTURE EVENTS
January 29 - February 3, 2001
Wheat Industry Conference and Exposition
New Orleans, LA - Fairmont Hotel

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"Report from Washington"
Editor: Gina Hoback
Contributing Editor: Wayne Hammon
Contributing Editor for WETEC: Chris Holdgreve

Published weekly by
National Association of Wheat Growers
415 Second Street, NE Suite 300 – Washington, DC 20002.
Phone: 202-547-7800
Web site:
http://www.wheatworld.org