[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
THE STATE OF THE U.S. LIVESTOCK AND POULTRY ECONOMIES
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON LIVESTOCK AND FOREIGN AGRICULTURE
OF THE
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
JULY 16, 2019
__________
Serial No. 116-16
Printed for the use of the Committee on Agriculture
agriculture.house.gov
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
__________
U.S. GOVERNMENT PUBLISHING OFFICE
37-194 PDF WASHINGTON : 2019
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COMMITTEE ON AGRICULTURE
COLLIN C. PETERSON, Minnesota, Chairman
DAVID SCOTT, Georgia K. MICHAEL CONAWAY, Texas, Ranking
JIM COSTA, California Minority Member
MARCIA L. FUDGE, Ohio GLENN THOMPSON, Pennsylvania
JAMES P. McGOVERN, Massachusetts AUSTIN SCOTT, Georgia
FILEMON VELA, Texas ERIC A. ``RICK'' CRAWFORD,
STACEY E. PLASKETT, Virgin Islands Arkansas
ALMA S. ADAMS, North Carolina SCOTT DesJARLAIS, Tennessee
Vice Chair VICKY HARTZLER, Missouri
ABIGAIL DAVIS SPANBERGER, Virginia DOUG LaMALFA, California
JAHANA HAYES, Connecticut RODNEY DAVIS, Illinois
ANTONIO DELGADO, New York TED S. YOHO, Florida
TJ COX, California RICK W. ALLEN, Georgia
ANGIE CRAIG, Minnesota MIKE BOST, Illinois
ANTHONY BRINDISI, New York DAVID ROUZER, North Carolina
JEFFERSON VAN DREW, New Jersey RALPH LEE ABRAHAM, Louisiana
JOSH HARDER, California TRENT KELLY, Mississippi
KIM SCHRIER, Washington JAMES COMER, Kentucky
CHELLIE PINGREE, Maine ROGER W. MARSHALL, Kansas
CHERI BUSTOS, Illinois DON BACON, Nebraska
SEAN PATRICK MALONEY, New York NEAL P. DUNN, Florida
SALUD O. CARBAJAL, California DUSTY JOHNSON, South Dakota
AL LAWSON, Jr., Florida JAMES R. BAIRD, Indiana
TOM O'HALLERAN, Arizona JIM HAGEDORN, Minnesota
JIMMY PANETTA, California
ANN KIRKPATRICK, Arizona
CYNTHIA AXNE, Iowa
______
Anne Simmons, Staff Director
Matthew S. Schertz, Minority Staff Director
______
Subcommittee on Livestock and Foreign Agriculture
JIM COSTA, California, Chairman
ANTHONY BRINDISI, New York DAVID ROUZER, North Carolina,
JAHANA HAYES, Connecticut Ranking Minority Member
TJ COX, California GLENN THOMPSON, Pennsylvania
ANGIE CRAIG, Minnesota SCOTT DesJARLAIS, Tennessee
JOSH HARDER, California VICKY HARTZLER, Missouri
FILEMON VELA, Texas TRENT KELLY, Mississippi
STACEY E. PLASKETT, Virgin Islands JAMES COMER, Kentucky
SALUD O. CARBAJAL, California ROGER W. MARSHALL, Kansas
CHERI BUSTOS, Illinois DON BACON, Nebraska
JIMMY PANETTA, California JIM HAGEDORN, Minnesota
Katie Zenk, Subcommittee Staff Director
(ii)
C O N T E N T S
----------
Page
Conaway, Hon. K. Michael, a Representative in Congress from
Texas, opening statement....................................... 5
Costa, Hon. Jim, a Representative in Congress from California,
opening statement.............................................. 1
Prepared statement........................................... 3
Rouzer, Hon. David, a Representative in Congress from North
Carolina, opening statement.................................... 4
Witnesses
Zimmerman, John, turkey farmer; Member, Executive Committee,
National Turkey Federation, Northfield, MN..................... 7
Prepared statement........................................... 9
Porter, Holly, Executive Director, Delmarva Poultry Industry,
Inc., Georgetown, DE........................................... 10
Prepared statement........................................... 12
Will, David, General Manager, Chino Valley Ranchers; Co-Chair,
Organic Committee, United Egg Producers, Colton, CA; on behalf
of Pacific Egg and Poultry Association......................... 14
Prepared statement........................................... 15
Georgiades, Kelley Sullivan, Owner and Operator, Santa Rosa
Ranch; Member, Board of Directors, Texas and Southwestern
Cattle Raisers Association, Crockett, TX....................... 17
Prepared statement........................................... 18
Salmon, Stephen J., rancher; Member, American Sheep Industry
Association; Director, Texas Sheep and Goat Raisers'
Association, San Angelo, TX.................................... 20
Prepared statement........................................... 21
Herring, David Dee, Vice President, TDM Farms/Hog Slat Inc.;
President, National Pork Producers Council, Lillington, NC..... 24
Prepared statement........................................... 25
THE STATE OF THE U.S. LIVESTOCK AND POULTRY ECONOMIES
----------
TUESDAY, JULY 16, 2019
House of Representatives,
Subcommittee on Livestock and Foreign Agriculture,
Committee on Agriculture,
Washington, D.C.
The Subcommittee met, pursuant to call, at 10:04 a.m., in
Room 1300 of the Longworth House Office Building, Hon. Jim
Costa [Chairman of the Subcommittee] presiding.
Members present: Representatives Costa, Brindisi, Hayes,
Cox, Craig, Harder, Plaskett, Bustos, Panetta, Peterson (ex
officio), Rouzer, Thompson, Hartzler, Kelly, Marshall, Bacon,
Hagedorn, and Conaway (ex officio).
Staff present: Malikha Daniels, Matt MacKenzie, Katie Zenk,
Callie McAdams, Patricia Straughn, Jeremy Witte, Dana Sandman,
and Jennifer Yezak.
OPENING STATEMENT OF HON. JIM COSTA, A REPRESENTATIVE IN
CONGRESS FROM CALIFORNIA
The Chairman. Ladies and gentlemen, the Subcommittee on
Livestock and Foreign Agriculture will now come to order. As we
said at the outset, we are attempting to try to hold at least
two Subcommittee hearings a month, and we are pretty much
keeping on track. Both the Ranking Member, Mr. Rouzer, and I
have been working with other Committee Members who are trying
to make sure that we have a thorough vetting of the issues
affecting the livestock industry and foreign agriculture around
the country, and the regional impacts that we see taking place.
We know that they are not all evenly placed, and of course,
these trade or tariff wars are having an impact as it relates
from commodity to commodity group. And therefore, we think it
is fitting and appropriate that we have the poultry industry
today give us a state of how they are doing, and not only with
regards to poultry economics, but also U.S. livestock in
general.
The title of this morning's hearing, The State of U.S.
Livestock and Poultry Economies, will come to order. We are
pleased to have a good cross representative of industry
leaders. Our goal today is to hear from on the ground
stakeholders in various segments of the livestock and poultry
industry so we know in Congress what is going on for the men
and women who are involved in this very important part of
animal agriculture in our country that provides protein for all
Americans. And enough so that we can export.
Livestock and poultry producers have big impacts on rural
economies. In my district alone, sales of livestock, poultry,
and related products adds up to over $2 billion a year.
Nationwide, that is nearly in excess of $200 billion annually.
It has significant broad reaching effects throughout the
country.
Today's hearing builds on the previous work of this
Subcommittee, including a hearing we had 2 months ago with the
United States Department of Agriculture Under Secretary Greg
Ibach on our ability to prevent and respond to a new suite of
animal health programs that was enacted as part of the new 2018
Farm Bill. Effective administration of animal pest and disease
prevention programs were dealt with, and how we mitigate and
eradicate with these new programs is crucial, especially now as
threats of Virulent Newcastle Disease, Cattle Fever Ticks,
African Swine Fever that threaten farmers and ranchers across
the country.
It is hard to talk about the state of the livestock and
poultry economies without talking about trade, as I noted in
the outset. Access to foreign markets and fluctuations in
foreign demand continue to be a major, major concern as
livestock and poultry farmers need export markets. The
Administration's tariff-first attitude hasn't been helping the
longstanding issues for poultry access into places like China
needing to be addressed.
I grew up on our family's farm with the notion that
farmers, ranchers, and dairymen are price takers, not price
makers. That means for the first person's who are not familiar
with life on the farm, they put all the input costs throughout
the year and at the end of the year, farmers, ranchers, and
dairymen take what the world market price is. And they may have
X in that product over a period of months, and need a Y to have
a profit. But if the market is not Y, they are going to get X,
and that is the challenge. Farmers, ranchers, and dairymen are
price takers, not price makers.
These tariffs are very troubling, and we see that combined
with climate conditions of floods taking place in parts of the
country that add further exacerbation of the challenges our
folks are facing.
We also know the need for a workable immigration system.
For all the rhetoric and emotion that surrounds the immigration
debate, livestock and poultry producers know that they depend
upon a reliable, year-round labor workforce to keep both the
farms and the packing sheds running. And what we have seen--and
I know in California, it is a continuing decline of available
workforce and reliable workforce in our fields and in our
packing operations. And it is very troubling, and there is fear
out in farm country, I can tell you, in the communities that I
represent. I just saw it last week about potential of raids and
the impacts of people being deported when some families are
documented and there legally, and some are not. That fear is
real.
Other issues we have, included with Federal meat
inspection, food safety, meat and poultry labeling across new
technologies, and Packers and Stockyards Act functions are all
major issues concerning this Subcommittee, and we will delve
into that at a later date.
Today's hearing, though, is just one more step in an
ongoing conversation on these important issues. The new farm
bill requires the USDA to complete several studies that will
provide Congress with the necessary information on important
issues including an analysis of a possible Livestock Dealer
Trust and the effectiveness of Food Safety Inspection Service
outreach to small livestock processors. That information is
going to help guide our work on these important issues, moving
forward. We look forward to getting these studies back and
scheduling a hearing appropriately where we can discuss the
results with you.
As Livestock Mandatory Price Reporting expires in 2020,
this Subcommittee is interested in learning farmer priorities
in advance so that we can deal with reauthorization.
I want to thank all of your for being here. I want to thank
Members of the Subcommittee for your presence and your
involvement.
[The prepared statement of Mr. Costa follows:]
Prepared Statement of Hon. Jim Costa, a Representative in Congress from
California
Good morning, and welcome to today's hearing of the Subcommittee on
Livestock and Foreign Agriculture on the state of the livestock and
poultry economy.
Our goal today is to hear from on-the-ground stakeholders in
various segments of the livestock and poultry industry so we in
Congress know what's going on for the men and women involved in animal
agriculture.
Livestock and poultry producers have big impacts on rural
economies. In my district alone, sales of livestock, poultry, and
related products added up to over $2 billion a year. Nationwide, that
number is nearly $200 billion annually.
Today's hearing builds on the previous work of this Subcommittee,
including a hearing we had 2 months ago with USDA Under Secretary Greg
Ibach on our ability to prevent and respond to animal pests and
diseases, including the implementation of a new suite of animal health
programs that was enacted as part of the 2018 Farm Bill. Effective
administration of animal pest and disease prevention, mitigation, and
eradication is crucial, especially now as threats of Virulent Newcastle
Disease, Cattle Fever Ticks, and African Swine Fever threaten farmers
and ranchers across the country.
It's hard to talk about the state of the livestock and poultry
economies without talking about trade. Access to foreign markets and
fluctuations in foreign demand continue to be a major concern as
livestock and poultry farmers need export markets. The Administration's
tariff-first attitude hasn't been helping and longstanding issues for
poultry access into places like China need to be addressed.
We also know you need access to a workable immigration system. For
all the rhetoric and emotion that surrounds the immigration debate,
livestock and poultry producers know that they depend on a reliable,
year-round labor workforce to keep both farms and packing plants
running smoothly.
Other issues including Federal meat inspection, food safety, meat
and poultry labeling, access to new technologies, and Packers and
Stockyards Act functions are all major issues of concern before this
Subcommittee.
Today's hearing is just one more step in an ongoing conversation on
these important issues. The new farm bill requires USDA to complete
several studies that will provide Congress with necessary information
on important issues including an analysis of a possible Livestock
Dealer Trust and effectiveness of Food Safety Inspection Service
outreach to small livestock processors. That information is going to
help guide our work on these important issues, moving forward. We look
forward to getting these studies back on time and discussing their
results with you.
And as Livestock Mandatory Price Reporting expires in 2020, this
Subcommittee is interested in learning farmer priorities in advance of
reauthorization.
Thank you all for being here today and I look forward to your
testimony.
With that I recognize the Ranking Member, Mr. Rouzer, for any
comments he wishes to make.
The Chairman. I am going to recognize the Ranking Member
for any comments that he may make, and then we also have our
Chairman and Ranking Member of the full Committee here to see
if they have any comments.
We are going to do something a little different, because
all of our witnesses represent the breadth and width of this
great country of ours, and we are going to allow the Members
who some of these witnesses come from their areas to actually
introduce their witnesses. We will do that after the opening
statement by the Ranking Member.
OPENING STATEMENT OF HON. DAVID ROUZER, A REPRESENTATIVE IN
CONGRESS FROM NORTH CAROLINA
Mr. Rouzer. Well thank you, Mr. Chairman, and I appreciate
you holding today's hearing to consider the state of the
livestock and poultry economies.
We are meeting today against the backdrop of the incredibly
difficult times in the agriculture industry as a whole. Our
producers find themselves in a precarious spot after facing
several years of extreme weather, volatile feed costs,
uncertain export markets, and constant pressure to protect
their herds and flocks from disease. Whether it is African
Swine Fever, labor shortages, as you mentioned, FDA's misguided
animal biotech strategy, Newcastle Disease, take your pick, the
animal agriculture sector faces significant threats that are
capable of devastating not only individual farmers, but the
broader rural economy as a whole.
In May, this Subcommittee heard from Under Secretary Greg
Ibach about USDA's prevention and response capabilities for
animal pest and disease threats. As we discussed in that
hearing, thanks to the efforts of the livestock industry and my
colleagues specifically here in this chamber, the 2018 Farm
Bill made an historic investment in the tools needed for USDA
and various partners to identify, diagnose, and respond to
these threats.
This Committee continues to engage with the Department, and
we are pleased to see progress being made on the farm bill
implementation.
Perhaps the most important thing that this Congress can do
to improve not just the livestock and poultry economies, but
the entire agriculture sector, is ratify the U.S.-Mexico-Canada
agreement, or USMCA as we know it. According to the U.S.
International Trade Commission, the increased market access for
dairy products with U.S.-specific TRQs and the elimination of
Canada's Class VI and Class VII milk pricing will lead to a net
increase in U.S. production of almost $227 million. For
poultry, eggs, and egg products, the U.S. would maintain
excellent access to Mexico, its top market for those products,
and would see an increase in Canada's TRQs for turkey, chicken,
eggs, and egg products with exports of some products expected
to grow nearly 50 percent.
Further, there are numerous protections and benefits across
the livestock and poultry sector in the new agreement on
sanitary and phytosanitary standards. With all that our farmers
and ranchers are going through, it is vital that we pass USMCA
just as soon as practically possible.
Finally, I would like to acknowledge and thank each of the
witnesses for providing your testimony today, as well as your
insight. The time spent away from your families and operations
is not lost on us, and we greatly appreciate your commitment to
providing this Committee with timely information that enables
us to do the very best we possibly can to effectuate good
public policy.
I look forward to hearing from you, and Mr. Chairman, I
will yield back.
The Chairman. I thank the Ranking Member for his opening
remarks, and I see that Chairman Peterson is not here, but I
see the Ranking Member, Mike Conaway from Texas, is here, would
you like to make an opening statement?
OPENING STATEMENT OF HON. K. MICHAEL CONAWAY, A REPRESENTATIVE
IN CONGRESS FROM TEXAS
Mr. Conaway. Only to say that you and the Ranking Member
both said what needed to be said, and I would rather hear from
the witnesses. I yield back. Thank you.
The Chairman. All right. As I noted beforehand, we are
going to get the formal introduction of the witnesses by
individual Members out of the way to begin with.
I believe, Mr. Conaway, you have a witness that comes from
your area that you would like to introduce?
Mr. Conaway. I do. Thank you, Mr. Chairman. I would like to
recognize Steve Salmon from San Angelo, Texas. Steve is a
third-generation rancher raising sheep, goats, and cattle north
of San Angelo, Texas. Steve is a member of the Texas Sheep and
Goat Raisers Association, where he currently serves and the
Chair of the Natural Resources and Environmental Affairs
Committee.
Steve, thank you for coming here today, and we look forward
to your testimony.
The Chairman. We thank the Ranking Member for that
appropriate recognition of that witness. We look forward to
your testimony.
Next on my list here is Ms. Craig from Minnesota. I believe
you have a witness from your district that you would like to
introduce?
Ms. Craig. Yes, sir. Thank you, Mr. Chairman.
I am incredibly proud to welcome John Zimmerman from my
district to testify before the Committee this morning. John is
a second-generation Minnesota turkey farmer who also raises
corn and soybeans. John is past-President of the Minnesota
Turkey Research and Promotion Council, and on the Executive
Committee of the National Turkey Federation. He is a graduate
of Iowa State University with a bachelor's degree in animal
science. He is also the current Board Chair of River Country
Cooperative, headquartered in Inver Grove Heights, Minnesota.
He and his wife, Cara, and son, Grant, live in the great
City of Northfield in Minnesota's second Congressional
District. Welcome, John.
The Chairman. All right. I have two witnesses, I believe
here, that I would like to introduce. Ms. Porter serves as the
Executive Director of Delmarva Poultry Industry, Inc., which is
based in Georgetown, Delaware, represents over 1,700 members of
the meat chicken industry in Delaware, Maryland, and Virginia.
And we are very pleased that you are here, and look forward to
your testimony.
In addition to Ms. Holly Porter, we have another witness,
Mr. David Will. He is the General Manager in Chino Valley
Ranchers in Colton, California, and the ranchers operate five
farms in southern California, and source eggs from farms in a
total of eight states, as I understand. Mr. Will is with us
today on behalf of the Egg Farmers of California, Pacific Egg
and Poultry Association, and United Egg Producers. Part of that
group that comes and makes omelets once a year. You make good
omelets. We are glad that you come here.
In addition to that, Mr. Vela, who I guess wanted to be
here--I hope he will be here at some time during the testimony,
has a witness from his part of Texas, and I will introduce her.
Ms. Kelley Sullivan Georgiades----
Mrs. Georgiades. It has only been my name for a month, so I
am getting used to it myself.
The Chairman. You are Mrs. Georgiades.
Mrs. Georgiades. Very good. I am very impressed.
The Chairman. Well, we will work with that. Mrs. Georgiades
is the owner and operator of Santa Rosa Ranch, which
specializes in Brangus cattle near Crockett, Texas, and she is
here today on behalf of the Texas and Southwest Cattle Raisers,
and we are glad that you are here to talk about that important
part of the U.S. beef industry.
And then, you have a witness as well, Mr. Rouzer, and I
will let you introduce your witness.
Mr. Rouzer. Well thank you, Mr. Chairman. It is a great
pleasure for me to introduce a friend, David Herring, who is
also a hog farmer from Lillington, North Carolina. David
currently serves as the President of the National Pork
Producers Council and works as the Vice President of TDM Farms/
Hogslat, Incorporated, which is a family-owned company. David
and his brothers, Tommy and Mark, started TDM Farms in 1983,
growing feeder pigs for market outdoors. Today, TDM Farms is a
sow, farrow-to-finish operation with farms in North Carolina,
Indiana, and Illinois, and as a fellow NC State alum, it is a
great pleasure to have David with us today, who also is an NC
State graduate, and who is doing a fine job as President of the
National Pork Producers Council. David, great to have you here.
I yield back, Mr. Chairman.
The Chairman. Well, thank the Ranking Member for that good
introduction, and we look forward to all six witnesses
testifying.
Some of you may have more familiarity with this process
than others, but let me, for all of you, simply say that your
testimony, as you have been informed, is limited to 5 minutes.
You have a lighting device in front of you. It is green for 4
minutes, and then on the fifth minute, it turns yellow, and
then when you hit the sixth minute, it turns red. And we like
you to conclude your testimony when it turns red. If you could
go a little bit before and end while it is still yellow, that
is fine, because that gives us a little more time.
The chair will be tolerant to a point, but obviously if you
continue to go on, that doesn't work so well for the Committee.
You do have the ability to provide extended testimony for the
record that is written that we can then look at, but it is 5
minutes. That is the way we do it. We will get through all of
your six statements, and then following, questions by Members
of the Subcommittee here. And we are limited to 5 minutes, and
we already have a list of Members on both sides who are looking
to ask questions.
Let us begin with Mr. John Zimmerman, turkey farmer,
Northfield, Minnesota, on behalf the Minnesota Turkey Growers
Association and the National Turkey Federation. You have 5
minutes. Please open up.
STATEMENT OF JOHN ZIMMERMAN, TURKEY FARMER;
MEMBER, EXECUTIVE COMMITTEE, NATIONAL TURKEY
FEDERATION, NORTHFIELD, MN
Mr. Zimmerman. Good morning, Chairman Costa, Ranking Member
Rouzer, Congresswoman Craig, and Members of the Committee.
Thank you for the opportunity to share the turkey industry's
perspective today.
My name is John Zimmerman, and I am a turkey grower from
Northfield, Minnesota. On our farm, we raise about 4 million
pounds of turkey per year, and grow corn and soybeans as well.
For me, raising turkeys has been a family business. I have been
around the industry my entire life. My father raised turkeys
before me, and I have taken over the family business. I won't
say that it is easy work, but we love what we do.
I also serve on the Executive Committee of the National
Turkey Federation, which represents the entire U.S. turkey
industry, from growers like myself, to processing companies,
and also our industry partners. Last year, more than 244
million turkeys were raised in the United States, and USDA
estimates that turkey meat production will reach 5.8 billion
pounds this year, right in line with what it was in 2018. In
total, the turkey industry generates nearly 441,000 jobs, and
in order to support these jobs, we need to make sure policies
coming out of Washington that affect us are common sense and
preserve rural America's ability to thrive.
That is where we need your help, and we look forward to
working with Congress and this Committee to address these
issues.
The turkey industry currently exports more than ten percent
of its products, and trade continues to play a more critical
role in our industry's ability to profitably grow. Now, more
than ever, the turkey industry needs government's assistance
opening closed markets and those markets that are open, but
prohibit U.S. turkey imports for other reasons. We are pleased
to report that almost all markets that were closed due to the
2015 outbreak of Highly-Pathogenic Avian Influenza have
reopened, but we still lack access to some very critical
markets, such as China. We are hopeful the ongoing trade
discussions yield a successful return, as this will greatly
improve the current stagnant turkey market conditions.
In 2018, NTF members exported more than 610 million pounds
of turkey valued at $623 million, and we will continue working
with government to build trade relationships.
The Chairman. What percentage of that total production is
that you are exporting?
Mr. Zimmerman. Is exported?
The Chairman. Yes.
Mr. Zimmerman. Ten percent.
To that end, the turkey industry is here for our annual
fly-in, and our number one priority is encouraging passage of
USMCA. Our industry has always had a fantastic relationship
with Mexico, and ratifying this agreement will only improve
that bond. The deal also lays the groundwork to see greater
quantity of U.S. turkey sent to Canada. This agreement did not
go as far as we were hoping, given their supply management
system for poultry; however, it is a modest improvement. And we
strongly encourage Congress to vote ``yes'' on USMCA as soon as
possible.
In 2015, the poultry industry was devastated by HPAI, which
exponentially reduced our export markets and forced the
destruction of flocks throughout my home State of Minnesota.
The global spread of HPAI and now African Swine Fever shows
that no country is immune, and we need to be prepared with an
adequate number of well-qualified response teams who have the
resources to work directly with animal agriculture to avoid
these diseases through prevention, first and foremost.
The farm bill process created the National Animal Disease
Preparedness and Response Program, designed to limit the impact
of foreign zoonotic diseases on U.S. livestock and poultry
producers, and we applaud the Committee for holding hearings
earlier this year on the status of the program. We anxiously
await its implementation.
As the saying goes, an ounce of prevention is worth a pound
of cure, and we need to stay focused on targeted efforts in
both monitoring and rapid response that reduce the ability of
foreign diseases to gain a foothold in this country, which
devastate our industries and wreck our trade markets.
As I mentioned 3 years ago during my testimony before this
Committee, our industry continues to suffer from a lack of
access to workers. We support immigration reform that includes
policies and provisions that meet the needs of the U.S.
economy, but most importantly, a visa program for meat and
poultry processors. Most turkey plants are located in rural,
low-unemployment areas, and to fully staff these plants,
producers must recruit from outside their local areas, and in
many instances, rely on immigrant labor. Existing guestworker
programs target only seasonal, on farm labor, and non-
agricultural manufacturing, and we need workers in our plants
year-round. We stand ready to work with any and all parties to
achieve a workable system. There is currently no single bill
that provides a silver bullet, but it is time to resolve the
immigration debate for the good of rural America's economy.
Finally, the meat and poultry industries have been working
with USDA, FDA, and academia to find better ways to combat
diseases and conditions that impact food safety and overall
animal health. Food safety and animal welfare are our top
priorities, and we have committed hundreds of millions of
dollars to these tasks. But the partnership with the Federal
Government is important to us, and there is considerable
expertise at the Agricultural Research Service, and we simply
encourage the Federal Government to continue committing, and if
possible, enhance resources to improving food safety and animal
welfare. Research, modernizing inspections, and streamlined
processes for new technology approval are critical to
maintaining the status of having the safest food in the world.
Once again, thank you for the opportunity to testify today
on the state of the U.S. turkey industry and the issues
impacting our businesses, and I would be happy to answer any
questions.
[The prepared statement of Mr. Zimmerman follows:]
Prepared Statement of John Zimmerman, Turkey Farmer; Member, Executive
Committee, National Turkey Federation, Northfield, MN
Good morning, Chairman Costa, Ranking Member Rouzer, Congresswoman
Craig, and Members of the Committee. Thank you for the opportunity to
share the turkey industry's perspective today.
My name is John Zimmerman, and I'm a turkey grower from Northfield,
Minnesota. On my farm, we raise about four million pounds of turkey
each year and grow corn and soybeans as well. For me, raising turkeys
is a family business. I've been around the turkey industry my entire
life. My father raised turkeys before me, and I took over the family
business. I won't say that it's easy work. But I do what I love.
I also serve on the Executive Committee of the National Turkey
Federation, which represents the entire U.S. turkey industry from
growers like me to processor companies and our industry partners as
well. Last year, more than 244 million turkeys were raised in the
United States, and USDA's latest data projects that turkey meat
production will reach 5.8 billion pounds this year, right in line with
what we saw in 2018. In total, the turkey industry generates nearly
441,000 jobs. As the industry continues to recover from the avian
influenza outbreak in 2015 and gain access to new markets for turkey,
we are also working to find more ways to remain competitive and meet
consumer demands in a crowded protein field. After all, while turkey
may have its big day on Thanksgiving, it's a great protein source year-
round. I see significant potential for the turkey industry's growth in
the near future, but we need to make sure policies coming out of
Washington that affect agriculture and food manufacturing are common
sense and preserve rural America's ability to thrive. That's where we
need your help, and we look forward to working with Congress, and this
Committee, to address these issues.
Exports
The turkey industry currently exports more than ten percent of its
products, and trade continues to play a more critical role in our
industry's ability to profitably grow. Now more than ever, the turkey
industry needs our government's assistance opening closed markets or
those markets that are open and prohibit U.S. turkey imports in other
ways. We are pleased to report that almost all markets that were closed
due to the 2015 outbreak of Highly-Pathogenic Avian Influenza (HPAI)
have reopened, but we still lack access to some very critical markets,
such as China as they continue to block U.S. poultry into the market.
We are encouraged and hopeful that the trade discussions that are
ongoing will yield a successful return--having this market available
again will greatly improve current stagnate market conditions.
In 2018, NTF members exported more than 610 million pounds of
turkey valued at $623 million. We will continue working with our
government to build relationships that benefit not only us but assist
those importing countries in growing jobs through further processing
and distribution of delicious turkey products.
To that end, the turkey industry's number one priority is
encouraging the passage of the U.S.-Mexico-Canada Agreement (USMCA).
The turkey industry has a fantastic relationship with those we do
business with in Mexico and ratifying this agreement will only improve
that bond. The deal also lays the groundwork to see a greater quantity
of U.S. turkey products going north to Canada. The agreement did not go
as far as we were hoping given their supply management system for
poultry; however, it is a modest improvement. It also achieves valuable
concessions on sanitary/phytosanitary standards. We strongly encourage
Congress to vote ``yes'' on USMCA as soon as possible.
Additional markets that we are hopeful to improve access to are
China as previously mentioned and India, which is still only nominally
open even though we have been granted access.
Disease Prevention Through Monitoring and Rapid Response
In 2015, the poultry industry was devastated by HPAI, which
exponentially reduced our export markets and forced the destruction of
flocks throughout my home State of Minnesota. Today, with the dangerous
spread of African Swine Fever (ASP) throughout the world, we are
reminded once again that we must be proactive in limiting our exposure
to emerging diseases that are a constant threat. The global spread of
HPAI and now ASP shows that no country is immune, and we need to be
prepared with an adequate number of well-qualified response teams who
have the resources to work directly with animal agriculture to avoid
these diseases through prevention first and foremost. The farm bill
process created the forward-looking, mandatory National Animal Disease
Preparedness and Response Program designed to limit the impacts of
foreign zoonotic diseases on U.S. livestock and poultry producers. We
applauded this Committee for holding a hearing earlier this year in
order to get a report on the progress of rolling out the plan. We are
anxiously awaiting implementation of this program as we truly do
believe that ``an ounce of prevention is worth a pound of cure.'' We
need to stay focused on targeted efforts, in both monitoring and rapid
response, that reduce the ability of foreign diseases to gain a
foothold in this country, devastate our industries and wreck trade
markets. We appreciate the progress made by APHIS on this front and
look forward to creating stronger, coordinated disease prevention
measures.
Immigration
As I mentioned 3 years ago during my testimony before this
Committee, our industry continues to suffer from a lack of access to
workers. The turkey industry supports immigration reform that includes
policies and provisions that will maximize benefits to the industry and
ensure a strong and durable immigration system that meets the needs of
the U.S. economy.
Most turkey plants are located in rural, low-unemployment areas. To
fully staff these plants, producers must recruit from outside of their
local areas and in many instances must rely on immigrant labor.
Existing guestworker programs target only seasonal, on-farm labor and
non-agricultural manufacturing. We need workers in our plants year-
round, and we stand ready to work with any and all parties to achieve a
workable system. The turkey industry hopes that Washington can put the
rhetoric aside and find a solution.
As mentioned earlier, the meat and poultry industry has the
opportunity to grow and provide additional quality jobs, particularly
if export markets can be improved, but we must have workers available
to help meet new demands. Otherwise, it will be virtually impossible to
capitalize when the doors of new export markets are pushed further
open. NTF members need better access to a pool of legal, general labor
immigrant workers, and we support a visa program that addresses the
needs of the meat and poultry processing industries. There is currently
no single bill that provides a ``silver bullet,'' but it is time to
resolve the immigration debate for the good of rural America's economy.
Food Safety
Finally, the meat and poultry industries have been working with
USDA, FDA and academia to find better ways to combat diseases and
conditions that impact food safety and overall animal health. Food
safety and animal welfare are our top priorities, and we have committed
hundreds of millions of dollars to these tasks. But, the partnership of
the Federal Government is important to us. There is considerable
expertise at the Agricultural Research Service, and we simply encourage
the Federal Government to continue committing--and if possible
enhance--resources to improving food safety and animal welfare.
Research, modernizing inspections and a streamlined process for new
technology approval is critical to maintaining the status of having the
safest food in the world.
Once again, thank you for the opportunity to testify today on the
state of the U.S. turkey industry and the issues impacting our
businesses. I will be happy to answer any questions.
The Chairman. All right, a little over your time, but
within reason.
Our next witness is Ms. Holly Porter, the Executive
Director of the Delmarva Poultry Industry, Inc., in Georgetown,
Delaware. Ms. Porter, would you please begin your testimony?
STATEMENT OF HOLLY PORTER, EXECUTIVE DIRECTOR, DELMARVA POULTRY
INDUSTRY, INC., GEORGETOWN, DE
Ms. Porter. Good morning, and thank you, Chairman Costa,
Ranking Member Rouzer, and Members of the Subcommittee. As
mentioned, I am the Executive Director of the Delmarva Poultry
Industry, Incorporated, which is the trade association that
represents the family farmers, the processors, and the allied
businesses within Delaware, the Eastern Shore of Maryland, and
the Eastern Shore of Virginia, also known as the Delmarva
Peninsula.
It is a pleasure to be here today representing the meat
industry, which actually got its start on the Delmarva nearly
100 years ago. Today, our ag economy in Delmarva is built on
what we refer to as a three-legged stool. The family farmers
raising the birds, the farmers raising the grain, and the
processors who both partner with these folks. If any one of
those legs were to come off the stool, the economy would
collapse.
As of 2018, we have more than 1,300 family farmers that
contract with five processing companies: Allen Harim, Amick
Farms, Mountaire Farms, Perdue Farms, and Tyson. This may be
unique to other areas of the country that produce chicken--our
growers have various growers or processors, and they also have
various production types. In 2018, these family farmers earned
$268 million in contract income. The five processors in
Delmarva purchase more than 136 million bushels of corn,
soybeans, and wheat to feed the chickens, which was mainly
grown on the peninsula. As a matter of fact, our grain farmers
receive a premium due to the proximity to the chicken industry,
and it is the reason why my father, a small grain farmer,
tilling only 325 acres, is able to be profitable.
And we needed all of that feed for our Delmarva farmers,
because we raised over 605 million chickens in 2018, which
equated to about 4.3 billion pounds of chicken, or $3.4 billion
wholesale value. While the number of chickens raised on the
Delmarva is about the same as it was 20 years ago, the weights
have increased by almost 36 percent due to different
efficiencies, genetics, and increased technology within the
chicken houses.
Most importantly, this industry brings jobs to the
Delmarva. The five companies alone employ more than 20,000
people and paid $784 million in wages. In an area with limited
industries, this is very, very important. As a matter of fact,
in an economic study, it was estimated that the meat chicken
industry generated $2.98 billion, $1.75 billion, and $1.33
billion in total economic activity in Delaware, the Eastern
Shore of Maryland, and the Eastern Shore of Virginia
respectively. That also generated millions in state and local
tax revenues.
Turning to national numbers, according to that same study,
the chicken industry added economic value of $347 billion,
created millions of jobs nationwide, and generated nearly $27
billion in state and Federal taxes. This was accomplished by
about 30 processors that contract with 25,000 family farmers
and raised over nine billion chickens, weighing in at 56.8
billion pounds of meat. The U.S. has the largest meat chicken
industry in the world.
I am not an economist, so I won't try to forecast, but
there are some basic factors that play into the growth or
decline of any business, namely supply and demand.
Domestically, demand continues to increase with Americans
consuming more than 98.3 pounds of chicken per capita in 2018.
However, in the past year, there has also been an increase of
animal protein supply on the domestic market. While that market
pressure has occurred, the chicken industry was also in the
middle of nationwide expansion, with six new poultry processing
plants expected to be operational by 2020. This has also
spurred an increase in the demand for additional houses, which
we have had as well on the Delmarva Peninsula. In the past
year, between the increase of new housing and some market
pressures, we have had a tightening of profit margins for both
our processors and our family farmers.
Due to our proximity to the Mid-Atlantic region, a lot of
our chicken industry is fresh market. However, the U.S.
exported about 17 percent of its chicken production in 2017, or
7 billion pounds of chicken meat. Mexico and Canada are our top
two export markets, with a combined value over $850 million.
The passage of USMCA is absolutely critical to the chicken
industry, and we call on Congress to vote on this agreement as
soon as possible.
Just like any business, increased market opportunities
through free trade agreements will only help the economy of the
chicken industry.
I appreciate the opportunity to provide this testimony, and
I am happy to answer any questions.
[The prepared statement of Ms. Porter follows:]
Prepared Statement of Holly Porter, Executive Director, Delmarva
Poultry Industry, Inc., Georgetown, DE
Good morning, and thank you Chairman Costa, Ranking Member Rouzer,
and Members of the Subcommittee. I am Holly Porter, the Executive
Director of the Delmarva Poultry Industry, Inc, also known as DPI, the
1,700-member trade association that represents the family farmers,
processors and allied businesses within Delaware, the Eastern Shore of
Maryland and the Eastern Shore of Virginia, otherwise known as the
Delmarva Peninsula.
It is a pleasure to be here today representing the meat chicken
industry, an industry that started on the Delmarva nearly 100 years ago
when Cecil Steele a farmer in Ocean View, Delaware received 500 chicks
instead of the 50 that she ordered for eggs. She decided to raise the
birds and sell them to a northern market--she made 62 a pound--which
would be $5-$6 today, ordered 1,000 chicks for the next flock and the
rest is history.
Today on Delmarva our agricultural economy is built on what we
refer to as the three-legged stool--the family farmers raising the
birds and the grain for feed, and the processors who they both partner
with. If any one of those legs were to come off the stool, the economy
would collapse. As of 2018, we have more than 1,300 individual family
farmers that contract with five companies to handle the poultry health,
processing and marketing, also known as the vertically integrated
system. Those five companies are Allen Harim, Amick Farms, Mountaire
Farms, Perdue Farms and Tyson. This may be unique to other areas of the
country that produce chicken--our growers have various options of not
only processors but also production type--from raising Cornish hens
(really small birds), broilers, roasters or even organic, depending on
the company's market and niche. In 2018, these family farmers earned
$268 million in contract income, an increase of 5% from the previous
year.
The five processors on Delmarva purchased more than 136 million
bushels of corn, soybeans and wheat for feed for chickens in 2018--most
of which was grown on the peninsula. As a matter of fact, our grain
farmers enjoy a premium for their commodity due to the proximity to the
chicken industry. It's one of the reasons why my father, a small grain
farmer tilling only 325 acres and others like him can still be
profitable.
And we needed all that feed as our Delmarva farmers raised 605
million chickens in 2018, that equated to 4.3 billion pounds of chicken
processed by the companies, generating $3.4 billion in wholesale value.
While the number of chickens raised on Delmarva is approximately the
same as 20 years ago, the pounds have increased by more than 36%, due
to efficiencies in feed, better genetics and increased technology
within the chicken houses allowing for a better environment to raise
healthy birds.
Another crucial aspect of the broiler industry on Delmarva is the
amount of job opportunities it generates. The five companies alone
employed more than 20,000 people across the Delmarva and paid $784
million in wages. In an area with limited industries, these jobs are
important for fueling the local economy. In the 2018 Economic Impact
Study of the Poultry Industry, conducted by John Dunham and Associates,
it was estimated that the meat chicken industry generated $2.98
billion, $1.75 billion and $1.33 billion in total economic activity in
Delaware, the Eastern Shore of Maryland and the Eastern Shore of
Virginia, respectively. This also generated tax revenues of $74.87
million, $112.8 million and $294.17 million in state and local taxes,
respectively.
I've focused on the economics within the Delmarva peninsula, but
let me talk a minute about some nationwide statistics. According to the
same 2018 Economic Impact Study of the Poultry Industry, there was a
nationwide economic value of $347 billion, creating nearly 1.4 million
indirect jobs and generating nearly $27 billion in state and Federal
taxes.
According to the National Chicken Council, this was accomplished
through 30 chicken companies that are processing and marketing chickens
and 25,000 family farmers who partner with those processors. They
raised more than nine billion chickens, weighing in at 56.8 billion
pounds of meat. With those numbers it is no surprise that the United
States has the largest broiler chicken industry in the world. And while
I'm proud to say that Sussex County, Delaware leads the United States
in the number of chickens produced in one county, the top five broiler
chicken states are actually Georgia, Alabama, Arkansas, North Carolina
and Mississippi.
I am not an economist, so I won't try to forecast the chicken
industry. But there are many basic factors that play into the growth or
decline of any business--namely supply and demand.
Domestically, demand continues to increase, with Americans
consuming more than 93.8 pounds of chicken per capita in 2018--an
increase of 11% over the past 10 years. However, in the past year there
has also been an increase of animal protein supply on the domestic
market, encouraging consumers to choose other meats--such as steak,
pork or seafood.
While that market pressure has occurred, the chicken industry was
in the middle of nationwide expansion, with six new poultry processing
plants expected to be operational by 2020. This has also increased the
demand for additional square footage of poultry houses.
The same expansion of new chicken houses has occurred on the
Delmarva peninsula. If you recall, I mentioned that the industry has
been in place for almost 100 years in our area. In 2018, DPI gathered a
sample of \2/3\ of the operating chicken houses on the peninsula and
26% were 31 years or older. Like any building, there is only so many
upgrades that can be made before the houses are not efficient. In the
past year, the increase of new housing along with market pressures has
caused some tightening of profit margins for both our companies and our
growers.
Due to the proximity of the Delmarva region to millions of people
in the Mid-Atlantic and Northeast, our production is mainly for fresh
market or tray packed. However, several of the companies processing on
Delmarva export dark meat and chicken paws and overall the United
States exported about 17% of its production in 2018 or 7 billion pounds
of chicken meat. This makes us second in broiler exports worldwide
behind Brazil. Mexico and Canada are our top two export markets, with a
combined value of over $850 million in 2018. The passage of U.S.-
Mexico-Canada Agreement (USMCA) is absolutely critical to the chicken
industry not only in protecting the current market place but growing
it. We call on Congress to vote on USMCA as soon as possible.
Just like any business, increased market opportunities through free
trade agreements, will only help the economy of the chicken industry.
I appreciate the opportunity to provide this testimony and I am
happy to answer any questions you may have.
The Chairman. Well, thank you very much, Ms. Porter, and I
believe that there will be a number of questions directed
toward you as it relates to the impacts on the trade and
sourcing.
Our next witness is Mr. David Will, General Manager, Chino
Valley Ranchers, Colton, California, on behalf of egg farmers
in California, and Pacific Egg and Poultry Association, that
are joined with the United Egg Producers.
Mr. Will, we look forward to hearing your testimony.
STATEMENT OF DAVID WILL, GENERAL MANAGER, CHINO VALLEY
RANCHERS; CO-CHAIR, ORGANIC COMMITTEE, UNITED EGG PRODUCERS,
COLTON, CA; ON BEHALF OF
PACIFIC EGG AND POULTRY ASSOCIATION
Mr. Will. Thank you, and good morning Chairman Costa,
Ranking Member Rouzer, and the distinguished Members of this
Subcommittee. My name is David Will, and since 2001, I have
been the General Manager of Chino Valley Ranchers, a second and
third generation family owned and operated business with five
farms in southern California, one in Texas. Chino Valley
Ranchers employs 330 people company-wide, and also sources eggs
from about 150 family-owned and operated farms in seven
additional states. In addition to representing farms in
California, I am honored here today to speak on behalf of the
Pacific Egg and Poultry Association, as well as the United Egg
Producers, whose members account for about 90 percent of all
eggs produced in the United States.
This Subcommittee will recall the devastation that egg
farmers and other poultry producers endured in the Highly-
Pathogenic Avian Influenza outbreaks of 2014 and 2015. This
catastrophe cost taxpayers around $1 billion, but the economic
impact to the affected producers, their workers, and local
communities was substantially more than that.
More recently, my State of California has suffered the
effects of Virulent Newcastle Disease. We hope that we are at
the end of this outbreak, which has an impact to more than 1.2
million head of poultry in three states.
There are several lessons that we have learned from these
and other disease outbreaks. Biosecurity is all important. Our
industry has already had extreme biosecurity, but we have had
to double down since the high-path AI outbreaks. Unfortunately,
as California experienced with vND has shown, biosecurity can
be undermined by backyard poultry flocks located near
commercial operations. During the outbreak, it has not been
uncommon to find 20 or more positive backyard flocks within a
kilometer of a commercial producer. In addition, our ability to
combat vND was compromised by social media networks that warned
of the approach of enforcement officials, and encouraged people
to move or hide potentially infected birds. More broadly, we
have a continuing problem with trespassers, often animal
activists, who break into our operations and sometimes remove
birds, compromising the biosecurity of the remaining flock, and
possibly forcing euthanasia to decrease the spread.
Fortunately, Congress has recognized the need for joint
efforts. We commend Congress, and in particular, this
Subcommittee, for the mandatory funding provided to animal
health in the 2018 Farm Bill. We, along with our colleagues in
animal agriculture, strongly support the new Animal Disease
Prevention and Management Program. We support all three of its
components. We do want to emphasize that the Pest and Disease
Prevention Program included in the cooperative agreement with
states should not be shortchanged. The vaccine bank is
important, but not the only part of the new program. The
prevention program, as well as animal health laboratories, are
critical components as well. Actually, in our own vND
experience is this great illustration. What we needed was not
vaccines, but boots-on-the-ground. A fast response team that
included both USDA and California Department of Food and
Agriculture.
In the area of avian health, everyone agrees that Highly-
Pathogenic AI should be prevented, but if an outbreak occurs
despite our best efforts, emergency funds under the Commodity
Credit Corporation are an appropriate response. We also believe
that USDA should use CCC funds for indemnity, virus
elimination, and other costs of Low-Pathogenic AI outbreaks.
History shows us that low-path can and does mutate into
high-path. For that reason, stamping out the disease when it
occurs is extremely important and justifies the use of CCC
funds. And similarly, USDA has used CCC funds to respond to vND
in California and other states. We commend the Department for
tapping those funds, and encourage the aggressive response.
Early detection is key. Finally, we support the
establishment of objective and equitable payment rates of the
costs involved in animal disease outbreaks. In particular, we
have serious concerns about USDA's proposal for payment rates
for virus elimination; that is, the cost of ensuring that avian
influenza virus is completely eliminated from an affected egg
farm. We have shown in detailed comments that USDA has
unrealistic and outdated numbers in these calculations.
Similarly, we have encouraged USDA to review how it calculates
indemnities are paid to affected producers for the value of
their lost production. We believe that costs in leaving
facilities idle for an extended period of time after an
outbreak, which is often required by USDA, should be taken into
account, in addition to the region where the eggs are produced.
Finally, I would like to say that this Subcommittee is
focusing on animal health, but the Subcommittee is well aware
that producers face numerous other challenges. I was
particularly happy to hear you, Representative Costa, say that
we do need year-round labor. We are not a seasonal group or
commodity, and we appreciate the comments.
Again, I am available for any questions, and thank the
Committee and my other ag members here for being available for
this. Thank you.
[The prepared statement of Mr. Will follows:]
Prepared Statement of David Will, General Manager, Chino Valley
Ranchers; Co-Chair, Organic Committee, United Egg Producers, Colton,
CA; on Behalf of Pacific Egg and Poultry Association
Chairman Costa, Ranking Member Rouzer, and distinguished Members of
the Subcommittee: My name is David Will and since 2001 I have been the
general manager of Chino Valley Ranchers, a third-generation family
owned and operated business with five farms in southern California.
Chino Valley Ranchers employs 330 people and also sources eggs from
over 150 family farms in seven other states. In addition to
representing egg farms in California, I'm honored today to speak on
behalf of the Pacific Egg and Poultry Association as well as United Egg
Producers, whose members account for about 90 percent of all eggs
produced in the United States.
The egg industry appreciates the Subcommittee's invitation to
testify. We are honored to be here with other commodity groups
representing animal agriculture. All of us face multiple challenges,
but the biggest challenges come from sources we can't see: animal
health threats such as avian influenza and virulent Newcastle Disease.
This Subcommittee will recall the devastation that egg farmers and
other poultry producers endured in the highly pathogenic avian
influenza outbreaks of 2014 and 2015. This catastrophe cost taxpayers
around $1 billion, but the economic impact on affected producers, their
workers and local communities was substantially more than that,
according to independent estimates. More recently, my State of
California has suffered the effects of virulent Newcastle disease. We
hope we are at the end of that outbreak, which had an impact on more
than 1.2 million head of poultry in three states. There are several
lessons to be learned from these and other disease outbreaks.
First, biosecurity is all-important. Our industry already had
extremely tight biosecurity, but we have doubled down since the HPAI
outbreaks. Unfortunately, as California's experience with vND has
shown, biosecurity can be undermined by backyard poultry flocks located
near commercial operations. During the outbreak, it has not been
uncommon to find 20 or more positive backyard flocks within a kilometer
of commercial producers. In addition, our ability to combat vND was
compromised by social media networks that warned of the approach of
enforcement officials and encouraged people to move or hide potentially
affected birds. More broadly, we have continuing problems with
trespassers, often animal activists, who break into our operations and
sometimes remove birds, compromising the biosecurity of the remaining
flock and sometimes requiring euthanasia to prevent disease spread.
Second, the impact of disease outbreaks is not only the losses to
affected producers, but the trade impacts that are often felt by entire
industries. USDA has done a great job of encouraging our trading
partners to regionalize their response to outbreaks, meaning they
restrict only imports from regions directly affected by the disease.
But not all trading partners respect these science-based practices, and
trade suffers as a result.
Third, both response and--most important--prevention require a
joint effort by the private- and public-sectors. Our industry learned
many lessons from the HPAI outbreak, but so did our Federal and state
partners. I think they would acknowledge they are better prepared now
than they were then.
Fortunately, Congress has recognized the need for joint efforts. We
commend Congress, and in particular this Subcommittee, for the
mandatory funding provided to animal health in the 2018 Farm Bill. We
along with our colleagues in animal agriculture strongly supported the
new Animal Disease Prevention and Management Program. We support all
three of its components. We do want to emphasize that the pest and
disease prevention program, including its cooperative agreements with
states, should not be short-changed. The vaccine bank is important, but
it is not the only part of the new program. The prevention program as
well as animal health laboratories are critical components as well.
Actually, our vND experience is a good illustration. What was needed
there was not vaccine but boots-on-the-ground--a fast response team
that included both USDA and the California Department of Food and
Agriculture.
In the area of avian health, everyone agrees that Highly-Pathogenic
AI should be prevented, but if outbreaks occur despite our best
efforts, emergency funds under the Commodity Credit Corporation are an
appropriate response. We also believe that USDA should use CCC funds
for indemnities, virus elimination and other costs of Low-Pathogenic AI
outbreaks. History shows us that LPAI can and does mutate into HPAI.
For that reason, stamping out the disease when it occurs is extremely
important, and justifies the use of CCC funds.
In a similar way, USDA has used CCC funds to respond to vND in
California and other states. We commend the department for tapping
those funds, and encourage USDA to continue its aggressive response to
this disease in partnership with industry and state officials. Early
detection is key. We need to keep the dialogue open between the show
bird community and commercial producers.
Finally, we support the establishment of objective and equitable
payment rates for the costs involved in animal disease outbreaks. In
particular, we have had serious concerns about USDA's proposals for
payment rates for virus elimination, that is, the costs of ensuring
that an avian influenza virus is completely eliminated from an affected
egg farm. We've shown in detailed comments that USDA has used
unrealistic and outdated numbers in these calculations. Similarly, we
have also encouraged USDA to review how it calculates indemnities that
are paid to affected producers for the value of their lost production.
We believe the cost of leaving facilities idle for an extended period
of time after an outbreak, which is often required by USDA, should be
taken into account in calculating indemnities. The type of eggs and the
regions where they are produced should also be taken into account where
they have different market values.
None of this takes away from the high regard in which we hold
USDA's animal health efforts. We work in partnership with APHIS as well
as state agencies, and we find them highly professional and genuinely
concerned about farm families, their employees, animal welfare and the
impact on local communities.
Although today's hearing has a focus on animal health, the
Subcommittee is well aware that producers face numerous other
challenges. While I realize that immigration is not generally within
your jurisdiction, I could not appear before you without stressing the
need for an immigration policy that allows us to have a stable,
reliable and legal labor force. Current guestworker laws focus on
seasonal employment, whereas we need to care for our birds 365 days of
the year. We appreciate the efforts of many Members to address the
labor needs of animal agriculture.
Thank you again for the opportunity to appear before you today.
The Chairman. Thank you for your testimony, and staying
within the time limit.
We have been joined by the Chairman of the House
Agriculture Committee, and always pleased to have him
participate. And we will now go on to our fourth witness, Mrs.
Kelley Sullivan Georgiades, Owner and Operator of Santa Rosa
Ranch in Crockett, Texas, on behalf of the Texas and
Southwestern Cattle Raisers Association.
Mrs. Georgiades. Thank you, Mr. Chairman.
The Chairman. The floor is yours.
STATEMENT OF KELLEY SULLIVAN GEORGIADES, OWNER AND OPERATOR,
SANTA ROSA RANCH; MEMBER, BOARD OF
DIRECTORS, TEXAS AND SOUTHWESTERN CATTLE RAISERS ASSOCIATION,
CROCKETT, TX
Mrs. Georgiades. Thank you. Good morning, Mr. Chairman, and
distinguished Members of the Committee. My name is Kelley
Sullivan Georgiades, and I am a fourth-generation cattle
producer from Crockett and Navasota, Texas, where I own and
operate Santa Rosa Ranch, the largest registered breeder of
Brangus and ultra-black cattle in the United States.
I am here today on behalf of the 142 year old Texas and
Southwestern Cattle Raisers Association to share our opinion on
the current state of the cattle industry, and our most pressing
challenges for the future.
Our nation is home to 94.8 million head of cattle. My home
State of Texas has 13 million, more than any other state, and
almost double the number of the next closest state.
The beef we produce not only provides Americans with a high
quality, safe, and nutrient dense form of protein, but the
Texas cattle industry is also the leading contributor to the
states' agricultural economy, with annual sales in excess of
$12 billion, nearly \1/2\ of the total for all commodities in
the state.
Though the cattle industry is robust and resilient, it is
certainly not without its challenges. I would encourage the
Members of this Committee to pursue policies that help address
these challenges, and secure a strong future for our nation's
cattle producers.
Chief among these issues is trade. For cattle producers,
maintaining and building demand for the U.S. beef products is
essential. The simple fact is that 96 percent of the world's
consumers live outside of the United States. These customers
have become a necessary part of our industry, and in 2018, we
sold more than $8.3 billion worth of U.S. beef products abroad.
Foreign consumers often demand cuts that are not highly
sought after in the domestic market. If you go to a steakhouse
in the United States, it is doubtful that you find beef tongue
listed among the ribeyes and other top beef cuts. Yet, in those
countries who are our largest export markets, such as Japan,
South Korea, Mexico, Canada, and Hong Kong, beef tongue and
other varietal cuts are a delicacy and fetch a premium price.
That premium and the additional demand from foreign consumers
increases the value of each animal sold in the United States by
almost $300 per animal. We would like to see that value
increase, because for many cattle producers, that $300 per
animal may already be the difference between being a successful
business and bankruptcy. It cannot shrink. We are a low-margin
industry.
The most important thing this Congress can do for American
ranchers is to approve the U.S.-Mexico-Canada trade agreement,
USMCA. Mexico and Canada combined buy $2 billion worth of U.S.
beef products every single year, and that is nearly \1/4\ of
all U.S. beef exports each year, and actually accounts for $69
of that $300 worth of value realized by U.S. producers as a
result of trade. USMCA keeps the good aspects of NAFTA,
unrestricted, duty-free access for U.S. beef and cattle, and
does not attempt to incorporate failed policies from the past,
like mandatory country-of-origin labeling. Failure to maintain
free trade with Mexico and Canada would be devastating to
cattle producers, and it has only left other trade
breakthroughs pending.
The wait and see concern is particularly true with Japan,
where U.S. beef faces a 38.5 percent tariff. Though Japan is
still our number one destination for U.S. beef, the lower
tariffs available to countries like Australia may soon begin to
hamper our growth in Japan if we don't act quickly. We have
already seen the moderating of export totals in Japan, in spite
of their increase of demand in the nation.
I implore the Members of this body and the entire U.S.
Congress to do two things on trade, moving forward. First,
reject calls for failed policy of the past like M-COOL. Second,
quickly ratify USMCA on behalf of America's ranchers and beef
producers.
While trade is our singular focus at the moment, there are
many other concerns in this industry that I, and others from
the TSCRA and the industry, will continue to discuss. Those
range from the fake meat movement to the accurate portrayal of
sustainability in ranching and needed regulatory reforms.
Finally, I would be remiss if I didn't conclude by thanking
this body for your work on behalf of America's cattle
producers. That is especially evident in your work on the 2018
Farm Bill, which maintains a strong conservation title and
provides funding for a more robust U.S. only foot-and-mouth
disease vaccine bank. Thank you for those two vitally important
components and your continued attention to their
implementation. Again, I appreciate your time and your
invitation, and I look forward to your questions.
[The prepared statement of Mrs. Georgiades follows:]
Prepared Statement of Kelley Sullivan Georgiades, Owner and Operator,
Santa Rosa Ranch; Member, Board of Directors, Texas and Southwestern
Cattle Raisers Association, Crockett, TX
Good morning, Mr. Chairman and distinguished Members of the
Committee. My name is Kelley Sullivan Georgiades, and I am a fourth
generation cattle producer from Crockett and Navasota, Texas, where I
own and operate Santa Rosa Ranch.
I am here today on behalf of the 142 year old Texas and
Southwestern Cattle Raisers Association to share our opinion on the
current state of the cattle industry and our most pressing challenges
for the future.
Our nation is home to 94.8 million head of cattle. My home State of
Texas has 13 million, more than any other state and almost double the
number of the next closest.
The beef we produce not only provides Americans with a high-
quality, safe and nutrient-dense form of protein, but the Texas cattle
industry is also the leading contributor to the state's agricultural
economy with annual sales in excess of $12 billion, nearly \1/2\ (49%)
of the total for all commodities.
Though the cattle industry is robust and resilient, it is certainly
not without its challenges.
I would encourage the Members of this Committee to pursue policies
that help address these challenges and secure a strong future for our
nations cattle producers.
Chief among these issues is trade.
For cattle producers, maintaining and building demand for U.S. beef
products is essential. The simple fact is that 96% of the world's
consumers live outside of the United States. These customers have
become a necessary part of the industry. In 2018 we sold more than $8.3
billion in U.S. beef products abroad.
Foreign consumers often demand cuts that are not highly sought
after in the domestic market. If you go to a steakhouse in the United
States, it is doubtful that you will find beef tongue listed among the
ribeyes and other top beef cuts. Yet, in those countries who are our
largest export markets, such as Japan, South Korea, Mexico, Canada and
Hong Kong, beef tongue and other beef varietal cuts are a delicacy and
fetch a premium price.
That premium and the additional demand from foreign consumers
increases the value of each animal sold in the U.S. by almost $300 per
animal.
We would like to see that value increase because, for many cattle
producers, that $300 per animal may already be the difference between a
successful business and bankruptcy. It cannot shrink. We are a low-
margin industry.
The most important thing this Congress can do for American ranchers
is to approve the U.S.-Mexico-Canada trade agreement (USMCA).
Mexico and Canada, combined, buy $2 billion in U.S. beef products
every single year. That's nearly \1/4\ of all U.S. beef exports each
year and accounts for $69 of those $300 realized by U.S. producers as a
result of trade.
USMCA keeps the good aspects of NAFTA--unrestricted, duty-free
access for U.S. beef and cattle--and does not attempt to incorporate
failed policies from the past, like mandatory country-of-origin
labeling.
Failure to maintain free trade with Mexico and Canada would be
devastating to cattle producers, and it has also left other trade
breakthroughs pending.
The ``wait and see'' concern is particularly true with Japan, where
U.S. beef faces a 38.5% tariff. Though Japan is still the number one
destination for U.S. beef, the lower tariffs available to countries
like Australia may soon begin to hamper our growth in Japan if we don't
act quickly. We have already seen the moderating of export totals to
Japan, in spite of their increase in beef demand as a nation.
I implore the Members of this body and the entire U.S. Congress to
do two things on trade moving forward.
1. Reject calls for failed policies of the past, like M-COOL.
2. Quickly ratify USMCA on behalf of America's ranchers and beef
producers.
While trade is our singular focus at the moment, there are many
other concerns in our industry that I and others from TSCRA and the
industry will continue to discuss. Those range from the ``fake meat
movement'' to the accurate portrayal of sustainability in ranching and
needed regulatory reforms.
Finally, I would be remiss if I didn't conclude by thanking this
body for your work on behalf of America's cattle producers. That is
especially evident in your work on the 2018 Farm Bill, which maintains
a strong conservation title and provides funding for a more robust U.S.
only Foot-and-Mouth Disease vaccine bank. Thank you for those two
vitally important components and your continued attention to their
implementation.
Thank you, and I look forward to your questions.
The Chairman. Thank you very much. I appreciated your
points that you made, and I am certain that we will get back to
those as it relates to the questions that Members will be
wanting to ask.
We will now get to the last two witnesses, and Mr. Steven
Salmon, a witness of Congressman Conaway's from San Angelo,
Texas, representing the Texas Sheep and Goat Raisers
Association of Texas. Mr. Salmon, you are first.
STATEMENT OF STEPHEN J. SALMON, RANCHER; MEMBER, AMERICAN SHEEP
INDUSTRY ASSOCIATION; DIRECTOR, TEXAS SHEEP AND GOAT RAISERS'
ASSOCIATION, SAN
ANGELO, TX
Mr. Salmon. Good morning, Chairman Costa, Ranking Member
Rouzer, Members of the Committee. Thank you for the opportunity
to speak with you today. I am Stephen Salmon from central west
Texas, a member of the American Sheep Industry Association, the
Director of Texas Sheep and Goat Raisers Association, and a
third-generation rancher, raising sheep in west Texas. I am
here today to represent the nation's 100,000 sheep producers.
The trade dispute with China has made a big impact on our
ability to market fiber, with tariffs severely hindering trade
with our largest export market. Since the implementation of
tariffs, we have seen raw wool exports drop by 85 percent in 6
months, and sheepskin exports drop nearly 70 percent in value.
Once a valuable asset, sheepskins now either have no value or
even result in a loss to producers.
As the Administration continues to review and implement
ways to aid producers during what we hope is a short-term loss
of this valuable market, we ask that sheep producers be
included in that conversation.
ASI strongly supports the ratification of the U.S.-Mexico-
Canada agreement, and urges Congress to act swiftly. We have
seen the benefits of trade, but we have also experienced
firsthand the detriments, as over \1/2\ of the lamb consumed in
the U.S. is imported.
We support a level playing field, and as the Administration
looks to negotiate new agreements with China, the EU, the UK,
and others, we urge a cautious approach. Most of these
countries directly or indirectly subsidize their producers,
which does not happen in the U.S.
About \1/2\ of the domestic sheep spend time grazing on
Federal land, including rangelands managed by the Forest
Service. Over the years, the Forest Service has systematically
removed grazing allotments and sheep producers from Federal
lands in the name of bighorn sheep management, despite existing
reasonable, science-based solutions to accommodate both
domestic sheep grazing while protecting the health of the
bighorn sheep. As such, we urge Congress to ensure true
multiple use of our nation's Federal lands.
As Congress prepares to reauthorize mandatory price
reporting, current confidentiality rules restrict the
information available, hindering the lamb price insurance
products that rely on USDA price reporting information. We
believe issues of confidentiality need to be resolved sooner,
rather than later.
We strongly support the Minor Use Animal Drug Program. We
urge USDA to make funds available under Section 12101 of the
2018 Farm Bill to ensure sheep producers have access to
critical technologies, many of which are successfully used by
our international competition, but not labeled for use in the
United States.
Coyotes, mountain lions, wolves, and bears kill thousands
of lambs and calves each year. These losses can cost ranchers
and producers more than $232 million annually. Every dollar
spent on predation management returns $3 in livestock value.
Predator management also supports abundant wildlife, hunting,
and other recreation activities. We applaud Congressional
efforts to ensure USDA Wildlife Services has the resources
needed to carry out livestock protection efforts.
The domestic sheep industry relies heavily on the work of
ARS' U.S. Sheep Experiment Station, and the Animal Disease
Research Unit. The work carried out by ARS researchers and
faculty is critical to our ability to remain productive and
push back against flawed science. Likewise, continued support
for the National Scrapie Eradication Program must remain a
priority.
Finally, sheep herd ranchers depend on the H-2A Sheep
Herder Program to care for more than \1/3\ of the ewes and
lambs in the United States. A workable guestworker program,
including special procedures for herding, is essential now and
in any future legislation.
Thank you for your support of the livestock industry,
allowing me to visit with you about our priorities. I look
forward to answering any questions you may have.
[The prepared statement of Mr. Salmon follows:]
Prepared Statement of Stephen J. Salmon, Rancher; Member, American
Sheep Industry Association; Director, Texas Sheep and Goat Raisers'
Association, San Angelo, TX
Introduction
Chairman Costa, Ranking Member Rouzer, and Members of the
Subcommittee, thank you for the opportunity to speak with you today. I
am Stephen Salmon, from central west Texas, a member of the American
Sheep Industry Association (ASI), and a director of the Texas Sheep and
Goat Raisers' Association. I have been involved with both organizations
for over 20 years. I am here today to represent the nation's 100,000
sheep producers. America's sheep producers continue a strong tradition
of supporting wildlife habitat, natural resources, and open space
across the country--all enabled by careful resource management while
grazing our flocks on private and Federal lands. Our members support
rural communities, the tax base, and local businesses providing safe
domestic lamb and wool. In fact, the economic impact of sheep and wool
production on our nation's economy is immense. From on the farm and
ranch to the retail level, the sheep industry has a total retail impact
in excess of $2.7 billion and supports nearly 98,000 sheep-industry
related jobs.
I am a third-generation rancher raising sheep, goats and cattle.
Our operation is located north of San Angelo, in a semi-arid region of
Texas, where we typically receive 16-20" of rain per year. This year
has been exceptional for our operation, with rain events that have
filled lakes and streams that have been dry for many years. Like
everyone here we understand the cyclical nature of agriculture and the
markets and for that reason we strongly support agricultural research,
price discovery and effective predator control. We also market sheep,
goats, lambs, wool and mohair. For our us the trade dispute with China
has made a big impact on our ability to market fiber with tariffs
severely hindering trade with our largest export market.
Trade
Continued strength in the international marketing of lamb and wool
requires a commitment to the promotion and export of U.S. wool to
export markets through strong USDA Foreign Agricultural Service (FAS)
Program funding.
ASI is the cooperator with the FAS for American wool and sheepskins
and finds success every year in securing customers with the Market
Access Program, the Foreign Market Development Program, and the Quality
Samples Program. In 2001, ASI relaunched an export program for wool and
significantly improved the competition of American wool. We now export
50 percent of American wool, on average, and have at least doubled the
number of U.S. firms that offer wool to overseas markets.
ASI strongly supports the ratification of the United States Mexico
Canada Agreement and urges Congress to act swiftly. We have seen the
benefits of trade and have made major progress first with the reopening
of Taiwan and most recently with the reopening of Japan to American
lamb. But we have also experienced first-hand the detriments of trade
as over half of the lamb consumed in the U.S. is imported. The vast
amount of imported lamb distorts traditional market signals to
producers for expansion and muddies price discovery. We support fair
trade on a level playing field, and as the Administration looks to
negotiate future agreements with China, the European Union, the United
Kingdom and others; we urge a cautious approach. We do not currently
enjoy the ability to export U.S. lamb to many of these countries and
most enjoy the benefit of direct or indirect subsidies to their sheep
industry. Again, we welcome the opportunity to compete, but we can only
compete on a level playing field.
The current trade disruption with China has been tremendously
challenging for our U.S. wool exports. Prior to the implementation of
tariffs, 72 percent of U.S. raw wool exports and 80 percent of U.S.
sheep skins were sent to China. Since the implementation of tariffs, we
have seen raw wool exports drop by 85 percent and sheep skin exports
drop by nearly 70 percent in value. Once a valuable asset, sheep skins
now have either no value or even result in a loss to producers at the
processing level. As the Administration continues to review and
implement ways to aid producers during what we hope is a short-term
loss of this valuable market, we ask that wool and sheep skin producers
be included in the conversation.
Bighorn Sheep in Domestic Sheep Grazing Allotments
Nationally, about \1/2\ of all domestic sheep spend time grazing on
Federal lands, including rangelands managed by the U.S. Forest Service
(USFS). Over the years, the USFS has been systematically removing
domestic sheep ranchers from Federal lands in the name of bighorn sheep
management, despite the fact that there are reasonable, science-based
solutions to accommodate domestic sheep grazing while protecting the
health of bighorn sheep populations. In mid-2016, the USFS announced
that it may close some allotments in the Ashley National Forest and the
[Uinta]-Wasatch-Cache National Forest in Summit County, Utah due to
bighorn sheep concerns. This is being done without any offer of
alternative allotments. In total, three allotments could be closed and
a fourth allotment reduced. The ranchers on these allotments have
letters from the USFS detailing that when they introduced bighorn sheep
to the area, there would not be an impact to the domestic sheep
population. There are many examples of these egregious actions.
Mandatory Price Reporting
In September 2015, the President signed into law the Agriculture
Reauthorization Act of 2015 which included an extension of the
Livestock Mandatory Reporting Act of 1999 (MPR). Unfortunately for
sheep, this reauthorization has not adjusted to changes in the lamb
meat industry. Of particular concern is the implementation of current
confidentiality rules of the U.S. Department of Agriculture (USDA)
which restricts the information available. Additionally, Federal lamb
price insurance products available to the sheep industry rely on the
USDA price reporting. ASI is in ongoing discussions with USDA and the
Agriculture Committees in the House and Senate to resolve this issue as
the date for reauthorization nears. Increased consolidation in the
packing industry across livestock will continue to hinder producers'
access to accurate price reports and we believe issues of
confidentiality will need to be resolved sooner rather than later to
preserve this program and the risk management tools that rely on it.
FDA Minor Use Animal Drug Program
It is also critical that producers have continued access to key
technologies. We strongly support the Food and Drug Administration
(FDA) Minor Use Animal Drug Program and its historic collaboration with
USDA's National Institute of Food and Agriculture (NIFA). The targeted
use of biologics and pharmaceuticals within a veterinary-client-patient
relationship is key to our ability to maintain flock health and provide
a safe wholesome product. We urge the creation of a mechanism for NIFA
funding for minor use animal drug research through the National
Research Support Project No. 7 (NRSP-7). NRSP-7 has an established
record with land-grant universities and has demonstrated excellent
results for minor use drug research for nearly 40 years. We urge the
USDA to make funds available under Section 12101 of the 2018 Farm Bill
to ensure sheep producers have access to critical technologies, many of
which are currently being used with great success by our international
competition, but not labeled for use in the United States.
Wildlife Services
Coyotes, mountain lions, wolves, and bears kill tens of thousands
of lambs and calves each year. Livestock losses attributed to these
predators cost ranchers and producers more than $232 million annually.
For years, ASI has led the aggressive defense of livestock protection
by bringing together a diverse coalition of supporters in the areas of
aquaculture, aviation, forestry, livestock production, range/forage
management, and state departments of agriculture to ensure the
programs' survival. Earlier this year, ASI led a coalition of 219
organizations to sign a letter supporting Wildlife Services funding.
Every dollar spent on predation management returns $3 in livestock
value saved. This has a tremendous impact on sheep and cattle producers
and the rural economies they support. Predator management also supports
abundant wildlife, hunting, and recreation activities on private and
Federal land. We applaud Congressional efforts ensuring USDA Wildlife
Services is fully funded and has the resources needed to carry out
their livestock protection efforts.
We are also keenly aware that existing, highly effective predator
control products like sodium cyanide and sodium fluoroacetate (Compound
1080) are under attack and their continued use is threatened. These are
the best available products for predator control; highly targeted,
species specific, environmentally sound and humane. Despite enhanced
guidance from Wildlife Services on the use and placement of these tools
and a track record of EPA approval, these products continue to come
under attack from Congress. The industry is committed to responding
with science, but also a keen eye to find alternatives that respond to
the concerns of the public. Developing alternatives that meet or exceed
the attributes of current products is a great challenge, and we rely on
the work of Wildlife Services Methods Development through the National
Wildlife Research Center in Fort Collins, CO. We urge Congress to
devote resources to that program for the development of alternatives to
ensure U.S. sheep producers remain competitive worldwide.
U.S. Sheep Experiment Station (USSES)
The domestic sheep industry relies heavily on the work of the U.S.
Sheep Experiment Station (USSES) and the Animal Disease Research Unit
(ADRU). Both facilities work collaboratively and are critical
components of the USDA's Agriculture Research Service. As our nation's
only experiment station primarily dedicated to sheep production, the
work carried out by these researchers and faculty are critical to our
ability to remain productive and push back against flawed science on
the range and in the area of animal health. In the past, administrative
action has worked to limit the scope of these facilities. Such action
not only threatens the viability of this resource for producers, but
also threatens the USSES' unparalleled historic sage grouse data. We
support the merger of the USSES and ADRU and encourage growth in their
roles in food-animal science, rangeland systems, and animal health
programs. These stations have a dedicated history of careful use of
taxpayer funds to solve issues and challenges for our producers and
counter flawed science from those wishing to remove livestock and
multiple uses from our nation's public lands. We appreciate USDA's
recognition in the role of the USSES as a critical part of our nation's
agricultural research system and will continue to work with Congress,
stakeholders and collaborators to build that resource.
Scrapie Eradication
Working collaboratively with USDA/APHIS and state partners, the
American Sheep Industry has nearly eliminated scrapie from the United
States. Official identification, surveillance, and traceability of both
sheep and goats are critical to continuing and maintaining these
efforts in order to preserve and enhance current and future export
markets. Continued and increased funding of the National Scrapie
Eradication Program must remain a priority to expand and build on
export opportunities.
H-2A Temporary Agricultural Workers
The American sheep industry has a decades long history of a
reliable, consistent, and legal workforce. Sheep ranchers depend on the
H-2A sheepherder program to help care for more than \1/3\ of the ewes
and lambs in the United States. To meet those needs, the industry has
largely participated in temporary visa programs (in various forms)
since the 1950s. As a result, sheep producers employ a legal labor
force with an estimated eight American jobs created/supported by each
foreign worker employed.
Increased regulation with ambiguous policies and enforcement have
made the H-2A sheepherder program very costly for employers. In the
2015 re-write of the sheepherder provisions, our program now
constitutes over half of all pages of regulations governing the entire
H-2A program, even though we are only a small percent of total H-2A
employees in the United States. A workable temporary foreign labor
program is essential for the sheep industry including the special
procedures for herding in future legislation involving immigration
workers.
2018 Farm Bill
ASI strongly supported the Agricultural Improvement Act of 2018
(2018 Farm Bill) and appreciates the leadership of the House
Agriculture Committee. The first and most important national security
concern is the ability of a country to clothe and feed its citizens.
The small investment made in agriculture by the farm bill when compared
to the Federal budget and the safe, affordable, and abundant food
supply enjoyed by the U.S. illustrates the wise investment farm bill
programs provide.
Conclusion
Thank you for your support of the livestock industry and for
allowing me to visit with you about our priorities.
The Chairman. Well, thank you and we appreciate your
testimony.
And we have our last witness, and then we will move on to
the questions by Members of the Committee. Mr. David D. Herring
of Lillington, North Carolina, representing the National Pork
Producers Council. Mr. David D. Herring, please make your
presentation.
STATEMENT OF DAVID DEE HERRING, VICE PRESIDENT, TDM FARMS/HOG
SLAT INC.; PRESIDENT, NATIONAL PORK
PRODUCERS COUNCIL, LILLINGTON, NC
Mr. Herring. Thank you, Chairman Costa, Ranking Member
Rouzer, and Members of the Subcommittee. My name is David
Herring. I am a pork producer from Lillington, North Carolina,
and President of the National Pork Producers Council.
NPPC is a national association representing the interest of
60,000 U.S. pork producers. The U.S. pork industry is the
world's lowest cost producer and the top exporter, annually
shipping more than $6 billion to foreign destinations. However,
despite significant growth in the U.S. pork sector, we are
facing numerous challenges, both at home and abroad, that if
left unaddressed, could pose significant harm to our farms, our
communities, and ultimately, consumers.
One of the most damaging threats to the U.S. pork industry
has been the punitive tariffs that China and other countries
have imposed. Market analysts projected 2018 to be a profitable
year for U.S. hog farmers. Unfortunately, restricted market
access from trade disputes caused a loss last year to our
farmers.
This year, the average hog farmer is making a very small
profit through the first 6 months of the year. Those small
profits would be much higher, were it not for trade retaliation
from China and other markets. The U.S. pork industry had the
dubious distinction of being on three retaliation lists over
the last year in China and Mexico. While Mexico's tariffs on
U.S. pork have been lifted, China's 50 percent retaliatory
tariff on top of the existing 12 percent duty on U.S. pork
remains. China is the largest producer, consumer, and importer
of pork in the world, but at a 62 percent tariff rate, U.S.
pork producers are losing $8 per animal, or $1 billion on an
annualized basis.
There is an unprecedented sales opportunity for U.S. pork
producers in China, as it continues to battle the spread of
African Swine Fever and experiences a major reduction in its
domestic production. Were it not for the retaliatory duties on
U.S. pork, we would be in an ideal position to meet China's
need for increased pork imports and single-handedly put a huge
dent in the U.S. trade imbalance with China. Instead, this
trade opportunity is fueling jobs, profits, and rural
development for our competitors. We seek an end to the trade
dispute with China.
NPPC is also deeply concerned as we helplessly watch the EU
and the CPTPP nations take market share away from us in Japan,
our largest value export market. We know the Administration is
engaged in trade negotiations with Japan, but those
negotiations can't move quickly enough, as far as we are
concerned.
Additionally, pork producers are eager to see ratification
of the U.S.-Mexico-Canada trade agreement. USMCA agreement
preserves zero-tariff pork trade in North America, Canada, and
Mexico, and both those markets account for more than 40 percent
of all U.S. pork exports, and support 16,000 U.S. jobs. We look
forward to Congressional ratification of this agreement.
In addition to trade issues, pork producers are fighting
another battle when it comes to preventing the spread of
African Swine Fever. The risk of ASF is growing as outbreaks
continue in Europe, China, and other parts of Asia. We can all
agree that we need to keep this deadly disease out of the USA.
NPPC is requesting appropriations funding for 600
additional U.S. Customs and Border Protection Agricultural
Inspectors at our borders, bringing the total number to 3,000.
Implementation of the 2018 Farm Bill as intended by
Congress is another foreign animal disease prevention priority
for U.S. pork producers. The 2018 Farm Bill includes important
funding for development of a foot-and-mouth disease vaccine
bank. The U.S. pork industry fought hard to secure funds to buy
vaccines to protect animal well-being and farmers' livelihood
from the real FMD threat facing the industry today. USDA must
utilize these funds provided by Congress to carry out its
intent to safeguard the rural economy.
Last, there is a severe shortage of labor in the pork
industry, both on the farm and in packing plants, that
undermines the industry's commitment to the high standards of
animal care. Pork production is a year-round endeavor.
Accordingly, the current H-2A visa program does not work for
pork farmers, as it only addresses seasonal agriculture
sectors. We need visa reform so pig farmers have access to a
sustainable supply of labor throughout the year.
Pork is one of the United States' most successful and
globally-competitive products, but a handful of obstacles are
preventing our farmers from realizing their full potential for
their families, consumers, and the American economy. Addressing
these challenge will make U.S. hog farmers even more
competitive, expand production, fuel job growth, and contribute
to rural communities across the country.
Thank you for the opportunity to testify, and I look
forward to any questions.
[The prepared statement of Mr. Herring follows:]
Prepared Statement of David Dee Herring, Vice President, TDM Farms/Hog
Slat Inc.; President, National Pork Producers Council, Lillington, NC
Introduction
NPPC is a national association representing 42 state producer
organizations. It represents the Federal policy and global interests of
60,000 U.S. pork producers. The U.S. pork industry is a major value-
added component of the agricultural economy, and a significant
contributor to the overall U.S. economy. In 2018, pork producers
marketed about 124 million hogs, and those animals provided total cash
receipts of more than $20 billion. Overall, an estimated $23 billion of
personal income and $39 billion of gross national product are supported
by U.S. pork.
The U.S. pork industry provides 26 billion pounds of safe,
wholesome and nutritious meat protein to consumers worldwide. Exports
are vital to the livelihoods of America's pork producers. New
technologies have been adopted and productivity has been increased to
maintain the U.S. pork industry's international competitiveness.
Exports of pork add significantly to the bottom line of each pork
producer and support approximately 110,000 jobs in the U.S. pork and
allied industries. In 2018, U.S. pork exports totaled 5.3 billion
pounds--valued at nearly $6.4 billion. That represented over 25 percent
of U.S. production, and those exports added more than $51 to the value
of each hog marketed with the average price received for a market hog
in 2018 being $141.
However, despite significant growth in the U.S. pork industry, it's
facing numerous challenges both domestically and abroad, including a
serious labor shortage on U.S. farms, punitive, retaliatory trade
tariffs, efforts to combat African Swine Fever and other animal
diseases, and ensuring proper oversight over gene-edited livestock.
Trade Disputes
One of the most damaging threats to the U.S. pork industry has been
the punitive, retaliatory trade tariffs that China and other countries
have imposed. Mostly because of trade agreements, the United States is
the leading global exporter of pork. We ship more pork to the 20
countries covered by trade agreements than we do to the rest of the
world combined. That's why NPPC has and will continue to devote so much
focus to expanding export opportunities.
As a result, U.S. pork is an attractive candidate for trade
retaliation. America's pork producers--and many other farmers--are
experiencing such reprisal now. After more than a year of trade
disputes impacting some of U.S. pork's most important markets, we saw
overall exports stagnate. The value of exports dropped one percent in
2018; volume was flat. We have been squarely focused for more than a
year on influencing the Administration to end these disputes, and to go
on the offensive to negotiate new trade agreements in markets promising
major growth opportunities for U.S. pork producers.
The U.S. pork industry had the dubious distinction of being on
three retaliation lists over the last year: China and Mexico related to
U.S. actions under Section 232 of the Trade Expansion Act of 1962 and
China in response to U.S. tariffs imposed under Section 301 of the
Trade Act of 1974. While Mexico's tariffs on U.S. pork tariffs have
been lifted in response to the U.S. lifting its North American metal
tariffs, China's 50% retaliatory tariff on U.S. pork--on top of the
existing 12% duty on U.S. pork--remains. China is the largest producer,
consumer and importer of pork in the world but, at a 62% tariff rate,
U.S. pork producers are losing $8 per animal, or $1 billion on an
annualized, industry-wide basis because of the punitive tariffs it
faces.
China holds more potential than any other market in the world for
increased U.S. pork sales. There is an unprecedented sales opportunity
for U.S. pork producers in China as that country continues to battle
the spread of ASF and experiences a major reduction in domestic
production. Were it not for the retaliatory duties on U.S. pork, we
would be in an ideal position to meet China's need for increased pork
imports and single handedly put a huge dent in the U.S. trade imbalance
with China too. Instead, this trade opportunity is fueling jobs,
profits, and rural development for our competitors. We seek an end to
the trade dispute with China and the restoration of more favorable
access to the world's largest pork-consuming nation.
NPPC is also deeply concerned as we helplessly watch the EU and the
CPTPP nations take market share away from us in Japan, our largest
value export market. We are going to continue to hemorrhage market
share unless we quickly get the same market access our competitors have
in Japan. We know the Administration is engaged in trade negotiations
with Japan, but those negotiations can't move quickly enough as far as
we are concerned.
Additionally, pork producers are eager to see ratification of the
U.S.-Mexico-Canada (USMCA) trade agreement. The USMCA agreement
preserves zero-tariff pork trade in North America. Under the terms of
our previous agreement with our North American trading partners, Mexico
and Canada became our No. 1 and No. 4 export markets, respectively. In
fact, those two countries account for more than 40 percent of all U.S.
pork exports, and support 16,000 U.S. jobs. We look forward to
Congressional ratification of this agreement.
Meantime, NPPC continues to advocate for Thailand to eliminate its
de facto ban on U.S. pork, based on unwarranted trade barriers erected
to protect its domestic industry and that lack scientific grounding. If
Thailand does not open its market to U.S. pork, it should lose its
benefits under the U.S. Generalized System of Preferences.
African Swine Fever
In addition to trade issues, pork producers are fighting another
battle when it comes to preventing the spread of African Swine Fever,
or ASF. The risk of ASF, an animal disease affecting only pigs and with
no human health or food safety risks, is growing as outbreaks continue
in Europe, China and other parts of Asia. We can all agree that we need
to keep this deadly disease out of the USA. NPPC has been very active
in driving awareness of the disease and how to mitigate its risk within
the industry.
NPPC has been actively advocating at USDA and with the U.S. Customs
and Border Inspection for strengthened biosecurity at our borders. To
date, USDA and U.S. Customs and Border Inspection have increased and
provided more robust inspections, in addition to working with Canadian
and Mexican officials on a North American coordinated approach to ASF
defense, response and trade maintenance.
We are encouraged by efforts to date, but more can be done. NPPC is
requesting appropriations funding for 600 additional U.S. Customs and
Border Protection Agricultural Inspectors at our borders, bringing the
total number to 3,000. The most likely path for a foreign animal
disease to enter the country would be through the importation of
infected animals or contaminated products.
We are also pushing U.S. Customs and Border Protection to work with
shipment companies to strengthen safeguards against illegal product
shipments and advocating for the maintenance or increase of airline
ticket and cargo fees to help fund the increase in inspectors.
Farm Bill Implementation
Congressional efforts on strengthening our borders to prevent
animal disease prevention have been helpful. The 2018 Farm Bill, signed
into law in December 2018, contained language championed by NPPC to
establish permanent, mandatory funding for animal disease prevention
and preparedness efforts. The bill also funds the Market Access Program
and the Foreign Market Development Program that support export markets
for U.S. farm goods. Animal Disease Prevention and Management
provisions include $150 million of mandatory funding, with Secretary
discretion for additional funding across the development of a Foot-and-
Mouth Disease (FMD) vaccine bank, the National Animal Disease
Preparedness and Response Program and the National Animal Health
Laboratory Network.
An FMD vaccine bank is needed to quickly contain and eradicate an
outbreak, which would immediately close all export markets to U.S.
meat. The U.S. pork industry fought hard to secure funds to buy
vaccines to protect animal well-being and farmers' livelihood from the
very real FMD threat facing the industry today. The 2018 Farm Bill
directed the Secretary to ``prioritize the acquisition and maintenance
of sufficient quantities of FMD vaccine.'' The U.S. Department of
Agriculture (USDA) must utilize the funds provided by Congress to carry
out its intent to help safeguard rural economies and the livestock
sector.
NPPC is monitoring USDA's implementation plans closely and will
continue to push for this implementation, one that will significantly
strengthen our ability to quickly contain an outbreak of FMD which,
unlike African Swine Fever (ASF), can be controlled with vaccine.
Labor Shortage
Another challenge that the U.S. pork industry is facing involves a
serious labor shortage that undermines our commitment to the highest
standards of animal care. Current visa programs widely used by pork
producers are not effectively addressing the issue. Without visa reform
to support a sustained, viable workforce for U.S. agriculture, animal
welfare is jeopardized, and production costs will increase, leading to
higher food prices for consumers. In some cases, a shortage of labor
could lead to farms and packing plants shutting down, causing serious
financial harm to those operations and their communities. According to
a study from Iowa State University researchers, the U.S. pork industry
faces a constrained rural labor supply due to an aging native-born
workforce and falling birth rates, making access to foreign-born
workers a critical matter for the prosperity of rural America. Reform
is needed to ensure that one of the most competitive U.S. agriculture
sectors can continue to provide safe and affordable pork to consumers
worldwide.
NPPC supports visa system reform that provides agricultural
employers with sustained access to year-round labor. We support a
bipartisan amendment from Reps. Henry Cuellar of Texas and Dan Newhouse
of Washington State that would expand the H-2A program to non-seasonal
ag workers. We support reform that establishes a legal and productive
workforce, while not unduly burdening employers.
NPPC's focus is on support for H-2A program expansion and to move
oversight of this program from the Department of Labor to the USDA,
where livestock agriculture's needs are better understood. As currently
defined, the H-2A visa program has limitations, since it applies only
to seasonal ag workers. NPPC supports legislation that opens the
program up to year-round livestock ag workers and is easier to navigate
for employers.
Gene Editing
There is a brewing battle in our scientific laboratories over gene-
edited livestock. NPPC recently launched a campaign, ``Keep America
First in Agriculture,'' to highlight the need to establish the right
regulatory framework for gene-edited livestock, an innovation that
promises to strengthen U.S. pork's competitive position globally. Gene
editing technology, which introduces useful genetic variation into food
animal breeding programs, promises significant animal health benefits,
including a natural immunity to disease and a reduction in the need for
antibiotic use.
While countries like Canada, Brazil and Argentina are moving
quickly to grab a competitive advantage by establishing regulatory
structures that support the development of this technology, the U.S. is
running the risk of falling far behind as a result of a regulatory land
grab by the Food and Drug Administration (FDA). Under FDA regulation,
gene editing faces an impractical, lengthy and expensive approval
process, threatening hundreds of thousands of jobs and nearly six
percent of U.S. Gross Domestic Product. Additionally, the FDA's
regulation inaccurately classifies livestock as drugs and farms as
drug-manufacturing facilities, creating significant challenges for the
international trade in animals and animal products.
That's why NPPC is working aggressively to establish oversight of
gene-edited livestock on American farms with the USDA's Animal and
Plant Health Inspection Service (APHIS), the agency best prepared to
implement a regulatory framework that will allow us to realize gene
editing's promise. The launch of our campaign received extensive media
coverage and we plan to continue to advocate for policies that allow
the U.S. to remain the global leader in agriculture.
Cell-Cultured Protein
Similar to gene editing, the FDA made a regulatory land grab on
cell-cultured protein (CCP) despite the Meat and Poultry Inspection
Act, which clearly indicates that CCP--produced from cultured cells
taken from pigs and other livestock--should be under the oversight of
USDA's [Food] Safety Inspection Service (FSIS). Fortunately, on March
7, 2019, the FDA and USDA's Food Safety Inspection Service signed a
formal agreement to regulate CCP on terms that ensures a level playing
field.
USDA will have ultimate authority over product names, label claims
and processing, while FDA will have oversight of the earlier cell
collection and culture phases. It's critical that product names and
label claims protect the investments livestock farmers have made to
establish a definition of meat protein that is widely understood by
consumers. Too many alternative products have been allowed to create
consumer confusion at the expense of agriculture.
Proposition 12
U.S. hog farmers are battling Proposition 12, a California ballot
initiative that passed in the 2018 election. It outlaws the sale of
pork in California that doesn't meet its arbitrary and unscientific
housing standards. Set to go into full effect for pork products on Jan.
1, 2022, it applies these regulatory mandates to not just the small
handful of California pork producers, but across the entire pork
industry operating outside of California borders. For pigs, Proposition
12 mandates that each sow be provided a minimum of 24\2\ of space, far
beyond what most group housing systems currently provide. Further, it
prohibits the sows--which are pack animals that naturally huddle
together--from ``touching another animal or the sides of the
enclosure.'' This ballot initiative, funded by anti-livestock
agriculture activists, was developed without the input of any experts
on raising hogs. Virtually no pork producer nationwide will be able to
comply with California's production requirements without undertaking
significant financial impacts.
As a result, Proposition 12 will dramatically reduce the supply of
wholesome, affordable and nutritious pork available to the state,
increasing the costs Californians pay for pork. California, the state
with the nation's highest poverty rate, is now set to impose these
costs on its most at risk citizens, including more than four million
Californians who receive assistance for food purchases and the more
than 18 percent of California children who live in poverty.
We need to put a stop to uninformed state mandates like Proposition
12 that impose arbitrary regulations on farms and other businesses
outside of their borders.
Summary
Pork is one of the United States' most successful and competitive
products. But, a handful of obstacles are preventing our farmers from
realizing their full potential for their families, consumers and the
American economy. Addressing these challenges will make U.S. hog
farmers even more competitive, expand production, fuel job growth and
contribute to rural communities across the country.
The Chairman. Thank you, and we appreciate the testimony by
all the witnesses. Now, we get to the part where we get a
chance for Members to ask questions as it relates to areas that
are focused not only regionally, but nationwide as it relates
to the livestock industry in this country.
Let me begin. Nearly all of you have mentioned the
importance of a workable solution to agricultural labor, and
many of us have been working with our colleagues on the
Judiciary Committee. I go back to comprehensive immigration
reform with the Bush Administration and then the Obama
Administration. In 2013 I think we came close. We had a bill
that came out 68 to 32 out of the Senate, and if it could have
come to the House floor, we would have passed it.
Unfortunately, that is water under the bridge at this point,
and we have struggled since that time to even do smaller
limited reform.
Would each of you share the impact if we maintain this
continued curve of not fixing this broken labor system that it
is going to have on your industry and on your own particular
operations? Who would like to start? Yes, Mr. Zimmerman?
Mr. Zimmerman. This has been an ongoing problem, like I
mentioned.
The Chairman. Yes.
Mr. Zimmerman. We mentioned this 3 years ago, and it has
only gotten worse. All of our processing plants are short of
labor. I can speak on the farm perspective; we are also short
of farm laborers. We need a visa program that addresses year-
round labor, and we have programs that are seasonal, but our
plants operate year-round. The turkey industry is not about
Thanksgiving. We are doing this year-round, and we need a visa
program that would allow these employees to stay for the entire
year.
If we don't have--we have looked into automation----
The Chairman. Do a lot of your workers--and automation is
part of it--but have some members of the family that are here
that have legal status and some that are not? In other words,
households that are mixed?
Mr. Zimmerman. I am sure that is the case in some areas,
yes.
The Chairman. Yes, and have you had any of the situation
with the ICE operations that have requested audits to match W-2
and I-9 efforts within plants and packing operations?
Mr. Zimmerman. I would assume that is correct, but not
being a processor, I can't speak to that exactly, no. But I
would assume it is correct.
The Chairman. Anyone else care to comment?
Mr. Will. We have actually had firsthand relationships with
that. We had some employees that had been with us for pre I-9,
pre e-verification, a number of years prior to any of those
being in place, and their paperwork was determined to be
fraudulent. And while they were not allowed to work for us,
nothing happened to them. And right now in this current
employment with the joblessness down where it is, it is very
hard to get people that can come in and be reliable and work.
And we desperately need some sort of program. Again, we are in
the same situation. We offer annual, year-round employment at a
competitive wage with benefits.
The Chairman. At a good salary that provides a good living
of the people you employ.
Mr. Will. Yes, it allows a reasonable living standard.
The Chairman. Yes, and with these current inconsistencies
about deportation and activities that have been talked about,
what is the mood out there in your communities in terms of the
workforce?
Mr. Will. Well again, we have gone through the e-verify and
gone through all of the verification systems. I don't think our
employees have that concern.
But just in general, I think it is unsettling in the
community.
The Chairman. We find a lot of----
Mr. Will. If--family members or not.
The Chairman. Yes. We find a lot of fear in our area in
California for these farm communities because many of them have
homes, many of them have been part of the community for 10, 15
years. And the threat of being deported, obviously, has changed
the whole dynamic.
Mr. Will. Exactly.
The Chairman. Let me switch over. The poultry and egg
industries in California employ over 20,000 people. Mr. Will,
you and I have talked in the office about direct experiences
with Virulent Newcastle Disease a few months ago. Knowing this
outbreak and the response we are seeing, what additional
Federal support or guidance would you suggest that we consider
to protect against future outbreaks?
Mr. Will. I think the most important thing is that we
retain some sort of active book about what we have learned
through this outbreak, like we did in the 2003 outbreak. I feel
like we kind of started over again with the USDA. At least keep
some sort institutional memory of this, and then also keep some
sort of monitoring program.
We were very fortunate with this outbreak, catching it very
early by actually show birds being taken into a veterinarian's
office and detecting it that way, versus a commercial
producer's breaking.
The Chairman. To all of you, and I don't know who might
want to weigh in. There are two major impacts in American
agriculture right now, and that is trade and that is labor.
What these trade impacts and these trade tariff wars, which I
don't think anyone ultimately wins, how concerned are you
about: first, the potential loss of these markets when they are
re-sourced by other countries; and second, to what degree is
this mitigation that we have come up with helped keep people in
business?
Mr. Herring. Well, I will speak from the pork producers.
Trade is a win/win for the pork industry. We have gone from
basically 1987 as a net importer of pork to today we export
about 25 percent of all the product grown here.
Trade has been huge for our industry, even as we struggle
with the labor issues, too. Most of the pork is grown in the
Midwestern states, but there is a lot of pork grown on the
eastern part of the country.
The Chairman. And that is year-round, pretty much?
Mr. Herring. Year-round, and post-9/11, the legal workers
are working in ag, are working in the pork industry, are aging
out. We really urge Congress to create some kind of seasonal
program that we can have access to workers.
The Chairman. You are concerned that when we get past these
trade wars, we are going to lose those markets?
Mr. Herring. It takes two parties to consummate a deal into
trade, and any time you make one of those parties uneasy, it is
hard to get back in. It is very concerning.
The Chairman. Okay, my time has expired. We will recognize
the Ranking Member of the House Agriculture Committee, Mr. Mike
Conaway, for any questions or comments he might have.
Mr. Conaway. Thank you. Just a quick question for Mr.
Salmon.
You talked about China not being a market for your
products, sheepskins and lamb and the wool, I think. Could you
more specifically address exactly why we can't get access to
the Chinese market, and what the potential for the Chinese
market might be, should you have full access for U.S. products?
Mr. Salmon. We always have the need for some sort of
foreign export to somebody. China has been the leading industry
right now, particularly for our fiber products, because we have
very little textile industry left in the United States. Without
being able to export wool or mohair or lambskin to China,
Japan, some of those foreign countries, our products are
limited as to what we can do with them.
Mr. Conaway. What China does specifically with respect to
retaliation? You had----
Mr. Salmon. They increased their tariff side of it, but
then they also quit just accepting the imports from us.
Mr. Conaway. Based on science----
Mr. Salmon. Based on the tariff war.
Mr. Conaway. Okay. Each of you mentioned in your testimony
the need to pass USMCA. Is there something specific with
respect to what you didn't get to say that you would like to
add to the testimony as to why that is important for each of
your industries? Does anyone have anything else to add to your
testimony as to why we need to get USMCA done quickly?
Mr. Herring. Well, from the pork producers' side, it makes
up about 32 percent of all our exports. They have been a great
trading partner for us. And second, when we look at North
America as a trading unit with United States, Mexico, and
Canada, it is healthy for our partners to the south of us and
the north of us to have good economies. It makes all of North
America more competitive on a worldwide basis.
Mr. Conaway. Your advice to Members of Congress would be to
push on the process of asking leadership to get this done?
Mr. Herring. I wish we could get it done tomorrow.
Mr. Conaway. Anybody disagree with that? Kelley Sullivan
Georgiades?
Mrs. Georgiades. I would not disagree. I am in full
agreement. In fact, Congressman Vela, his district in
particular is one of the primary beneficiaries of robust trade
specifically with Mexico.
It is no question that Texas is a tremendous beneficiary of
our relationship with our southern partner. It has been, like I
said, prior to the USMCA, the NAFTA was wonderful for the beef
industry, and that is why we want to see it ratified to be able
to move forward and keep that duty-free access that we have for
our beef. We already have agreement from Canada and Mexico to
move forward, and again, it would just be robust for us to be
able to get this ratified and get this in place. Because once
we can do this, then we can begin to continue focusing--and
like I mentioned in my testimony, our other trading partners,
we are somewhat in limbo because it is kind of a wait and see
attitude that our largest trading partners, in particular,
Japan, are taking. I mean, we are not members of CPTPP any
longer. We are facing a 38\1/2\ percent tariff on our beef into
Japan, but they are looking at our--kind of our dangling USMCA
issue out there, and this will help be able to secure this and
move forward so that we can begin to continue fortifying those
different agreements that we have with our other trading
partners, from a beef perspective.
Mr. Conaway. I appreciate that. Anyone else in the minute
left?
Then I yield back. Thank you, Mr. Chairman. I appreciate
that.
The Chairman. All right. Our next Member is Congressman TJ
Cox from California for 5 minutes of questioning.
Mr. Cox. Thank you, Mr. Chairman.
Mr. Will, during your testimony, you mentioned the
challenges faced by yourself and others regarding the outbreak
of Virulent Newcastle in California. It is certainly something
that you just discussed with Congressman Costa, but as you
know, it is something that is having a major impact on the
poultry economy in California and has the potential to be a
major inhibitor of economic growth if it is not addressed
certainly now, and adequately while we have the opportunity to
eradicate the disease.
If you wouldn't mind just kind of reiterating some of the
points that you made with regard to Federal support or guidance
in the future, and with respect to inoculated birds, what could
better assist in protecting against outbreaks and spread of the
disease?
Mr. Will. Thank you. Part of it was that the impact of the
disease outbreak is not only loss affected producers, but the
trade impacts are often felt by the entire industry. USDA has
done a great job in encouraging our trading partners to
regionalize their response to outbreaks, meaning that they are
to restrict only imports from regions directly impacted by the
disease, but not all trading partners have respected this
science-based practice, and some trade has suffered.
In California currently, we have lost 1.2 million chickens.
We have 301 responders on site as of the 10th of July 2019. We
have had 470 premises that have been identified as positive,
causing 1.24 million birds euthanized. Of those, 123,000 were
backyard and 1.1 million were laying hens. They have had 7,530
fallow checks going back to people who have had to be
depopulated to make sure that they have stayed quarantined, and
they have tested 34,000 birds.
The biggest thing we have learned from this outbreak is
early detection is key. Getting people on the ground to go in
and to do the depopulations where they have to. We went
through, unfortunately, right as it really ramped up, the
virus, is when we had the budget shutdown, and one of the
toughest things was we were all set, ready to depopulate some
infected farms. However, the people were furloughed in USDA who
were responsible for issuing all of the equipment necessary to
do that work. All it did was it left several hundred thousand
birds in the environment, continuing to shed virus for several
weeks while we worked through all that paperwork.
The Chairman. Would the gentleman yield?
Mr. Cox. Yes.
The Chairman. I am just curious in that whole effort, how
important was the California Department of Food and Agriculture
in working in conjunction with you folks to deal with the
eradication program?
Mr. Will. Well, they were absolutely huge, because at the
start when it was first detected back in May of 2018, the CDFA
came out and worked and implemented a Food Response Defense
Plan for all of our processing plants, all of our farms. They
loaned us veterinarians to walk and epidemiologists to walk on
our properties to make sure that our defenses were proper, we
were using the right chemicals, everything that we could do to
minimize and mitigate risk. That early response was probably
why we were able to contain it to only five commercial
operations in the State of California.
And in addition, they helped us in our processing plants to
make sure we didn't spread it. As an industry, we have matured
as well, going away from material that could be sent to any
farm. Almost all of us now use dedicated in and out type of
material to those farms in order to mitigate it.
But at the start, it was mostly CDFA. It took USDA a while
to ramp up and get in. During the 2003 outbreak, we had over
1,000 responders, right now at 301 between state and Federal.
We are at about the high that we have been.
The Chairman. I thank the gentleman for yielding.
Mr. Cox. Thank you, Chairman.
Mrs. Georgiades, in fact, I just had to step out to talk to
a beef producer who brought up in our conversation that the
withdrawal of TPP was such a missed opportunity. I think you
already touched on it, but in the sense the U.S. has withdrawn
from TPP and the agreement was completed without us, what has
that impact been on U.S. beef exports and are we already losing
ground in Japan?
Mrs. Georgiades. We have moderated as far as losing ground
in Japan. Our imports into Japan have been incredibly robust.
We, as U.S. beef producers, have essentially created that
market.
As I mentioned in my testimony, we are at 38\1/2\ percent
versus our competitors, Australia, Canada, members of CPTPP,
who are currently paying, I believe, around 22 percent, but
eventually will be going nine percent. You can see that delta
is going to make a tremendous impact.
I sat on a panel actually with a gentleman from Canada that
said that Japan is their number one target because of the
market share we, U.S. beef producers, created. Pursuing a
bilateral agreement, having some sort of agreement in place
with Japan is going to be vital for us.
I mentioned about the value of just the different cuts that
go into Japan. I have been there twice myself actually to see
just the robust demand that they have for our beef, and being
able to get that type of agreement in place with Japan is going
to be critical for our producers, moving forward.
Mr. Cox. Great, thank you so much.
The Chairman. All right. The gentleman's time has expired.
I will now recognize the Ranking Member of the Subcommittee,
Mr. Rouzer from North Carolina.
Mr. Rouzer. Thank you, Mr. Chairman.
Mr. Herring, in May this Subcommittee heard from Under
Secretary Ibach regarding animal pest and disease threats, and
USDA's capacity to protect the industry. Specifically, I asked
Mr. Ibach about African Swine Fever, and USDA's coordination
with Canada and Mexico in that regard. What is your feeling and
what is your opinion? Are you confident that USDA and U.S.
Customs and Border Protection have the resources needed to
protect the industry?
Mr. Herring. Chairman, Mr. Rouzer, in our industry, when
you look at FMD or ASF or classical swine fever, that is the
one caveat. Any foreign animal disease that would make me want
to get out of this industry, because it will not only be
devastating to pork producers, but all of agriculture.
We have enjoyed a great relationship with USDA and CBP. I
think both entities are working very hard. We have been in
collaboration with them. Unfortunately, we are short of
agricultural specialists at entry points, and we have been
advocating to increase that about 600 agricultural inspection
specialists, and hoping that Congress will provide the funding
for that.
African Swine Fever is the hot topic right now, and it
changed the world of pork production last October when it was
introduced or became prevalent in the world's largest swine
herd in China. Swine production, going forward, will be totally
different. When you look at risk assessments, actually we are
more susceptible to classical swine fever, but ASF is the hot
topic right now.
But to try to answer your question, we need those
agricultural inspection specialists, and we need to continue to
have the great relationship we have enjoyed so far with USDA
and CBP.
Mr. Rouzer. My next question is a much broader question,
and this is one that I think about often. I walked by the brand
new Whole Foods the other day as you go out towards the Navy
Yard, just an immaculate, incredible building, as beautiful a
building you will ever find. Polished floors, food on the
shelves, and I thought about it. You know, 98, maybe 99 percent
of the folks that go in there have absolutely no idea where
those food products come from or how they are produced, or any
of that. And it has always bothered me a little bit that it
seems like we are under the same business model we were under
100 years ago where you are totally dependent upon commodity
prices and totally dependent upon trade as well. For years we
talked about energy production and how we need to get away from
the Middle East and production in the Middle East, and America
needed to produce more. Well now because of advances in
technology, we are and helping to dictate the price on the
world market.
But it strikes me we have to fundamentally think about
making some major modifications for agriculture, because you
have huge advances in technology, allow you to produce more on
less. But yet, margins get thinner and thinner. At what point
do you run out of economies of scale, so to speak? You have all
this consolidation in agriculture across the board. Margins
continue to get thinner, which means you have to get bigger.
Well, the bigger you are, the bigger you are known at the bank.
It is almost at a point where you are too big to fail. Well,
you hear about that in terms of banking, et cetera.
My question is who out there is thinking about a new
business model so that we are not totally reliant upon what
happens in China and Japan and everywhere else? Not totally
reliant upon somebody pulling out of a trade deal or--it just
seems like we need to be thinking about this a little bit
differently. I don't have the answer. I will just throw it out
there. It is the question I ponder all the time.
Mr. Herring. That is a good question. We are in the
business of feeding people, and when you look at projections,
they are saying that by 2050 we will have two billion more
people in this world. And I am speaking for myself, but I think
my colleagues would agree, we want the opportunity to help feed
those people.
Ag is a commodity business, and we harvested 123 million
pigs in this country last year. In 1979, we harvested about
half that many with the same amount of animals basically.
Technology has been great. We need the access to it, but we
can't urge you enough to help us keep these trade doors open.
As far as changing the way the industry is, I can't answer
that. That is way above my pay grade.
Mr. Rouzer. It is way above mine, too.
Mr. Chairman, I have run out of time. I yield back.
The Chairman. Our next witness is Ms. Craig from Minnesota.
Ms. Craig. Thank you so much, Mr. Chairman.
The Chairman. Thank you.
Ms. Craig. Mr. Zimmerman, thank you so much for appearing
before this Committee this morning on behalf of Minnesota
turkey. I am also proud to see representation from the rest of
livestock industry here today, as Minnesota ranks first in
turkeys raised, second in hogs, and sixth in red meat
production. I am just going to take credit on behalf of all
Minnesota here today.
Mr. Zimmerman, in your testimony, you expressed that you
are optimistic for the continued growth of the turkey industry
in Minnesota. In fact, since 2012, we have added over 100 new
turkey farms throughout the state. I certainly share this
optimism, but as Mr. Costa said, both you and I know that if we
fail to address the emerging issues mentioned in your
testimony, we risk slowing the growth for our state and for the
industry.
Many of the livestock producers I talked to in my district
tell me they need reliable labor, and certainly Mr. Costa
touched on immigration reform. I know you mentioned the demand
for workers in your written testimony, and you sat before this
Committee in the past to express a need for labor.
How does this lack of workers harm the industry's ability
to grow, and what labor reforms would be most helpful to you as
a producer?
Mr. Zimmerman. Well, you can't raise more birds without
more people, and we have gone down the automation route. A lot
of the processing plants have increased automation, but at the
end of the day, you still need people in those plants to do
things. There is a certain point where you just can't do
anymore without the people--and like we all said here, the
livestock and poultry industries are different from vegetable
crops in that we need year-round labor. We need that certainty
of having those people here all the time.
I hear from the processing guys that they employ people;
but, they will often employ 120 or 130 percent of the people
they need because of absenteeism and just the uncertainty if
those people are actually going to be there. We need those
workers to be confident that they are going to be here and that
they will have a job, and that the processors are confident
those people are also going to be here. It is just a matter of
getting a visa for your own help, and making sure that they
have the confidence and the certainty that they will have that
job there, and they won't be removed for any reason.
Ms. Craig. There is no doubt in your mind that if we made
those kinds of workforce changes that you could raise more
turkeys? We could have more processing plants, that our
industry would grow?
Mr. Zimmerman. To grow an industry, you need inputs.
Whether it is fertilizer, feed, whatever, the input of labor is
something we really don't have control over, because it is the
erratic nature of the laws that are affecting it. Yes, if there
could be more certainty with that input, we could grow more.
Just like if we knew we had the fertilizer to grow corn, we
could grow more corn. It is no different. We need certainty in
that input of labor.
Ms. Craig. Thank you, and I sure as heck would like to grow
more, let me turn now to the threat of animal disease. I know
in Minnesota, we fought this battle with avian influenza, and
it is very fresh in everyone's mind.
The 2015 outbreak cost Minnesota's economy nearly $650
million. Mr. Zimmerman, from your point of view, what has
improved between industry and government partnerships when it
comes to preparedness, and where can we continue to improve
those partnerships?
Mr. Zimmerman. Well, 2015 was a very bad year for us, and
we have learned a lot since then. I think we were somewhat well
prepared, but we have come a long way.
Complacency is an issue. We have not become complacent. We
have changed our barns, made them more biosecure. We have
changed our logistical patterns to make sure that we route
things to avoid the spread of disease. Our state has a very
good monitoring system. If there is an outbreak or anything
comes up, we can all be informed right away. Communication is
key with our state and Federal partners.
But in the future, the Animal Pest Disease Program that was
in the farm bill is critical to stopping it as quickly as
possible; because, as you know, the outbreak in 2015 in
Minnesota was followed by a much smaller outbreak in Indiana a
year or so later, and they were able to nip that in the bud
very quickly. The lessons we learned in Minnesota and the
Midwest were applied to that outbreak, and it was much more
successful in minimizing the spread of that outbreak.
Communication, having boots-on-the-ground right away, and
nipping it in the bud are critical.
Ms. Craig. Thank you again so much for being here, and I am
nearly out of time, so, Mr. Chairman, I will yield back.
The Chairman. All right. The gentlewoman will yield back,
and we thank you for your questioning.
On the Republican side, the next Member will be Mrs.
Hartzler from Missouri, for 5 minutes.
Mrs. Hartzler. Great, thank you, Mr. Chairman, and thank
you for each of you being here.
As a lifelong farmer, I grew up on a hog farm, and my
husband and I raise cattle today. And Missouri's 4th District
has the most poultry of any other Congressional district, and
we have a Cargill turkey processing plant. I just feel right at
home with you all, and appreciate you coming here.
I wanted to start with Mr. Zimmerman, because in your
testimony, you talk about food safety, which is really
important. I had an amendment in the farm bill, FSIS is doing a
study on small meat processors, but you mentioned in here that
you would like to see them continue to modernize inspections
and streamline processes for new technology approval. You say
that is critical.
I was wondering, do you have any specifics in mind that you
think the inspection process needs to be modernized, any
thoughts on that, or how the process could be streamlined? What
are some of the problems that you are alluding to?
Mr. Zimmerman. Well, food safety is one of our major
concerns, and we have come a long way in addressing those
concerns. I can't speak from a processing perspective. I can
speak from a grower perspective; but, we want to make sure
there is a safe food supply out there, and we want an efficient
inspection service.
As far as specifics, I can definitely put you in touch with
people much smarter than me on that; but, we continue to work
on eliminating bacterial threats on the farm through the whole
process, and we just, we ask for the government's help in
streamlining those processes and making it more efficient so we
can do the best we can.
Mrs. Hartzler. Sure. Okay, great. Thanks.
And we have already talked about the African Swine Fever
issue a little bit, but I did want to just emphasize, because
this is so important, that this disease has no vaccine. And it
is spreading all across the world, certainly devastated China,
but Mr. Herring, if you could just emphasize again, you said
you really think what needs to happen is to have us here in
Congress fund 600 more of these Customs and Border Protection
agents. Can you talk a little bit more about how they inspect
and how critical it is, our only line of defense is to keep it
from getting here.
Mr. Herring. Well, there are many ways that it could be
introduced in our country. I have laid up at night and have
nightmares thinking about it, but those agricultural
specialists would help us prevent--and we think prevention is
the number one key. Through USDA they have funded 60 new
beagles that are being implemented, and today, that is the very
best inspection service we have is those beagles.
There is a lot of opportunity, as long as we can keep ASF
out of this country. And any given day, we have one million
pigs on the road. If we get an introduction in the right place,
it will be very difficult for us to contain the African Swine
Fever.
Mrs. Hartzler. Okay, thank you. Well, we are in the process
of going through appropriations process, and I think that is
really important to us on Agriculture Committee can help
advocate for that.
You also mentioned about FDA's current regulation on gene
editing process that classifies livestock as drugs and farms as
drug distributors, and how this creates international trade
challenges. Can you please discuss this a little bit and how
this might impact producers on a domestic level, and what you
would like to see regarding gene editing?
Mr. Herring. Well, we would like to see the gene editing be
over FDA--I mean, over at USDA. We think it is a viable tool as
we go forward, just like we were talking about ASF. There is a
potential with gene editing to prevent ASF, animals that are
immune to ASF. And we feel like if USDA is the agency to
administer it, and if we don't, if we fall behind, we are going
to lose this technology to other countries, and it will make
our farmers and our rural areas less competitive.
Mrs. Hartzler. Isn't China doing research right now on gene
editing----
Mr. Herring. There are several countries doing research.
China is one of them.
Mrs. Hartzler. Okay. I only have 30 seconds left, but the
NPPC has a new Keep America First in Agriculture campaign. Can
you talk further about this campaign, and how it could impact
consumer level and producer level?
Mr. Herring. Well, as Mr. Zimmerman said, first and
foremost, we want to grow healthy, safe products that are
affordable for our consumers. And any tool, whether it is gene
editing or any technology that is available, we want to have
firsthand experience and firsthand use of those products and
that technology to help our producers and our farmers be
competitive on a worldwide stage.
Mrs. Hartzler. Thank you very much. I yield back.
The Chairman. The gentlewoman's time has expired, and we
will now recognize the gentlewoman from Connecticut,
Congresswoman Hayes.
Mrs. Hayes. Thank you, Mr. Chairman, and thank you to our
witnesses for being here.
When people talk about my home State of Connecticut, they
often skip over one of its most prominent and thriving
industries, and that is agriculture. From dairy to greenhouses
to poultry--actually, my district, the number one economy is
greenhouses, which most people don't know. Connecticut has a
vibrant agricultural industry. We are small, but we are mighty.
In my home district, there are about 15 local family-owned
poultry and egg producing farms. Just this Sunday, I went to an
agriculture roundtable with some of these farmers, and had a
display of meat birds, which I got a very good education in
that. Our flagship university, the University of Connecticut,
has a very large poultry farm and a poultry resource unit, and
many of our high schools and academic settings are developing
vocational-ag training programs, and there are long, extensive
waiting lists.
While much of the poultry in Connecticut is sold locally
and regionally, an international export market also exists for
farmers in Connecticut. Some of our strongest trading partners
are our neighbors in Canada and Mexico. However, those
relationships are not without their problems, and farmers and
producers in my state and across the country are hit by the
roadblocks that do not allow them to produce to their full
potential. We heard that from some of the witnesses.
I hear from farmers that trade deals like NAFTA and the new
USMCA have made this easier and more frequent; however, certain
industries did not get as much easy access, as is the case with
dairy and other thriving industries in my state.
I would like to get a little bit more information about how
Congress, as well as partners like the USDA and USTR, can help
to facilitate the exportation of more poultry to Canada, and
what that would mean for businesses, especially small family
farmers in my district.
My question is for Mr. Zimmerman. In your testimony, you
mentioned that you see significant potential for the turkey
industry's growth in the near future. What, in your estimation,
will drive that growth, and what impact will it have on the
industry and on local turkey farmers?
Mr. Zimmerman. From an export perspective, the U.S.
consumer prefers white meat. They now prefer more--maybe a
little bit more dark meat.
Mrs. Hayes. So does my husband.
Mr. Zimmerman. I like the dark meat too, but historically
it has been white meat. But a lot of our trade partners, Mexico
specifically, takes a lot of our dark meat.
Trade and export markets use products as many others on the
panel said, that you know, aren't necessarily used in the
United States, so it allows us to use the whole bird more
efficiently. And our profit margin is pennies, and if we can
sell turkey paws (only the foot) to China for a few more
pennies, I mean, that is the difference between a profit and a
loss.
And as far as a small grower like myself, a rising tide
raises all boats, and if the market can improve for everyone,
it improves for the little guy as much as the big guy. Trade is
just important.
Canada, their system is just a tough nut to crack with
their quota system, internally for poultry. Some progress was
made there. We would love to see more. We are content with
getting some more access to the market, but anything we can do
to open that market more fully would be wonderful for U.S.
producers.
Mrs. Hayes. That is what I heard a lot, that greater access
to the Canadian markets would be helpful. This is what I have
been hearing from farmers in my district.
Ms. Porter, for you and your member companies in Delaware,
Maryland, and Virginia, what kind of effect would greater
access to markets like Canada have on local businesses?
Ms. Porter. Sure. Thank you. Similarly with turkey again,
and the same with the meat chicken industry here domestically,
white meat is usually preferred. Dark meat is usually exported,
as well as chicken paws, the same thing. There is quite a
market for chicken paws outside of the United States as well,
too.
Mrs. Hayes. And beef tongue.
Ms. Porter. That is right, and beef tongue. Again, the
opportunities, as I mentioned in my testimony, within our
region, a lot of our marketplaces are fresh market, because of
course, we have access to millions of folks in the New York,
the Northeast area, and so, that is very beneficial to us. We
do do some export as well. But what happens is, is that when
the exports are limited within, then you have more a glut
within the domestic market. That has direct impacts very much
so on our fresh market when things are not moving out.
Any increase, any ability to increase exports throughout
other areas of the region into Mexico, into Canada is going to
benefit our area, as well as, again, the small farmers within
your Northeast area as well, too.
Mrs. Hayes. Thank you, and I appreciate you saying that we
cannot forget small farmers when we are having these
conversations.
Thank you, Mr. Chairman. I yield back.
The Chairman. The gentlewoman yields back. We thank you for
your questioning, and the next Member is Mr. Hagedorn from
Minnesota.
Mr. Hagedorn. Thank you, Mr. Chairman. Witnesses, I
appreciate your testimony. It is wonderful to be here today.
I happened to grow up on a grain and livestock farm in
southern Minnesota. My father and grandfather, great-
grandfather all southern Minnesota farmers. We had hogs and
corn and soybeans and things like that, and it was a great
experience.
I appreciate what you do. We have a lot of livestock in
southern Minnesota. I think we are number two or three in hogs.
They did an inventory. They said we were 500 hogs behind
Rouzer's district over there. We want a recount. We want a
recount. I don't know what is going on, but a lot of hogs, lot
of----
Mr. Rouzer. I think you have been counting dead hogs up
there.
Mr. Hagedorn. It is the corn flip. Yes, I think so. A lot
of hogs, a lot of beef, and dairy and everything else. And we
appreciate you, and what you do to provide the goods to the
American people so when they walk into the grocery store, they
have those choices at affordable prices. It is a wonderful
thing, and we need to continue that.
Sometimes I think we--I heard the testimony, interested in
trade, immigration laws and things like that, but we kind of
gloss over that there have been some gains made for agriculture
in just the last couple of years that have been very important.
On regulations, if we didn't do something about that Waters
of the United States regulation, I daresay that everybody on
this panel would right now be complaining about how it is
onerous, it is driving up costs, how the EPA and others would
have too much power over your producers and what you do. That
was a good thing.
I think the way we looked at energy in the last couple of
years has been very important. Some of those anti-energy
policies in the last Administration were driving up costs
needlessly, and for many farmers, the cost of energy is a big
driver, whether or not you are going to make money, lose money,
and now we have U.S. energy independence, except for that
little 20 percent of crude oil that we import. We are keeping
downward pressure on your cost of doing business.
On Obamacare, one of the biggest things that is driving up
costs and hurting farmers and agribusinesses has been this
Obamacare since it has been implemented. Not enough has been
done to fix that, but the association plans and others that
have some promise, and we have to do better. I am for patient-
centered medicine, and I promise to do everything I can to try
to drive down your costs there.
On trade, though, yes, USMCA I am all for it. I was the
first elected official in the State of Minnesota to come out
for it. My friends, Congressmen Tom Emmer and Pete Stauber, are
from Minnesota. We sent a letter to the President and to the
Speaker saying send us that agreement. Madam Speaker, let's get
a vote. There are five folks that we offered that up to in the
Minnesota delegation who weren't Republicans. They didn't sign,
but I would encourage you to go to my friends on the other side
of the aisle and encourage them to go to the Speaker and say we
need a vote. Because Mexico and Canada are going to ratify it.
Mexico already did. But the only way we are probably not going
to ratify it in the United States is if the Speaker doesn't
give us a vote on the House floor. And we need to have a vote
by the end of the year to make sure that this is done. I would
like it done yesterday as well, sir, so let's keep that in
mind.
And it will build great momentum for these other deals. I
mean, if we can't do one with Mexico and Canada, how would
anybody in Japan or China or anywhere else expect us to get
something done with them? And the deals that they are working
on with Japan, China, the UK, South Korea, it is good for
agriculture. It is good for all the Minnesota businesses and
others.
On immigration, though, I hear kind of one side of it, and
we have to remember there are two sides to this. One is I am
for a work program. Let's expand it. Let's bring people in,
fill needed jobs. We can offer them credits towards
citizenship. We can do lots of things in order to make sure
that we have folks for these jobs. But until we secure the
borders, until we have an immigration system that works, that
can't be circumvented, those programs are worthless. Because if
you can just run over the border or overstay a visa and then
undercut the programs that we have to try to fill these jobs,
some people are still going to cheat. Some people are still
going to get in there and work illegally. That is inherently
unfair. We have to have a system that is fair and legal for
everyone.
I am for that. I hope you will want to secure the borders,
have merit-based immigration. Those types of policies that are
going to make sure that we have an even playing field for
everyone, and that we can have commerce and industry and
workforce like you need.
With that, I yield back. Thank you.
The Chairman. All right. The gentleman yields back, and the
next Member on our side is Ms. Plaskett from the U.S. Virgin
Islands.
Ms. Plaskett. Thank you very much, Mr. Chairman, and I
thank the Ranking Member and the witnesses for being here.
I think this has been a really enlightening and educational
discussion, at least on my part. I would think some of my
colleagues as well.
Mr. Zimmerman mentioned something that I found very
interesting with regard to flu and some of the work that you
did afterwards after the disease to making sure barns were safe
and more stable.
Ms. Porter, you referenced, however, that \1/4\ of the
chicken houses in your region are more than 30 years old. Would
you guess the same is true for other major poultry-producing
parts of the country?
Ms. Porter. I would not necessarily be able to speak for
other parts. As I mentioned, our industry has been around for
over 100 years, so we have had quite a robust industry for a
while. But I would speculate that there probably are some aging
houses throughout, especially within the Southeast, again, in
the states that have had an industry for a while. Many of those
houses have had technological upgrades over the years.
Ms. Plaskett. Sure.
Ms. Porter. But, like any house, even your own current
houses, there is only so much that you are able to do for
upgrades, and so that is why sometimes you will need----
Ms. Plaskett. What tools would help and support farmers for
upgrades in those areas?
Ms. Porter. Sure. Most of the time any upgrades or
technology are going to have some costs to them, so to have
secure lending opportunities, whether it is through USDA, FSA
programs, whether it is through any of our rural banks and
local banks and lenders, as well as programs through the SBA as
well, too. All of those are very important. Most of the
upgrades are not $100 or $200 fixes.
Ms. Plaskett. Sure.
Ms. Porter. They are usually thousands of dollars.
Ms. Plaskett. Substantial.
Ms. Porter. Yes, absolutely.
Ms. Plaskett. I know in the Virgin Islands, you talk
about--secure loan sounds like a great idea, as well as rural
banks and making them easier for farmers to be able to utilize
is the thing that I think about most.
In the Virgin Islands, our needs are not necessarily age,
but resilience to be prepared for inclement weather and other
issues that we may have. And so, I appreciate some of those
things that you mentioned.
I know Mrs. Georgiades--tell me how to do it right.
Mrs. Georgiades. Spot on. You got it. Me too, I am still
practicing, I promise you.
Ms. Plaskett. When I talked about sustainability and
resilience, you mentioned accurate portrayal of sustainability
in ranching. What practices does your farm employ, and why do
you choose to implement them?
Mrs. Georgiades. One thing I have always made a hallmark on
about our industry is that you cannot find any better
conservationists in the world than agriculture producers. If we
don't have productive land, we can't produce the food and fiber
that our neighbors enjoy.
It has been an interesting conversation from the standpoint
that people will look at agriculture producers and perhaps
really out of not understanding the industry, associate certain
practices that are not accurate with what we do. I have always,
like I said, you cannot find a better conservationist in the
world than agriculture producers, because the things that we
do, for example, in my part of Texas, we are in one of the
highest forage producing areas of the United States. We have
ample rainfall. We have had a little too much this year. It has
been quite interesting. But the benefit is that we are able to
produce forage. And as we know, forage cannot be consumed by
humans to be converted to food.
Ms. Plaskett. Right.
Mrs. Georgiades. And so, the techniques that we use are
different rotational grazing practices, and just optimal
utilization of the natural resources that we are given. And so,
that is our responsibility as producers, and our operation at
Santa Rosa Ranch is to make sure that we utilize those to the
greatest benefit of the cattle and the beef that we are
producing.
Ms. Plaskett. Well, I appreciate that, and I know that
ranchers in the Virgin Islands as well where we produce them,
and created the Senepol bull, which is a very heat-resistant
and made specifically to adapt to environment. I appreciate----
Mrs. Georgiades. Actually, we have exported cattle to other
Caribbean nations also.
Ms. Plaskett. Excellent. We have to talk.
Mrs. Georgiades. Yes. Brangus do just as well as Senepols
everywhere else.
Ms. Plaskett. See, you need to come on down to the Virgin
Islands then.
Mrs. Georgiades. I would love to.
Ms. Plaskett. February is agriculture fair. What better
place to be in February?
Mrs. Georgiades. I think that sounds like a great time to
visit. Thank you.
Ms. Plaskett. I am showing off. Thank you so much.
I just wanted to know, Mr. Chairman, if I might, Mr.
Zimmerman, the importance of Federal research and expertise.
You mentioned that, and why is the Federal research so
important to the turkey industry? And with that, I yield back.
Mr. Zimmerman. Federal research, state research, university
research is always important for new and emerging disease
threats. We don't know what--we knew about avian influenza, but
the highly pathogenic strain, we saw that coming but we didn't
see it coming. But with the help of the University of Minnesota
and Federal research we were able to figure out these different
viral strains, and they are constantly changing and constantly
mutating. And the help of the academia, as I mentioned, to
analyze what is there and what is not there has been incredibly
beneficial.
After our outbreak of avian influenza, there was a massive
study undertaken about why did it happen here and not here, and
through the University of Minnesota and other institutions,
they were able to come up with many theories of why viruses
travel the way they traveled. And it was incredibly beneficial
for us preparing for the next outbreak to have that information
from them. And that is something that only a large institution
like that could do with Federal funding.
The Chairman. All right. We thank the gentleman for his
answer, and we thank the gentlewoman for questioning and her
focus. You sort of hit an interest over on this side about
possibly having a Subcommittee hearing in the Virgin Islands,
part of that conversation.
The gentleman from Pennsylvania, let me recognize Mr.
Thompson.
Mr. Thompson. Thank you, Chairman. Thanks to the members of
the panel for being here today, and thank you for what you do,
and just reinforcing the importance of what you do. We need a
robust American livestock and poultry industry. It benefits
American families in every community. It contributes towards
what we need to achieve of a more robust rural America. And it
also, quite frankly, benefits national security. You are all in
the national security business, actually, from my perspective,
you look at the importance and the priority of food security
when it comes to national security.
Just real quickly, how much of a threat is the workforce
shortage and the unreliability of workforce in the livestock
and poultry industries to our own nation's food security?
Thoughts on that?
Mr. Zimmerman. It is the number one issue we have here in
D.C. this year, and it has been the number one issue for the
last several years. Like I said, it is the one input that we
really have the least control over right now. And without
having people, we can't function. I don't know how to put it
more simply than that. We just need a steady, secure source of
labor to do our jobs.
Mr. Thompson. Yes. Without workforce, there are great
business plans, but you are just not going to be able to
produce, and without that, it is a pretty slippery slope to
food insecurity.
For that reason, if no other reason, I mean, as quickly as
possible as we can get USMCA ratified, approved, and then
obviously, that is the motivation for--and that would give us
great momentum with--trade with other countries. Mexico and
Canada are number one and number four maybe, something like
that, in terms of trading partners. They are certainly top.
We talk a lot about--well, we actually talk a little bit.
We have seen no action on infrastructure. I thought coming out
of the chute in January that would be the first thing that we
would do in a bipartisan way. We haven't gotten there yet. But
when we do, do you see any needs within your industries for
processing? Agriculture processing in my home State of
Pennsylvania is something that--workforce is a limiting issue,
but the availability of sufficient processing for agriculture
products as well. Any ideas or suggestions that we should put
forward to be considered with some type of infrastructure
package that hopefully will be occurring here in the not too
distant future?
Mr. Zimmerman. I guess related to infrastructure, I will
talk about truck weights. That is something that we have been
discussing corn-side, turkey-side, whatever, but if we could--
several states have increased their truck weight limits, and
that needs to be something that would be able to cross state
lines. Some sort of uniformity in truck weights and increasing
those truck weights. We can reduce--it helps with labor because
you don't need as many truck drivers, and it helps with
infrastructure because you don't destroy your roads because you
have less wheel--it is much more efficient. Sustainability, it
helps on so many different levels.
But to have some sort of uniform increase in truck weights
would be very beneficial in a number of ways to our industry.
Mr. Thompson. Mr. Salmon, you mentioned in your testimony
the difficulty of cost enforcement issues associated with the
H-2A program and the sheep industry. Can you elaborate just a
little more with that?
Mr. Salmon. I am sorry, could you repeat part of that
question? I missed part of it.
Mr. Thompson. Sure. Just with the difficulty of cost
enforcement issues associated with the current H-2A program,
specifically to the sheep industry. I wondered if you could
just elaborate on that a bit about what those issues are? Why
doesn't that work well for year-round agriculture?
Mr. Salmon. For us, the sheep herding program is a year-
round function. For the rest of the industry, most of it is
going to be either in processing or in sheep or goat shearing,
which is typically seasonal. But the problem that we have been
faced with is some--what we would call some frivolous lawsuits
against the H-2A program where those folks who have applied for
H-2A workers, and it has really cost a lot of folks a lot of
money to try and deal with that issue.
But we need those workers, because we can't find those
workers--we can't find American folks that will take some of
those jobs.
The Chairman. I agree, and your time has expired, but we
will continue to try to work on this important area.
The last Member on our side for questioning is Congressman
Panetta from the beautiful Central Coast of California. Mr.
Panetta?
Mr. Panetta. Thank you, Mr. Chairman. I appreciate this
hearing. I appreciate this opportunity, and thanks to all the
witnesses for being here, as well as your preparation to be
here. Clearly a lot was put into this, and thank you for your
expertise on this issue as well.
As the Chairman mentioned, I come from the Central Coast of
California, so we have a lot of specialty crops. We have a
little bit of cattle, and some dairy as well. But obviously,
the specialty crops are what we focus on. However, even though
we have different products, I think we all have the same
issues, clearly based on the few questions that I have heard in
these last couple minutes.
Obviously, immigration is very important. Sustainability is
very important. Infrastructure is very important as well. And
yes, I do believe that we need immigration reform. Yes, we
are--want to get to yes on USMCA on this side of the aisle, and
I just came from a Ways and Means meeting where basically
discussions are being had and negotiations are being had as we
speak, in regards to that with the Trade Representative as
well. Bob Lighthizer has done one heck of a job, I believe, in
being accessible and being ready for these types of
negotiations. That is a good thing.
However, I do believe there is also another angle we can
go, and I kind of saved that. Obviously, a lot of people took
all my questions, so now I am at this question right here, and
that has to do with ag tech. Because I do believe that we can
look at mechanization to fill some of our labor issues. I do
believe we can look at ag tech to fill some of our
sustainability issues as well. Being from the Salinas Valley,
which is in the shadow of the Silicon Valley, obviously we have
a lot of those relationships and you are seeing a lot of
private industry make those types of investments. I believe it
is time for the government to step up and also help out as
well, and that is why we wanted some of that mechanization
language in the 2018 Farm Bill, which we got.
But my question to you, to anybody that would be willing to
answer, would be how is ag tech benefitting your industry, and
where do you think--if you could rattle off a couple of
innovations that it has helped, either with producing or--I am
not going to say harvesting, that is us--but producing or
sustainability as well?
Mr. Zimmerman. It is interesting, because just in the last
few months we have actually installed a prototype robot in one
of our turkey barns.
Mr. Panetta. Exactly. Can you go into detail about that,
will you, Mr. Zimmerman?
Mr. Zimmerman. I can go into some detail, but they don't
want too much detail out yet.
Mr. Panetta. I understand.
Mr. Zimmerman. It is mainly to gather environmental
parameters, but also for animal welfare, to check on the health
of the birds and make sure everything--a robot can be there 24/
7, and it can notice problems much quicker than a human could.
Robotics is one thing, but then just computerized
monitoring and sensoring in the barn has been another thing.
Today's hog barn is--I can access my turkey barns right here. I
know exactly what the temperature is in every barn right now.
Things like that and gathering data. Analyzing that data is a
whole other thing. What are we going to do with all the data
once we get it, and that is what we are working on now.
Replacing some labor, but not all. I think it changes the
labor. It helps you become a better manager, and I was always
told all this data and all this modernization will make a good
manager better, and it will make a bad manager worse. You still
need good people in there to do the jobs, and we are also going
to need a new class of people to fix all this increased
automation. Tech degrees, 2 year degrees, people that have the
ability to repair and replace and monitor these computer
systems and these robots and these barns, whether it is
turkeys, hogs, sheep, whatever, are going to be of value in the
future, too.
Mr. Panetta. And are you seeing that kind of shift in some
of your local community colleges, your local colleges as well?
Mr. Zimmerman. Robotics clubs are big. I am 46 years old
and I didn't think I was old, but now I have these 22 and 25
year old kids coming out and putting robots in my farm and
talking a language I don't even understand.
Mr. Panetta. Yes.
Mr. Zimmerman. But some of them played football, but most
of them were in a robotics club. It is a whole new world.
Mr. Panetta. Yes, and look, you are right. I think nothing
will replace our human intuition. As a farmer said to me, the
best fertilizer is a farmer's shadow, and I a firm believer in
that. However, I do believe that, like you said, there has to
be some improvements to make it a little bit easier in regards
to dealing with some of the conditions we have, and especially
with sustainability. If there is anybody else that has anything
to say in regards to how ag tech has helped your industry?
Ms. Porter. I would just echo, again, what Mr. Zimmerman
said, and in addition to that, it has also been talked about
too, just the importance of ag research. The ag tech, you do
have individual companies that are looking at this; but, it is
also important again in looking back at academia and working
with our land-grant universities and having the ability to work
with them and work with that research. The land-grant
universities, through their practical research, through their
extension services, working directly with growers, farmers are
really going to be some of your best ways to help advance and
continue to advance any ag technology out there.
Mr. Panetta. Outstanding. Once again, thank you, ladies and
gentlemen. I yield back my time.
The Chairman. I thank the gentleman for his questioning and
his comments, and we are now prepared to adjourn. I will
recognize the Ranking Member here for any closing remarks that
he may want to make.
Mr. Rouzer. Well thank you, Mr. Chairman. I want to thank
each of the witnesses for being here today, for providing your
testimony and your expertise to us. It means more than you
know. It is very valuable to the Committee as a whole, as well
as Congress in general.
There are a number of issues out there that are challenges,
and a number of those were highlighted today, and I appreciate
your input on that. I want to underscore again just how
important it is to get USMCA ratified. Probably if there is one
thing Congress can do between now and the end of the year, I
don't know of anything more important than that. Of course, we
have other things on the plate that we got to deal with, the
caps agreement and budget deal, and appropriations bills, et
cetera. But from a policy standpoint and trade policy
standpoint, I don't know anything more critical to agriculture.
Let's keep up a full court press to get that vote, and get that
agreement ratified.
With that, Mr. Chairman, I appreciate the opportunity to
join you today, and your work on these particular topics, and I
yield back.
The Chairman. Well thank you very much, Ranking Member, for
your coordination and collaboration with this Subcommittee. We
appreciate it. I think we had a good hearing this morning. I,
too, concur that besides dealing with our budget bills and
dealing with sequestration and lifting the debt ceiling, which
are among our first priorities, clearly, to keep government
funded, passing the USMCA measure would--before the end of the
year--be significant on behalf of not just American
agriculture, but our partnerships with Mexico and Canada and
continuing to build on our economy and provide certainty as we
try to deal with other trade agreements as well.
Quickly, Mrs. Georgiades, California may not have as many
beef cattle as you have in Texas, but we have a lot of them
too. We exported $375 million in beef products. Beyond
maintaining our tariff re-access to Mexico and Canada, can you
see us getting a deal with Japan, and what other markets are
most important to the U.S. beef producers?
Mrs. Georgiades. Japan is our number one market. South
Korea is our second. Mexico is our third. Canada is our fourth,
and Hong Kong is fifth. Hong Kong is the pass-through market to
China.
The Chairman. It is mainly that gray market in Hong Kong,
is it not?
Mrs. Georgiades. It is, and they admit to it, too. Yes,
that is what they do call the gray market. Working with the
European Union at this point in time is another strong effort
that we are making to fortify those agreements as well. But as
I mentioned before, the uncertainty that surrounds these
different trade issues that we have are what make people
concerned. I think that passing USMCA, ratifying this will give
people confidence. I would say it would give our producers
confidence to perhaps invest in and expand their operations
even more so, understanding that we are moving forward and
trying to have some of these agreements in place with our
largest partners.
The Chairman. And it is not just beef, but it is all
commodities that we grow in this country
Mrs. Georgiades. It is, correct.
The Chairman. I won't bother to take you through the list
of California commodities. Forty-four percent of our
agriculture is dependent upon export, and so these trade wars
are not helping that at all, and the mitigation is a pittance
in comparison.
Well, I thank my colleagues. We got a good conversation on
not only specifics within livestock and poultry, but also the
challenges that all of our industries are facing with regards
to immigration and trade, something that American agriculture
deals with in common, and we must try to provide solutions in
those areas.
With this work of the Subcommittee done this morning, under
the Rules of the Committee, the record of today's hearing will
remain open for 10 calendar days to receive additional material
and supplemental written responses from witnesses to any
questions posed by a Member.
This hearing of the Subcommittee on Livestock and Foreign
Agriculture is now adjourned. Thank you.
[Whereupon, at 11:59 a.m., the Subcommittee was adjourned.]
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