Representatives of 29 of the nation's farm and commodity organizations met today to seek common ground to address the serious economic conditions now facing America's farmers and ranchers. The goal of the summit was to develop short and long term common principles of agreement in critical areas for U.S. agriculture, including the farm safety net, risk management, industry concentration andinternational trade.

The current economic environment for U.S. agriculture is extremely volatile, and prospects for improvement highly uncertain. Financial problems in Asia, Russia and South America in the last two years have triggered an $11 billion decline in foreign demand for U.S. food and fiber. The world's agricultural producers have responded to falling prices by maximizing production, pushing prices and farm income to historic lows. Last year, our income protection and crop insurance programs proved unable to offset rising farm losses, requiring an additional $5.9 billion in emergency economic and crop disaster assistance. The outlook for low prices and farm income in 1999 is at least as critical.

During the same period, trends in U.S. agribusiness and in domestic and international trade policies have increased concerns about the competitiveness of U.S. agriculture in the 21st century. Growing concentration of ownership in basic industries - in crop and livestock merchandizing and processing, and in farm inputs such as seed, technology, and crop protection products - is increasingly restricting producer options, and threatens to reduce market opportunities and raise production costs. Unilateral economic sanctions prohibiting agricultural sales and humanitarian assistance to key markets for reasons of foreign policy continue to benefit our foreign competitors.
 
Participants at the national agricultural summit discussed these issues in four plenary sessions, followed by a closing session to determine principles of agreement. Our intention is to communicate our concerns, including policy recommendations on which we have reached consensus, to Congress and the Administration to assist their efforts to address the economic crisis in American agriculture. Positions on which agreement has been reached are identified on the accompanying list.

Safety Net

• To address the numerous challenges America's farmers and ranchers face, we urge Congress to increase the agriculture budget allocation and appropriations by such sums necessary.
• The marketing loan is an essential component of the safety net for U.S. grain, oilseed, and cotton producers. The program could be strengthened by eliminating local and regional inequities in loan program operation.
• Fully fund 1998 disaster assistance programs and provide for timely payments.
• We support full restoration of funding for cotton's Step 2 Program for the remainder of the FAIR act.
• We support immediate congressional action to pass the fiscal 1999 emergency supplemental appropriations bill to provide additional needed funding for Farm Service Agency's (FSA) guaranteed loan program.
• We support a temporary freeze on further reductions in field staff of the county FSA offices.
• We support the continuation of federal market order system. We oppose the reductions in dairy farmer income as evidenced by  the March 1999 Market Order Reform plan announcement.
• The Federal Tobacco Program has been successful since 1941 in keeping tobacco farmers profitable. This program should continue to serve as an arms-length transaction to protect the tobacco farmer from the ever-growing tobacco companies who have recently proposed contract buying. Any proposed change in the program by tobacco farmers needs to be endorsed and supported by farm organizations and by Congress.
• We support the upgrading and modernization of the inland waterway transportation system with trust funds.
• We support the current price support program structure for peanuts. Maintain current government cost provision.

• We support the current sugar loan program. Elimination of marketing assessment. Elimination of one-cent forfeiture penalty.
• We support the minor oilseed marketing loan program at $9.30 which includes sunflower, canola, mustard and crambe.
• We support the continuation of the current dairy price support program through 2002 to coincide with the farm bill expiration.
• We urge Congress to consider a federal tax credit/refund for state and local property taxes paid in the event an  across-the-board tax cut is enacted.
• We support making family farms and small businesses eligible for up to $500,000 in capital gains tax exemption for the sale of  farm or business property.
• The concept of a National Renewable Fuels Standard shall be supported.
• We support federal farm programs due to the fundamentally unique business structure farmers have.
• We urge the Surface Transportation Board (STB) ensure fair and equitable treatment for all shippers, (elevators, etc.) especially those who have reasonable access to only one railroad.
• We support that EPA use sound scientific actual use data and not assumptions in the regulation writing for FQPA.

GENERAL

• American farmers and ranchers need increased access to world markets for their products, and markets free from unfair import and export trade practices.

• We believe that producers and the congressional agriculture committees should be actively involved in preparations for and oversight of trade negotiations.
• We support making the Special Ambassador for agriculture a permanent position in the Office of the U.S. Trade Representative.
• We support consistent standards in classifying countries as developed or developing where that classification affects trade negotiations or trade patterns.

• We believe that U.S. exports of food, fiber, and food and fiber products should not be used as the subject of sanctions.
• We believe dispute resolution procedures should be improved and sped up (especially for seasonal products) with adequate assurance of compliance or with penalties or compensation once decisions are reached.
• We believe that imports of agricultural products should meet U.S. standards for production and processing where consumer health or the environment may be impacted.
• We believe that export subsidies as defined in the Uruguay round should be immediately eliminated on a multilateral basis.
• We believe that the President should immediately approve the pending license request to permit the sale of agricultural commodities to Iran.

• We support a trade adjustment assistance program to counterbalance distortive trade impacting practices of exporters.
• We believe that trade negotiations should encourage more private sector trading and less state trading or state supported trading in agricultural commodities.
• We believe funding for agriculture export and food assistance programs should be increased.

• We believe that the needs of U.S. agriculture be considered in the development of monetary policy, including safeguards again unfair manipulation of exchange rates.
• We believe that efforts should be supported to bring eligible countries into the World Trade Organization, on terms that are favorable to U.S. agriculture.

• Competitive markets are good for farmers, ranchers, and consumers.
• We call on the Congress, the U.S. Department of Agriculture (USDA), the Department of Justice, and the Federal Trade Commission to monitor and investigate all mergers, ownership changes, interlocking directorates, joint ventures and strategic alliances in the agriculture industry to determine whether competitive markets for farmers and ranchers have been or will be compromised; and take necessary steps to prevent and/or reverse such mergers and ownership changes.
• We call for Congress to provide adequate funding for consistent oversight and vigorous enforcement of antitrust laws, including Section 202 of the Packers & Stockyards Act. We also call on Congress to examine the relevance of existing antitrust and monopoly laws for the 21st century.
• We support investigation by proper agencies as to whether the concentration in agriculture is harmful to crop and livestock producers' profitability.
• We support creation of a public policy environment that would foster and expand competitive market opportunities and infrastructure.
• We support mandatory price and volume reporting for all livestock slaughtered, processed and marketed in the U.S. by packers,  processors and importers that control a significant portion of a national or regional market for a particular commodity.
• We encourage a review of federal policies on the patenting and licensing of agricultural products produced through public or private funding.
• We call for development and implementation of national legislation prohibiting unjust or unreasonable conduct by a business that is in a dominating position in contracting, supplying or buying agricultural goods or services.
• We oppose the use of the USDA grade label on imported meat.
• We call on Congress to amend the Clayton Act to give standing in Federal court to indirect purchasers, in price fixing and other anti-trust cases (i.e. Repeal the Illinois Brick decision).

CROP/REVENUE RISK MANAGEMENT

We support crop/revenue insurance as only one of the components of an adequate farm safety net. Modifications should be made to the  federal insurance programs to expand production and revenue coverage opportunities for all producers at more affordable premium rates and improve program performance and delivery. These programs need to be compatible with market risk management opportunities. Increased participation will enhance the actuarial soundness of the programs while ensuring greater economic stability in production agriculture.

• Improved coverage levels at affordable premium cost will reduce the need for ad hoc production loss disaster programs.
• Administrative reform will improve the efficiency and integrity of the crop insurance programs.

• Provide increased and inverted premium subsidies for crop loss products.

• Allow for program adjustments to minimize the coverage impact of natural disasters.
• Develop multi-year coverage options.
• Modify quality adjustment provisions to reflect market discounts.
• Establish innovative coverage options.
• Support revenue-based risk management tools for all states and crops.
• Provide equity and comparability of coverage across production sectors and regions, including prevented planting and replant coverage based on actuarially sound data.
• Develop nationwide pilot programs to expand coverage availability for crops and livestock.
• Correct/modify the rating methodology to reflect actual production capacity.
• Provide individualized "good experience" discounts.
• Review the risk and expense sharing agreements between the insurance companies and Risk Management Agency (RMA).

• Provide regulatory and monetary incentives to encourage the development of new crop insurance products.
• Reform the Federal Crop Insurance Corporation (FCIC) / Risk Management Agency (RMA) relationship to clarify roles and responsibilities, improve producer representation and reduce any conflicts of interest.
• Improve public/private effectiveness in reducing program fraud and abuse.

• We support an effective regulatory system for the agricultural futures and options markets enforced by Commodity Futures Trading Commission (CFTC) to ensure market integrity, transparent commodity price discovery and enhance market price risk management opportunities for agricultural producers. The oversight function of the Senate and House Agriculture Committees should be maintained.
• We support CFTC providing stronger enforcement of the prohibition of insider trading and market manipulation.

• We support the availability of agricultural credit in rural America at affordable interest rates.
• There should be an adequate funding base and program regulation modifications to ensure adequate agricultural credit  availability for farmers and ranchers through the USDA direct and guaranteed loan programs.
• USDA's credit programs are necessary to ensure eligible producers have adequate credit during economic crises.
• USDA credit programs provide an opportunity for eligible beginning and limited resource farmers to enter and remain in agricultural production.
• USDA regulatory flexibility is needed to allow the program to adjust and react to changing economic needs of borrowers while minimizing the risk of losses to the program.
• Make Chapter 12 Bankruptcy permanent law.