Letter Conveys Crop Insurance Support

Froman Nominated As USTR

Spill Compliance Plan Deadline Near

NCC Support of FUELS Act Conveyed

Honey Bee Report Released

Reform Bills Expand OSH General Duty Clause

NAS Report Addresses ESA/FIFRA Conflict

Specifications Finalized For USDA Review

Sales, Shipments Strong Again

The NCC joined 43 other agricultural organizations in cosigning a letter to Senate Agriculture Committee Chairwoman Stabenow (D-MI) and Ranking Member Cochran (R-MS) supporting crop insurance and opposing provisions that would limit its effectiveness.

The letter, on the NCC's website at www.cotton.org/issues/2013/upload/13cropinsletmay1.pdf, stated that insurance products offered through federal crop insurance are essential to food security, allowing farmers and ranchers to secure operating capital from lenders each year and produce food for consumers around the world. Agricultural producers keep the rural economy on track, purchasing needed inputs and equipment and supporting jobs throughout rural America. Without the risk protection provided by federal crop insurance, agricultural lenders would be forced to increase underwriting standards, increase costs to offset risk and reduce credit availability in some areas of the country to some producers.

The letter noted that as with other lines of insurance, crop insurance requires a broad pool of participants to function properly. Arbitrarily assigning a means test for support will affect the pool of participants, both in the near term and longer term. If adopted, an income means test can reasonably be expected to be more restrictive in the future. Means testing unfairly discriminates against full-time farms and those producing higher value crops, such as specialty crops.

The organizations said that making crop insurance protection unaffordable would cause producers to reduce their program participation, resulting in a higher risk pool of insured producers, higher loss ratios over time and increased premium rates for those who remain in the program. Limiting crop insurance protection also would yield the unintended consequence of increased calls for ad hoc, off-budget disaster assistance, which were not heard during the devastating '12 crop production year.

The Committee is expected to mark up its version of the farm bill this month with floor action this summer. Crop insurance undoubtedly faces challenges as opponents already have indicated their intention to propose damaging amendments to this program.

President Obama has nominated Michael Froman to serve as US Trade Representative (USTR) and Penny Pritzker to be the next Commerce secretary. Froman currently serves as deputy national security adviser for International Affairs at the White House.

Given Froman's close and long term relationship with President Obama (Harvard law school classmates), his nomination seems to indicate that the office of USTR will play a stronger role in developing and implementing US trade policy. Many believe that in recent years, major trade policy decisions were made in the White House, with Froman playing a key role. Some analysts believe Froman will be one of the most powerful US Trade Representatives in recent administrations. He played an important role by helping to negotiate the automobile provisions in the South Korea-US free trade agreement. The business community believes Froman has a thorough knowledge of trade issues and a proven ability to close deals. They are enthusiastic about his nomination.

Pritzker formerly served on the President's Council on Jobs and Competitiveness and the Economic Recovery Advisory Board. As heir to the Hyatt hotel chain founder, she is one of the wealthiest Americans. She is considered to be close to the President given her strong financial support for his campaigns and as a prominent member of the Chicago business community.

At USDA, Secretary Vilsack announced that Under Secretary for Farm and Foreign Agriculture Services (FFAS) Michael Scuse will serve as Acting Deputy Secretary with the departure of Kathleen Merrigan. Thus, current FFAS Deputy Under Secretary Darci Vetter will serve as acting Under Secretary; Susan Heinan, the current administrator of the Foreign Agriculture Service (FAS), will serve as acting Deputy Under Secretary; and Phil Karsting, former chief of staff to retired Sen. Kohl (D-WI), will be named FAS administrator.

May 10, '13 is the compliance date by which owners/operators of a regulated farm or facility must have an Oil Spill Prevention, Control, and Countermeasures (SPCC) plan. Fines may start at $1,000 for not having an SPCC plan in place and can go up to $35,000 per day.

Regulated farms or facilities are those that meet all three of the following:

• Stores, transfers, uses, or consumes oil or oil products such as diesel fuel, gasoline, lube oil, hydraulic fluid, adjuvant oil, crop oil, vegetable oil or animal fat; and
• Stores more than 1,320 US gallons in aboveground containers or more than 42,000 US gallons in completely buried containers; and
• Could reasonably be expected to discharge oil to waters of the US or adjoining shorelines such as interstate waters, intrastate lakes, rivers and streams.

Aboveground storage is calculated by adding capacity of containers 55 gallons or larger. Farms or facilities with aboveground capacity greater than 1,320 gallons and up to 10,000 gallons with no single container greater than 5,000 gallons and who also have a good spill history may prepare and self-certify their SPCC plan (Tier I).A Tier I template and example Tier I Plan is available at is available at www.epa.gov/osweroe1/content/spcc/spcc_ag.htm.

Farms or facilities with total aboveground storage greater than 10,000 gallons or with single containers greater than 5,000 gallons may need to have a SPCC plan certified by a Professional Engineer.

The EPA's SPCC Farms Fact Sheet at http://www.epa.gov/emergencies/docs/oil/spcc/spccfarms.pdf is the best information source for evaluating responsibilities under the SPCC Program. Farm owners/operators should first establish whether they qualify as a regulated facility.

Owners/operators are reminded that containers on separate facilities are not to be added together when determining total oil storage capacity. It is not uncommon for a farm to be comprised of multiple facilities with respect to oil storage.

It is also recommended that owners and operators document and file explanations of circumstances that exclude them from this rule. Exemption from this rule does not exclude responsibilities for clean-up of oil spills or any containment requirements for their storage containers.

In a related development, included in the continuing resolution to fund government operations through the end of the fiscal year was an amendment by Sen. Inhofe (R-OK) that prohibits the use of funds to enforce EPA's SPCC rule against farmers for the remainder of FY13 or until Sept. 30. However, EPA has advised Congressional offices that under this amendment, its enforcement of the rule will begin on Oct. 1 but will be retroactive to May 10—the date the rule becomes effective.

Keith Menchey, NCC's manager of Science & Environmental Issues, sent a letter to Sens. Pryor (D-AR) and Inhofe (R-OK) conveying the cotton industry's support for their efforts to advance S. 496, the FUELS Act(see 3/15/13 Cotton's Week).

The letter stated that, "Your bill will alleviate the costly regulatory burden on farmers resulting from EPA's Spill Prevention, Control, and Countermeasure (SPCC) Rule. EPA's unusual threshold number of 1,320 gallons has no basis in science or in normal tank sizes for agriculture. S. 496 will raise that threshold to a more realistic and practical level."

The letter noted that the Senators' bill also will allow more farms to self-certify rather than hiring a qualified professional engineer.

Sens. Pryor and Inhofe are planning to introduce S. 496 as an amendment to the Water Resources Development Act, which may be on the Senate floor soon.

USDA Deputy Secretary Kathleen Merrigan and EPA Acting Administrator Bob Perciasepe jointly released a new report on the factors contributing to US honey bee health decline. The report summarizes the latest science and emerging research on honey bee health as discussed at The National Stakeholder Conference on Honey Bee Health in Oct. '12.

The report shows that the observed decline in pollinator health is due to multiple factors, including parasites and disease, genetics, poor nutrition, and pesticide exposure. Solving this challenge will require continued collaborative work between the federal government, researchers, beekeepers, growers, industry and the public. The report is the product of unprecedented collaboration and shows that while there is much work yet to do, solutions to this serious challenge are being developed.

Meanwhile, the European Commission said it will proceed with a moratorium in the European Union (EU) on three widely used neonicotinoids - clothianidin, imidacloprid and thiamethoxam - alleged to cause bee colony decline, despite the failure by EU voting rules to obtain the 255 votes necessary for a qualified majority vote. The moratorium will prohibit use of the pesticides after Dec. 1, '13, for seed treatment, soil application (granules), and foliar treatment on bee-attractive plants and cereals. The restriction's initial period will be two years during which the Commission said it will review the three neonicotinoids' approval conditions.

House and Senate bills, H.R. 1648 and S. 665, both designed to reform the Occupational Safety and Health (OSH) Act, would expand the law's general duty clause to include employees who work for contractors and independent contractors at multi-employer worksites. The OSH Act currently extends general duty protections only to a company's own employees.

The House version, introduced by Rep. Miller (D-CA), is a bit more narrow and would limit general duty clause coverage to hazards "that the employer creates or controls," or to which the employer exposes any direct employee or other person performing work at the worksite.

Both the House and Senate bills modify the general duty clause to allow for per-employee, or instance-by-instance, citations under the Occupational Health & Safety Administration's (OSHA) egregious penalty policy. This provision would address a '97 decision by the US Court of Appeals for the Fifth Circuit in Secretary of Labor v. Arcadian Corp. which prohibited OSHA from citing employers for each employee exposed to a hazard under the general duty clause.

The bills have been referred to the House Education and the Workforce Committee and the Senate Health, Education, Labor and Pensions Committee, respectively.

The National Research Council (NRC), a part of the National Academy of Sciences (NAS), released its report on improving the scientific assessment of risks to endangered species from pesticides. Sponsored by the National Oceanic and Atmospheric Administration, EPA, US Fish and Wildlife Service (FWS), and USDA, the report concluded that when determining the potential effects pesticides could pose to endangered or threatened species, EPA, the National Marine Fisheries Service (NMFS) and FWS should use a common scientific approach.

Under the Federal Insecticide, Fungicide & Rodenticide Act (FIFRA), before a pesticide can be registered in the United States, EPA must ensure that it does not cause unreasonable adverse effects on the environment, which includes species that are listed as endangered or threatened and their habitats. Moreover, the Endangered Species Act (ESA) requires federal agencies, including EPA, to consult with FWS and NMFS when a federal action "may affect" a listed species or its habitat. If EPA determines that a pesticide is "not likely to adversely affect" a listed species -- and FWS or NMFS agrees -- no further consultation is required.However, if EPA determines that a pesticide is "likely to adversely affect" a listed species, a formal consultation with FWS or NMFS is required. At that point, FWS or NMFS determines whether a proposed action is likely to jeopardize the listed species and issues a biological opinion.

Over the last decade, the consultation process for pesticides has been non-functional. In the '04 Washington Toxics case, the court determined that EPA must consult with FWS or NMFS on pesticide registrations. Since that time, not a single pesticide consultation has been completed. EPA, FWS and NMFS have developed their own approaches to pesticide risk assessment because of differing legal mandates, institutional cultures and expertise. Although the agencies have tried to resolve their differences in assessment approaches, they have been unsuccessful at reaching a consensus. As a result, the NRC was asked to examine the scientific and technical issues related to determining risks posed by pesticides to listed species.

The committee that wrote the report said a common approach among the agencies is needed. If FWS and NMFS could build on EPA's analysis of whether a pesticide is likely to adversely affect a listed species rather than conduct a completely new analysis, the assessment would likely be more effective and scientifically credible, the committee determined. Furthermore, agreement among the agencies has been impeded by a lack of communication and coordination throughout the process. Therefore, the committee emphasized the need for coordination, which it views as necessary to ensure a complete and representative assessment of risk and that each agency's technical needs are met.

Speaking last week at a conference sponsored by CropLife America, industry and non-governmental organization representatives suggested the NAS report is unlikely to even settle the scientific disputes between EPA and the wildlife agencies over how best to assess risks to species from pesticides or what mitigation measures are appropriate to ensure they are adequately protected.

The '13 Joint Cotton Industry Bale Packaging Committee (JCIBPC) Specification Review Subcommittee adopted revisions to the JCIBPC's '12 Specifications for Cotton Bale Packaging Materials (specifications). The Subcommittee's task was to make sure that all JCIBPC actions were properly recorded in the 2013 specifications.

Only two changes to the specifications were adopted by the JCIBPC this year. The first change was to standardize minimum gauge thickness for all PET strapping devices. The second change made sure the new polypropylene bagging construction that was approved by the JCIBPC was properly recorded in the specifications. Other than date revisions, no other changes to the previous year's specifications were made.

The next step in the publication process is sending the Subcommittee's recommendations to USDA for final action. Once USDA reviews and approves the changes, the specifications' new edition will be published on the NCC website at www.cotton.org/tech/bale/specs/index.cfm.

Net export sales for the week ending on April 25 were 333,700 bales (480-lb). This brings total '12-13 sales to approximately 13.0 million bales. Total sales at the same point in the '11-12 marketing year were approximately 11.9 million bales. Total new crop ('13-14) sales are 1.5 million bales.

Shipments for the week were 391,100 bales, bringing total exports to date to 10.0 million bales, compared with the 8.3 million bales at the comparable point in the '11-12 marketing year.