Provisions Of The 2008 Farm Bill That Pertain To Livestock

Producers

Rodney Jones

OSU NW Area Extension Economist

Livestock Provisions

• COOL (Country of Origin Labeling)• LIP (Livestock Indemnity Program)• LFP (Livestock Forage Disaster Program)

COOL

• Brief History,– Controversial (supporters say it sells more

product, opponents say it costs too much and is hard to implement)

– Became law in 2002 farm bill– Implementation delayed, became mandatory for

fish and seafood in April, 2005– Implementation for other covered commodities

again delayed– Some modifications in 2008 farm bill,

implementation time line set

Implementation Timeline

• Rules in place September 30, 2008

• 6 month grace period for full compliance– Gets us to about April 1 for full compliance

• Implementation began immediately– Product produced prior to September 30,

2008 exempted

Covered Commodities

• Muscle cuts of beef, lamb, chicken, goat, and pork

• Ground beef, lamb, chicken, goat, and pork

• Wild and farm raised fish and shellfish• Fresh and frozen fruits and vegetables• Peanuts, pecans, macadamia nuts, and

ginseng

Who is Involved

• Retailers of covered commodities with an invoice value of at least $230,000.00 annually

• Rules about the labels– In English, legible, not obscuring other info,

consistent with FDA, FSIS, CBT, etc.– Meat origin categories include: U.S. Origin;

Multiple Countries of Origin; Imported for immediate Slaughter; and Imported meat

– Ground product labels must include all actual or reasonably possible countries of origin

Retailers Must Keep Records

• Origin, supplier, identity of covered commodities

• Maintained for one year

Who (What) is Exempt

• Food service establishments– Restaurants, food stands, taverns,

lunchrooms, etc.

• Processed foods– Changed in character by cooking, drying,

curing, smoking, etc.– Food that is mixed with another food item

Why Should Producers Care?

• Retailers of covered commodities with and invoice value of at least $230,000.00 annually

• Suppliers of covered commodities must provide origin information to buyers

Suppliers (Growers, Distributors, Handlers, Packers, and Processors)

Must Keep Records• Make available information to the

subsequent purchaser about the country of origin of the covered commodity

• Maintain records to establish and identify the immediate previous source, and the immediate subsequent recipient of a covered commodity or one year from date of transaction

Records

• Must be legible• Hard copy or electronic• Records used in the normal course of

business are acceptable• Maintained in any location• Must be made available to USDA

representatives within 5 days if requested

In The Case of Meat, Packers are Responsible for Making the Origin

Declaration• Packers must possess or have legal access to

records necessary to substantiate that declaration

• Visual inspection may be sufficient???• A producer affidavit is acceptable evidence of

origin provided it is from someone with firsthand knowledge of the origin of the animals, and identifies the animals unique to the transaction

Affidavits

• Readily available from industry sources (organizations, markets, web, etc.)

• Continuous affidavit – kept on file with market outlet until revoked by signer

• Specific transaction statement – stand alone for specific transaction, can be used on invoices and other sales documents

• Packers may request a statement indicating that records will be kept and made available as required by law

Cow-Calf Implications• Supply affidavits for animals sold if asked– Record buyer, date, and location of sale

• Keep records to document claims– Herd and calving records– Vet and feed records

• Document herd inventory, and changes since July 15, 2008

• Inventory raised cows and bulls• Request and file affidavits on any livestock

purchased including breeding stock

Stocker/Feeder Implications• Request and file affidavits for all purchased

animals (record seller, date, and location)• Provide affidavits for all sales (can be in

groups (keep records to verify inventories)• Can co mingle and re sort as long as under

same origin• Segregate domestic and imported animals

unless individual ID is used

NAIS system is acceptable verification

LIP and LFP

• Established through the Agricultural Disaster Relief Trust Fund

• Programs Include– Supplemental Revenue Assistance Program (SURE)

– Livestock Indemnity Program (LIP)

– Livestock Forage Disaster Program (LFP)

– Emergency Assistance for Lvstk, Honey bees, and Fish (ELAP)

– Tree Assistance Program (TAP)

LIP

• Will compensate producers for livestock death losses– In excess of normal mortality due to adverse weather– Between 1/01/08 and 10/01/11

• No sign-up period. Apply when disaster apparent– Within 30 days of loss

• No disaster declaration required• Payment = 75% of market value of livestock on

day before death

Adverse Weather Events

• Wildfire, Blizzard, Hurricane, Tornado, Lightning, Ice Storms, Earthquakes, Flood, Tropical Storm, Extreme cold or heat.

• Disease that caused death must be related to an eligible adverse weather event to trigger LIP

• Drought is not a trigger (because it is covered under LFP) unless it is associated with anthrax, a condition that is associated with drought

Eligible Livestock

• Beef and Dairy cattle (all weights), Buffalo, Beefalo, Equine, Elk, Reindeer, Deer, Sheep, Alpacas, Emus, Swine, Goats, Llamas, Poultry

• Must be livestock that normally graze• Must be maintained for commercial use part of

a farming operation• Ineligible – Hunting animals, Show animals,

Pleasure animals, Rodeo Stock, Pets, Animals kept for home consumption

LFP

• Covers grazing losses due to drought, as determined by the intensity level of the U.S. Drought Monitor– Payments are 1, 2, or 3 monthly payments,

depending on the intensity of the drought

• Rate is 60% of the lesser of– Feed grain equivalent

– Monthly feed cost based on normal grazing land carrying capacity

Drought-Loss Categories

• D2 (severe drought): 8 consecutive weeks in any area of the county during the normal grazing period = 1 monthly payment

• D3 (extreme drought): any area of county at any time during the normal grazing period = 2 monthly payments

Drought-Loss Categories

• D3 (extreme drought): 4 weeks in any area of the county during the normal grazing period = 3 monthly payments

• D4 (exceptional drought): any area of county at any time during the normal grazing period = 3 monthly payments

• 3 months is the maximum payment on same livestock

Eligible Livestock and Forages

• Livestock normally grazing in an eligible county during the normal grazing period– During the 60 days prior to the qualifying drought (or

fire) were owned, leased purchased, contracted for purchase, grown under contract, or disposed of due to drought conditions

• Native or improved pastureland with permanent vegetative cover

• Forages planted specifically for the purpose of grazing (small grain, forage sorghum)

To Be Eligible

• Producer must either have purchased NAP coverage on the forage, or have purchased a forage insurance product for the months in which the drought occurs

• Thank You

• Questions or Discussion !!!!