May 29, 2006
Mid-Sized Grain, Oilseed Handlers Face June 9 FDA Recordkeeping Start-Up
FDA regulations requiring mid-sized food and feed companies to maintain strict recordkeeping are scheduled to go into effect June 9, and the National Grain & Feed Association (NGFA) has issued two guidance documents to aid in the process. FDA’s bioterrorism recordkeeping regulations apply to most industry firms that receive, store, manufacture, process, pack, distribute, transport or import raw grains and oilseeds, feed, feed ingredients, food or other agricultural products in the United States. They became effective last December for companies with 500 or more employees; they become effective June 9 for companies with 11 to 499 full-time employees. For firms with 10 or fewer employees, the regulations take effect this coming December.
Companies covered by FDA’s bioterrorism recordkeeping regulations are required to establish and maintain records sufficient to identify what the regulations call “the immediate previous source” (the supplier/seller) of the agricultural product and the “immediate subsequent recipient” (the buyer/receiver) of the product. “Put simply, the FDA bioterrorism regulations require a one-step-back and one-step-forward recordkeeping to track products,” says NGFA.
Companies that transport agricultural commodities, feed, feed ingredients and other food products also are required to establish and maintain records containing information that is “reasonably available” to identify the shippers and receivers of such products.
FDA’s bioterrorism recordkeeping regulations provide partial exemptions for certain types of retail food establishments, including commercial feed dealers and retail feed stores. To qualify for the exemption, the total annual dollar value of sales by a retail store direct to final consumers must exceed the value of sales to all other buyers, which include farms, livestock and poultry feeding operations and other businesses.
According to NGFA President Kendell Keith, trade associations can provide information “that can assist grain, feed and processing firms immeasurably in better understanding the kind of recordkeeping information FDA requires, as well as available compliance options.”
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House Completes Work On FY2007 Agriculture Appropriations
The House last week passed (by a vote of 378-46) a $93.6 billion FY2007 agriculture appropriations bill. The Senate Agriculture Appropriations Subcommittee has yet to mark up its version of the legislation.
In total, the House bill provides $18.4 billion in total discretionary resources, a decrease of $96 million below the FY2006 enacted level and $564 million over the president’s budget request. As for mandatory spending, the House bill would provide for $76.1 billion, down from $83.1 billion in FY2006 and slightly below the $76.4 billion requested by the president. Mandatory spending includes funding for such things as the entitlement programs for food stamps and crop subsidies.
House members adopted an amendment by Agriculture Appropriations Committee Chairman Henry Bonilla (R-Texas) to restore about $40 million to the environmental quality incentives program (EQIP). Overall, conservation programs received $791 million, a decrease of $40 million from last year.
The bill would provide $80 million to fund avian influenza countermeasures and monitoring, and about $90 million for mad cow detection and prevention activities. It also would provide $19.7 billion for USDA’s Commodity Credit Corporation and $1.2 billion for PL-480, the food for peace program.
$4 Billion Proposed As Farm Aid Opposed By Bush Administration And House
The Senate wants to spend nearly $4 billion this year to help farmers pay for high fuel prices and damage from severe weather. However, House leaders object to the aid, saying Congress spends taxpayer dollars too freely, and President Bush is threatening to veto the aid. The White House dislikes the farm aid because it raises the total amount of the spending bill for the Iraq war and hurricane recovery.
Beyond that, the farm money wouldn’t give energy relief to every farmer, said Agriculture Secretary Mike Johanns. Even without the disaster aid, the government will spend an estimated $17 billion subsidizing farmers this year. It will spend at least another $3.6 billion on crop insurance, which covers unavoidable crop losses. Unlike subsidies, which go to the major crops, crop insurance is available for all kinds of crops, from avocados to macadamia nuts to sunflowers.
U.S. Projects Farm Exports To Hit $67 Billion In 2005-06
USDA is forecasting U.S. agricultural exports will reach $67 billion during the current fiscal year which ends Sept. 30. The forecast is up $2.5 billion from USDA’s February estimate. Both higher prices and export volumes for corn and sorghum were credited for the increase.
USDA also said China has supplanted the EU as the No. 4 customer for U.S. farm products. The top five customers (and the value of U.S. agricultural product purchased) are: Canada ($11.4 billion), Mexico ($10.4 billion), Japan ($8 billion), China ($6.8 billion) and EU ($6.6 billion).
Japan’s Soybean Imports To Remain High In 2006, USDA Says
Soybeans are the most imported oilseed in Japan. USDA estimates that total imports of soybeans for 2006 are forecast to be 4.2 million tonnes, down slightly from 2004 and 2005, due to reduced soybean crushing. The U.S. share of imports should remain at the 2005 level of roughly 76 percent, USDA says.
Japan’s total utilization of soybeans in 2004-05 was about 4.5 million tonnes with domestic production accounting for 226,400 tonnes and imports accounting for the remainder. Imports were mainly from the U.S. (3.13 million tonnes) over that period.
In 2005, about 74 percent of total demand for soybeans was for oil use; 23 percent was for food use; and the remaining 3 percent was for feed use, according to USDA estimates. Food soybeans are used in Japan for tofu (soybean curd), frozen tofu, fried tofu, miso (soybean paste), natto (fermented whole beans), boiled soybeans, and soy sauce. USDA finds that soymilk and soy bars are gaining in popularity in Japan as well.
Meanwhile, the meal from soybean crushing is used for both animal feedstuffs and further processing into such products as soy protein and soy sauce. All Japanese users of food soybeans require “non biotech” varieties from their suppliers, USDA says.
USDA concludes that soybean meal imports will remain relatively high as the Japanese livestock industry and feed manufacturers have started to use oilseed meals as substitutes for animal-origin meals as a consequence of the BSE outbreaks of the last few years.
Soy Complex Higher Despite Crush Not Meeting Expectations
The soy complex closed up on May 25 despite smaller-than-expected crush and larger-than-expected stocks of soybean meal and oil. The Census Crush report indicated the soybean crush for the month of April at 3.68 million tonnes; oil stocks at the end of April were 1.25 million tonnes; and meal stocks were 419,244 tonnes. July bean futures closed up $0.64 finishing at $214.67; August was $0.55 higher, closing at $216.97; and September gained $0.55 ending at $219.08. July meal was up $1.32, closing at $191.25; August was $1.10 higher, finishing at $192.35; and September increased $0.66 to finish at $193.23. July oil closed $0.22 higher to finish at $553.13; August was up $0.44, closing at $557.10; and September lost $0.66, ending at $561.29.
