NCBA Offers USDA Four-Point
Plan To Improve Cattle Market

WASHINGTON — The National Cattlemen's Beef Association late last week outlined a four-point plan that the Clinton administration could use to help restore price and profitability to U.S. cattle producers.

"The U.S. government can take some fundamental, market-based actions to restore price and profitability to the livestock sector through improved demand," NCBA President Clark Willingham and NCBA CEO Chuck Schroeder said in a joint letter to USDA Secretary Dan Glickman.

In just the past 18 months, cattlemen have lost over $4 billion in equity.

"Mr. Secretary, we know you have not forgotten the tough situation cattlemen are facing," the letter said. "These are initiatives you can aggressively pursue that will help cattlemen restore prices, and eventually, profitability to the beef industry."

"Direct payments will not alleviate supply problems for beef or pork," they added. "We must stress that we are not interested in direct payments."

The four-point plan Willingham and Schroeder outlined involves action to:

Resolve the EU beef ban. For over a decade, U.S. beef producers have been unfairly banned from selling their products in the EU market. NCBA urges USDA, USTR and the White House to insist on EU compliance with WTO rulings that the EU ban is illegal. If the EU is not in compliance by the May 13, 1999 deadline, every available trade and policy tool should immediately be brought to bear to force the EU to lift the ban.

Increase government beef purchases. NCBA urges USDA to make additional beef purchases to take advantage of the current low beef prices and provide domestic feeding programs with an excellent source of iron, protein, b-vitamins and zinc. Cattle producers have appreciated past government purchases of beef for use in these beneficial programs.

Finalize inspection inequities rules. NCBA urges USDA to publish final rules that would eliminate the inequities between processing regulations for red meat and poultry. USDA regulations currently allow the poultry industry to add up to nine percent water during processing. NCBA is urging that there be a zero-tolerance for added water (the current red meat standard) for both red meat and poultry. These inequities not only provide poultry a comparative advantage over red meat in the marketplace, but resolving them would increase cattle producers' ability to compete in the marketplace on a level playing field. In addition, due to the inequities, U.S. consumers unknowingly purchase water at the cost of $5 per gallon whenever they buy poultry at the grocery store.

Rescind use of USDA quality grades on imported meat. USDA quality grades are a stamp of value on beef products in the retail meat case. NCBA urges USDA to immediately begin rulemaking procedures to rescind the use of USDA quality grades on imported beef and beef from cattle imported for immediate processing in U.S. plants. Current regulations allow imported beef and cattle for immediate processing to utilize USDA quality grades, and thus be marketed as U.S. beef to American consumers. Rescinding the USDA quality grade from imported meat will allow U.S. cattlemen to better meet the needs and demands of U.S. consumers.

"NCBA appreciates the projects USDA has underway to improve the economic situation for U.S. cattle and beef producers through increased access to foreign markets, more accurate and timely market information, and full implementation of regulations to protect our herds from potentially devastating foreign cattle diseases," Willingham and Schroeder said. "Just as we will be working with our grassroots members, state affiliates and member organizations to pursue these objectives, we stand ready to work with USDA in any way that we are able to restore profitability to the cattle industry."

Absent from the NCBA plan was any mention of fed cattle price disclosure or limits on captive supply arrangements. Cattlemen throughout the country have urged efforts to address those issues, but NCBA and the beef processing sector have joined in opposing them.