U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001

30–124 PDF 2006

S. HRG. 109–645

REGIONAL FARM BILL FIELD HEARING:

LUBBOCK, TEXAS

HEARING

BEFORE THE

COMMITTEE ON AGRICULTURE, 

NUTRITION, AND FORESTRY

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

SEPTEMBER 8, 2006

Printed for the use of the 

Committee on Agriculture, Nutrition, and Forestry

(

Available via the World Wide Web: http://www.agriculture.senate.gov 

COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

SAXBY CHAMBLISS, Georgia, Chairman 

RICHARD G. LUGAR, Indiana 

THAD COCHRAN, Mississippi 

MITCH MCCONNELL, Kentucky 

PAT ROBERTS, Kansas 

JAMES M. TALENT, Missouri 

CRAIG THOMAS, Wyoming 

RICK SANTORUM, Pennsylvania 

NORM COLEMAN, Minnesota 

MICHEAL D. CRAPO, Idaho 

CHARLES E. GRASSLEY, Iowa 

TOM HARKIN, Iowa 

PATRICK J. LEAHY, Vermont 

KENT CONRAD, North Dakota 

MAX BAUCUS, Montana 

BLANCHE L. LINCOLN, Arkansas 

DEBBIE A. STABENOW, Michigan 

E. BENJAMIN NELSON, Nebraska 

MARK DAYTON, Minnesota 

KEN SALAZAR, Colorado

MARTHA SCOTT POINDEXTER, Majority Staff Director 

DAVID L. JOHNSON, Majority Chief Counsel 

VERNIE HUBERT, Majority Deputy Chief Counsel 

ROBERT E. STURM, Chief Clerk 

MARK HALVERSON, Minority Staff Director 

(II) 

(III)

C O N T E N T S 

Page

HEARING(S):

Regional Farm Bill Field Hearing: Lubbock, Texas .............................................. 1

Friday, September 8, 2006

STATEMENTS PRESENTED BY SENATORS 

Chambliss, Hon. Saxby, U.S.Senator from Georgia, Chairman, Committee 

on Agriculture, Nutrition, and Forestry ............................................................. 1

Conaway, Hon. Michael K., U.S. Representative from Texas .............................. 4

Neugebauer, Hon. Randy, U.S. Representative from Texas ................................ 3

Panel I 

Bearden, Ricky, National Cotton Council and Texas Cotton Producers, Plains, 

Texas ..................................................................................................................... 9

Skarke, Troy, National Sorghum Producers, Claude, Texas ................................ 7

Wedel, Jimmy, Corn Producers Association of Texas, Muleshoe, Texas ............. 8

Womack, Tommy, Past-President, National Association of Wheat Growers, 

Tulia, Texas .......................................................................................................... 6

Panel II 

Higginbottom, Ted, Western Peanut Growers Association, Seminole, Texas ..... 21

Holbrook, Dennis, Texas Produce Association and Texas Citrus Mutual, Mission, Texas ............................................................................................................ 20

Murden, Dale, Rio Grande Valley Sugar Growers, Monte Alto, Texas ............... 18

Raun, L.G., U.S. Rice Producers Association and USA Rice Federation, El 

Campo, Texas ....................................................................................................... 19

Panel III 

Battle, Bill, Catfish Farmers of America, Tunica, Mississippi ............................ 31

Berger, Mike, Association of State Wildlife Agencies, Austin, Texas .................. 27

Broumley, Keith, Dairy Farmers of America, Hico, Texas ................................... 30

Mahler, Barry, Association of Texas Soil and Water Conservation Districts 

and the National Association of Conservation Districts, Iowa Park, Texas .... 26

Smith, Dale, Texas and Southwestern Cattle Raisers Association and Texas 

Cattle Feeders Association, Amarillo, Texas ..................................................... 29

APPENDIX 

PREPARED STATEMENTS: 

Battle, Bill ......................................................................................................... 42

Bearden, Ricky .................................................................................................. 47

Berger, Mike ..................................................................................................... 53

Broumley, Keith ................................................................................................ 56

Higginbottom, Ted ............................................................................................ 63

Holbrook, Dennis .............................................................................................. 68

Mahler, Barry ................................................................................................... 72

Murden, Dale .................................................................................................... 77

Raun, L.G. ......................................................................................................... 82

Page

IV

PREPARED STATEMENTS—Continued

Skarke, Troy ..................................................................................................... 94

Smith, Dale ....................................................................................................... 103

Wedel, Jimmy ................................................................................................... 107

Womack, Tommy .............................................................................................. 112

QUESTIONS AND ANSWERS: 

Berger, Mike: 

Written response to questions from Hon. Saxby Chambliss ......................... 116

(1)

REGIONAL FARM BILL FIELD HEARING: 

LUBBOCK, TEXAS 

SEPTEMBER 8, 2006

U.S. SENATE, 

COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY, 

Lubbock, Texas 

The committee met, pursuant to notice, at 9:03 a.m. in the Helen 

DeVitt Jones Auditorium, at Texas Tech University, Lubbock, 

Texas, Hon. Saxby Chambliss, chairman of the committee, presiding. 

OPENING STATEMENT OF HON. SAXBY CHAMBLISS, U.S.

SENATOR FROM GEORGIA, CHAIRMAN, COMMITTEE ON

AGRICULTURE, NUTRITION, AND FORESTRY 

The CHAIRMAN. This hearing will now come to order. 

Good morning and welcome to the Senate Agriculture Committee’s eighth and final farm bill field hearing. The Committee has 

travelled to Georgia, Missouri, Pennsylvania, Iowa, Oregon, Nebraska and Montana to hear directly from producers on the next 

farm bill. And I can’t tell you how pleased we are to have our final 

hearing today in Lubbock, Texas. And I am particularly pleased to 

be back in Lubbock. I kind of like the way you people talk out here. 

I don’t have to bring my interpreter with me when I come to Lubbock. And this is not my first visit here and won’t be my last. And 

frankly, it’s not by coincidence that we are here or by accident that 

we’re here in Lubbock. And I’ve had the opportunity to visit with 

any number of folks from this area relative to agriculture over my 

years in the House and in my years in the Senate; and of course, 

one of my dearest friends in the world is Larry Combest and his 

wife Sharon. Where is Larry? Larry, wave at us. 

There they are, right here. Larry and Sharon are truly two great 

Americans, and Larry and Sharon have always been a great inspiration to me in their personal lives, but particularly professionally. 

Larry has been somebody that I not only have had the opportunity 

to work very closely with and have had the opportunity to look up 

to as a mentor, but he’s somebody that taught me what principle 

is all about early in my career in the U.S. House, and cast a very 

tough vote for me as a freshman member of the U.S. House of Representatives. Along with Larry, we made sure that farmers and 

ranchers not just in Lubbock, Texas but in the State of Georgia 

were also protected in the 1996 farm bill. And Larry was not only 

a great friend, but as I say, a great mentor through that process 

and through all of my years in the House and the Senate. So I’m 

2

pleased to be in his hometown. I also am in the hometown of one 

of my staff members. 

When Keith Williams says ‘‘I’m from Lubbock, Texas,’’ he means 

I am really from Lubbock, Texas, born, raised and schooled here 

from elementary school all the way through Texas Tech. Where is 

Keith? He’s right down front here also. Keith does a great job in 

running my press shop on the AG Committee. And I asked him 1 

day why he went to Texas Tech, and he said ‘‘Well, I couldn’t get 

into the University of Georgia.’’ But he’s a great Texan, and we’re 

sure pleased to have him on our staff on the AG Committee. I’m 

also pleased to be with my good friends Randy Neugebauer and 

Mike Conaway. These two guys truly know what agriculture is all 

about and truly have a great appreciation for what agriculture is 

about. I know we’re in Randy’s district this morning, and I am very 

proud of the way that he represents you folks here from this part 

of the state. And he and I have had the opportunity to dialog on 

any number of issues, both related to agriculture and otherwise, 

and I’m just very pleased, as I say, to be in this district. 

Mike Conaway has been gracious enough to come from next door 

over to be with us. Again, both these gentleman were with us back 

in February when we were here. And again, Mike Conaway just 

truly has a great appreciation for the problems in agriculture and 

for what we need in the next farm bill. So I’m pleased that both 

these gentlemen could join us here this morning. 

And when I say I’m glad to be in Lubbock, I truly mean that because I know that I’m in the heart of ag country, not just cattle 

and cotton, but in the heart of ag country. When I pick up a newspaper normally and read about agriculture, I see criticism of the 

farm bill and constant criticism of farm programs. When I get up 

this morning, I pick up the Lubbock paper, I don’t know who your 

editor is, but I want to put him on my regular list. I want to quote 

from his editorial here this morning because I’ve never seen an editorial in any paper in any part of the United States that summed 

it up better than what your editor—the way your editor summed 

it up this morning. He says in part: Farm subsidy payments could 

better be described as consumer subsidy payments. Keeping our 

farmers and ranchers in business means keeping the U.S. cornucopia overflowing. Our farm policy accounts for little more than one 

half of 1 percent of the 1U.S. budget but allows American shoppers 

to spend only 11 percent of their income for food, far less than consumers in any other country. 

You know, that is what farm bills are all about, and I’m very 

pleased with the way the current farm bill is working to do exactly 

what he describes in the editorial this morning. Though Congress 

has some challenges ahead as we approach the reauthorization of 

the farm bill, for a time it appeared Congress would have to adjust 

our domestic programs to respond to the new trade agreement. But 

now that the Doha rounds has been suspended, the debate has 

shifted and Congress must now decide how far to go to ensure our 

existing domestic programs are consistent with our trade obligations. We also face new and growing concerns about the distribution of farm program benefits and how programs and policies interact with each other. One example is what the increased use of 

3

grain for energy production of ethanol or biodiesel will need for 

livestock producers. 

Of course, one of the biggest challenges is the influence of the 

budget deficits on—deficit on farm program spending. Unlike 2002, 

it is highly unlikely that we will have the additional funding available for our farm bill programs. A more likely scenario is one 

where we will have to aggressively defend what we already have. 

I expect to face these attacks even though the 2000 farm bill has 

spent 12.9 billion dollars less than was originally estimated by 

CBO. 

My goal as always is to develop a farm program that provides a 

safety net for producers. It should help them manage the inherent 

risks of farming while being responsible with the taxpayers’ money, 

conserving our natural resources and complying with our trade obligations. 

One immediate concern for most of the witnesses here today is 

the drought situation across the South and Midwest. I understand 

the drought losses in Texas alone have been estimated at more 

than $4 billion, and the good portions of Texas are rated extreme 

to exceptional on the U.S. drought monitor. 

I understand Texas has gone through a multiyear drought planning process to assess water needs for the next 50 years and that 

this process is admired around the Nation for its focus on local solutions. Given the long-term nature of drought cycles and the need 

to be prepared, a question that Congress needs to address should 

be: If the authorizing committee should restructure existing farm 

programs to fund a permanent disaster program. 

I would appreciate thoughts from the witnesses this morning and 

anybody else, for that matter, on this particular concept. I would 

like to thank the witnesses for being here today to provide testimony and to the audience for your interest in farm policy. I want 

to particularly thank President John Whitmore and Texas Tech 

University for allowing us to use this very nice facility that we’re 

in this morning. 

In Addition, Pat Burns and Ronald Phillips deserve special recognition for their assistance in arranging the hearing. Thank you 

for hosting the Senate Agriculture Committee in the Lone Star 

State today. 

And now I’d like to turn to my colleagues Congressman 

Neugebauer and Congressman Conaway for any comments they’d 

like to make. Randy. 

STATEMENT OF HON. RANDY NEUGEBAUER, A U.S. 

CONGRESSMAN FROM TEXAS 

Mr. NEUGEBAUER. Thank you, Chairman Chambliss, for having 

your eighth and final hearing here. I think that’s a real honor for 

our folks. I want to thank the producer groups and the panelists 

that are here today. I think one of the things that I’m most proud 

about is during this process, both as we begin to sit down and write 

the next farm bill, we’ve had both now of the House agriculture 

and the Senate agriculture committees to have hearings in this region. 

We’ve also had Secretary Joe Hins who’s here, and so I think one 

of the things that you’re going to hear today is there’s a very conVerDate 0ct 09 2002 15:32 Nov 07, 2006 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 C:\DOCS\30124.TXT SAG2 PsN: SAG2
4

sistent message that all of these folks have heard, and that is that 

many of the producer groups in this area believe that the 2002 

farm bill has performed just exactly the way it was designed, and 

I’ve seen those numbers that you’ve seen this week, Senator, about 

that it actually not only provided a safety net but it also was a fiscally responsible farm program and that it actually cost less than 

what was originally projected. 

And so I’m pleased to have you here. I appreciate that. I told the 

Chairman last night when he got off the plane that he’s been here 

twice now within nearly a 6–month period, one more visit in this 

year and he has to start talking to a realtor about buying a house 

in this—in our community. So we’re glad to have you here. 

I’m also particularly glad to hear you talk about the drought assistance and the problems that we’ve had with weather patterns 

over the last few years and whether we should look at the next 

farm bill should have some kind of a permanent disaster program, 

and whether it’s a permanent disaster program, I have been a 

strong proponent, Senator, of having—improving our crop insurance programs so that producers know exactly when they actually 

incur a loss that they’re going to be able to know that, in fact, 

they’re going to have the proceeds to pay for those losses and to 

reimburse them for their costs and not have to wait on whether the 

policies and the politics of Washington are going to shine favorably 

upon them. 

And so I think as we begin to look at the next farm bill, I think 

particularly either improving the crop insurance program or looking at some kind of permanent drought or permanent disaster program is certainly in some dialog that we would have. 

Again, thank you for being here. I’m appreciative of my neighbor 

Congressman Conaway being here today. One of the things we kind 

of, Mike and I, understand we cover a lot of real estate, and when 

you look at agriculture in Texas, we primarily represent the major 

part of agriculture in this state. And Mac and Mike and I continue 

to work together as a team when it comes to agriculture, and really 

in any other issues because there’s just not many of us out here, 

but we do have a strong relationship. And so I’m proud to have 

Mike here with us. And again, Senator, thanks for having your 

eighth and final hearing here in Lubbock, Texas, and we welcome 

you and look forward to hearing from these producer groups today. 

The CHAIRMAN. Thank you, Randy. Mike. 

STATEMENT OF HON. MICHAEL K. CONAWAY, A U.S. 

CONGRESSMAN FROM TEXAS 

Mr. CONAWAY. Thank you, Senator. I appreciate your kind words 

earlier. Thank you very much. 

Thanks for coming to West Texas, and in particular Lubbock, 

and Randy, thank you for your hospitality as always. There’s an 

old adage in politics that everything has been said, just not everybody has said it, so I’m going to avoid the temptation to repeat 

things that the Senator said and 

Randy said, because as I agree with them, and look forward to 

the testimony. This issue—or the hearing today is just that, and so 

I’ll once again thank everybody, and I’ll shut up so we can get to 

the hearing part of this and allow the folks who know the most 

5

about agriculture and feed their families and take those risks day 

in and day out to share with us what their concerns are, and hopefully their solutions and ideas on how we can go forward collectively in a better manner than we currently have. So Senator, 

again, thank you for coming to West Texas. Thank you for your 

kind words. Randy, thank you for being here. And I look forward 

to hearing from the producer groups this morning. Thank you. 

The CHAIRMAN. Well said. Short speeches are the way to get reelected. I said that, in my comments, that we certainly welcome 

comments not just from our witnesses today but anybody who has 

an interest in agriculture. And the way you can do that is to go 

to our Web site, and our Web site on the Senate Ag Committee is 

www.agriculture.senate.gov. Don’t worry about writing that down. 

If you’ll see any of these staff members afterwards, they’ll be happy 

to give it to you, and we would welcome your comments coming 

over the internet. 

I have a couple of other folks on our staff that are Texans that 

I want to make sure that we introduce this morning. First, Vernie 

Hubert. Vernie, raise your hand. Vernie is a gentleman that I have 

gotten to known—gotten to know since my original election of Congress. He worked for former chairman of the AG Committee, Kiki 

DelaGarza for a while for my first 2 years there and then he 

worked for Charlie Stenholm after that. Charlie was also a very 

dear friend of mine as well as agriculture, and I got to know Vernie 

then and I recognized his talent. So when we became—I became 

chairman of the Ag Committee, he was one of our first hires. And 

Vernie is from Riviera, Texas and does a tremendous job of helping 

us out on the staff. 

And Dawn Stump, where is Dawn? Right behind me here from 

Oilton, Texas. Dawn also is one that we have known for a long 

time. She’s a former Combest staff, and anybody that worked for 

Larry knows everything in the world there is to know about agriculture. And Dawn has just come back to the Hill, as we refer in 

Washington. She was downtown making a lot of money and decided 

to come back to the Hill because she’s committed to agriculture, 

and make a lot less money. And that says a lot about her. But she 

is a very bright young lady and does a terrific job on our staff. 

On our first panel this morning is a group of very distinguished 

gentlemen, some of whom I’ve had the opportunity of knowing for 

a long time and working with for a long time. So I’m particularly 

pleased to see you gentlemen here. We have Mr. Tommy Womack 

of Tulia, Texas who is speaking on behalf of the National Association of Wheat Growers, Mr. Troy Skarke of Claude, Texas on behalf 

of the National Sorghum Producers, Mr. Jimmy Wedel, I guess that 

is, Jimmy, I hope I got that right, of Muleshoe, Texas on behalf of 

Corn Producers Association of Texas, and Mr. Rickey Bearden of 

Plains, Texas on behalf of the Texas Cotton Producers and the National Cotton Counsel. 

Gentlemen, we welcome you. We will certainly submit your entire statement for the record, but we look forward to any opening 

comments you might have to make. And Tommy, we’ll start with 

you. 

6

STATEMENT OF TOMMY WOMACK, PAST-PRESIDENT, 

NATIONAL ASSOCIATION OF WHEAT GROWERS, TULIA, TEXAS 

Mr. WOMACK. Thank you, sir. 

Mr. Chairman, thank you for coming to West Texas, rest of the 

members of the committee. My name is Tommy Womack. I’m the 

past president of the National Association of Wheat Growers. I am 

a wheat farmer in Tulia, Texas, and represent the Texas Wheat 

Growers. I think the main thing is I like the way you talk. Agriculture needs somebody like you three gentlemen that stand up. I 

know you have the battle scars to prove it, but just to let you know 

that I thank you very much for that. USDA has had some 50 plus 

meetings such as this, the House and Senate has had some 20 plus 

meetings such as this over the period of this farm bill. And with 

a resounding yes, most all the commodities testify that they would 

like to keep this farm bill intact as it is with only minor critiques 

within it. I think that’s a must for us. 

I think the second thing would be, as you boys mentioned, a disaster program. The last 2 years has been devastating. The United 

States tries to help people all over the world when natural disasters occur. These two disasters that we’ve had last year and this 

year have really been devastating to the farmers across the United 

States, and so we would ask that you would work on some type of 

a disaster package to let the farmers either choose the year 1905 

or 1906 to participate in some type of disaster package. 

I think I would like to mention a little bit about wheat straw for 

ethanol. I know that’s one thing you spoke highly about. I think 

that’s really on the right track, and we appreciate your thoughts 

holding up agriculture today but not only in the future, an energy 

that would certainly be one that we could help grow and keep from 

buying so much oil from overseas. I think the last thing that I 

would say, and I’m just kind of talking to you from my heart here, 

I turned in a paper, but I just wanted to—really wanted to let you 

know would be a type of insurance program. Congressman 

Neugebauer has worked on that and mentioned some of that. The 

insurance program is working as a whole, but when you have a 

place that you buy 65 percent, that leaves 35 percent uncovered 

when you have a loss. 

The diminimous yield is something that a farmer cannot recover 

even though it’s charged against him within that insurance package. To maybe get us out of asking for a disaster package every 

year, we might somehow want to raise where we could afford to 

buy insurance at a higher level and not have 35 percent out there, 

maybe 10 or 15 percent of it, and buy insurance to cover us at a 

fuller rate than what we have in that crop that way. 

I think the last thing that I would like to say to you is that I’ve 

been farming 35 years, and the last 2 years has been the toughest 

that have been involved in farming, and that’s primarily because 

of fuel adjustment and the high cost of equipment that we need to 

buy. But that aside, those people need to make a job and work as 

well. But the American farmer agrees to jobs for 27 other people 

and through that turnover of the money, that’s what helps the government payments keep us in business and keeps us going so that 

other companies could share in that as well. 

7

Thank you for inviting me to come today. You have a nice day, 

and God bless you. 

[The prepared statement of Mr. Womack can be found in the appendix on page 112.] 

The CHAIRMAN. Thank you, Tommy. Troy. 

STATEMENT OF TROY SKARKE, NATIONAL SORGHUM 

PRODUCERS, CLAUDE, TEXAS 

Mr. SKARKE. Gentlemen, thank you for this opportunity to 

present my views for the next farm bill consideration. My name is 

Troy Skarke. I farm in Claude, Texas and the Texas Panhandle. I 

raise dry land sorghum and dry land wheat and I run 50 cow-calf 

pairs on my grassland. 

This has been a very trying year in my area of the country. From 

January to August we had less than six inches of rain, and that’s 

15 inches below the 21 inch average. The second week in August, 

2 months late, we received two inches of rain which germinated the 

sorghum I had planted earlier in the year. Normally, I can count 

on sorghum for a crop, but not this year. Assuming the good Lord 

changes the weather pattern and gets us out of this drought, I have 

no doubt that we producers have the ability to grow the crops needed to feed and fuel the world, given the fair market access. 

As a family farmer, there are four topics of interest that will affect my profitability in farming for the future. The four issues are: 

Farm policy, water, energy and technology. Let me address the 

farm programs first. I strongly support the 2002 farm bill. Currently direct payments and marketing loan programs provide our 

operation with the most protection. If Congress is to change our 

current programs, I would ask that the committee preserve the equity relationship between all commodities. 

On conservation programs, the Ogallala Aquifer is slowly being 

depleted by irrigation, and I’m concerned about the water supply 

for future generations. I have made the choice to implement farming practices that conserve underground water. Grain sorghum 

works very well in my crop rotation practice because of its water 

sipping qualities. Generally I can make a good yield without much 

rain during the growing season using sorghum in my fallow rotation which builds up the soil moisture profile during the winter 

months. 

The Conservation Security Program is a good fit for my farming 

practices and for grain sorghum. Although I believe the program 

should focus more on quantity measures instead of just water quality measures. The program directs conservation funds for good 

stewardship practices while allowing me to continue to produce a 

crop. I realize that many of my fellow producers have not had the 

opportunity to participate in this program and may not share my 

feelings. 

On the energy issue, private industry is investing millions in my 

region on ethanol plants. 15 percent of the sorghum crop is currently going to ethanol. That’s about the same percentage as the 

corn crop. I believe the next farm bill needs to continue to invest 

in alternative energy to reduce our dependence on fossil fuel. Sorghum will play a very important role in grain, sugar, and biomass 

ethanol industry as it’s developed in order to meet the goal of 25 

8

percent renewables by 2025. Just the increased ethanol demand 

alone for my grain should increase my price 15 to 20 cents per 

bushel. 

My last priority deals with technology. Gentlemen, the increased 

cost of fertilizer, fuel, equipment, repairs continue to skyrocket. 

Producers must keep pace and adapt to better farming practices 

with more effective and efficient cropping systems. The initiative to 

adapt does not come cheaply for producers, and I’d emphasize that 

now would not be the time to weaken the safety net that’s in place. 

Strong farm programs are critical when the agriculture economy 

slows. You have a challenge to re-write the nation’s farm policy. 

The sorghum industry will work with you, Mr. Chairman, as you 

develop a new farm program. Thank you. 

[The prepared statement of Mr. Skarke can be found in the appendix on page 94.] 

The CHAIRMAN. Thank you. Jimmy. 

STATEMENT OF JIMMY WEDEL, CORN PRODUCERS 

ASSOCIATION OF TEXAS, MULESHOE, TEXAS 

Mr. WEDEL. Good morning, Chairman Chambliss and Congressmen. Welcome to Texas. Thank you for holding the hearing today 

to allow those of us involved in Texas agriculture an opportunity 

to offer our views on U.S. farm policy. My farm is located about 70 

miles northwest of Lubbock in Bailey County. My main crop is 

corn, but I, like many Texas producers grow multiple crops. I 

produce cotton, wheat, soybeans, peas and peanuts. 

The 2002 farm bill is very popular with farmers. I believe it has 

lived up to what it was designed to do and what farmers must 

have, a safety net during times of low prices. I support extending 

the 2002 farm bill and its budget baseline. 

If it is necessary to re-write the farm bill I hope that many of 

the basic concepts of the 2002 farm bill will be included. The system of direct payments and counter-cyclical payments, combined 

with the marketing loan, has provided the level of support that 

growers need during times of low prices while saving taxpayers’ 

money when prices are adequate. But again, rather than write a 

new farm bill, an extension of the current farm bill with a few 

minor revisions might better serve the farming community. 

The 2002 farm bill however does not address the significant challenge of rapidly inflating energy prices and other expenses of production. Since 2001 we have seen the cost of irrigation double, the 

cost of diesel and gasoline triple, and the price of nitrogen fertilizer 

more than double. Obtaining even a modest direct payment in the 

form of disaster legislation to help farmers recoup a small percentage of their increased financial outlay has not yet been possible. 

The farm bill or crop insurance should look at the production expense risk associated with modern agriculture. 

The commodity title has the most effect on the farmer’s bottom 

line, but I do not want to imply that I am not interested in other 

titles. Growers need conservation programs that help them to resolve environmental problems on working lands. The EQIP program was expanded in the 2002 farm bill and those results have 

been very positive, not only for agriculture, but for all of society. 

9

The CSP program has been a disappointment in that too few watersheds have been allowed into the program and rules have made 

entry into the program very complicated. Some have argued that 

the CSP and similar programs will replace the commodity title as 

a means of complying with future WTO agreements. Most farmers, 

including myself, are very suspicious of this plan because it will not 

be a program that responds to low prices. Most producers believe 

the conservation programs should remain a cost share rather than 

income producing or supporting program. 

I believe the Research Title must be structured and funded to 

levels to ensure the continuation of basic and applied agriculture 

research. With global competition increasing, now is not the time 

to cut back on research. The 2002 farm bill for the first time included an Energy Title. I believe that this title should be expanded 

to encourage faster development of renewable energy from crops 

and bio-mass. We are dependent on the world for our energy; only 

sound agriculture policy will prevent us from following the same 

road in food and fiber. Thank you for this opportunity to comment. 

[The prepared statement of Mr. Wedel can be found in the appendix on page 107.] 

The CHAIRMAN. Thank you. Rickey. 

STATEMENT OF RICKY BEARDEN, NATIONAL COTTON 

COUNCIL AND TEXAS COTTON PRODUCERS, PLAINS, TEXAS 

Mr. BEARDEN. Mr. Chairman and Congress, welcome to Lubbock. 

Thank you for this opportunity to talk to you. I’m Rickey Bearden, 

a third generation farmer from Plains, Texas. I grow cotton, peanuts, milo, wheat and black-eyed peas. My income is completely dependent on the success of my farm. Production agriculture is what 

drives our small rural economies. The current safety net provides 

a delicate balance between coupled and decoupled payments. As a 

producer, this is very important to me because I do not want farm 

programs to become welfare programs. 

Unfavorable weather cut ag production dramatically this year in 

Texas. For effective producers, emergency disaster for 2006 and 

2005 will be critical. We should—we would also wish you to consider developing a permanent disaster program and improve crop 

insurance programs to address similar situations in the future. The 

financial safety net provided by our farm policy has never been 

more critical. The combination of direct and counter-cyclical payments along with marketing loan provides an effective safety net. 

It is important to maintain the current balance between these 

three mechanisms. 

The marketing loan is extremely important to cotton producers. 

It is especially important that all production remains eligible to 

loan. Contrary to popular belief, these do not guarantee a profit. 

Sound farm policy is of little value if the cotton industry has unworkable payment limitations placed on it. With the natural consolidation of agriculture, it’s inevitable that the majority of the program benefits will go to the farmers who account for the majority 

of the production, just as it should be. We also believe that conservation programs will continue to be an important part, but they 

will not be a substitute for the safety net provided for by commodity programs. 

10

Mr. Chairman, we understand you and your colleagues will face 

significant challenges in designing and maintaining farm policy. 

Cotton producers and the majority of our industry would be satisfied with the extension of the current law. An extension provides 

a level of certainty to both growers and those financing growers. It 

is also a great job to fill here in the United States. 

Regarding the trade negotiations, I commend you and our negotiators for continuing to demand an ambitious result in negotiations and refusing to allow unwanted pressure or deadlines to undermine the U.S. position. We also appreciate your insistence that 

agriculture negotiations be conducted as a single undertaking and 

that cotton not be singled out. But improved trade alone will not 

provide an adequate safety net for U.S. cotton producers. U.S. Congressional AG Committees in Washington D.C., not international 

trade negotiators from around the world, must write U.S. farm policy. This is very, very important to us. 

I assure you this committee and that the cotton—I assure this 

committee that the cotton industry is prepared to work with you 

to interest and develop and support continuation of the balanced 

farm policy. We look forward to working with you. 

Again, thank you for you the opportunity to testify today for this 

industry that I so dearly love. I would be glad to respond to any 

questions later. Thank you, sir. 

[The prepared statement of Mr. Bearden can be found in the appendix on page 47.] 

The CHAIRMAN. Gentlemen, thank you all very much. And I’m 

going to start off the questioning by asking a series of questions 

here that I’ve asked every commodity panel that we’ve had all 

across the country because we want to make sure that we understand where people are on certain issues with respect to the current farm bill. 

Tommy, let me start with you and then we’ll go right down the 

row. How would you prioritize farm bill programs generally and the 

commodity title specifically? How would you rank the relative importance of the direct payment program, the marketing loan program and the counter-cyclical payment program? 

Mr. WOMACK. I would think the direct program should be No. 1, 

the counter-cyclical program would be No. 2, then the market alone 

would be No. 3. And the reason that I would place them that way 

is because the direct payment is budgetary, it’s WTO compliance, 

and it’s something that farmers can count on. 

The CHAIRMAN. Okay Troy. 

Mr. SKARKE. I believe the direct payment is most important, it 

will give cash-flow when there’s no crop, you know, disaster year, 

it helps. And also the LDT payment will be very critical during low 

prices; and of course, the counter-cyclical payment least. 

The CHAIRMAN. Jimmy. 

Mr. WEDEL. Pretty much the same. I think the direct payment 

is very important. And here again, it is WTO compliance so you 

have a little bit of—a little bit of freedom to move around in that 

area. And then probably the counter-cyclical and marketing loan I 

think are probably a toss-up from the farmer’s standpoint, although probably the counter-cyclical I think would come first and 

marketing second on direct payment. 

11

The CHAIRMAN. Rickey. 

Mr. BEARDEN. Well, I’m going to differ, I guess, a little bit, which 

people that know me shouldn’t find that too unusual. The marketing alone is the most important thing a producer can have, and 

I say that because I am a producer of a commodity. And without 

that base price, I have no promise of any type of price. 

Production is what drives these small rural economies, as I said 

while ago. And if you give these other two payments, you don’t 

have to produce. But that is what drives these economies, and we 

need to remember that this is a bill that’s for rural, and I don’t 

think there’s anything that drives rural economies better than the 

production of those commodities. 

Next would be the direct because it is something to base what 

you do, are able to operate on. Your lender knows that is a guaranteed payment. And last is counter-cyclical. And all of these are very 

important, but counter-cyclical I’d put last because it affects—when 

prices are low, it kicks in. But that’s also very important. But as 

I said, once again, marketing loan is the most important one. 

The CHAIRMAN. Second question: We can expect an effort to further reduce payment limits in the next farm bill. Do payment limits need to be modified? Tommy. 

Mr. WOMACK. You know, I would say yes, but I think they should 

be increased because they are the same or have went down over 

the past years, and our cost of production has increased drastically, 

and so it costs a guy that raises 100 acres the same as it costs 

1,000 per acre to raise that commodity. So I would say yes, it needs 

to be changed, but I would say it needs to be raised. 

The CHAIRMAN. Tommy, we need next to bring you the floor of 

the Senate. Troy. 

Mr. SKARKE. Mr. Chairman, I may have to differ with Tommy a 

little bit. Small farmer, dry land, wheat and sorghum, I’ve never 

had to worry about a payment limit. So I just think the payment 

limit needs to go to the people with the greatest risk. 

Mr. WEDEL. I don’t know, I tend to agree with Tommy a little 

bit. As farmers who have to consolidate, as you well know, we’re 

getting basically the same price for our commodities as we have the 

last 10, 20, 30, 40 years, yet our production prices keep going up 

every year. The only way we’re able to stay in business is to increase our acreage to become more efficient. And of course, as you 

do, then you begin to you hit those pay limits. So in this day’s 

farming climate and business climate, you have to be—I’m not saying you have to be a large producer, but most people have to continue to get larger to stay at the same income level and then you 

begin to hit those pay limits. So I agree with Tommy, they really 

need to be increased. I know that’s a very unpopular idea in Congress, but at the very least, they need to be frozen where they’re 

at, and hopefully increased. 

The CHAIRMAN. Rickey. 

Mr. BEARDEN. Payment limits is a problem, and I look at it simply from the fact of what I just said before, that there needs to be 

no limit on the marketing loan. And I say that because of last year, 

I’ll give you a prime example. I had a bumper crop, and the year 

before I didn’t have any, I didn’t collect any marketing loan on cotton on my dry land acres, and last year I—it gave me a base price 

12

on that, and there’s no way for me to be able to do that. My marketing loan gains would be all over the floor. But I tend to agree 

is that it needs to be raised, but I understand that’s probably not 

politically feasible for us to do, so we have to learn to do that. But 

the main thing is we have to allow the marketing loan to not be 

capped, and I think we’ve accomplished that with the fact that we 

can get certificates, and I think that’s worked very well. And it also 

has not—it has worked well for producers in the fact that it gives 

us the flexibility that we need to go from commodity to commodity. 

As it’s been mentioned, several of us go from one commodity to the 

other. And I think that’s very important and I think it needs to be 

addressed. 

The CHAIRMAN. Doha round negotiations have sought to provide 

additional market access for U.S. agriculture goods in exchange for 

cuts in domestic farm payments. Is this a reasonable exchange for 

farmers? Tommy. 

Mr. WOMACK. Yes, sir, I think that it is. As a wheat grower, we 

need to rely on, and what we need to do is to export at least 50 

percent of our product every year, and that certainly helps us in 

the export of business to help feed the world. But also I think what 

would help us along the same line is to lift some sanctions on the 

countries that would trade with us, such as Cuba. 

The CHAIRMAN. Troy. 

Mr. SKARKE. Almost half of our crop, Mr. Chairman, is exported. 

I had the opportunity to go to Africa to watch my grain sorghum 

feed 80,000 refugees from Angola and Zambia. I still contend we 

need fair market access, and until we get fair market access, no 

matter what happens, people will starve in this area, so we have 

to continue to work on that. 

The CHAIRMAN. Jimmy. 

Mr. WEDEL. Well, I agree that we do need fair market access, but 

I’m a little bit troubled that we would base our whole farm program on the perception that with these free trade agreements that 

we have that we’re actually going to export more of everything, because I know typically there have been a lot of agreements signed 

in the last several years. But corn exports have been relatively flat 

for the last 10 years, even really going back 20 years, they’ve been 

relatively flat. 

So there is no guarantee that we will be able to get a higher commodity price or we will sell our commodities at a higher price just 

because we have a certain amount of WTO agreements. I do agree 

that a reasonable trade would be good for all us. But as far as a 

tradeoff for safety net for farm support, I don’t think I’m in favor 

of that. 

The CHAIRMAN. OK. 

Mr. BEARDEN. Mr. Chairman, I started farming in 1975, and I’ve 

heard my whole life that we’re going to export our way out of this 

program of cheap prices, and so far it hasn’t worked. Cotton prices 

are flat over the last 20 years, some spiked. But I do not think that 

we should give away our safety net, our safety net that’s been in 

place with the same price, the loan price and target price for cotton 

since 1981 with no cost of living adjustment. It’s very, very important that that safety net stay in place and that we—we do need to 

have trade, don’t get me wrong, and we do need to help other counVerDate 0ct 09 2002 15:32 Nov 07, 2006 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 C:\DOCS\30124.TXT SAG2 PsN: SAG2
13

tries, but we don’t need to do it that way. One way would be very 

good, I think we could ask the people in this room if they would 

be willing to give 30 cents more for a 

T-shirt. That would double the price of cotton. That would help 

producers all around the world much more than us giving up our 

safety net that is in place to ensure us a way of life and a safe and 

good source of food for the U.S. public. 

The CHAIRMAN. Some organizations have explored the possibility 

of a revenue based approach for the commodity titles. What do you 

think of a revenue based approach to the safety net as a replacement for the current commodity programs? 

Mr. WOMACK. We have wheat growers that have really kicked 

that around a lot, but I really feel like that if we done a little adjusting within the counter-cyclical program of the original farm bill 

that we’re living with now, we would be better suited. And I think 

that through WTO compliance rules that would only cover 70 percent of our crop, and the insurance would not cover that either. So 

we’d have a cap at 70 percent and we’d have a 30 percent loss. So 

I would not be in favor of that. 

The CHAIRMAN. Troy. 

Mr. SKARKE. I think the key to a revenue based approach is the 

crops still have to be produced by the farmer. And zero percent of 

nothing—or anything is still zero. So I don’t—I really think in my 

semi arid region of the country where the—and especially after the 

last 2 years of drought, the yields are so low I don’t see that being 

explored. 

The CHAIRMAN. Okay. 

Mr. WEDEL. Probably from—as a Texas corn producer, I would 

probably not be in favor of the revenue assistance—or assistance 

revenue program that I have seen. The devil’s in the details. It 

sounds good on the surface, but when you look at the details and 

how the program works, it’s going to reward inefficient producers. 

I don’t think that’s a good idea. And there are some problems with 

the method of calculation. I know some of the data that we looked 

at on that program. I have one farmer—one farm in one county 

that would have paid me maybe $100 an acre and the farm in the 

adjacent county would have paid me zero dollars an acre under the 

past farm program. So there’s a lot of discrepancies, a lot of details 

would have to be looked at on that. But I still think I agree with 

the other two gentlemen, I think if you take the existing farm program and maybe tweak it a little bit in some certain areas, I think 

we’ll come out with a better program. 

Mr. BEARDEN. A revenue guaranteed program, personally I do 

not like, and I don’t think it’s any type of substitute. As I visited 

with a guy the other day, I think it would make a great disaster 

program, a permanent disaster program, but I don’t think it would 

be worth anything as far as production. And I go back to my statement: This is production agriculture. It’s not a way of sustaining 

life. We don’t want to end up, like Jimmy said, talking to people 

and finding out ways to scam the policies. 

I think what—this is a farm policy, this has been the basis of our 

farm policy for a long time. I think it’s worked great through the 

years. I think we’ve—the 2002 farm bill is probably the best attempt at giving us a safety net that’s ever been, and I think we 

14

should continue it. And I don’t—I think we can tweak it around the 

edges, but we have to remember that production is what drives 

these economies, and that’s the part that I see in all these programs is it likes the ability to drive production. And I’m not saying 

overproduction, as the rest of the world would say, but this is—this 

is production that gives all these people and myself the ability to 

help this U.S. economy and allows agriculture to be about 15 to 17 

percent of the gross national product, and I think we should continue with stuff that rewards us, that doesn’t make us turn into 

welfare. 

The CHAIRMAN. Last, should an increase in conservation or energy programs come at the expense of commodity programs? 

Tommy. 

Mr. WOMACK. Mr. Chairman, I would say no, but I would also 

add hastily that the energy program is very important in the food 

and fiber industry. Renewable fuels are here on the forefront using 

wheat straw to make ethanol and such as that. But I think they 

should be funded out of an energy type program somewhere else, 

but not out of the commodity entitlement. 

The CHAIRMAN. Troy. 

Mr. SKARKE. I tend to agree. I don’t believe we should—energy 

should remain a national security issue, and I don’t believe we 

should make food a national security issue. On the conservation 

program, it has not been as friendly to sorghum, my sorghum crop, 

as it has been to other crops. 

Mr. WEDEL. I too agree, and I think that probably as more and 

more corn and sorghum goes into ethanol production under the current farm bill system, as prices go up, then actually it will save 

some money from the taxpayers from the counter-cyclical standpoint and also from the marketing loan as well. So that is already 

in place in the current farm program as far as those—the savings 

that will come about as a result of the strong energy policy. But 

I too agree any funding for energy programs should come out of an 

energy policy, not be taken away from a conservation title—or I’m 

sorry, a commodity title. 

The CHAIRMAN. Thank you. 

Mr. BEARDEN. I think the commodity title should remain the center point. I think conservation is very, very important. I think all 

of us as producers on this panel would agree that we want to be 

able to pass down a better farming area than we inherited. We 

all—I have a son-in-law that wants to farm, and I want him to be 

able to produce—be a good producer. I think we are conservationists. We know what needs to be done, and I think that it shouldn’t 

be the center point. As far as the energy bill, whatever the U.S. agriculture industry can do to help us become less dependent on foreign oil, I think we should try to do. If that’s—if that’s doing some 

things different than what we’ve done in the past—I don’t think it 

should be taken out of the commodity title though. We’re argued 

as an easy target, but agriculture has something to offer to this 

U.S. economy, and if that’s helping us get through tough times and 

high energy prices and us help do that in some way through whatever it may be, through vital fuels, I think we should do it but, I 

think it should come out of an energy title. 

The CHAIRMAN. Thank you very much, gentlemen. 

15

Is there any comments you want to make or any questions you 

have that we haven’t covered? 

Mr. NEUGEBAUER. Just one question I would have is some discussion about the disaster. If you look back over your operation for say 

the last five or 6 years, if you had a good crop insurance program, 

would you—would you have made any change then to the commodity titles moving forward? We have had some disaster programs. One of the things I hear about disaster programs, though, 

is sometimes there’s inequity in that for folks that really didn’t get 

a—have a disaster, you know, may have gotten payments, where 

people that did have a disaster didn’t get as much payment or as 

much reimbursement as they, you know, thought was necessary. 

So if you look back over there, we’ve had a price safety net with 

the farm bill, but you’ve not had really a production safety net, how 

would that have impacted your operation? 

Mr. WOMACK. So Congressman Neugebauer, you’re asking me if 

I always planted wheat and there was a different insurance program, would I change to corn or some other crop? 

Mr. NEUGEBAUER. Well, no really, I—obviously we don’t want 

to—we don’t want to have policy that encourages you to farm to a 

program, but I mean, yeah, I guess, Tommy, that would be part of 

the question. Would you have been able to stick with a particular 

commodity, or how important would a good crop insurance program 

be in your continuing operation in allowing you to have flexibility? 

Mr. WOMACK. Oh, it would be fantastic. As I said, I farmed a 

long time, and so I think each farmer kind of finds its niche with 

its own piece of land and makes it work with the different crops 

and the weather and the water that he has. And so to exist, he 

finds that special niche, so there would be no changes there. 

But a good insurance program where we could sit down with our 

banker and discuss: Can I afford to lose 15 percent if I have a tremendous disaster this year? Could I afford to lose 10? And be able 

to pick and choose rather than—because the Federal Government 

has kind of honed in on us buying 65 percent coverage because of 

the premium, and then with the diminimous yield involved, if I go 

out there and I have 100 pounds of cotton left, then that comes off 

even though it’s not feasible for me to harvest that. So that’s kind 

of a double loss, and I would kind of explain that this way: If I 

went out and bought a new car and I insured it at $1,000 loss and 

I had a wreck in it, then I would stand the first—I would know exactly. And the insurance company wouldn’t come back and say 

‘‘This right front tire is still real good, so I’ve got to deduct that.’’ 

And that’s what happens with crop insurance. 

Thank you for the question. 

Mr. SKARKE. I have to agree with Tommy. A farmer or producer, 

it takes a while to learn how to grow that crop, and when you have 

something, sorghum, wheat, no matter what it is, corn, cotton, you 

know how to produce that crop. And I’m afraid we’re in today—a 

lot of people are looking at ‘‘Well, let’s see what the crop insurance 

will pay me and then I’ll decide what I’ll plant.’’ And I believe we’re 

headed in the wrong direction right now. 

Mr. WEDEL. Congressman, I too agree with Tommy. I think that 

if we’d had a better insurance program over the last few years, 

what little I received from disaster assistance, I think it would 

16

have been much more—handled much more efficiently through 

some type of insurance program. And the problem lies with we’re 

only able to insure basically 65 percent of our production which 

leaves you with huge a risk on top, and no—I don’t think any person would feel comfortable, any businessman would feel comfortable insuring their car or their building or whatever at only 65 

percent value. That is a huge deductible that you have to stand, 

as well as taking the diminimous yield loss. If you’ve got a small 

yield on the bottom end, you’ve got to deduct that right off of it. 

So definitely a better insurance program would be much better 

than a disaster program. 

Mr. BEARDEN. An improved crop insurance program is something 

that we all strive for. I think this is something that’s been going 

on since the mid-80’s trying to figure out how to solve the problem, 

Randy. And, you know, I don’t know if we can. I think we should 

always be looking for new approaches. It’s got to where agriculture 

operates on such a slim margin that we have to figure out a way 

to do that. 

My—the other thought of a totally crop insurance program that 

I see is that: Is it going to be affordable to producers, something 

that we have to pay for? I don’t know how we’re going to do it, but 

that would be one concern that I would have. I wonder, though, if 

we shouldn’t take a look at crop insurance as a total product. What 

we’ve been doing in ad hoc disasters the last two or three—or 

last—every 2 years for the last couple of years, put that pool of 

money together and find out what is the best option for a safety 

net, a production safety net for the U.S. producers. And I think 

that’s probably where we need to go and really look and study at 

that. And I know you’ve been willing to look at it, and I appreciate 

your help on that. 

Mr. CONAWAY. I don’t have a specific question. Is there—after 

having gone through the testimony and thought about what you 

wanted to say or wish you would have said or could have said, do 

you want to run back through it one more time and just add any 

final comments that you might have missed on your first round 

through, Tommy? 

Mr. WOMACK. Thank you for the opportunity. 

And you know, I probably missed a lot. I think the important 

thing that I would just want to reiterate would be that people like 

you boys are here to listen to the farmers who get the dirt under 

their fingernails and truly have a heart for agriculture. You boys 

kind of remind me of a good old country creature, he knows what 

to say to help you for today, and yet he’s helping you if you’ll listen 

to him for the future. And that’s what you boys are doing, you’re 

trying to help us for today to feed the United States people and yet 

looking into the future to be sure there’s a good food and fiber program there in place so that the farmers can do a good productive 

job of that and that we can also help export overseas. Thank you 

again for the opportunity. 

Mr. CONAWAY. Troy. 

Mr. SKARKE. Again, thank you. Producers have been taking a 

pretty strong hit by a lot of special interest groups the past few 

years talking about the farm program. I appreciate you guys standing by our sides. You know what it’s all about. Thank you. 

17

Mr. WEDEL. Thank you again for coming and thank you for listening to us. I think we pretty much have a consensus among this 

group. I think you’ve heard that and I think you’ve heard that 

through all the hearings that have gone on through the House side 

and also the Senate side. Most farmers are pretty much happy with 

the current farm bill the way it’s administered. The way it runs, 

it does provide us with a safety net and at a very minimal cost to 

the taxpayer. 

And I would like to hand over that message. Thank you. 

Mr. CONAWAY. Rickey. 

Mr. BEARDEN. I guess the one thing I’d like to say is I appreciate 

you all coming. And the other thing is, it’s been mentioned, you 

three gentlemen have the weight of this industry to help uphold, 

and you are a part of this industry. When you signed on, you became part of this industry. But we look for you to look to us for 

ways to make this industry better. 

As I mentioned while ago, I have a son-in-law that’s farming and 

he’s got a whole career in front of him, and I want to make sure 

that the farm policy that we make right now helps him and gives 

him the tools to succeed and to become a farmer if he so chooses. 

Many of the people in this audience, their children or grandchildren may want to farm. I want us to make sure as we go forth 

we think about things all the way from trade deals to all the things 

that we have in front of us that have an impact on our industry, 

and we make sure that we make good, intelligent decisions that 

will allow agriculture to still be an industry when I’m getting 

around on a—in a wheelchair, but my grand kids can, if they so 

want to. 

I want to leave you with one thought: Cotton prices since 1985 

have declined 17 percent. Average yields have gone up 39 percent. 

That gives you a plus 15 percent. It’s not the responsibility of the 

government to make sure that I get a profitable price, it is responsible for us to make sure that we have a safety net. U.S. minimum 

wage has gone up 54 percent during that time period compared to 

15. That’s the plight that our young people face. We need to make 

sure, not only through a good safety net, but through good trade 

deals, that we leave an agricultural industry that will give our children and our grandchildren a chance to succeed like those before 

us have given me. Thank you. 

Mr. NEUGEBAUER. I want to thank each one of your for your testimony. At this time we’re going to dismiss this panel. And thank 

you again. And turn back over to the chairman and bring on a new 

panel. 

The CHAIRMAN. Thanks very much, gentlemen. We appreciate 

you being here, and we look forward to staying in touch and continuing the dialog. We now ask—we’re going to take about a 10 

minute break right now before we move to our second panel. 

(Break.) 

The CHAIRMAN. We’ll continue now with our second panel. We’re 

pleased to have Mr. Dale Murden of Monte Alto, Texas who is here 

on behalf of the Rio Grande Valley Sugar Growers, Mr. L.G. Raun 

of El Campo, Texas on behalf of the U.S. Rice Producers Association and USA Rice Federation, Mr. Ted Higginbottom of Seminole, 

Texas on behalf of the Western Peanut Growers Association, and 

18

Mr. Dennis Holbrook of Mission, Texas on behalf of the Texas 

Produce Association and Texas Citrus Mutual. 

Gentlemen, thank you all very much for being here. 

Again, we will submit your entire statement for the record, but 

we look forward to any opening comments you might have. Dale, 

we’ll start with you and go right down the row. 

STATEMENT OF DALE MURDEN, RIO GRANDE VALLEY SUGAR 

GROWERS, MONTE ALTO, TEXAS 

Mr. MURDEN. Good morning, Mr. Chairman. I want to thank you 

for taking the time to come back to Texas today and listen and 

speak to those of us who are producers and truly depend on the 

farm bill. My family raise sugarcane and my son wonders what the 

future really holds for agriculture. We also produce cotton, sorghum, corn, citrus and vegetables. 

Being a farmer for 25 years, I’ve been active in several farm organizations and currently sit on the board of the Rio Grande Valley 

Sugar Growers, Incorporated, the sugarcane cooperative that’s fully 

owned by the growers. Why is sugar policy so important to Texas? 

Simply put, stability. Farming is kinda like bull riding. It’s a lot 

of fun, but a whole lot can go wrong. Just like that rider can’t control that bull, farmers can’t control Mother Nature, commodity 

markets, or subsidized foreign competitors. 

The U.S. sugar program works even under the most uncontrollable of situations. Look no further than last year. Hurricanes, 

flooding and drought challenged us like never before. But this 

country’s sugar farmers passed that test, and our no-cost sugar 

program is one of the main reasons why. Immediately following 

Katrina, sugar policy gave USDA the flexibility it needed to address supply interruptions. 

Domestic stocks were quickly made available and USDA was 

able to increase imports to address domestic shortfalls. Other countries aren’t so lucky and don’t have this kind of flexibility when disaster strikes. Thailand and Australia both have experienced weather disasters that have led to short supply. Much of Brazil’s cane 

crop has been diverted into ethanol in the face of high oil prices. 

It doesn’t take an economist to figure out that these events have 

had a dramatic effect on the world sugar market. 

And it doesn’t take a genius to see that America cannot become 

dependent on such unreliable foreign sugar supplies. This country 

needs homegrown sugar, and America’s sugar farmers need a 

strong sugar policy. We are gravely concerned about talks of buying 

out the U.S. sugar program and converting it to a traditional row 

crop program. Such talks are illogical and ill informed. In times of 

tight Federal budgets, should Congress really ask the taxpayers to 

take on the extra burden of converting the current no-cost program 

to a taxpayer-funded subsidy program? The yearly cost of such a 

conversion would be in addition to the billions of dollars that a buyout itself would cost. 

We are also looking at the Congressional Budget Office’s sugar 

program score of up to $300 million per year by 2013. We do not 

know what assumptions they are using but we are skeptical that 

amount of sugar would be forfeited to the government. We hope to 

19

meet with CBO to discuss the methodology they used to determine 

those numbers. 

I also need to point out that the recent tariff rate quota announcement by USDA has many of us concerned because this allows too much sugar to be imported into the United States. The 

Department is allowing more sugar into the U.S. than needed and 

we producers are concerned that this could create considerable 

market uncertainty and the danger of a disorderly transition to 

free trade with Mexico in 2008. The current sugar program is 

working well. It has kept prices low and stable for grocery shoppers 

in times of a national emergency. It is not costing America’s taxpayers anything. It makes sure that we’re not dependent on foreign 

supplies. And, it helps support thousands of sugar farmers and factory workers across the country. 

As Congress looks to re-authorize a new farm bill, we humbly 

ask that the current program be extended. 

[The prepared statement of Mr. Murden can be found in the appendix on page 77.] 

The CHAIRMAN. Thank you. 

STATEMENT OF L.G. RAUN, US RICE PRODUCERS 

ASSOCIATION AND USA RICE FEDERATION, EL CAMPO, TEXAS 

Mr. RAUN. Thank you, Chairman Chambliss. 

Howdy and welcome to Texas. And thank you, staff, for also 

being here today. My name is L.G. Raun. I’m a rice farmer from 

El Campo, Texas, and my family has farmed rice for over 90 years, 

covering four generations. I am a third generation rice farmer, I 

have been farming for over 30 years. I’m a board member of the 

U.S. Rice Producers Association, chairman of the Texas Rice Producers Legislative Group. In addition to these groups, I’m speaking 

on behalf of the USA Rice Federation. Briefly I will highlight some 

of the key points from my written testimony. 

Preservation of the 2002 farm act’s safety net is the industry’s 

top issue. There are clear benefits to extending the farm bill until 

a multilateral WTO agreement is approved by Congress. No. 1, unilateral disarmament of U.S. policy, is prevented. Second, a new 

farm bill is written only once after WTO negotiations are concluded 

and the new trade rules are known. And third, the safety net that 

provides farmers and their lenders with predictability and stability 

as maintained. We would also note that farm programs continue to 

operate in a fiscally responsible counter-cyclical manner. 

Mr. Chairman, as you mentioned earlier, the fiscal year 2005 

commodity program costs were actually $19 billion lower than projected when the 2002 farm bill was passed. In Texas, the decoupling of payments from production in the 1996 farm bill has had 

a serious impact on tenant rice farmers, rice acres, and in turn, our 

rural economies of rice growing areas here in Texas. Although the 

Washington Post article on July the 2nd was misleading on the 

number of residential areas that were collecting program payments, the fact remains many tenant farmers were ousted from 

rice lands so landowners could take 100 percent of the program 

payments. 

20

The rice industry would like the opportunity to work with the 

committee on options to make sure we have equitable administration of the farm program between landlords and tenants. 

The U.S. rice industry opposes any further reduction in payment 

levels provided in the current farm bill. Direct payments were reduced 20 percent in the 1996 farm bill without an increase in the 

rice loan rates then or since. Pay limits today restrict many Texas 

rice farmers to planting only 500 acres of rice. Just one tractor or 

combine today costs us between $200,000 and $300,000. Any further restrictions of pay limits or limiting access to the marketing 

loan program will force farm size down to an uneconomical size. 

On the environmental side, rice farmers are proud of our history 

of releasing cleaner water from our fields than we put on them, of 

releasing water during critical periods, for in stream bay and estuary needs and providing wildlife habitat in rice fields second to no 

other crop grown. Mr. Chairman, we urge you to support an extension of one of the most popular farm bills ever. It is good for farmers and good for America. I thank you for this opportunity to speak 

today and for your service to America, and I’m ready to answer 

questions at the appropriate time. 

[The prepared statement of Mr. Raun can be found in the appendix on page 82.] 

The CHAIRMAN. Thank you. 

Mr. Holbrook. 

STATEMENT OF DENNIS HOLBROOK, TEXAS PRODUCE 

ASSOCIATION AND TEXAS CITRUS MUTUAL, MISSION, TEXAS 

Mr. HOLBROOK. Good morning, Senator Chambliss and members 

of the Committee. We’re grateful that you’re here today in Lubbock 

for this hearing. I’m Dennis Holbrook, owner of South Texas 

Organics. I’m also the current chairman of Texas Citrus Mutual, a 

trade association of citrus growers and allied industries. Today I’m 

representing the Texas Citrus Mutual and the Texas Produce Association. These two associations have been working with other specialty crop groups, as well as the United Fresh Fruit and Vegetable 

Association on recommendations for the next farm bill. 

Our proposals are based on the growing importance of the specialty crop industry and the need for fair treatment of this sector 

in the next farm bill. U.S. fruit and vegetable production accounts 

for 30 percent of cash receipts for crops, and with the addition of 

nursery and greenhouse production, the figure rises to 44 percent. 

The value to the Texas economy from fruits, vegetable and tree 

nuts is approximately $635 million. 

I will focus on the basic principles that provide the foundation 

for our recommendation. One, the specialty crop industry is a critical and growing part of U.S. agriculture, deserving of full and 

equal consideration in the farm bill. Dietary guidelines for 2005 

call for the doubling of fruit and vegetable consumption to address 

issues of obesity and overall health. Strong support for the fruit 

and vegetable industry in the farm bill will be necessary to achieve 

this goal. Four, specialty crops face threats from pests, diseases, 

and bio-terrorism that can destroy an entire crop industries. 

I am a citrus grower in the Rio Grande Valley of Texas. The very 

survival of that industry is now threatened by several citrus pests 

21

in Florida and Mexico. We are talking specifically about citrus 

greening, citrus canker and citrus tristeza virus. The latter two diseases can result in the removal of very large numbers of trees to 

stop the spread of these diseases. 

We are calling on Congress to support an effort by APHIS to 

prioritize foreign pest threats to domestic production of specialty 

crops, including bio-terrorism. By the way, citrus greening is on the 

Select Agent list for bio-terrorism. When disease exclusion is not 

successful and eradication is necessary, we urge Congress to make 

Commodity Credit Corporation funds available to the Secretary of 

Agriculture, without encumbrances, to conduct the emergency 

eradication. 

We are recommending mandatory funding of $200 million per 

year or 1 billion over 5 years for the Federal School Fruit and Vegetable Snack Program, including in that is the 100 million to the 

selected 50 schools per state in the current program an addition of 

another 100 million to be distributed based on the population of 

each state. 

Currently the most discussed thing about the farm bill is whether there should be an extension with limited modifications or a 

brand new farm bill. I realize my point of view may not be shared 

by all in this particular audience today, but the specialty crop industry is opposed to an extension of the farm bill. The specialty 

crop industry does not receive benefits equal to our part of the agriculture economy. As the face of the American agriculture has 

changed and specialty crops have become more important, we believe it is time for our farm policy to reflect that change. 

Thank you for the opportunity to present this testimony before 

you today. 

[The prepared statement of Mr. Holbrook can be found in the appendix on page 68.] 

The CHAIRMAN. Thank you very much. Now, Ted, before you 

present your comments, you see what we’ve got up here? 

Mr. HIGGINBOTTOM. I saw that. 

The CHAIRMAN. We’ve got these great Georgia peanuts. Now, as 

you know, I am a big fan of Texas red skin peanuts also. We grow 

runners, we don’t grow any Spanish peanuts at home. And I know 

you’ve heard my story about I constantly used to go to Larry’s office and carry his staff some Georgia peanuts and exchange them 

for Texas peanuts. I’m going to be disappointed if I leave Lubbock 

today without some red skin peanuts, now, let me tell you. My 

friend Ted Higginbottom. Ted. 

STATEMENT OF TED HIGGINBOTTOM, WESTERN PEANUT 

GROWERS ASSOCIATION, SEMINOLE, TEXAS 

Mr. HIGGINBOTTOM. Good morning, 

Mr. Chairman, and we won’t disappoint you. We’ll fix you up 

with some peanuts. Good morning Congressman Neugebauer and 

Conaway. I’m Ted Higginbottom, president of Western Peanut 

Growers Association. I would like to welcome you to West Texas. 

We appreciate your time and willingness to travel to our rural 

farming region. I started out as a small farmer and had to grow 

in size to make a living out of farming. 

22

I want to thank this committee for crafting a farm bill in 2002 

that makes it possible for producers like me to maintain my livelihood from farming. I would like to make it clear that we do support 

the current farm bill and the peanut program law. During the first 

few years of the new program we experienced a significant increase 

in the consumption and production of peanuts. This growing region 

also experienced an economic boom with the construction of new 

peanut handling facilities. Unfortunately USDA’s implementation 

of the law has changed this initial success to a near disastrous situation for our growers as well as our industry. The 2006 crop year 

should be proof that the method used by USDA to administer the 

repayment rate does not work for our growers. Depressed prices 

caused by the buildup in peanut stocks have forced the farmer 

stock price of peanuts down. Due to these low prices, U.S. peanut 

growers have reduced plantings in the current year. As an example, the planted acreage for the State of Texas is down by 44 percent. 

We ask that this committee mandate that USDA set the peanut 

loan repayment rate at a market clearing level. I would like to 

bring to the attention a couple of other issues that are important 

to us and the rest of the peanut industry. Another issue that receives a great deal of attention in the national media is payment 

limitations. I am shocked at how misleading this information usually is. I appreciate the Committee coming to West Texas because 

we are a prime example of an area that would be devastated if 

some of the payment limitation issues or amendments being considered by Congress were adopted. More restrictive payment limitations would wreck the farm economy of West Texas. 

One last issue that I want to mention, we do still strongly support the extension of the peanut storage and handling payment. We 

do believe this committee did a great job in writing the farm bill, 

including the peanut program in 2002. Respectfully, this committee 

only needs to make a couple of minor tweaks in order for the peanut program to regain its initial success and to carry out the intent 

of Congress when this program was written in 2002. Thank you for 

conducting this hearing in Lubbock, Texas. And we look forward to 

working with you. 

[The prepared statement of Mr. Higginbottom can be found in 

the appendix on page 63.] 

The CHAIRMAN. Thank you. Dale, let me start with you. On January 1, 2008 United States is set to drop the tier two tariff allowing duty-free imports on sugar from Mexico. How will this affect 

the current sugar program and how will domestic demand be able 

to absorb the extra sugar while preserving the basic structure of 

the program? 

Mr. MURDEN. That’s a great question. I wish I knew. A whole lot 

of assumptions, a whole lot of unknowns. I hear the administration 

makes assumptions based on unknowns. I’ve lived on the Border 

my whole life and I’ve dealt with Mexico my whole life, and my fellow cotton farmers out there will probably tell you the same thing, 

it’s probably like knowing really how much cotton is in China. Do 

you ever really know? I don’t think we know what Mexico is going 

to do to us. 

23

I know I can compete with them and I know the door swings 

both ways. I hope I can sell them my higher quality, lower price 

sugar. 

The CHAIRMAN. What’s the industry’s outlook for commercial production of ethanol from sugar, and do you ever envision a market 

for ethanol from sugar in this part of the country? 

Mr. MURDEN. You know, Brazil is doing it widespread, but 

there’s a lot of reasons Brazil’s doing it, government incentive probably being the largest. Sucrose ethanol, probably might work in the 

future. My particular sugar mill is in the midst of a feasibility 

study regarding ethanol, but for us in the Valley, you know, we run 

a pretty green friendly co-op, we manufacture our own electricity, 

and so there’s benefits of probably teaming up with say grain sorghum in our area for ethanol production. 

The CHAIRMAN. Is all of your sugar in this region generated from 

cane? 

Mr. MURDEN. Yes, sir, all ours is sugarcane in South Texas. 

The CHAIRMAN. L.G., how would you prioritize farm bill programs generally and the commodity titles specifically? How would 

you rank the relative importance of the direct payment program, 

marketing loan program and counter-cyclical payment program? 

Let me address this to you and Ted, which is obviously the same 

question we had of the previous panel. 

Mr. RAUN. Mr. Chairman, the commodity title is by far the most 

important program of the farm bill. It’s what keeps U.S. agriculture operating so that all Americans can benefit from both the 

conservation and the nutrition titles. Within the commodity program, the marketing loan program is the most important. The nonrecourse loan provision continues to be the bedrock of our farm program safety net. 

It’s a major factor that’s looked at by bankers and farmers both 

on the repayment ability of farm operating loans. Following the 

marketing loan program then would be the direct payment program and then the counter-cyclical payment program. 

The CHAIRMAN. Ted. 

Mr. HIGGINBOTTOM. I agree with L.G.. The commodity title is 

very, very important. The peanut program seems to revolve around 

the loan program, so I would have to put it No. 1; the direct payment being No. 2; and counter-cyclical No. 3. But I’d also like to 

reiterate really all three of them work hand-in-hand. And if one of 

them is tinkered with a whole lot, I think it would hurt all three. 

The CHAIRMAN. L.G., some organizations have explored the possibility of a revenue based approach for the commodity title. What 

do you think of a revenue based approach to the safety net as a 

replacement for the current commodity programs? 

Mr. RAUN. The rice industry has looked at some of those proposals, and right now we don’t see how a revenue based product 

would work for rice in the way that would even minimally replace 

the current commodity programs that we have. There may be a role 

for revenue insurance or a revenue product that plays a role as a 

supplement to commodity programs, but we still don’t feel like it 

could be a replacement for our current farm safety net. 

To a large extent in the rice industry, we self-insure by irrigating 

100 percent of the rice that’s grown in the United States. So we’re 

24

taking away the drought risk component a lot of other crops have 

and revenue insurance is based on large drops in yields that we 

don’t have in rice farming. We also do a lot of precision leveling of 

our fields to self-insure against lower yields on our crops. So our 

higher risk areas are not on the yield side but they’re on the price 

component and the input cost side. That’s where our risks are in 

rice farming. But we’d be pleased to work with you and the committee if you would like more information from us in this regard. 

The CHAIRMAN. We recently had a variety of genetically engineered long grain rice grains which have not been deregulated and 

were found in commercial samples of long grain rice. Even though 

this genetically engineered rice is safe for human consumption, 

what needs to be done in the private sector to reassure markets so 

the supply and export chain can remain open, product flowing and 

prices stable? 

Mr. RAUN. That announcement on August the 18th, Mr. Chairman, came as a real surprise to us when they found that trace 

amounts of the GM rice had been found in samples of long grain 

U.S. grown rice. And the reason being that we’ve never grown commercially GM rice. GM rice, genetically engineered rice has only 

been grown in some research trials. The LL–601 protein found in 

that long grain rice was—has been analyzed previously by both 

USDA and FDA and both of them agree it imposes no human 

health, food or food safety or environmental concern and is safe for 

consumption. 

The price of rice has dropped 15 percent since that announcement on August the 18th, so it’s certainly a huge issue in the rice 

industry. More specific to your question, I made a list of a few 

things that I think we need to do to reassure the markets. 

We need to develop a standardized, affordable, verifiable testing 

procedure that would be used by the whole U.S. rice industry and 

also a standardized reporting method. We need USDA, GIPSA or 

the appropriate US agency to issue a standardized certificate once 

we have this rice tested that can be viewed by the markets. Some 

key sensitive markets may not accept tests unless the government 

signs off on them. 

Obviously we’re going to IP any tested rice once we find if it is 

contaminated or not. We need to better communicate the fact that 

the LL–601 is safe and that all U.S. rice is safe. We’re in the process of—regulatory process of getting the LL–601 deregulated. We 

expect deregulation in the next 40 or 50 days. We think that will 

help the situation a lot. We need—the people that designed and 

were researching this product, to step forward and provide the necessary commercial assurance agreements, similar to what they did 

in the BT 10 corn situation, to ensure that exports continue to flow 

in all of our markets. But we will continue to keep this committee 

up to date as we proceed, and we look forward to working with you 

and your staff as we process through this issue. 

The CHAIRMAN. Dennis, there are proposals such as state block 

grants, additional research funding and counter-cyclical payments 

which have been made to provide more money to the specialty crop 

industry. Which of these ideas would benefit the industry most and 

how do you find—how do you propose we fund such proposals? 

25

Mr. HOLBROOK. Well, I would say that the grant proposals for 

additional research is something that’s been badly needed in our 

particular sector of agriculture. We’ve got issues with, as I indicated in my comments, of pests and diseases that are constantly 

coming into the country with greening is the most recent one in 

Florida. We need to learn how to be able to combat those. You 

know, that’s a $64,000 question, is how you come up with funds. 

You know, I’m not sure that I have a magic bullet for that answer 

today because I think it’s something that we need to look at and 

perhaps, you know, there’s ways to come up with that additional 

revenue. 

The CHAIRMAN. Brazilian cotton case has raised questions regarding the classification of direct payments as the green box because of the planting flexibility provisions restricting fruit and vegetable production on base acres. Do you have any thoughts about 

whether or not we ought to relax this provision on base acres? 

Mr. HOLBROOK. Well, our particular position on that, Mr. Chairman, is the fact that provides an unfair advantage to those who are 

receiving those payments that currently the specialty crop industry 

does not receive. So by having people who are—have that flexibility 

to go in and out could create some real commodity oversupplies, 

cause some real market issues in the specialty crop industry. 

The CHAIRMAN. You may or may not know that my son-in-law is 

a special crop grower. He’s a vegetable grower, and he has always 

told me that ‘‘What we want is you all just to leave us alone.’’ But 

at the same time, if we change this planning flexibility, it puts the 

specialty crops in an entirely different atmosphere within the farm 

bill. And we have had requests as we’ve been around the country 

from specialty crop growers that some say exactly what Joe says, 

and that’s ‘‘Do nothing. Leave us alone. Don’t change it.’’ We’ve also 

had comments from folks who, as a specialty crop grower, would 

like to have the ability to take base acres, not receive payment on 

those base acres but to grow under contract specialty crop products. 

Do you have any thoughts on whether or not that would work and 

what impact that might have on your industry? 

Mr. HOLBROOK. I guess the best way to address that is that specialty crops, they’re very sensitive to price fluctuations being the 

fact that if there’s oversupply then, you know, you’ve got some 

problems with the fact that prices are going to be reduced. You 

know, we have kind of—in our industry we’ve basically survived 

on—without the support, financial support in most respects in government payments and so forth. I think that, you know, we probably are better off if we can just continue on with the way we’re 

going as we’ve been going with, you know, perhaps some areas that 

are like research, some of those. 

You know, crop insurance is another issue that needs to be 

looked at that could be greatly improved to assist us in our particular area of the agricultural sector. 

The CHAIRMAN. Gentlemen, do you have questions, comments? 

Mr. NEUGEBAUER. (No audible response.) 

Mr. CONAWAY. (No audible response.) 

The CHAIRMAN. All right. Well, gentlemen, thank you all very 

much for your input. We appreciate your comments, your testimony, and I really appreciate your taking the time to come to be 

26

with us this morning. And we look forward again to continue to dialog with all of you. Thank you. 

We will now move to our third panel. I’ll ask them to come forward. Mr. Barry Mahler of Iowa Park, Texas on behalf of the Association of Texas Soil and Water Conservation Districts and the National Association of Conservation Districts, Mr. Mike Berger of 

Austin, Texas on behalf of the Association of State Wildlife Agencies, Mr. Dale Smith of Amarillo, Texas on behalf of Texas and 

Southwestern Cattle Raisers Association and Texas Cattle Feeders 

Association, Mr. Keith Broumley of Hico, Texas on behalf of Dairy 

Farmers of America, Mr. Bill Battle of Tunica, Mississippi on behalf of Catfish Farmers of America. 

Gentlemen, thank you very much for being here. 

You have heard the process that we use. We will certainly take 

your full statement and put it in the record, but we look forward 

to your opening comments. 

Mr. Mahler, we’ll start with you. 

STATEMENT OF BARRY MAHLER, ASSOCIATION OF TEXAS 

SOIL AND WATER CONSERVATION DISTRICTS AND THE

NATIONAL ASSOCIATION OF CONSERVATION DISTRICTS, 

IOWA PARK, TEXAS 

Mr. MAHLER. Thank you, Mr. Chairman. My name is Barry 

Mahler. I am a producer from Iowa Park, Texas, the 1Rolling 

Plains where it’s been quite dry the last year or two. 

And certainly we’re getting some change now and we’re optimistic about that, but it’s been tough. And one of the things that’s 

been extremely tough for us, of course, is increased input cost. And 

any time you have crop losses and a tremendous run-up in our 

input cost, it creates problems. 

Mr. Chairman, I’m at a little bit of a disadvantage because I do 

a little farm broadcasting work along with my farming operation, 

and where I work when the red light comes on that’s when you 

start. So I’m going to have to reverse that thought here this morning, and I’ll try to behave. I would love to talk about commodity 

programs, entitlements, I’d love to talk about crop insurance, I’d 

love to talk about maybe an ad hoc disaster program or some ways 

we could make this work. But my goal here today is to talk about 

soil and water conservation. I do represent soil and water conservation district directors from across the State of Texas and actually 

across the United States. It’s a tremendous effort to protect both 

the public and private lands, and I certainly am privileged to represent them here today. 

But the one comment I will make up front is that we know very 

well that there will be no conservation in the country without ag 

profits. It is absolutely imperative that we have a strong economic 

base for agriculture to enhance soil and water conservation. They 

work hand-in-hand. We won’t have long-term profits without it, we 

won’t have conservation without ag profits, and so the two work 

hand-in-hand, and we appreciate you for inviting me to be on this 

panel today. 

Just a few comments on some things that I pointed out in my 

written testimony that I think we should really take a look at, and 

one of them is technical assistance. And certainly technical assistVerDate 0ct 09 2002 15:32 Nov 07, 2006 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 C:\DOCS\30124.TXT SAG2 PsN: SAG2
27

ance is literally the glue that joins our conservation efforts together 

in these great United States. And of course, that is the ability of 

the NRCS and USDA to bring that great engineering expertise and 

application expertise to the country to work with local soil and 

water conservation districts to make soil and water conservation 

happen in this country. It’s absolutely important, it’s going to be 

one of the goals, I think, of our National Association 

Conservation Districts to point out how important that’s going to 

be. EQIP program, Environmental Quality Incentive Program did 

fantastic in the 2002 bill. We’ve had great increases. We think 

we’ve done a great job putting that money to use, and we would 

like to see that extended in either an extension of the 2002 bill or 

new legislation in 2007. The great thing about EQIP, locally led, 

we’ve got our work groups, it’s a voluntary program and it has been 

very well received by producers across the country and there’s been 

some great work done, and we need to do more of it. 

The CSP program designed by the 2002 bill, mixed reactions. The 

big problem has been funding. If we could fund it totally, it would 

be fantastic. We’ve not been able to do it. Let’s look at some different ways to fund it. Maybe some tax incentives instead of direct 

payments for doing great conservation work. May be something 

there that we can work out. The main thing is we need to make 

it available to producers all across the country and not leave it as 

a have or have not. 

Soil and water conservation districts are vital to soil and water 

conservation in the United States. They’re these individuals that 

give up their time and volunteer to work together with state funds, 

Federal funds, state organizations, the Federal, of course NRCS, 

our sister agency, and soil and water conservation to put soil and 

water conservation on the ground. They do a tremendous job. It’s 

a tremendous service to agriculture, and they help guarantee not 

only the present of good production agriculture in the United 

States but good production agriculture for the future of this great 

country, and we think it’s great. 

Strong conservation districts across the country, vitally important in my opinion to making this—this agricultural industry to 

continue to be productive. And with that, I see the red light and 

I will yield my time. Thank you very much. 

[The prepared statement of Mr. Mahler can be found in the appendix on page 72.] 

The CHAIRMAN. Thank you very much. Mike. 

STATEMENT OF MIKE BERGER, ASSOCIATION OF STATE 

WILDLIFE AGENCIES, AUSTIN, TEXAS 

Mr. BERGER. Good morning Mr. Chairman, and Representatives. 

I’m Mike Berger. I am the Director of the Wildlife Division of the 

Texas Parks and Wildlife Department. Today, I represent that department as well as the Association of Fish and Wildlife Agencies 

that represents all the state wildlife agencies around the country. 

I want to thank you particularly for your support of those agencies 

and for support of the Fish and Wildlife Conservation Programs in 

the conservation title. 

We support the current farm bill, and we have, as you won’t be 

surprised, a suggestion or two that we think might make it better. 

28

These include better incorporation of local guidance, improved integration with local and regional resource initiatives and expanded 

delivery of technical assistance. The current agriculture issues of 

complexity, diversity and interaction defy the one size fits all 

model. Incorporating local guidance and integrating regional resource initiatives directed toward solving multiple resource management concerns will ensure the most cost effective means of delivering conservation programs that meet local producers’ needs. To 

this end, we have some suggestions. 

Establish Habitat Technical Teams made up of state and Federal 

conservation agency staff. These teams would seek to integrate 

state farm bill conservation program delivery into existing state 

and regional fish and wildlife conservation plans and programs. 

Create state-level conservation, producer and business advisory 

groups charged with establishing guidelines for farm bill energy 

programs which ensure the long-term financial health of farm and 

ranch families, energy production and the environment. 

Institute the associations suggested CRP, EBI scoring system 

that provides equal weight to soil, water and wildlife issues. Consider the creation of regional EBIs that fairly balance landscape 

differences, areas of ecological significance and state and regional 

conservation priorities. Decouple the continuous CRP and Wetland 

Reserve 

Program from the CRP county acreage caps. Local playa wetlands in this area are vital to the Ogallala Aquifer recharge, but 

because they’re in capped counties, they’re currently excluded from 

receiving needed protection and restoration under CRP or WRP. 

Restore EQIP’S original cost effective whole farm resource system approach. Expand this system so that it integrates local, state 

and federal resource goals, including water, soil, air and wildlife. 

Increase WHIP funding and focus it on local issues through the 

use of having the technical teams that I mentioned earlier. Simplify the contracting for Farm and Ranch Protection Program, 

Grasslands Reserve and Wetland Reserve by using a single easement deed contract, preferably the current Wetland Reserve Program contract. 

Expand the Grassland Reserve Program, targeting areas with 

the highest land fragmentation rates while emphasizing conservation and restoration of native habitats. Create priority areas using 

state wildlife action plans. Ensure the Forest Land Enhancement 

Program funding is used for its original purpose of providing technical conservation assistance to Texas’ 300,000 non-industrial private forest owners. I have some other remarks, but I see that red 

light is on and I’ll pass those up and answer any questions you 

have at the proper time. Thank you. 

[The prepared statement of Mr. Berger can be found in the appendix on page 53.] 

The CHAIRMAN. Thank you very much. Dale. 

STATEMENT OF DALE SMITH, TEXAS AND SOUTHWESTERN 

CATTLE RAISERS ASSOCIATION AND TEXAS CATTLE FEEDERS ASSOCIATION, AMARILLO, TEXAS 

Mr. SMITH. Chairman Chambliss, Representative 

29

Neugebauer and Representative Conaway, thank you for allowing me to appear before you today and provide the Texas cattle industry’s perspective on the upcoming 2007 farm bill. 

My name is Dale Smith. I am a cow-calf producer, stocker cattle 

operator, and cattle feeder from Amarillo, Texas. I’m also a member of Texas and Southwestern Cattle Raisers Association, Texas 

Cattle Feeders Association, Panhandle Livestock, and the National 

Cattleman’s Beef Association. 

Before I get into the farm bill, I’d like to touch on an extremely 

important issue that is currently affecting many cattlemen. The 

Southwest is dealing with a drought of historic proportions. Estimated livestock related losses are $1.6 billion in Texas alone and 

77 percent of the state’s hay production has been lost. This is in 

addition to the millions of acres and miles of fence that were destroyed by wildfires that ravaged through the region, especially the 

Texas Panhandle, earlier this year. As such, I respectfully ask this 

committee and Congress to act quickly and pass an agricultural 

disaster package. 

As the nation’s largest segment of agriculture, the cattle industry 

is focusing on continuing to work toward agricultural policy that 

preserves the right of individual choice and the management of 

land, water, and other resources; provides an opportunity to compete in foreign markets; and does not favor one producer or commodity over another. As a cattle producer, my livelihood is tied to 

many other agriculture commodities. Livestock consume three out 

of four bushels of the major feed grains harvested in the U.S., and 

beef cattle account for nearly 30 percent of the consumption. As 

such, cattlemen support the continuation of reasonable, market-oriented programs for crops, but strongly oppose government supply 

programs. It is not in the farmers’ or ranchers’ best interests for 

the government to implement policy that sets prices; underwrites 

inefficient production; manipulates domestic supply, demand, cost 

or price. 

Likewise, conservation programs and environmental regulations 

must be based on common sense and sound science. One such program that achieves this is EQIP. Cattle producers across the country participate in this program, but arbitrarily setting numerical 

caps that render some producers ineligible limits the success to the 

program. Addressing environmental—addressing environmental 

problems is not a large versus small issue. All producers have a responsibility to take care of the environment and their land and 

should have the ability to participate in the programs that establish and attain environmental goals. Therefore we work very closely with the NRCS office to administer the NRCS program and 

hopefully they will maintain fully staffed to provide technical assistance. 

We support efforts to increase our nation’s renewable fuel supplies; however, I reiterate that livestock consume three out of four 

bushels of the major feed grains harvested. And governmental incentives to expand ethanol and other alternative fuel supplies 

should not function to the detriment of livestock producers. 

U.S. cattlemen have been and continue to be strong believers in 

international trade. We support aggressive negotiating positions to 

open markets and to remove unfair trade barriers to our product. 

30

Cattlemen also support Congressional and regulatory action to address unfair international trade barriers that hinder the exportation of U.S. beef, and I appreciate the Committee’s efforts to reopen foreign markets that were closed to U.S. beef after the discovery of BSE. As you all know, foreign markets are key to success 

in most, if not all, segments of production agriculture. 

Last, I want to touch on a few issues that are not addressed in 

the farm bill; namely country of origin labelling, and in other proposals that limit the cattlemens’ ability to mark their cattle or restrict ownership on cattle. But in saying that, we’re also very much 

for the enforcement of the Packers and Stockyards Act. 

Thank you very much for allowing me to be here today, and I’d 

like to answer any questions. 

[The prepared statement of Mr. Smith can be found in the appendix on page 103.] 

The CHAIRMAN. Thank you. Keith. 

STATEMENT OF KEITH BROUMLEY, DAIRY FARMERS OF 

AMERICA, HICO, TEXAS 

Mr. BROUMLEY. I’m Keith Broumley, a dairy farmer from Central 

Texas representing Dairy Farmers of America. Thank you for the 

opportunity to address this hearing. And because we don’t think 

there’s going to be any radical shifts in the policy direction as a result of the 1907 farm bill, we support the view of an extension of 

the current farm bill which will work well for most of the nation’s 

dairy farm families. We feel the next farm bill should maintain 

some form of an economic safety net for dairy farmers. Safety nets 

prevent prices from falling so low that businesses become unviable. 

And hope Congress will maintain these policies. 

The most important safety net provision we have in the dairy—

is the dairy price support program. We favor continued operation 

of the dairy price support program at a targeted 9.90 U.S. average 

manufactured price. We would oppose granting the Secretary any 

discretion, which would reorient its intended purpose away from 

supporting the income to dairy farmers just to result in minimizing 

government costs. 

Additionally, I would request that the CCC take action and adjust the support program purchase price levels for cheese, butter 

and nonfat dry milk to reflect significant additional costs manufacturers face when selling products to the CCC. The second safety 

net is the Milk Income Loss Compensation Program, which DFA 

supports as long as there are no caps limiting access to the benefits. This program puts cash in the hands of producers at the very 

point it is needed, at the lowest part of the price cycle. 

In general, the guidelines for a safety net program should be programs that do not discriminate between farmers of different sizes; 

does not discriminate between farmers in different regions of the 

country, and it should not be high enough to encourage additional 

production. We support continual—continuation of the Federal 

Milk Marketing Orders program. Marketing orders are important 

to us as they undergird all of our marketing and pricing efforts all 

over this country. Another reason we support extending the current 

farm bill is so that we can have a more clear view of the WTO—

WTO trade talks. We can see no reason to change our programs 

31

until we know what the World Trade Rules will be and more importantly perhaps who will—who will play by them. 

We support the Dairy Export Incentive Program and would appreciate the Secretary’s use of it. Finally, we support the Senate 

Bill 1417 offered by Senator Craig that imposes tariff rate quotas 

on certain casein and milk protein concentrate products. Current 

tariff rate quota schedules for dairy products were written before 

these products were mainstream dairy ingredients. Like all other 

policy areas, this section needs to be reviewed and updated to reflect today’s economic realities. 

Thank you for your time. 

[The prepared statement of Mr. Broumley can be found in the appendix on page 56.] 

The CHAIRMAN. Thank you very much. Bill. 

STATEMENT OF BILL BATTLE, CATFISH FARMERS OF 

AMERICA, TUNICA, MISSISSIPPI 

Mr. BATTLE. Chairman Chambliss, members of the committee. 

My name is Bill Battle. I’m currently president of the Catfish 

Farmers of America, an association representing catfish farmers 

across the nation. Thank you for this opportunity. 

The U.S. catfish industry is a true American success story. 20 

years ago, it had limited demand and name brand recognition outside of Mississippi, Alabama, Arkansas, and Louisiana. Since then, 

U.S. catfish farms have literally built the industry pond by pond 

making catfish farming the largest agriculture industry in the U.S. 

today. At the same time, through an innovative and expensive marketing program we successfully developed a significant national 

market for domestically farm-raised catfish making it the fifth 

most popular seafood in America. 

The catfish industry accounts for significant shares of economic 

output in jobs in catfish farming and processing areas. The economic health in these regions depends on the health of the industry. If the farmer cannot sell their food size fish, the processors 

cannot in turn go elsewhere on supply. If the processors cannot sell 

their products, farmers cannot sell their fish. One of the most serious challenges facing our industry in recent years has been imports, particularly those from Vietnam. The Vietnam fish known as 

‘‘basa’’ and ‘‘tra’’ are different species than U.S. catfish. They are 

able to establish a foothold in the U.S. market by bootstrapping 

their product to our successful market program using names and 

labels suggesting that their product is the same as U.S. catfish. 

Worst yet, they took a significant share of the market by unfairly 

pricing their product at levels below the cost of our most efficient 

farmers and processors. By 2002, the sale prices had been depressed to their lowest point in 20 years. A lot of catfish farmers 

didn’t survive during this period and the industry fell on the brink 

of collapse. 

Congress enacted legislation requiring that the different Vietnamese species of fish be labelled properly as to avoid confusion 

with domestic catfish, but this alone could not remedy the problem 

of unfair pricing. In 2003, the Commerce Department imposed antidumping duties on Vietnamese fish imports which would have provided the necessary relief, however widespread mislabeling of VietVerDate 0ct 09 2002 15:32 Nov 07, 2006 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 C:\DOCS\30124.TXT SAG2 PsN: SAG2
32

namese ‘‘basa’’ and ‘‘tra’’ as those species such as Grouper has allowed a large share of import to side step—side step the payment 

of duties. 

The government has been actively investigating these practices 

and several Federal criminal indictments have already been 

brought. 

However, mislabeling remains a serious problem. American consumers must be allowed to reliably choose the product they prefer 

to eat. Another important issue is the presence of banned and dangerous substances, including one known carcinogen that had been 

found in Vietnamese imports. These expose consumers to serious 

health risks and undermine consumer confidence in seafood products. 

The U.S. catfish industry supports free trade and supports establishing permanent, normal relations with Vietnam. Having Vietnam subject to the same rules as many other exporting countries 

will be a step in the right direction. At the same time, we must 

continue to address unfair trade, mislabeling practices, safety concerns and other issues that have hindered our industry’s ability to 

grow. 

On behalf of the U.S. catfish industry, I respectfully request this 

committee take all appropriate steps in the 2007 farm bill to ensure that our agriculture industry is afforded the full benefits of 

the trade laws. 

Thank you for this opportunity. 

[The prepared statement of Mr. Battle can be found in the appendix on page 42.] 

The CHAIRMAN. Thank all of you gentlemen. 

Mr. Mahler, given the budget constraints, where should the committee focus its resources which are going to be available for conservation? 

Mr. MAHLER. We’ve been very pleased with the 

EQIP program because we think it’s put a lot of conservation 

work on the ground nationwide. And obviously there’s some considerations that need to be taken to make it even a better program. 

Of course, your EQIP program only functions because you’ve got 

great technical assistance in your local soil and water conservation 

districts. So those two would have to almost go hand-in-hand. It’s 

hard to be as strongly supportive of the Conservation Security Program, although we think it’s a great concept. I think it’s long overdo to realize that there’s some people out there doing a great job 

and they should be rewarded for that. We also realize that it leans 

toward being WTO friendly, which is excellent. The problem has 

been though is that we have not had the level of funding to make 

it available to producers nationwide. We’ve got haves and have 

nots. 

In my own district, I’ve got a neighbor right across the fence 

that’s in and I’m not because more of my land falls in another watershed than the one that had been approved in our area. We’re 

both doing comparable jobs of conservation, but he’s receiving the 

payment and I’m not right across the barbed wire fence just because of locale. So that’s been the big problem with it. Once again, 

we think it’s a great concept, we’d love to see it. But we realize 

budget constraints on it are going to be tremendous. 

33

So to answer your question: The EQIP program we think has 

functioned well. With some minor tweaking and adjusting a bit, we 

think we can continue to do a great job managing both the public 

and private lands in the United States, certainly here in Texas. 

And along with that, great technical assistance from the NRCS is 

tremendous. They do such a great job in not only the engineering 

practices that we need but overseeing it and seeing it through it 

is a very unique situation that they have, and they do a great job 

for us. 

The CHAIRMAN. We have had some conversation from folks in 

other parts of the country as we’ve been around our hearings about 

possible reduction in authorized acres of CRP. We’ve got about 44 

million acres authorized. I think the most that we’ve ever had in 

the program is around 40. Do you have any thoughts relative to 

what we might do with CRP, particularly as we look toward expanding the energy title? 

Mr. MAHLER. Mr. Chairman, as you—as you know and we’ve 

mentioned here throughout the morning, we’ve been in a tremendous drought across the Plains. One of the things that I always 

think about is that even though we’ve been in drought that is certainly as bad as what we had back in the dust bowl days, which 

is when the organized conservation effort in this country really got 

started was because of the problems we had then, even though 

we’re that dry and drier, we have not had those old red sky days 

when that dust has moved by. And we always joke in our part of 

the country ‘‘We saw Lubbock come by yesterday,’’ we haven’t had 

that. And the reason we haven’t had that is due to great conservation efforts by our producers out there in the country. Not only 

through EQIP programs and other things, but through CSP. There 

were so many acres that were so fragile that were covered with 

permanent grass and other means that protected that it has literally kept us from having another dust bowl in this part of the 

country. I firmly believe that. So to give that up would be very, 

very hard indeed. Plus, one of the things I really like about CSP 

is it——

The CHAIRMAN. Are you talking about CSP or CRP? 

Mr. MAHLER. Yeah, CRP. I’m sorry, CRP, I’m sorry. Thank you. 

The CRP deal actually is a reserve program. Think about where we 

would be in this country today if we would have had a similar program for energy some 20, 30 years ago and actually had that capability in reserve. We’re talking about a tremendous amount of acres 

out here that are lying idle, under covered, protected. If we got into 

some kind of national security problem or if we got into some kind 

of a food problem, we could literally have a lot of that land back 

in production in, say, eight to 9 months. That’s a tremendous reserve for this country. Wouldn’t we love to be in that shape in our 

industry situation today. So it’s got some benefits other than just 

being there to take care of the conservation issues. 

Now, how do we pay for it? That’s always the big question. We’re 

obviously going to have to have some changes, because I feel like 

it would be a budget buster if we continued to add to it. Actually, 

there’s some land out there that needs to be added to it. 

The commodity programs are telling us right now the markets, 

we don’t need the production. We obviously don’t need that exVerDate 0ct 09 2002 15:32 Nov 07, 2006 Jkt 000000 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 C:\DOCS\30124.TXT SAG2 PsN: SAG2
34

tended production to bring it back into production. So we need to 

find some way that maybe we can keep it idle, keep it protected 

and utilize it in some other way. But it’s been a fantastic program 

both in conservation and also from supply management. It’s been 

a—it’s been a successful program. 

The CHAIRMAN. Mr. Berger, let me just say that 

I have a great appreciation for what you all are doing with wildlife in Texas. I am—I am a big quail hunter. That is my passion, 

and I’m fortunate enough to live in part of the country where it is 

sort of the king of our hunting operations in Southwest Georgia. 

But I also have had the opportunity over the last several years, 

and I’m coming back again this year, to Roberts County, Texas to 

hunt. So I really do appreciate you all continuing to have the 

hatches of quail that you have managed to have up here, and we’re 

going to continue to try to make the supply and demand issue important in quail hunting as well as in production agriculture. 

Mr. BERGER. Very good. We’re proud to have you back. The 

drought that we—that’s been spoken of so much here has cost our 

quail production some this year, but I think there’s going to be 

some birds around for you. We’re glad to have a good population 

of wild birds, and we’ll welcome you to come here. 

The CHAIRMAN. How should Congress balance agriculture’s potential and renewable energy production with wildlife, environmental and feed stock concerns? 

Mr. BERGER. As Mr. Mahler said, there’s lots of CRP out there, 

and it is a tremendous reserve. That’s probably our largest, it’s one 

of the oldest, one of the original CRPs along with grassland reserve 

and wetland reserve, and they are great stories items. I think 

that’s one way of balancing the wildlife. And there are other benefits that are associated with that CRP as the storehouse and as 

ready land. 

Regarding CRP, one of the things that has happened here in 

parts of this country is there are many counties, quite a few, that 

are overenrolled, they’re over that 25 percent cap, and they’re not 

easily converted into farming or ranching at this time without considerable investment and especially on areas that need to be protected from soil and wind erosion. They have already been incorporated into the economy of those counties. I think it would be a 

real shame, not only for wildlife but for the local people and local 

businesses if those counties were to come out of CRP in order to 

meet a 25 percent county by county cap that would be strictly enforced. 

But we’d like to see those lands stay in conservation, particularly 

for some species like lesser prairie chickens which are—up in this 

part of the country we’re trying to save them from becoming on the 

endangered species list which would be an outcome that would 

really be damaging for agricultural producers throughout this region. 

The CHAIRMAN. The programs you mentioned are all related to 

cover for wildlife and they work very well. But with the drought 

situation, and you alluded to that in talking about the quail hatch, 

we’ve got the same problem, we’ve had a lot of drought this year 

in Southwest Georgia and it has affected our wildlife production. 

And I’m curious as to whether or not you have any thoughts about 

35

the conservation programs that we have in effect from a water supply standpoint as it might affect wildlife. With so many farmers 

now getting additional income from rental to hunters for various 

types of wildlife, are there any things that we may need to put 

more emphasis on from a conservation standpoint to ensure not 

only we’ve got cover but we’ve got water for wildlife also in these 

draught stricken times? 

Mr. BERGER. As you probably know, one of the best and most 

cost efficient ways of keeping water in underground aquifers and 

in ponds and streams is to have proper land management all 

around—around that area. Good land management is good water 

management and incorporates that water into the—into the soil 

and it makes it available for wildlife and for people too to use. 

The market in much of this part of the world and the Rolling 

Plains and throughout Texas it seems to be driven these days by 

the recreational buyer who’s coming in and the fragmentation that 

is created by that is a concern. But I think if we consider the soil, 

the water and the wildlife when we’re constructing the EBI, consider those factors when we’re talking about EQIP payments and 

CRP and all that is the way to keep that in. Keep water and wildlife as integral components of all programs when we consider payments we’re making under various conservation programs. 

The CHAIRMAN. OK. Mr. Smith, I have to tell you that as we’ve 

been around the country, we’ve kind of had this little rating game 

going because I’m a big beef consumer. I try to help your industry 

as much as I can. 

Mr. SMITH. I like to hear that. 

The CHAIRMAN. So everywhere we go, we have to have an opportunity to have a steak. And as we’ve compared steaks around the 

country, I’m going to have to tell you that Nebraska is at the top 

right now, and that has hurt Vernie’s feelings dramatically. 

Mr. SMITH. They’re probably buying cattle out of Texas. 

The CHAIRMAN. As we left the steakhouse in Nebraska the other 

day—other night, he told us, he said ‘‘Well now, you all have not 

seen anything until you get to Texas.’’ Unfortunately we got in 

about 11 o’clock last night and we didn’t have an opportunity to do 

our Texas comparison. So I’ve already told everybody how much I 

love Lubbock, so I’ve got one more reason to come back to Lubbock 

because we’ve got to have this comparison of Texas beef, and I have 

no doubt that Vernie is going to find the cow and make sure the 

steak we get here is the best steak around the country that we’ve 

seen. 

What effect would bans on packer ownership and forward contracting of cattle and mandatory country of origin labelling have on 

livestock producers? 

Mr. SMITH. No. 1, it would just—it would be just government interference in free trade. I don’t see why the government should 

come in and say who can own cattle and who can’t own cattle. And 

I know we—plus, it hinders cattle producers’ ability to forward 

market their cattle which is an excellent risk management tool. I’d 

rather have that option available to me than some type of a livestock price insurance that’s subsidized by the government. I’d rather be able to make my decisions on how I want to market my cattle 

and who I want to do business with. But in saying that, I also want 

36

there to be, through the Packers and Stockyards Administration, to 

be of strict enforcement of the antitrust laws and make sure that 

there’s no collusion or price fixing or anything like that. And we 

are down to four to five major packers right now, and that is a fear 

that you could have that. But I think with adequate government 

oversight that should be alleviated. 

In regards to country of origin labelling, I see that too is—to me, 

that’s a market program. If Tyson or Cargill want to label their 

beef that I produce and it’s from Texas as compared to Nebraska 

and that it’s—it’s that much better, then I’m all for that. To force—

for the Congress to force the industry to use country of origin labelling on our imports of cattle from Canada or Mexico and segregate 

those cattle all throughout the whole production system, you’re basically just adding a cost with very little benefit. If there is a benefit, let’s let the market decide and let’s let the market—let’s let 

the market take advantage of that, including myself. 

The CHAIRMAN. We’ve had this issue of reauthorization of mandatory price reporting law and we’ve had some conflict between the 

House Ag Committee and the Senate Ag Committee. It’s primarily 

been whether we do it for 1 year or 5 years. And we’ve go two census from Iowa who have been firm that that effect ought to be 1 

year versus five. So unfortunately we’re at loggerheads and we 

have not been able to get that bill reauthorized, but as you know, 

we’re operating on a voluntary basis right now and I am doing my 

best to try to figure out some common ground here that we can get 

this thing done. But how important is mandatory price reporting 

to the cattle industry? 

Mr. SMITH. With more and more trades being made on a formula 

basis where we’re using USDA data that’s being published on a 

weekly basis to market your cattle, and it does help very much that 

cattle producers use that information to market their cattle the 

best they can. So it has—it has been important. 

The CHAIRMAN. What’s your most pressing environmental or conservation concern, and do existing conservation programs help you 

address them? And any thoughts you have relative to improvements that we might make from a cattle perspective in a conservation programs? 

Mr. SMITH. OK. EQIP is an excellent program in a lot of different 

ways. On a rangeland perspective, it helps us with our brush management, it helps us with water development and properly grazing 

our rangeland. It helps us recover from the wild fires that we had 

in the Texas Panhandle. And then from a feed yard perspective or 

for a dairy perspective, it helps producers be able to build lagoons 

or sprinkler systems so they can comply with environmental regulations. So EQIP has been a very, very good program and I’ve been 

very active in several different EQIP contracts. The Conservation 

Security Program is also very good. 

What I like about it is that unlike a lot of these programs in the 

past, and this at some point to me was a criticism of when EQIP 

first came out, is that you got—the worse your rangeland condition 

was, the higher your score was, or the worse—in other words, if 

you did—or the worse your brush problem was, the higher your 

score was and therefore, it penalized good producers and it made—

gave poor producers at an unfair advantage when it was applying 

37

for EQIP funds. So that’s one thing I like about CSP, is it does reward good environmental stewardship. And my family’s ranch is in 

a CSP contract and it has been very good. And I’m proud to say 

that I’m in it because we’ve earned it, I feel, through good stewardship. 

Some of the old programs basically were rewarded, inefficient 

producers or in bad stewardship to some degree. Granted their goal 

was to try to get them from becoming bad stewards to convert them 

over to being much better stewards of the land. 

The CHAIRMAN. Mr. Broumley, we had your DFA folks in Washington this week. I visited with a number of them, my long-time, 

good friend Gary Hamblin and other executives and directors were 

in town, and I was very pleased to have a chance to visit with 

them. 

The reported aggregate measure report the dairy is 4.5 billion. 

And although current WTO negotiations are suspended, if the 

United States’ latest proposal was accepted, the U.S. would be restricted to 7.6 billion in the Amber box. 

These reductions will require proportional cuts in all commodities, including dairy. How do you envision dairy adjusting to a scenario of paying your fair share of the reduction in the Amber box? 

Mr. BROUMLEY. I’m going to have to get back with you on that. 

I’m sorry. 

The CHAIRMAN. Currently only dairy producer cooperatives have 

the ability to forward contract with their members. Does forward 

contracting provide producers with an additional risk management 

tool to manage price and income volatility in the marketplace, and 

should this option remain available only to dairy producer cooperatives, or should processors and non cooperative dairy producers also 

be able to utilize this risk management tool? 

Mr. BROUMLEY. As of now, I haven’t used that risk management 

tool. I—and there are others around this country that have. And 

to my knowledge, those that have utilized this tool, there’s been 

more losses in the situations than there has been gains. Understand that a lot of people are using that to set a bottom on their 

prices so that they’re not—so they are protected on the bottom side. 

And I have not used that tool today as far as it being able to be 

used by others in the industry. At this point in time I’d like to see 

it remain as is. 

The CHAIRMAN. OK. Mr. Battle, I’ve been to Tunica, Mississippi, 

and I’m glad to know that there are catfish raised there, because 

just like beef, I’m a big consumer of fried catfish. That’s a great 

southern tradition as you know, and you guys do a great job. But 

what I didn’t know, as I say, is that you grew catfish in Tunica because when I was there, we were playing golf and attending a little 

facility down the road probably from your catfish farm that probably keeps your catfish awake at night because of all the lights of 

the casino and all the noise that’s made there, and I would much 

rather made a deposit eating catfish than the deposit I left at the 

casino that night. What types of consumer marketing strategies 

have the 

Catfish Farmers of America been able to develop to promote U.S. 

farm-raised catfish as a superior product of the alternatives that 

you discussed in your testimony? 

38

Mr. BATTLE. Well, the alternatives are not really catfish, is our 

problem. We can compete with anybody, but a ‘‘basa’’ and a ‘‘tra,’’ 

how many times have you gone to the store to buy ‘‘basa’’? If they’ll 

label their product what it is, we don’t have a problem competing. 

We spend about $25 million a year that comes off of a feed checkoff 

to promote U.S. farm-raised catfish. But when they come in here 

and put it in a box that looks like farm-raised catfish and can raise 

it for nothing because of labor costs and several other reasons, we 

can’t compete with that. If they don’t cheat, we can compete. 

The CHAIRMAN. I’ll have to admit I didn’t know what ‘‘basa’’ and 

‘‘tra’’ was. In fact, in looking over these questions I got my staff up 

here, and I said ‘‘What in the world is that? Is that right?’’

But we’re in the midst of final negotiations now with the Vietnamese on a bilateral trade agreement, and I’m assuming that the 

Catfish Association has been apprised of what’s in there relative to 

country of origin labelling or whatever. Are you familiar with that 

enough to know as to whether or not your association is satisfied 

with the terms of that agreement, and are we putting the right 

kind of restrictions on them? 

Mr. BATTLE. We’re putting the right restrictions and everything, 

if it applies and if it’s enforced, is going in the right direction. But 

enforcement and circumvention is our major concern. They are—

the Vietnamese sending their fish to Cambodia now to be processed 

can circumvent the avenues and the tariffs, and they call it 

‘‘Grouper,’’ they call it whatever they want to get it into the United 

States, and it’s hard to compete with people that are not honest. 

The CHAIRMAN. So irrespective of what we’ve got in the agreement there, do you think there are current laws in place right now 

to prevent that mislabeling is just a matter of enforcement rather 

than requirement? 

Mr. BATTLE. Inspection and enforcement. 

The CHAIRMAN. Yeah. Is all of that USDA or is FDA involved in 

that also? 

Mr. BATTLE. FDA, USDA, USDC, to some extent, and there have 

been some arrests and some seizures made, but 

I’m not sure by who. 

The CHAIRMAN. Randy, Mike, any comments? 

Mr. CONAWAY. No. 

Mr. NEUGEBAUER. Dale, I wanted to just—as I’ve travelled the 

last month of August really through the entire district and, you 

know, looked at row crop conditions and then the grazing conditions and as we begin to try to formulate some kind of appropriate 

response to that, kind of assess for me the—where the cattle industry needs—where the needs are for assistance and what form of assistance does that need to be in? Because, you know, we’ve gotten 

some rains recently in parts of the district, so that may help our 

wheat crop. But we did have those fires. We hurt a lot—we had a 

lot of grass, grazing, burned up that we weren’t probably able to 

utilize this summer on top of that. So as we look at the appropriate 

response, can you kind of give me a feeling of where you think that 

response needs to be and what form it needs to be in? 

Mr. SMITH. OK. The response that we had on the country that 

was burned up by the wild fires that we had in 

39

March that burned over a million acres in the Texas Panhandle, 

we entered into an EQIP contract. The NRCS was very nimble, especially for a government agency, and they had extra funds and 

they rolled it into a—they paid $5 an acre to defer grazing from 

May 15th to October 15th on year one on the effected rangeland 

and then for May 15th—or for the first part of the growing season 

for the year two, and that was a very large help. And it helped, 

one, alleviate, or at least helped some on the financial cost of having, you know, an entire ranch burn up, and then it—but it also 

helped in an environmental standpoint that it was an incentive 

to—it paid you on a per acre basis, but you had to remove the cattle so they’re not sitting there nubbing down that grass when it 

needs to be rested and allowed time to recover. So it had two different benefits. It helped in the financial hardships, but also helped 

on the environmental side, for the rangeland health side. So I 

thought it was very good. 

Mr. NEUGEBAUER. Did the emergency grazing and some of that 

CRP, did that accrue some——

Mr. SMITH. That did help. Yeah, it kind of gave you a place, especially in the extreme fires—I’m glad you mentioned that. When the 

fires were so bad, you just didn’t have any options, I mean, besides 

buying hay, which is very inefficient to just sit there and feed hay 

to cows while they’re in a dry lot. So it helped producers go to that 

CRP, I give them some time to make—either find some outside pasture or make some marketing decisions. They weren’t forced to sell 

at the, you know, next county sale. It helped. 

The CHAIRMAN. Gentleman, thank you all very much. Again, as 

I’ve said to all the other panelists, I can’t tell you how much I appreciate you taking time from what I know is a very busy schedule 

to come here today and to give us very valuable information. As we 

move forward with ultimately developing the policy and writing the 

farm bill, we certainly look forward to continuing the dialog with 

you and making sure that your views are well represented in this 

next farm bill. So thank you very much. 

I want to again thank all of our witnesses for being here today 

and assure them that their interests, their thoughts on the next 

farm bill are very important to all of us as we move forward in 

both the House and the Senate relative to writing the next farm 

bill. 

And I would like to again remind anyone who is interested in 

submitting a written statement for the record that you may do so 

for up to five business days following this hearing. Our Web site 

again is agriculture—let me see, have I got that right? It’s 

www.agriculture.senate.gov for additional details on how you submit that statement for the record. And I’ve introduced several of 

our staff members here today. I want to make sure that you know 

who these other folks are. First of all, my staff director, and I 

would say she is the first female chief of staff of the Senate Agriculture Committee, but she does one heck of a job. She’s been with 

me off and on for my 12 years in Congress, and that’s Martha Scott 

Poindexter. Raise your hand, Martha Scott. 

We also have from the democratic staff, Adella Romas. Adella, 

we’re pleased that you’re here. And also Betsy Coker who has been 

have a very valuable member of our staff. And the reason I’d like 

40

for you all to know these staff members is that we are a U.S. Senate committee, we’re not a Georgia committee or a Texas committee. And any time you have a question regarding ag policy, we 

want you to know that you can not only call your Member of Congress or your Senator, but certainly you have the right to contact 

the Senate Ag Committee at any time. And when you call them, 

these are the folks that you’re likely to be talking to. So if you have 

any questions relative to policy, just feel free to call on us at any 

time because that is what we’re for. 

So I think all of you witnesses. I thank all of you folks for coming 

out to listen to us today, and we look forward to continuing to dialog with you also as we move forward in writing this farm bill. 

With that, our hearing will be concluded. 

[Whereupon the hearing was adjourned.] 

(41)

A P P E N D I X

SEPTEMBER 8, 2006

42


30124.001
43


30124.002
44


30124.003
45


30124.004
46


30124.005
47


30124.006
48


30124.007
49


30124.008
50


30124.009
51


30124.010
52


30124.011
53


30124.012
54


30124.013
55


30124.014
56


30124.015
57


30124.016
58


30124.017
59


30124.018
60


30124.019
61


30124.020
62


30124.021
63


30124.022
64


30124.023
65


30124.024
66


30124.025
67


30124.026
68


30124.027
69


30124.028
70


30124.029
71


30124.030
72


30124.031
73


30124.032
74


30124.033
75


30124.034
76


30124.035
77


30124.036
78


30124.037
79


30124.038
80


30124.039
81


30124.040
82


30124.041
83


30124.042
84


30124.043
85


30124.044
86


30124.045
87


30124.046
88


30124.047
89


30124.048
90


30124.049
91


30124.050
92


30124.051
93


30124.052
94


30124.053
95


30124.054
96


30124.055
97


30124.056
98


30124.057
99


30124.058
100


30124.059
101


30124.060
102


30124.061
103


30124.062
104


30124.063
105


30124.064
106


30124.065
107


30124.066
108


30124.067
109


30124.068
110


30124.069
111


30124.070
112


30124.071
113


30124.072
114


30124.073
(115)

QUESTIONS AND ANSWERS

SEPTEMBER 8, 2006

116


30124.074
117


30124.075
118

Æ