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Concerns With the Tester Amendment

by: Jill Richardson

Fri Apr 16, 2010 at 18:09:52 PM PDT


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Over the past week, I've been beating the drum in favor of Jon Tester's amendments to the food safety bill in the Senate. The good news is that MOST of what is needed to fix the bill so that it simultaneously provides food safety regulations to big business while NOT harming small farms is good to go, at least in the Senate version of the bill. Two of the amendments that aren't a sure thing yet are the Tester amendments - the ones I've been promoting an action alert for (here).

However, I want to make sure I give everyone full information about these amendments as much as possible. After all, political philosophies differ and you may examine the facts and come down on a different side than I do, given the pros and cons at stake. I just got an email from Consumers Union saying that they do NOT support the Tester amendments. Here's why (below). And, as I make clear below, I'm still in support of the Tester amendments, even after reading through all of Consumers Unions concerns.

Jill Richardson :: Concerns With the Tester Amendment
One of the big complaints the local/sustainable food movement has had with the bill is that it puts requirements in place for farms that sell direct to consumers or to schools, hospitals, or other institutions. And of course, these are the sorts of programs we WANT - the last thing we want to see is them getting squashed by regulations that make it impossible for them to exist. So the Tester amendment gives an exemption to any farm selling over 51% of its produce to consumers, restaurants, schools, hospitals, etc.

That's where Consumers Union gets a little scared. Uh-oh... what if that restaurant is Burger King. How about a mega-farm that sells 51% of its crop to Burger King? And what if that farm is located in China? YIKES. (That said - how many international farms sell directly to anyone in the U.S.? And if we're worried about them, why don't we step up our inspections at the border?) Consumers Union worries that a mega-farm selling a majority of produce directly to large institutions may be exempted from Good Agricultural Practices under this bill. They say:

If you really think that there is no point anyway in requiring bathrooms for farm workers on lettuce farms, or requiring cattle to be a certain distance from a spinach field, then this is no big deal.  But CU really thinks it is important for farms, especially big corporate farms, to have to meet these standards.

Fair enough. I wouldn't mind seeing the exemption capped at farms making $500,000 or less in gross sales. However, Consumers Union still doesn't agree to the amendment even if that were added.

If you want to see stats for how many farms are actually going to be exempted by the Tester amendment, look at the 2007 stats on direct-to-consumer sales in the link. Only 6.2% of all farms sold direct to consumers that year, and 2.1% of the largest farms sold direct to consumers. And the dollar amounts of what they sold to consumers directly on average are fairly low, making me believe that very few farms will actually be exempted by this amendment. However, the stats only show direct-to-consumer sales, not direct-to-institution sales. That's a different story and I don't know where to access stats on that.

Consumers Union is also upset that Tester's amendments would exempt farms selling under $500,000 in gross sales per year from creating food safety plans (HACCP plans) if they do any processing. I agree with them much less here. HACCP plans can be a very good thing but they are only as good as the way the laws are written and their implementation. I tend to see them as a joke (even though a properly written HACCP plan is a WONDERFUL thing). These farms would also be exempted from future expansions of traceability requirements.

I realize that $500,000 seems like a lot here. I've broken it down below so you can see how many acres are exempted and how large the exempt farms realistically can be. Because most of the nation's agricultural acreage is planted in corn and soy, I've also included breakdowns for various crops and livestock species. (I'm pretty sure livestock is irrelevant here and we're just talking about crops, but I've included it just in case.)

Average Gross Sales:

Vegetable/Melon Farms: $368,950
Fruit/Nut Farms: $187,726
Cattle Ranches: $43,225
Cattle Feedlots: $977,048
Dairy farms: $611,773
Hog farms: $596,999
Poultry/Egg farms: $586,297

Sheep/Goat farms: $8622
Aquaculture & other livestock: $25,902

The first two categories are what you might call "Hobby farms."

Retirement Farms: 20.7% of farms; 9.7% of acres

Retirement farms have market value of
agricultural products sold of less than $250,000,
and a principal operator who reports being
retired.

This category includes:
18.1% of vegetable & melon farms (4.3% of acres)
24.4% of fruit & nut farms (9.7% of acres)
23.9% of cattle ranches (11.1% of acres)
17.5% of cattle feedlots (6.3% of acres)
4.8% of dairy farms (2.7% of acres)
7.4% of hog farms (2.4% of acres)
10.9% of poultry/egg farms (5.8% of acres)
18.3% of sheep/goat farms (10.2% of acres)
18.6% of aquaculture/other livestock farms (9.5% of acres)

Residential/Lifestyle Farms: 36.4% of farms; 13.1% of acres

Residential/lifestyle farms have market value of agricultural products sold of less than $250,000, and a principal operator who reports his/her primary occupation as other than farming.

This category includes:
27.7% of vegetable & melon farms (5.1% of acres)
33.8% of fruit & nut farms (12.1% of acres)
39.6% of cattle ranches (14.7% of acres)
35.9% of cattle feedlots (8.8% of acres)
8.4% of dairy farms (2.5% of acres)
33.2% of hog farms (6.3% of acres)
30.7% of poultry/egg farms (11.1% of acres)
45.7% of sheep/goat farms (16.1% of acres)
44.9% of aquaculture farms (15.8% of acres)

The next two categories are real farms, but they sell less than $100,000 in gross sales per year.

Limited Resource Farms: 14% of farms; 4.6% of acres

Limited-resource farms have market value of agricultural products sold gross sales of less than $100,000, and total principal operator household income of less than $20,000.

This category includes:
19.4% of vegetable & melon farms (3.1% of acres)
10.9% of fruit & nut farms (3.1% of acres)
15.6% of cattle ranches (5.2% of acres)
10.5% of cattle feedlots (2.7% of acres)
6.1% of dairy farms (2.1% of acres)
11.1% of hog farms (2.5% of acres)
12.7% of poultry/egg farms (5% of acres)
22.4% of sheep/goat farms (8.6% of acres)
17.6% of aquaculture/other farms (6.9% of acres)

Farming occupation - lower sales: 11.7% of farms; 9.5% of acres

Farming occupation/lower-sales farms have market value of agricultural products sold of less than $100,000, and a principal operator who reports farming as his/her primary occupation.

This category includes:
15.9% of vegetable & melon farms (4.0% of acres)
11.2% of fruit & nut farms (5.4% of acres)
13.1% of cattle ranches (13.2% of sales)
10.8% of cattle feedlots (5.7% of acres)
10.3% of dairy farms (4.7% of acres)
8.3% of hog farms (2.8% of acres)
7% of poultry/egg farms (3.4% of acres)
10.9% of sheep & goat farms (15.4% of acres)
13.3% of aquaculture/other livestock farms (7% of acres)

The next two categories are the two largest types of farm that are exempted by the Tester amendment.

Farming occupation - higher sales: 4.5% of farms; 11.3% of acres

Farming occupation/higher-sales farms have market value of agricultural products sold of between $100,000 and $249,999, and a principal
operator who reports farming as his/her primary
occupation.

This category includes:
3.3% of vegetable & melon farms (2.9% of acres)
3.6% of fruit & nut farms (4.5% of acres)
2.5% of cattle ranches (13.4% of acres)
4.8% of cattle feedlots (7.9% of acres)
28% of dairy farms (19.4% of acres)
4% of hog farms (3.8% of acres)
1.6% of poultry/egg farms (1.4% of acres)
0.5% of sheep & goat farms (16.2% of acres)
0.7% of aquaculture & other livestock farms (1.2% of acres)

Large Family Farms: 3.9% of farms; 13.3% of acres

Large family farms have market value of agricultural products sold between $250,000 and $499,999.

This category includes:
2.8% of vegetable & melon farms (5.1% of acres)
3.4% of fruit & nut farms (6.2% of acres)
1.5% of cattle ranches (12% of acres)
4.8% of cattle feedlots (10.7% of acres)
19.6% of dairy farms (21.9% of acres)
7% of hog farms (8% of acres)
6.6% of poultry/egg farms (7.1% of acres)
0.2% of sheep & goat farms (11.5% of acres)
0.5% of aquaculture & other livestock farms (1.3% of acres)

The last two categories are the ones that are likely NOT exempted by the Tester amendment. Together, they constitute 38.5% of all agricultural acres in the U.S.

Very Large Family Farms: 4.6% of farms; 22.9% of acres

Very large family farms have market value of agricultural products sold of $500,000 or more.

This category includes:
7.4% of vegetable & melon farms (53.5% of acres)
4.1% of fruit & nut farms (26% of acres)
1.2% of cattle ranches (14.1% of acres)
11.4% of cattle feedlots (44.3% of acres)
17.6% of dairy farms (38.1% of acres)
23.1% of hog farms (62.8% of acres)
26.6% of poultry/egg farms (58.3% of acres)
0.2% of sheep/goat farms (12.6% of acres)
0.6% of aquaculture & other livestock farms (3.6% of acres)

Non-Family Farms: 4.1% of farms; 15.6% of acres

Nonfamily farms are farms organized as nonfamily corporations, as well as farms operated by hired managers.

This category includes:
5.5% of vegetable & melon farms (21.9% of acres)
8.6% of fruit & nut farms (33% of acres)
2.5% of cattle ranches (16.4% of acres)
4.3% of cattle feedlots (13.7% of acres)
5% of dairy farms (8.6% of acres)
6% of hog farms (11.4% of acres)
4% of poultry/egg farms (7.8% of acres)
1.9% of sheep & goat farms (9.5% of acres)
3.9% of aquaculture & other livestock farms (54.6% of acres)

In the end, I would MUCH rather see the bill pass WITH the Tester amendments and THEN get them fixed if needed than having it the other way around. Just like I'd much rather see a guilty person go free than an innocent person locked in jail, I'd much rather pass the bill with too big an exemption than pass it in a way that may harm small farms. And I do hope that we can bring the two sides of this debate together to discuss this dilemma and come to a conclusion. After all, if both sides of this debate are in talks with the Senate (as it seems they are) then we can come to a compromise, communicate it to the Senate, and then see if they'll put the best possible language in the bill in conference (or even before the Senate vote).

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HACCP programs do not have to cost an arm and leg (4.00 / 2)
It depends on the size of the operation. If it's a mom & pop operation the amount of work in developing a HACCP plan could fit on a few sheets of paper.

Food poisoning is bad even; if it only hits a handful of people that by from a local producer.

I agree with Testers approach, it is consistent with other financial size exemptions in the federal government.  USDA pegs earnings of less than $250,000.00 as the level of a small farm.

It would be simple just require everyone develop a HACCP program, even those exempted, but the federal government would subsidize the smaller producers cost of developing the HACCP plan.  Designing plans for small processors would turn into a cottage industry and all consumers would be safer.

This is basically how the Organic certification subsidy works for small farmers who cannot afford the cost of certification.  


international farms (4.00 / 1)
how many international farms sell directly to anyone in the U.S.?

I can't answer your question, but the answer might become "many." As to why we don't do more border inspection, preventing border inspections is one of the reasons we have free trade agreements.

Right now, I suppose that most food from Canada and Mexico, for example, probably is sold to distributors, although it could be sold directly to Burger King. The pattern could easily shift in future, if growers see that the legislation provides incentives to do so.


average gross sales (4.00 / 1)
Cattle Ranches: $43,225

Breakdowns in your subsequent categories show us why that number would be accurate, but even so, I'm flabbergasted. I never would have expected that.


Most cattle ranches don't have a lot of animals, (4.00 / 2)
when I say a lot of animals a couple hundred would be a lot, most are smaller than that. Also, most cattle ranches are selling calves and feeders, not mature animals, and they certainly aren't getting retail prices. Sure, they're selling live weight, but the animals are small. They're the size of the heifer we got last fall. Harold paid $500 for her which is about what the cattle rancher would have gotten at auction for her.

According to the Chicago Mercantile Exchange live cattle prices were 98.75 cents/pound while feeders were 111.95 cents/pound. On the live cattle it didn't say what age of cattle that was. Feeders I think are 500#-800#.

One of the local talk show hosts goes hunting every year with a cattle rancher friend of his in Eastern Oregon. He said the fellow told him that he clears $100/head on feeder calves. I think he has to be selling into the commodity system to be making that little on his calves. Which is why I stop Harold every time he says we can get some cattle and sell the calves at auction. That's the best way I know to not make any money. Especially if you have to buy hay to over winter the momma cows.

I don't even want to think about what hay is going to cost this year. As soon as I get some money I'm going to buy up all the grass hay from last summer I can. I'm going to start putting up hay for the coming winter right now before the hay prices start going up. 7 years ago I was paying $80/ton in the barn, over the past several years the price has climbed, and had a high of $200-$230/ton for regular grass hay. At one point alfalfa was cheaper than grass, which just boggled my mind. Now the local grass I'm getting at the hay dealer is $160/ton and as soon as I have the money, I'm going to put up at least 10 ton of the stuff. With the way gas prices are rising at the gas station I wouldn't be surprised if hay wasn't up around $250/ton by December. I do not want to have to go there.....

Prices like that make feeding livestock over the winter very difficult, and even more difficult to turn a proffit selling those animals into the commodity market.

Normal people scare me.... But not as much as I scare them.


[ Parent ]
small cattle "ranches" (4.00 / 2)
That sure explains why a small rancher has no chance of influencing cattle prices in an industry dominated by huge feedlots and slaughterhouses, doesn't it?

Do you know how fairly CMEX prices reflect actual prices paid to producers? Wouldn't most cattle trades not go through CMEX?


[ Parent ]
I don't know which markets the cattle go through (4.00 / 2)
but I'd be surprised if the buyers weren't keeping a close eye on CMEX prices. Just like with milk, where I don't think that the big dairy manufacturers actually buy the milk directly through CMEX, but the price they pay the dairy coops is based on the CMEX price. At least that's how I understand it.

When we used to go to the auction in Woodburn, Oregon every tuesday and watch the cattle auction, the prices were what I considered to be very low, around 80 cents/pound for feeders. One reason for that was that there were a few buyers who were bidding on all of the cattle and before the auction began they'd get together and agree to only pay a certain ammount for the cattle. That was broken up many years ago, I forget which regulatory agency did it, but what those buyers were doing was strictly illegal. I'd not be surprised if they weren't watching prices on something like CMEX to determine how much they would pay.

Normal people scare me.... But not as much as I scare them.


[ Parent ]
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