By: Philip Ellis,
NCBA President
Cattlemen and women can rest a little easier as they move
into the New Year knowing several policy victories were contained in the
Omnibus Appropriations bill. For NCBA, top among these was Country of Origin
Labeling. Cattle producers have long known that consumers were unaware COOL
labeling existed, and it had no discernable impact on the price or demand for
U.S. beef. However, the largest issue remained the threat of retaliatory
tariffs and the long term damage that violating our trade agreements would have
had on future trade negotiations. While NCBA continued to urge action to avoid
these outcomes, unfortunately it took within hours of implementation of tariffs
for Congress to act.
While COOL certainly captured the headlines, the Omnibus
contained many more priorities for cattle producers including language to
continue congressional oversight of the dietary guidelines process. With
passage, Congress made it clear that the current and future Dietary Guidelines
will be based on scientific agreement and limited to nutrition and dietary
information. The bill also increases scrutiny on beef imports from regions with
known animal disease issues, funds wildfire reserves, continues prohibitions on
environmental permitting and reporting and blocks the Department of Interior
from designating de facto wilderness areas.
Just as timely, Congress also passed tax extenders
legislation, which always seem to fall to the last minute, forcing producers to
either make decisions during the year speculating on the tax ramifications or
push major decisions to the last days of the year in order to take advantage of
these provisions. While that is again the case this tax year, the good news is
Section 179 was made permanent at $500,000, 50 percent bonus depreciation was
extended through 2019 and the Conservation Easement Tax Credit was permanently
extended. This was remarkable news for NCBA, as we’ve been working on certainty
in the tax code for a number of years, and without the appetite by Congress to
take up full tax reform, it subjected many of these critical provisions to
short term extensions. Now with permanent and multi-year extensions, producers
will be able to plan with their financial advisor to grow and expand their
operations.
This end to 2015 puts the cattle industry in a great place
to set our sights on expanded trade and access to Asia and the Pacific Rim in
2016. While the priorities for the industry will be set by our producer
leadership in San Diego, Calif., we know that passage of the Trans-Pacific
Partnership will be a major focus for the year ahead. The cattle industry has
already lost over $100 million in trade into Japan, thanks to a preferential
trade agreement between Japan and Australia. That gap will continue to grow as
the Japan-Australia Economic Partnership Agreement continues to ratchet down
Japan’s tariff on imported beef. The good news is the Trans-Pacific
Partnership, negotiated by the U.S. Trade Representative, would reduce Japan’s
tariffs on imported beef below Australia’s preferential agreement upon passage.
That would instantly level the playing field, and allow U.S. producers to seize
and build on our lost market share. The cattle industry cannot afford to push
passage of TPP back, every day without an agreement costs us market share in
the Pacific. With over $7 billion in U.S. beef exports in 2014, exports help
stabilize our markets, allow our producers to fetch a premium for muscle cuts
internationally, and add value to variety meats that otherwise would sell for
little to nothing domestically. Trade represented $350 in value per head in
2014, and it represents the future of the profitability of the beef industry. I
hope you’ll visit our website at www.TPPNow.com
to see more benefits to the cattle industry from trade and learn how this
agreement will impact your bottom line.
We were pleased to see so many priority issues the Omnibus.
While this wasn’t an ag bill, it addressed the industry’s top concerns and will
allow the NCBA to focus on passage of the TPP in 2016. I look forward to seeing
many of you at the Cattle Industry Convention and NCBA Trade Show in San Diego,
Calif., Jan 27-29. For more information and to register, visit www.BeefUSA.org, or call (303)-694-0305. And
from my family to yours, we wish you a merry Christmas and a Happy New Year.
#30
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