Vilsack looks at managing man-made risks in agriculture going forward
Arlington, Va. – With the issues affecting agriculture constantly changing and becoming a larger force in the industry, the USDA held its 2013 Agricultural Outlook Forum with a focus on risk management.
“When we normally talk about agriculture and risk, we talk about the weather, talk about the drought – things that we may not have a lot of control over,” commented USDA Secretary Tom Vilsack, “but the uncertainty and the risks in agriculture today, in many cases, are man-made.”
The Forum, held Feb. 21-22 in Arlington, Va., featured a wide array of speakers who looked at the implications of risk moving into 2013 and the future.
Vilsack particularly highlighted budgets, legislation, specifically the Farm Bill, labor concerns and trade barriers as risks that agriculturalists deal with every day.
“There is risk in the uncertainty with reference to budgets and the impending sequester to agriculture,” he said.
With the approaching sequester, Vilsack explained that nearly every line item in the USDA budget will be reduced by five to six percent, which can be particularly detrimental to agencies with very few items in their budget, such as Food Safety.
“If you happen to be in an agency like Food Safety, where you have very few lines and where most of the lines involve people and labor, you have very little recourse,” Vilsack explained. “The only way we can absorb a cut of this magnitude is by impacting the people who work in the Food Safety areas of USDA.”
As a result, the cuts impact not just workers, but also processing facilities and production facilities across the U.S.
“This is another risk that’s man-made and can be avoided,” added Vilsack, mentioning the implications that will be seen if Congress doesn’t pass a budget or Continuing Resolution by March 27.
“There is the uncertainty and the risk associated with not having a five-year Farm Bill,” said Vilsack. “It did not get done, and that now creates uncertainty as to what the safety net will be for farmers who are faced with drought.”
Vilsack mentioned that the Farm Bill is vital to the nation’s ability to feed itself – a luxury that is not enjoyed by many other countries around the world.
“If we are to build this rural economy and create economic opportunity for these young people that are excited about living and working and raising their families in a small community, then we have to complement production agriculture and its safety net with a strong commitment to the bioenergy and the bio-economy,” added Vilsack, noting that the Farm Bill must encompass both of those sectors to be effective.
The other issue affecting America’s ag communities is the availability of labor.
“There is risk to agriculture, and we are beginning to see the implications of that risk,” Vilsack mentioned. “We’ve had crops that were grown last year that could not be harvested because there simply weren’t enough hands to pick them.”
“It’s important and necessary that we have immigration reform, that we create a system in this country that understands and appreciates the importance of immigrant labor,” he added.
Risk in the form of trade barriers established by other countries also proves challenging for American farmers and ranchers, according to Vilsack, who specifically mentioned a ban on beef from Russia.
“We’re dealing with a decision made by Russia to impose a ban as a result of the use here of ractopamine that is not scientifically based and is contrary to international law,” he explained. “As these barriers are constructed, we have to tear them down.”
As a result of man-made risks, as well as natural risk such as drought, Vilsack noted that steps must be taken by Congress and the international community to remedy problems.
Additionally, Vilsack noted direction by President Obama for the creation of a drought task force to aid in managing risk. The task force, made up of representatives from all federal agencies, aimed to mitigate the impacts and effects of drought.
“We opened up CRP land, and we provided some relief on crop insurance premium payments,” Vilsack said, as examples, noting that they also looked further.
In other topics discussed, Vilsack noted that they looked to encourage practices such as multi-cropping that could ease the strain of the drought, and promote all systems of agriculture that are used throughout the nation.
“We have a diverse agriculture in this country,” he said, “and there are different production systems that people want to use. We put together a group of folks, and we challenged them to think about how we could create a system and support in this country where different production processes could, in a sense, coexist.”
USDA, according to Vilsack, will continue to research and understand the various aspects of agriculture, including a focus on seed quality, compensating for economic losses, offering grants and working to provide avenues to all sectors of agriculture to succeed.
“All of this is designed to manage, eliminate, mitigate the risk that is associated when folks want to do things a little bit differently, but they want to do it in the same general space,” said Vilsack. “It is part of managing risk.”
“We at USDA have a responsibility to figure out ways in which we can mitigate the risk of something we really can’t control, in a sense, when it happens. We can’t control when a drought occurs,” Vilsack commented. “We can’t control when a horrible tornado hits or when flooding occurs, but we can take steps to mitigate the impacts and effects of that.”