Iowa Public Television

 

Export Demand for Meat on the Rise

posted on June 16, 2000


THE DIVERSITY OF FACTORS AFFECTING THE RURAL AMERICAN ECONOMY WAS APPARENT THIS WEEK.

IN THE URBAN MIDWEST AND NORTHEAST, RAGE OVER SOARING GAS PRICES FUELED CHARGES OF COLLUSION AMONG OIL COMPANIES. THE SUSPICION IS THE OIL COMPANIES ARE NOT ONLY SCHEMING TO PROD CONGRESS TO LOWER CLEAN AIR STANDARDS, BUT TO ALSO EASE PRESSURE ON REFINERS TO USE ETHANOL.

ON ANOTHER FRONT, ONE STATE, AFTER YEARS OF LITIGATION, WAS ANOINTING A LARGE LIVESTOCK PRODUCER WITH THE DUBIOUS TITLE OF "HABITUAL VIOLATOR". THE PENALTIES THAT ACCOMPANY THE DESIGNATION COULD ALTER THE CONDUCT OF OTHER LARGE-SCALE OPERATIONS.

MEANWHILE, RECOVERING ASIAN ECONOMIES ARE FUELING DEMAND FOR AMERICAN MEAT, SPURRING THE USDA TO REVISE ITS ESTIMATES FOR BEEF AND PORK EXPORTS.

RENEWED DEMAND FROM RECOVERING ASIAN ECONOMIES WILL PUSH BEEF EXPORTS FOUR PERCENT HIGHER THAN EARLIER USDA ESTIMATES. PORK EXPORTS HAVE BEEN REVISED UPWARD BY SIX PERCENT FROM PREVIOUS GUESSES.

THE RESURGENCE IN DEMAND FOR BEEF COMES AT A TIME OF FALLING U.S. BEEF PRODUCTION. THE USDA HAS PROJECTED BEEF PRODUCTION TO EBB IN THE SECOND HALF OF THE YEAR AS RANCHERS BEGIN RETAINING HEIFERS FOR HERD EXPANSION.

PORK PRODUCTION IS PROJECTED TO REMAIN STABLE, BUT SOME OF THE INDUSTRY'S LARGEST PLAYERS ARE CONFRONTING FINANCIAL AND REGULATORY CHALLENGES. THIS WEEK ONE OF THE INDUSTRY'S MORE NOTORIOUS MEMBERS WAS ON THE BUSINESS END OF A WHACK ACROSS ITS BOTTOM LINE.

TOM MILLER, IOWA ATTORNEY GENERAL (paraphrased): "So today, we announce the agreement with Jack DeCoster. He pays $150,000. He's subject to penalties of $25,000 a day instead of $5,000 a day."

THE IOWA PENALTIES GO BEYOND HARD CURRENCY. DECOSTER ALSO WILL NOT BE ALLOWED TO BUILD ANY ADDITIONAL CONFINEMENT FACILITIES IN THE STATE FOR FIVE YEARS.

THE PENALTIES COME UNDER THE STATE'S "HABITUAL VIOLATOR" LAW, A DESIGNATION FORTHCOMING FOR DECOSTER.

MILLER (paraphrased) "In Iowa, someone can be designated a habitual violator if they have three substantial violations for their confinement operations."

THE ACTION CULMINATES FOUR YEARS AND FIVE LAWSUITS FILED BY THE STATE FOR VIOLATIONS OF IOWA'S ENVIRONMENTAL LAWS.

ON ANOTHER ENVIRONMENTAL FRONT PETROLEUM COMPANIES ARE BLAMING A COMBINATION OF NEW CLEAN AIR STANDARDS AND THE HIGH PRICE OF CRUDE OIL ON THE SHARP RISE IN THE COST OF A GALLON OF GAS. EVEN SO, BOTH THE ENVIRONMENTAL PROTECTION AGENCY AND THE DEPARTMENT OF ENERGY ARE INVESTIGATING PETROLEUM PROCESSORS FOR PRICE GOUGING.

CRITICS OF THE INDUSTRY AGREE SOME OF THE INCREASE IS JUST THE COST OF DOING BUSINESS. HOWEVER, THE SAME CRITICS QUESTION WHETHER THE HIGH PRICES ARE BEING USED TO PUT PRESSURE ON CONGRESS TO ELIMINATE THE POLLUTION LOWERING FUEL COMPONENT OF THE NEW CLEAN AIR STANDARD.

CONGRESS HAS SEVERAL ALTERNATIVES TO CONSIDER. THEY INCLUDE THE ELIMINATION OF THE NEW FUEL STANDARD, A NATIONWIDE BAN OF MTBE AND, THE ESTABLISHMENT OF A "RENEWABLE FUEL" STANDARD WHICH WOULD PAVE THE WAY FOR GREATER USE OF ETHANOL.

SOME CARMAKERS APPEAR TO BE INVESTING IN THAT SCENARIO. BEGINNING IN 2002 GENERAL MOTORS SAYS IT WILL MAKE FULL-SIZED UTILITY VEHICLES AND PICK-UP TRUCKS THAT WILL BE ABLE TO BURN FUEL BLENDS COMPOSED OF 85 PERCENT ETHANOL.

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