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Agricultural Bargaining: in a Competitive World

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Agricultural Bargaining: in a Competitive World United States Department of Agriculture Agricultural Rural Economic and Community Development Bargaining: Cooperative Services In a Competitive Service Report 47 World Highlights: 39th National and Pacific Coast Bargaining Cooperative Conference December l-3,1994 San Diego, CA NATIONAL COMMITTEE OF COOPERATIVE AGRICULTURAL BARGAINING AND MARKETING ASSOCIATIONS PRESIDENT OTHER DIRECTORS Vernon DeLong Tom Butler Agricultural Bargaining Council Michigan Processing Apple Growers (MACMA) 744 Main Street, Suite 1 r. 0. Box 30960 Presque Isle, ME 04769 Lansing, MI 489098460 VICE PRESIDENT William Ferriera Apricot Producers of California John Welty 064 Woodland Avenue, Suite E California Tomato Growers Association Modesto, CA 95351 I? 0. Box 7398 Stockton, CA 95267-0398 Michael Klein Hazelnut TREASURER Growers Bargaining Assn. 8101 SW Nyborg Rd., I#201 Ronald A. Schuler, President Toalatin, OR 97062 California Canning Peach Association Vaughn Koligan P.O. Box 7001 Raisin Bargaining Association Lafayette, CA 94549 3425 N. First, Suite 209 Fresno, CA 93726 SECRETARY ASSISTANT SECRETARY Adin Hester, Manager Olive Growers Council of California Andrew A. Jermolowicz 121 E. Main Street, Suite 8 USDA/RBCDS-Cooperative Services Visalia, CA 93291 Ag Box 3252 Washington, DC 20250-3252 Preface These proceedings are published by the Cooperative Services program of USDA’s Rural Business and Cooperative Development Service (RBCDS) at the request of the bargaining and marketing cooperatives. This 39th National Bargaining Conference was combined with the Pacific Coast Bargaining Conference Dec. l-3, 1994, at San Diego, CA. Proceedings include speeches delivered at the conference and related information. Opinions expressed reflect views of participants. The proceedings should not be viewed as representing the policies of the United States Department of Agriculture. Use of commercial names does not constitute endorsement. Copies of the proceedings may be obtained from RBCDS-Cooperative Services, Ag Box 3255, Washington, DC 20250-3255. Price: Domestic $5; Foreign: $5.50. Service Report 47 September 1995 ii Contents Marketing Orders and USDA Reorganization ...................... .l LonHatamiya ............................................. Problems Facing New Bargaining Associations . 5 JohnMorrison . The Methyl Bromide Issue, Gary Obernauf, Research Consultant . .7 Update on National Bargaining Law, Donald Frederick . .13 Services Draw Growers to Bargaining Cooperatives ................ .I 8 Ron Schuler, California Canning Peach Association ............ .18 Vaughn Koligian, Raisin Bargaining Assoication ............... .19 Dick La Framboise, Central Washington Farm Crops Association . .21 Attendance Roster . ...24 . 111 USDA Reorganization Implements Dramatic Changes Lon Hatamiya, Administrator Agricultural Marketing Service U.S. Department of Agriculture As you know, Washington is going through AMS is funded primarily by user-fee programs. If many changes at this time. You’ve heard about the our costs skyrocket, our customers, including many changes on Capital Hill, but I want to talk to you of you, would simply drop the service we provide. about the wide ranging and long-lasting changes The only significant change from reorganization this Administration is effecting in the U.S. will be in the eight product inspection areas which Department of Agriculture (USDA). are being moved to the new Food Safety and Implementation of USDA reorganization, on tap Inspection Service. for 2 years, is now almost completed. We will do Some administrative changes at AMS will cut more with less people and for less money Some duplications and cost and in the end the economies agencies have merged, either improving or at least will benefit you by keeping down the cost of our not diminishing services to producers. services. Secretary Mike Espy left a smaller, more USDA’s former Agricultural Cooperative efficient USDA because of his leadership and reor- Service (ACS), for instance, was merged with the ganization. He also led an effort to make school Rural Development Administration. (Subsequently, lunches healthier. AMS purchases many of the RDA’s Cooperative Services became part of the commodities that you deal with. Since September new Rural Business and Cooperative Development (1994), we also have nearly tripled our purchases of Service-RBCDS.) The new Farm Service Agency fresh fruits and vegetables. As you know, both the merged most of the Agricultural Stabilization and needy recipients of these products and well as the Conservation Service (ASCS) with the farm credit distressed producers benefit from these purchases. programs of Farmer’s Home Administration and Some schools have been concerned about the the Field Crop Insurance Corporation program to handling problems and the perishability of fresh provide one-stop shopping. We hope to not only produce. To address those issues, we set up a task save farmers trips, but also save administrative force with USDA’s Food and Consumer Services. overhead by collocating various agencies. That We also started working with the Department of means a lot to both of us. Defense (DOD) Personnel Support Center on a pilot As a business person going to the Federal program with eight schools systems to purchase Government, I wanted to make sure we saved as fresh produce through DOD’S economies of scale much as we could. We expect the same benefits and its own sophisticated electronic distribution from merging the former Soil Conservation Service system. This allowed spilt loads and 3-day deliv- and the ASCS conservation cost-share program into ery. Preliminary reports on the program were the new Natural Resources Conservation Service. promising. As I recently mentioned to the Almond Board We’ve had a second-quarter report card on the of California, the reorganization will not affect Northern American Free Trade Agreement Agricultural Marketing Service (AM% programs (NAFTA) as well, led by a 50-percent surge of fresh significantly. Adding an Assistant Secretary for and processed fruits and vegetables. It is a true suc- Marketing and Regulatory Programs to the original cess story. The General Agreement on Tariffs and plan testifies to an appreciation of our uniqueness. Trade (GATT) should give everybody in agriculture 1 new export possibilities. GATT will reduce tariffs, I can’t begin to estimate the dollar value of how and since tariffs fund our Section 32 purchasing much misery and chaos PACA has prevented in its program, GATT may also affect that program as 65 years of existence. The retail produce business is tariffs are reduced. roughly $80 billion. Just imagine the consequences However, we’re studying some very possible of half of that amount embroiled in recovery. The solutions to some potential problems. U.S. Trade only beneficiaries of that situation might be Representative Mickey Kantor has made the point lawyers, and even they might not be paid. that as agriculture expands internationally, its As agriculture becomes more international, influence on trade policies will also expand. Not AMS has expanded its supports for exports, adding only does AMS encourage exports, it administers market news reports from countries to which we marketing orders. This administration supports export, or whose exports compete with ours. We marketing orders. I, myself, have farmed under are working to harmonize international grading them. As you know, Secretary Espy discontinued standards that will speed international contracting. the California-Arizona citrus marketing order last We are even working on international standardiz- summer (19941, and for a good reason. Too many ing of pallets and packages, and lowering foreign members of that order were cheating. This barriers to our products. Administration supports orders where members I’ve mentioned NAFTA and the GATT, but abide by their own rules. this Administration will progress further on When the 9th Circuit Court’s decision was exports thanks to Trade Representative Kantor’s announced, critics of marketing orders saw it as a relentless efforts. I suppose you have celebrated the victory for their position. In fact, the decision was shipping of our apples and beef to Japan, a tri- otherwise. It spelled out the legality of the Federal umph of our trade policy. We are even shipping orders. It did not fault the task of the almond order apples to China. We also should celebrate the to promote almonds, it only quibbled with the President’s recent achievement at the Asian Pacific order’s tools - how that program promoted its Economic Conference (APE0 in Jakarta where he product. has seen the beginning of a mighty Pacific free- However, in its decision, the Court glossed trade zone in which we shall be a major partici- over the issue of generic ads, the orders’ principal pant. Barring unforeseen circumstances, the AMS promotional vehicle, missing the distinction regulatory programs this bargaining group uses between promoting a product to expand a market will continue as will the other programs like those and promoting a brand to expand market share. supporting exports. I look forward not only to The almond order continues to function under a administering them for a long time, but also to new promotion program. being your cooperator and resource. Our research and promotion programs also Questions From Audience: continue. Some have increasing linkages to export initiatives, like the Foreign Agricultural Service Q Regarding potential changes to the Agricultural (FAS) market promotion programs. Perhaps
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