The livestock title of the Farm Bill was finally brought up for consideration during a late-night meeting of the conference committee that concluded on May 2.  The House conferees receded from their position of addressing livestock issues in a miscellaneous title, and agreed to include a livestock title as found in the Senate version. This left the Senate's proposed ban on packer ownership of livestock more than 14 days before slaughter as the only outstanding issue in the livestock title to be addressed by the members of the conference committee. 
After debating this provision, the Senate voted down the ban on packer ownership by a resounding voice vote. Because it failed on the Senate side, no House vote was necessary and the packer ownership ban was removed from the Farm Bill.  In addition, the proposed Office of Special Counsel provision - another provision of the livestock title opposed by NCBA - had been removed from the Farm Bill.
A private meeting of the conferees was held May 6 in an attempt to wrap up the committee's work on the Farm Bill. No further formal conferences are likely at this point, as the respective chairmen attempt to finalize the conference report. The final report could emerge later this week, but is more likely to be released early next week. At that point, the biggest hurdle remaining for the Farm Bill is whether President Bush will sign it before the current extension expires on May 16. The President has threatened to veto the legislation if his Administration finds it too costly or lacking in free-market policy reforms. If the President vetoes the Farm Bill and Congress does not have the votes for an override, agricultural policy will revert to the 1949 permanent law, or Congress may choose to pass a long-term extension of the 2002 Farm Bill. 
One of the more controversial aspects of the Farm Bill - and one that could affect the chances of a veto - is the question of whether to limit direct payments to farmers over a certain adjusted gross income threshold. Also still to be determined is whether Congress will apply these income limits to conservation payments. The bill provides an additional $4 billion for conservation programs, including $1.1 billion for the Conservation Stewardship Program (CSP) and $2.4 billion for the Environmental Quality Incentives Program (EQIP). The conference committee took action with regard to the total funds available for an EQIP contract, limiting individual EQIP contracts to $300,000 over six years.  However, the Secretary of Agriculture may grant a waiver for environmentally significant projects, which would boost that number to $400,000 over six years.  

Other key developments from the Farm Bill conference committee include the following:

Renewable energy:  The Farm Bill presently offers a mixed result for the cattle industry with regard to renewable fuels. The current 51-cent-per gallon ethanol blender tax credit is set to be reduced by 6 cents. Some of the savings generated by that reduction will be used to help fund an increase in the cellulosic ethanol credit to $1.01 per gallon. These tax credit changes are designed to provide a greater incentive for ethanol plants to move more quickly toward cellulosic production.

On the negative side, the Farm Bill includes a two-year extension (through 2010) of the current 54-cent per gallon ethanol import tariff, which had been set to expire at the end of this year. NCBA member policy supports allowing the tariff to expire as scheduled. The tariff limits access to a potential fuel source during a time of great need, and insulates grain-based ethanol production from market competition.

Permanent ag disaster program: Sens. Max Baucus (D-Mont.) and Kent Conrad (D-N.D.) championed inclusion of a $3.850 billion permanent disaster aid program. For producers that proactively seek to protect themselves from losses by purchasing non-insured agricultural program (NAP) coverage, this program will provide assistance to help compensate for extreme forage or livestock losses resulting from disasters such as drought, wildfires and floods.  

Country-of-origin labeling (COOL): The Farm Bill contains language that makes implementation of mandatory Country-of-Origin Labeling (COOL) more flexible for both producers and the meat industry, and moves us closer to having a COOL law under which USDA can write its rules. The Farm Bill language provides for the same four-tier labeling system that was passed as a part of the House farm bill back in July 2007, but the grandfather date for domestic livestock has been moved from January 1, 2008 to July 15, 2008.