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Farmers To Gain From House Climate Bill

03 December 2009

US - Agriculture Secretary, Tom Vilsack summarised the USDA's latest analysis of a cap and trade bill passed by the House last summer as positive for most farmers, including livestock producers.

"I think there's a real opportunity for agriculture," Mr Vilsack said in a telephone press conference.

However, the latest study, presented by the USDA's Chief Economist, Joseph Glauber, shows energy costs rising modestly for all of agriculture during the first four years after the law would take effect, from 2012 to 2018.

Agriculture itself isn't capped under the House bill, so it wouldn't have to buy carbon offsets, says AgricultureOnline. But other industries that supply inputs and fuel to farmers would, causing fuel prices to rise. Increases in fertiliser costs would be small, since the bill delays the effects of cap and trade on the fertiliser industry until after 2025.

USDA projects average annual changes in fuel costs to rise between 2 per cent and 5.3 per cent from 2012 to 2018, compared to where they would be without the legislation. And fertiliser costs would go up by an additional 0.3 per cent to 1.7 per cent each year.

The analysis also looks at the effects on crops. Corn, one of the most energy-intensive crops grown in the US, would see costs increased by $1.44 an acre, if the USDA uses Environmental Protection Agency estimates of changes in energy costs. They would rise an added $4.72 an acre using different data from the Department of Energy.

The estimates of increased energy costs ignored potential benefits that farm owners will get from selling carbon credits, mainly through increased tree plantings. That would bring an added $22 billion a year into the ag sector of the economy, a 12 per cent increase over projections without any cap and trade legislation.

Mr Vilsack is one of several cabinet members who will be traveling to Copenhagen, Denmark for the UN Climate Change Conference.

Mr Vilsack said he doesn't think the meeting will be affected by a controversy in the climate science community dubbed Climategate by the media. E-mail messages from British climate researchers that were critical of climate change doubters in the scientific community were leaked, resulting in accusations that they tried to suppress the debate over human influence on climate.

"The reality is that the vast, vast majority of scientific information suggests there are indeed changes taking place in climate," Mr Vilsack said. Agriculture has the potential to be part of the solution to climate change because of its ability to capture greenhouse gases, he said. In the US, agriculture accounts for 7 per cent to 10 per cent of emissions but could capture 20 per cent to 25 per cent by sequestering carbon.

TheCattleSite News Desk



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