National Financial Managers Conference in Savannah, GA on June 20, 2012. Audrey J. Adamson, Vice President of Domestic Public Policy, gave a presentation on the following key points: 1) Regulatory and legislative challenges in 2011 including budget issues and special interest groups as well as some wins preventing unfavorable rules. 2) Key regulatory issues regarding the environment like the CAFO rule and air regulations. 3) Key legislative issues around the 2008 and 2012 Farm Bills regarding mandatory price reporting and "GIPSA-like" provisions. 4) The need to focus on the long term sustainability of the animal agriculture industry given increasing pressures on branding and public perception.

1. National Financial Managers Conference
Savannah, GA
Public Policy Update
June 20, 2012
Audrey J. Adamson
Vice President, Domestic Public Policy

2. Presentation Summary
2011 Challenges & Wins
Key Regulatory Issues:
Environment
Animal Health
Key Legislative Issues:
2008 Farm Bill Hangover Issues
The 2012 Farm Bill
Sustainability of Animal Ag: The Larger View
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3. 2011 Challenges & Wins

4. 4

5. 2011 Challenges & Wins
Challenges
 Ongoing Budget Crisis
 Gridlocked Congress
 Special/Single Interest Groups
 Many Freshmen
 Administration
 Congressional Redistricting
 Increased Feed Supply Pressure
Wins
 GIPSA Rule WAY back!
 Passage of 3 FTA’s
 MPR Wholesale Pork Negotiated
Rule: Comments due May 22
 Ethanol vs. Livestock Feed Availability
Hearing: “Changing the Dialogue”
 Won Key Senate Vote (73-22) End
VEETC & Import Tariff
 Intro Bi-Partisan Renewable Fuels
Flexibility Act (HR 3097)
 Negative MCOOL WTO Ruling
 MF Global Hearings & CFTC Action
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6. 2011 Challenges & Wins
Challenges
 CAFOs #1 EPA Enforcement and
Regulatory Priority
 “Sweetheart” Lawsuit Settlements w
Enviro Activists on CAFOs
 Chesapeake Bay TMDL and
Threatened Mississippi River TMDL
(Enviros Have Sued; Argue for
Sweetheart Settlement)
 Antibiotic Use Issues Continue
 Animal Welfare Issues: Legislative &
Regulatory Actions Continue
 Food Safety: Salmonella in Ground
Turkey Repercussions
Wins
 Key Victory in 5th Circuit CAFO Rule
Litigation – EPA Must DO Over!
 NPPC Sued EPA re: Chesapeake Bay; EPA
Can’t Do Mississippi River
 Proactive NPPC Input w FDA on VFD
Transition & 209/213 Guidance
 2011 GAO Report : Antibiotic Use:
The Science Just Isn’t There…
 Expert Antibiotics Hill Staff Briefings
 Proposed Animal Disease Traceability Rule:
Works for Swine ID: 99% Prem. Registered
 FSIS Animal Welfare Inspector Guidance
 FSIS Changes Cooking Temp - 145 degrees +
3-Minute Hold
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7. Environment

8. CAFO Rule
(Livestock Water Discharge Rule)
5th Circuit Decision NPPC vs. US EPA
12 Years of Work – EPA Needs to Start Over
• Unanimous Decision for NPPC, et al.
• No Duty to Apply for Permit; Can Only Penalize for
Discharge without Permit; Single Violation
– Removes EPA’s Big Stick
• Two Lingering Issues:
– Field Application
– Dust & Feathers
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9. CAFO Rule
EPA’s Next Steps
 Ignore Decision & Back to the Drawing Board
 Withdraw VACATED 2008 CAFO Rule & Develop New CAFO
Rule (Proposal Expected Late 2012)
• Redefine Discharge
– Ventilation Dust; Ammonia Deposition; Change Agronomic Rates
• Redefine Point Source
– Expand Definition of “Water of United States”; Tile Drains
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10. CAFO Rule
• Part of 5th Circuit Enviro. Settlement
– Record Keeping Requirements
 National Livestock Database Rule
– Water Quality Standard to Force State Action
• Universal Report for CAFOs & AFOs
– All the Information in a Permit
• Final Decision by July 2012 (Per Enviro Agreement)
– Do Not Have to Issue Final Rule
– EPA & Enviros May Delay Issuance
– Before Election Day??
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11. CAFO Rule
Chesapeake Bay Settlement Agreement
• Proposed Rule Due in June 2012
• Designation of AFOs as CAFOs
• 3rd Party Uses of Manure
• Stringent P Management
• Agriculture’s Concern: EPA will Use Data, Together with TMDL, to Set
Permit Limits for # of Animals within Bay Watershed
• NPPC & Others Engaged in Litigation on Bay Settlement
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12. CAFO Rule
Mississippi River TMDL
• Enviros Sued EPA in March 2012
– Seeking Mississippi River Watershed TMDL
• NPPC has Led Coalition of Agricultural Groups to
Challenge Litigation
– Goal: Prevent Chesapeake Bay like “Sweetheart Settlement”
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13. Continuing Air Challenges
• Air Toxics
– H2S as a HAP + TRI Proposed Reporting Rule
• Dust Rule
• Ozone Rule
• CERCLA/EPCRA Rules
– Withdrawn & Remanded to EPA
– No New Rules Post-National Air Monitoring Emissions
Study until 2013 or Beyond
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14. Animal Health

15. FDA Antibiotics Actions
April Guidance Documents
• Final Guidance #209
• Draft Guidance #213
• Draft VFD Codified Language
• Guidance How FDA Will Conduct Business
– Guidance is “Voluntary”
– “Voluntary” is Relative
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16. Guidance for Industry #209
• “Production Uses” (Growth Promotion & Nutritional
Efficiency (AGP)) of Antibiotics in Classes Used in
Human Medicine are “Injudicious”
– Does Not Call Them Unsafe
• Requires Other Uses of These Same Classes of
Antibiotics Be Under “Veterinary Oversight”
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17. Guidance for Industry #209
• “Voluntarily” Working with Sponsors to
Discontinue Claims or Migrate Production
Claims to Disease Prevention
– Guidance #213 Gives Roadmap on Implementation
– Sponsors Must Notify FDA Intentions within 90
Days
– Implement Intentions within 3 Years
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18. Guidance for Industry #209
• What Does It Really Mean?
– Most AGP Uses/Dosages Will End Within 3 Years
– Unsure How Animal Health Companies Will
Proceed to Support New Claims
– No OTC Feed Grade Antibiotics; Will Require a
VFD
– Water Medications will Become Rx
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19. Veterinary Feed Directive
• FDA Held Meetings with Veterinary and
Industry to Make VFD More “User-Friendly”
– For Up to 6 Months for a Production Site (Dose, Duration,
Refills)
– Approximate Number Animals Treated, Not Tons of Feed
– Fax, Email VFD Forms – No Originals Required
– Records Retained for 12 Months
– Decoupled from VCPR
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21. Reauthorized: September 2010
Wholesale Pork Reporting Negotiated Rulemaking: Completed
Final Agreement: Completed
• FOB Plant vs. FOB Omaha (River): BOTH
• BETA TEST: Dual Reporting System for 1 Year
• NPPC “Proposed Rule” Comments Submitted: May 22 Completed
 Final Rule Expected: End of 2012, Early 2013
2008 Farm Bill Hangover Issues:
Mandatory Price Reporting
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22. Items for Potential Litigation
1. Elimination of Need to Prove Injury
2. Establish. of “Unfair” Rules for Packers & Swine Contractors
3. Invalidation of Price Differentials or Contract Variations
1. These are the “Shelved GIPSA Provisions” which USDA Said They
May Consider at a Later Date
MCOOL – Possible fix? Need to Prevent Retaliation!!
2008 Farm Bill Hangover Issue: GIPSA
Rule
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23. 2012 Farm Bill Timeline
• Fall 2011: Super Committee Failed
– Across-the-Board Cuts: $15 Billion (January 2013)
 Hearings: Complete
 Senate Ag: Passed April
– Senate Floor Vote: YES
• House Ag: Markup Late June????
– House Floor Vote?
• Conference? Signed By POTUS?
– Before Election? Lame Duck? Narrow Extension?
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24. Key NPPC Farm Bill Issues
 Support New Comprehensive Surveillance System: Pilot for Pork
(included in senate bill)
 Support New Catastrophic Event Insurance Program Study
(included in senate bill)
 Support Beginning Farmer & Rancher Programs: Pork Producers
(included in senate bill)
 Support Reductions in CRP to Address Feed Availability
Situation (included in senate bill)
 Support Increase in Swine Research Funding (included in senate bill)
 Support Foreign Market Development & Market Access
Programs (included in senate bill)
 Support Feral Swine Eradication Efforts (included in senate bill)
 Support Extension Services (included in senate bill)
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25. X Oppose Livestock Title (Not included in Senate Bill)
X Oppose Egg Inspect. Amendments (aka Farm Takeover, Rotten
Egg Bill HR 3798/S 3239) (Not included in Senate Bill)
X Oppose “GIPSA Rule-Like” Provisions; NO Packer Ban; NO
Limit to 40 Hogs per Contract; NO Spot Market Mandate (Not
included in Senate Bill)
X Oppose Antibiotics Ban (PAMTA) (Not included in Senate Bill)
X Oppose Federal Purchasing Restrictions to Mandate Production
Practices (Not included in Senate Bill)
X Oppose Expansion of Advance Bio-Fuels Definition to Include
Corn-Based Ethanol (Not included in Senate Bill)
Key NPPC Farm Bill Issues
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26. “Farm Takeover Bill”
• Sen. Feinstein & 6 Senators – S. 3239
• East & West Coast Senators + Brown-MA, Vitter-LA
• Procedurally Difficult
• Did you TAKE ACTION? Call Senate Ag Committee
– (1) Don’t Bring Up & (2) VOTE NO!
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27. “Farm Takeover Bill”
• Rep. Schrader (D-OR) & 60+ Co-Sponsors – HR 3798
• Schrader likely to offer as Amendment to Farm Bill on Floor
• Fewer Procedural Hurdles
• Need 218 Votes
• Working Non-Ag: 250+ Offices as “Barnyard”
• We Will Need You to Take Action
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28. “Farm Takeover Bill”
NPPC Actions
• SEVERAL Calls to Action: Over 1500+ Letters & Calls into Senate
• Barnyard Lobbying Meetings on Hill
– Leadership; Rank & File MOCs
• Op-Eds Ready to Go: Targeting Toss-Up Races
• NPPC & State Association Letters; Farm Animal Welfare Coalition Letters
• AFBF President Bob Stallman – USA Today OP-Ed
• Politico Op-Ed: Cage-Free Egg Producer
• KEEP Food Affordable Coalition
• www.keepfoodaffordable.com
• Egg Farmers of America
• National Turkey Federation
• New Study to Bring Cost Impacts on Other Federal Feeding & US
Treasury
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29. THE
MOVEMENT
• The Egg Bill
• Antibiotics
• Agile Campaign for Other Issues
• Industry Engagement

30. BRANDING
• Website
• Facebook
• Twitter

31. VISIBILITY
• Media
• World Pork Expo
• Third Party Relationships

32. Sustainability of
Animal Ag:
The LongerView

33. • Not about Stalls or Castration…
– Eat Meat vs. Don’t Eat Meat… We LOVE Bacon Chzbrgrs!
• Plan A: Ballots; Lawsuits; State Leg. Threats
• Plan B: Pressure the Brand & Work Backwards
– “Shame the Brand” or “Curse of the Publicly Held Company”
– Social Media is KING
• DECISIONS ARE NOT ABOUT SCIENCE... BUT ABOUT BRAND
• “Game Changers” What’s Next?
1. Kony 2012: Viral in 24 Hours
2. “AGENT ORANGE CORN”: 1M Petition
3. “Pink Slime” : 2 Weeks; 250K Petition Killed It – No USG Involved
4. Starbucks: Insect Extract in Frappuccinos: Change.Org; Petition 6,500
5. Pork Focus: Stalls: Tyson Petition: Change.org 178,000
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35. It’s About Long Term Sustainability of US Pork
Industry
Look 10-15 Years Out…
– 2012 Election: Fewer Aggies in Congress
– Then Who? Those Who Eat…
• New Alliances & New Agendas
– Refocus Ag Education/Outreach
– Refocus Industry Communications
– Act… Not React…
• It’s Our Livelihood
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36. Thank You
• Questions? Comments?
• Thank You…
Call/E-Mail
adamsona@nppc.org
(202) 347-3600