In California, Bankruptcy of Giant Farming Co-op Holds a Lesson

Modesto Bee

 

The bankruptcy of Tri Valley Growers, a huge grower- owned cooperative, cast a pall over tomato and peach growers just as the 2000 canning season got rolling.

Ten years after its demise, the outlook is brighter in the sun-soaked fields near Westley where former Tri Valley member Bill Cox still grows tomatoes.

He sells his crop to two other food processors now, though the 2010 price might not be as high as the past three years. He sees continuing demand from fans of ketchup, pasta sauce and salsa.

But the collapse of Tri Valley, which cost the 500-plus grower- members about $145 million in equity, still is felt. Cox said his share of that was "a couple hundred thousand dollars," money that could have helped him diversify.

"We lost a bunch of money," he said. "We could have developed a couple hundred acres of orchards, or at least 100."

The bankruptcy of the 11,000-employee company, with plants up and down the valley, also contributed to the decline in the region's cannery work force. While primarily seasonal work, the mostly unionized jobs pay fairly good hourly wages compared with other valley occupations.

"There are nowhere near the employees there were back when they were going strong," said Wayne Zipser, who grew peaches for Tri Valley and now is

executive manager of the Stanislaus County Farm Bureau.

As for the growers, he said, "it hurt them. They were counting on those investments to grow the company. And it hurt the local economy."

A giant before the fall

Tri Valley, founded in 1932, grew to be the biggest player in the state's canning industry. At its peak in the 1980s, it ran 1.3 million tons of produce a year through 10 plants in California and one in New Jersey, selling under labels such as S&W and Libby.

Modesto was at the heart of it all, with one plant for tomatoes and two for peaches, apricots and other fruit.

The cooperative made a profit every year from 1988 to 1997, then lost $165 million over the next two years. It was bleeding yet more cash when it filed for bankruptcy July 10, 2000.

"It was a momentous event and a horrific event because growers lost millions and millions of dollars in equity," said Richard Sexton, an agricultural economist at the University of California at Davis.

He co-wrote a 2004 paper that cited several reasons for the collapse. They include overpayment for the raw crops, inefficient plants, a heavy debt load, poor financial oversight and weak brands in the tomato market.

Tri Valley stumbled through the 2000 harvest, then vanished as its assets were sold off to pay creditors. The Modesto presence has been reduced to one fruit plant, a Finch Road operation now owned by Seneca Foods Corp.

Processing has survived

The bankruptcy came as demand for canned fruit was slipping, another factor in the shrinkage of the industry.

Yet food processing has survived. At the peak of production last year, about 9,000 people worked at nine fruit and tomato plants in Stanislaus, Merced and San Joaquin counties.

"It puts money in people's pockets, whether to pay a bill or pay the mortgage," said Michael Tapia, who used to drove a forklift at a ConAgra Foods tomato warehouse in south Modesto.

He was seeking similar work this summer at the Del Monte Foods fruit cannery on Yosemite Boulevard. The job pays $16.94 to $18.37 an hour, not bad in a county where the jobless rate was 17.3 percent in May and many working people have taken pay cuts.

"It's tough out there right now for anybody," Tapia said. "People are losing homes. People are losing the things they have worked hard for in life."

Times were not so bad for the overall economy when Tri Valley faltered, so the impact was softened. The dairy, wine and nut industries were expanding, though not without some rough patches, and they employed mostly year-round workers.

Despite the troubles for tomato and peach growers, total gross income to Stanislaus County farmers nearly doubled from 2000 to 2009, to an estimated $2.31 billion.

On top of that, a housing boom brought plenty of work in construction and related fields, though it would come crashing down in the second half of the decade.

In 2000, it was tomatoes rather than the more lucrative fruit that dragged Tri Valley down. Today, the situation is reversed for the canning industry, with tomato demand stronger and fruit lagging.

One reason for that is the steady demand for paste, sauce and other tomato products. Industry representatives say consumers find them convenient, tasty and nutritious.

"The canning tomato market doesn't compete much with the fresh tomato market," Sexton said. "They go to different uses."

The Central Valley remains an ideal place to farm tomatoes thanks to its long stretches of sunny days. Mechanical harvesting has greatly reduced the need for field workers. Irrigation supplies are a long-term concern, especially on the West Side, but the easing of the drought this year has helped.

"I think it should be stable," Cox said of the processing tomato market. "I don't know about any international competition that's going to be accelerating."

Tough market for fruit

Not so for growers of peaches and other canning fruits. They contend with cheap imports and with the high cost of hand labor during the harvest.

Then there's the consumer, who can get fresh fruit from somewhere in the world all year.

The canned fruit industry has gone on the offensive, arguing that its process seals in flavor and nutrition. It also has offered new packaging, such as 4-ounce plastic cups, and new ingredient mixes, such as fruit packed in juice.

"It suffers from this notion of being not in fashion, but it's still a good product," said peach grower Paul Van Konynenburg of Modesto. "You put it in front of any 4-year-old and they will tell you how great it is. It's not your grandfather's heavy- syrup peaches."

Van Konynenburg was a Tri Valley member and served on its board of directors. He said the cooperative was done in by a number of factors that added up, including the conflicting needs of tomato growers, who have an annual crop, and fruit growers, who have long-lived trees.

Van Konynenburg now sells his peaches to Seneca, which he said has a good system for keeping the inventory moving.

Gary Darpinian, an Escalon-area grower who chairs the California Canning Peach Association, also praised Seneca.

"They've been a good addition to the peach industry," said Darpinian, who sells to Del Monte and was not a Tri Valley member. "The growers I know have been very pleased with their operation."

A spokesman at Seneca headquarters in Marion, N.Y., did not respond to a request for comment on how the old Tri Valley plant is faring.

Rethinking co-ops

Tri Valley's troubles got industry people thinking about the value of farming cooperatives. Growers have formed them to get fair prices for their crops, but they have to be wary of producing surpluses or pricing out the buyers of the finished products.

Darpinian said cooperatives need to have communication among the growers, board members and executives.

"Having good, accurate information about the financial condition of the company is very important," he said.

Sexton, in his 2004 post-mortem on Tri Valley, said the cooperative structure contributed to crop overpayments and "cumbersome" decision making, but the company also faced larger trends in the fruit and tomato markets.

Ten years after the Tri Valley debacle, the canning tomato industry is growing, although prices waver as processors try to match supply with demand.

The fruit industry is clearly struggling, but if it can stabilize, Modesto could be the hub of what remains. Seneca has started up the old Tri Valley plant for yet another season, and Del Monte has invested heavily in its own Modesto operation.

"It's a smaller total piece of the pie than it was in, say, 1964, but it's still a big piece," Van Konynenburg said.

He noted another advantage of supplying canned food to the world:

"Because those are outside dollars coming into our community, that is how our economy builds its wealth."

How Financial Overhaul can Hurt Farmers

The Wall Street Journal

 

GILTNER, Neb.—Farmer Jim Kreutz uses derivatives to soften the blow should the price of feed corn drop before harvest. His brother-in-law, feedlot owner Jon Reeson, turns to them to hedge the price of his steer. The local farmers' co-op uses derivatives to finance fixed-price diesel for truckers who carry cattle to slaughter. And the packing plant employs derivatives to stabilize costs from natural gas to foreign currencies.

Far from Wall Street, President Barack Obama's financial regulatory overhaul, which may pass Congress as early as Thursday, will leave tracks across the wide-open landscape of American industry.

Designed to fix problems that helped cause the financial crisis, the bill will touch storefront check cashiers, city governments, small manufacturers, home buyers and credit bureaus, attesting to the sweeping nature of the legislation, the broadest revamp of finance rules since the 1930s.

Here in Nebraska farm country, those in the business of bringing beef from hoof to mouth are anxious, specifically about the bill's provisions that tighten rules governing derivatives. Some worry the coming curbs will make it riskier and pricier to do business. Others hope the changes bring competition that will redound to their benefit.

"Out here we like to cuss the large banking institutions because of the mortgage mess, but we also know that without them some of these markets don't work," says Mike Hoelscher, energy program manager for AgWest Commodities LLC, a Holdrege, Neb., brokerage that provides derivatives services to the farming industry.

Derivatives are financial instruments whose value "derives" from something else, such as interest rates or heating-oil prices. The first derivatives were crop futures, which appeared in the U.S. at the end of the Civil War and became a standard facet of business for companies across America.

During the financial crisis, they became notorious as American International Group Inc. and others were gutted by bad bets on derivatives linked to bad mortgages.

President Obama and other proponents say the financial overhaul will prevent the kind of reckless lending and borrowing that sank the financial system and left taxpayers with the check. They say non-financial companies are worrying unduly about the derivatives portion of the legislation. The Senate is expected to approve the financial regulatory overhaul on Thursday, sending it to the president.

The full impact won't be known for years, but in Nebraska nerves are already on edge.

Executives at Five Points Bank in Hastings think the new rules on mortgage lending will make the home-loan business less profitable. "When they create a new regulator, it really scares us," says Nate Gengenbach, vice president of commercial and agricultural lending.

Advance America Cash Advance Centers Inc. thinks the new Bureau of Consumer Financial Protection will take aim at the payday-loan business, though it's not clear what steps the agency will take. Advance America's storefront at the Skagway Mall in Grand Island charges an effective 460.08% annualized interest rate on a two-week $425 loan.

But it's the derivatives portion—the part of the bill aimed directly at Wall Street—that might end up touching most lives in rural America.

The new law requires most derivatives transactions be standardized, traded on exchanges, just like corporate stocks, and funneled through clearinghouses to protect against default.

Faced with intense lobbying, Congress partially exempted businesses that use derivatives for commercial purposes. So, farmers and co-ops probably won't face new collateral requirements, for instance—although there remains a dispute over that section of the bill. Those that trade derivatives on regulated exchanges, such as the Chicago Board of Trade, are less likely to see immediate impacts than those conducting private over-the-counter deals, which will face federal regulation for the first time. The goal is to make such deals transparent.

The question for these farmers is whether such rules will make hedging more expensive. Some say new requirements on big players will create higher costs for small players, including the cash dealers will have to put aside to enter into private derivatives transactions. Some brokers think restrictions on big-money banks and investors will drain the amount of money available to the everyday deals farmers favor.

Others predict the opposite effect, pushing money from the private market to the exchanges and creating more competition that will benefit farmers.

Uncertainty reigns in Giltner, a town of 400 residents 80 miles west of Lincoln. At first glimpse, Giltner's landscape seems featureless, a fading horizon of corn and soybeans. But its details are more subtle, including wildflowers and shaded creeks. Everywhere galvanized-steel sprinkler systems crawl across farm fields like giant stick insects.

Mr. Kreutz, an outgoing 36-year-old with a sandy crewcut and sunburned neck, gave up a career in finance and took over the 2,800-acre family farm after his father's death. As he works his fields, he checks the crop futures prices on his smart phone.

Here's how Mr. Kreutz does it: Say in early summer he sees that the price for a Chicago Board of Trade futures contract on corn for delivery later in the year is $3.56 a bushel. If he likes the price, and wants to lock it in, he calls AgWest and sells a futures contract for 5,000 bushels. The futures contract is a derivative in which the price for corn is set now for exchange in the future, though no kernels will change hands. Instead, when the contract nears expiration, Mr. Kreutz and the buyer of his contract will settle—in effect—by check.

By fall, when Mr. Kreutz is ready to deliver his crop to the local co-op, the market price might have fallen by 50 cents. He'll sell his actual corn for that lower amount. But he'll make up the difference through his financial hedge. (Mr. Kreutz buys a new futures contract at the lower price to make good on his earlier promise, making up the 50 cents.) In all, he'll have hit the price target he locked in earlier in the year, minus brokerage fees.

If the price rises during the summer, as it did during the food crisis two years ago, Mr. Kreutz has to pony up extra cash for his broker—a margin call—to maintain his positions. He recoups that by selling his actual corn at a higher price, but has to take a loss to meet the futures contract he signed earlier in the year, missing out on a windfall but ultimately meeting his target price.

Mr. Kreutz does this type of operation dozens of times a year, hedging about 70% of his 345,000-bushel corn harvest.

Such deals ripple through the local economy. When Mr. Kreutz gets a margin call from his broker, he turns to his banker, Mr. Gengenbach, for a loan to cover it. Mr. Gengenbach estimates that one quarter of his farm clients use derivatives.

"Somebody like Jim has a lot of money in his crop out here," says the 37-year-old Mr. Gengenbach. "If he can't protect that, it's not good for us."

Mr. Kreutz's brokerage, AgWest, thinks the new finance law will hurt both firm and farm. If big investors and dealers have to keep more cash on hand, there will be less liquidity in the market and therefore the cost of derivatives will increase, Mr. Hoelscher, the broker said.

A few minutes from the Kreutz family farm are the corrals of Jon Reeson's feedlot. Mr. Reeson, 43, is married to Mr. Kreutz's sister Jane. His feedlot holds as many as 1,500 steer, mostly Black Angus, which grow from 600-lb. calves into 1,300 pounders ready for slaughter.

Mr. Reeson uses derivatives to hedge both the price he pays for feed and the price he gets for selling his steer.

The fattening takes about 7,000 pounds of food for each animal. Mr. Reeson can't count on a favorable price from his brother-in-law's farm, in which he has a stake, so when he sees a feed price he likes, he seals it with a futures contract.

In April, he called AgWest and locked in a price with a futures contract for $95 per hundredweight of cattle. Since then the market price has dropped to $90. If the price stays there until October, he'll have made the right call, earning a higher price than if he'd relied on the market alone. If the price spikes higher, though, he'll miss out on potential gains.

Mr. Reeson is willing to live with that possibility in exchange for locking in a profit or a narrowed loss. Derivatives hedging helped him survive the recession of 2008-2009, when cash-strapped diners avoided steak and the price of beef plunged.

He's watching the new legislation warily and can't yet tell if it will hurt or help.

When his cattle have reached full weight, Mr. Reeson puts them on Roger and Barb Wilson's trucks for the trip to the slaughterhouse. The Wilsons have seven semi tractors and 16 trailers, and one of their biggest costs is diesel fuel to keep the fleet on the road.

In 2004, Cooperative Producers Inc., his local co-op, offered Mr. Wilson a price-protection plan for 10,000 gallons of diesel at about $2.50 a gallon, with 90 days to use it.

CPI had a choice. It could take its chances and hope the price of fuel would drop before Mr. Wilson took delivery on his full order, a windfall for the co-op. If diesel prices jumped, though, the coop would take a bath. "That falls under speculation," says Gary Brandt, CPI's vice president of energy. "But that's not what cooperatives do. That's what Goldman Sachs does."

Instead, CPI hedged on the New York Mercantile Exchange, buying a futures contract on heating oil, a close market substitute for diesel fuel. The co-op goes a step further and hedges also the difference between the prices of fuel traded in New York and delivered in Nebraska.

For the 57-year-old Mr. Wilson, the pricing plan proved a mixed blessing. The first year, the pump price shot up by another 20 to 25 cents, meaning he was getting a good deal. The following year the pump price dropped about a quarter a gallon, but Mr. Wilson was obliged to pay the higher price. "It hurt to have to pay for that fuel," he recalls sourly. He quit the program after that.

The finance law's imminence has prompted CPI's Mr. Brandt to warn his sales team and customers that the co-op may have to end its maximum-price fuel contracts. He's worried too that CPI might have to cut its fuel supplies if it can't hedge against price drops.

"We have to start making a game plan if they take away the ability for us to hedge that inventory," Mr. Brandt says.

The Wilsons deliver Mr. Reeson's steer to a low, cement-gray complex on the edge of Grand Island, Neb., where trucks arrive loaded with cattle, and others leave loaded with meat. Over the past year, Mr. Reeson has sold 1,125 steer to the packing plant, which is owned by JBS USA, a Greeley, Colo., unit of Brazilian-owned JBS SA.

JBS buys livestock two ways. Sometimes it pays cash for the following week's kill. Sometimes it buys further forward, agreeing in July, for instance, to a fixed price for steer delivered in December. JBS hedges on the derivatives market to make sure live cattle prices don't drop before it takes delivery.

The company also sells beef cuts forward to restaurant chains, promising delivery at set prices months ahead of time. JBS expects to have enough meat to fulfill the agreements. But if it runs short, it doesn't want to risk having to pay higher prices to buy meat to supply those restaurants.

So, it uses the derivatives market to play it safe. To do so, the company has to find a way to hedge different cuts of beef: Tenderloins might represent 1.5% of the total value of a steer. Strip loins might make up 3%. In a sense, JBS protects itself by reconstructing the steer through a derivatives trade on the Chicago Mercantile Exchange. "We try to put the carcass back together financially," says company spokesman Chandler Keys.

The company hedges electricity for its refrigerators and natural gas for its boilers. It hedges currencies to stabilize its income from overseas. It hedges fuel for its fleet of thousands of trucks.

Even executives at a big firm such as JBS haven't been able to nail down the precise impact of the legislation on their business, introducing an unaccustomed level of uncertainty into their operations. They aren't changing the way they use derivatives, yet, hoping instead that exemptions for commercial users will insulate them.

"To get food, particularly highly perishable food like meat and poultry, through to the consumer, you have to manage your risk," says Mr. Keys.

Indiana Couple Use 10-Acre Farm to Grow Local Produce

Chicago Tribune

GOSHEN, Ind. — What began as Karen Wellington's personal quest for honest information about where food comes from has evolved into a local family farm that is reaping more than just healthier food -- it's producing a crop of friends.

Offers for free eggs from Karen and Jim Wellington's 10-acre farm, located within Goshen's city limits on Waverly Avenue, between the canal and the river, have appeared on Facebook. Karen drops off 10 to 12 dozen eggs a week at her husband Jim's downtown Goshen eye care office for community members to pick up. There's never any charge, she said.

Wellington was inspired to begin farming after reading books such as "Fast Food Nation" and "The Omnivore's Dilemma" and watching documentaries along the lines of "Food, Inc." which investigate genetically modified, corporate mass-production food systems and the complex politics and health concerns wrapped around the average American diet. Wellington reached a point in her research where she could no longer feed her family with meat from grocery store shelves.

"A neighbor raised a cow for us that we butchered and when the cow was gone I said, 'that's it.' We didn't eat any meat after that for two years," she said.

In mid-July, Karen is offering local people a chance to raise their own White Mountain chickens, from day-old chicks through to slaughter. The chickens are pesticide and antibiotic-free and are raised in a free-range pasture. Participants will divide the cost of the chicks and locally-milled feed, and will share a rotational schedule of caring for the chicks. They will participate in the slaughter together. All needed equipment will be free of charge.

For Janet Gulec, who follows her friend's farming adventures and who wants to eat more locally produced food, it's an opportunity for her kids to learn an appreciation for where food comes from. Janet is hoping to raise 15 pasture-raised hens. She loves the taste of Wellington's chicken and has time to invest in the experience. Gulec is buying a freezer and also plans to buy a quarter share of a cow from Wellington.

"Karen's a great person to be offering her resources to help people in the community to try this. Goshen, for a small city, is very special in so many ways, and this is just one more great thing that adds to the flavor of our community," Gulec said.

For an amateur almost-city farmer, there have been sad times and difficulties, as Karen learns "by trial and error," she said.

"Last summer a gentleman came to me and asked if he could do work for me in exchange for putting his horses up at my pasture. Since I wanted to raise my own beef, we spent some money beefing up my fence and he did the labor. I paid for all the materials, starting with 16 calves."

Wellington learned -- a little too late -- that calves need several weeks of mother's milk before feeding on grass alone, she said.

"I think it stunted their growth a little bit. They're probably not as big as they should be."

Last summer she lost two calves. One became sickly and died shortly after transport. Another succumbed to pneumonia.

And then there was Buttercup.

"We bought a dairy cow and milked her for two or three months but she got mastitis and she didn't get better. We butchered Buttercup into hamburger because she was an older cow. She really was an outreach to the community because we'd invite people to come out and milk her, and take the milk home for free, because you're not allowed to sell raw milk in Indiana," she said.

Overall, it's been an easier go with the chickens. "Chickens can eat anything -- corn, grain, grass, bugs. What I've learned is that chickens and cows have a very interesting, symbiotic relationship. A cow poops and it's infested with flies and maggots, and chickens love that. The chickens sanitize the pasture and the manure keeps the grass growing to feed the cows. When chickens are separated from cows on a farm, the benefits of this natural relationship are lost, she said.

"If you look at nature, I'm convinced those things are all meant to work together," she said.

Karen enlisted help to build some 8-foot by 8-foot "chicken tractors" which hold about 20 chickens per tractor. The tractors transport the hens around the pasture, ensuring they move to new grass daily to fertilize the land and to eat insects.

"Broilers are pretty lazy. They sit around waiting for you to bring them food."

The Wellingtons' hens produce far more eggs than Karen, Jim and their three children can eat. They love to give the rest away.

"It's fun. Yesterday I passed a woman who was collecting grass clippings after mowing. I needed the clippings for my vegetable garden, so I traded eggs for them and the woman was thrilled."

Karen plans to give the woman a dozen eggs every weekend from now on, she said.

"You try to find ways to brighten someone's day. We get three or four blue eggs a day. That's pretty cool. It still gives me a tiny thrill when I collect the eggs and I try to put a blue one in almost every dozen."

Karen's co-op of new chicken farmers will buy all the one-day old chicks on July 13th and will raise them up for eight to ten weeks before taking part in a butchering day together.

"For me, I have the land, I have the means, and in my circle of friends there are so many who, if they had the land, would do this, because they care about what they put into their bodies. Why wouldn't I want to share? Part of it is selfish, because I don't want to do all the work myself," she said.

Deere to Expand Dealership Network in India

Business Standard

US-based agriculture farm equipment and tractor manufacturer John Deere today said it was looking to expand its dealership network in the country, from the existing 380 to over 400 within a year.

"We are looking to expand our dealership network in the country and shall add up, say, close to 50 dealers within a span of one year, taking the tally of total dealers from the existing 380 to between 420-430", Deputy General Manager Marketing Services John Deere, Mahesh Boolchandani said here.

"The company sold 25,000 tractors in the country last year, and exported around 13,000 units from India to around 68 countries including US and South America", he said.
   
The company with 7.34 per cent domestic market share, also launched two new tractor models here, 5036C and 5041C- of 35 horse power(hp) and 41 hp respectively.
    
Quoting Tractor Manufacturing Association of India figures,Director Sales and Marketing, John Deere, Ravi Menon said, "4.14 lakh tractors are sold annually in the country, of which 31 to 40 hp models account for highest sales in the segment."
   
"With the launch of these two new models we are targetting a larger domestic market share", he added.
   
The company, which manufactures eleven models of tractors at its facility in Pune has installed annual capacity of 60,000 units.
   
John Deere also forayed into manufacturing of micro irrigation systems recently, for which it has set up a facility at Vadodara in Gujarat.
   
"We have set up a micro irrigation systems manufacturing facility at Vadodara on a 5 acre plot, and presently are selling our range of products only in Gujarat," Boolchandani said.
   
"We have a total business volume of $2 million at the Vadodara facility," he said. The company intends to start selling it's micro-irrigation range of products in Madhya Pradesh and Tamil Nadu soon.

Ohio Farmers Laud Livestock Care Accord

The Norwalk Reflector

As the saying goes, there are two things people don't like to watch being made: laws and sausage.

Ohio voters will be spared both this year, as a national animal rights group and the Ohio Farm Bureau reached an agreement Wednesday that will avoid a face-off and keep a ballot issue on livestock care off the November ballot.

For Ohio farmers like Jeff Schwab, whose three farms in Butler County breed and sell more than 17,000 hogs a year, this means they'll have years to change their practices instead of potentially only months if the threatened initiative passed.

"Instead of basing it totally on emotion, we'll be basing it on science," Schwab said.

Wednesday's deal follows last year's constitutional amendment creating the Ohio Livestock Care Standards Board, which farm groups lobbied hard for. It was an open attempt to prevent the Humane Society of the United States from pushing a tougher measure this year that farmers feared would drive them out of business.

HSUS officials say they have the half-million signatures needed for that effort, which would prohibit confining farm animals so they can't turn around, lie down, stand up or fully extend their limbs. Similar measures have succeeded in states such as California, Michigan and Florida.

Both sides are claiming victory in the compromise.

"One of animal agriculture's most vocal critics has agreed that the Livestock Care Standards Board is the proper authority to handle difficult questions about farm animal care," said Jack Fisher, Farm Bureau executive vice president.

Wednesday's agreement, shepherded by Ohio Gov. Ted Strickland, included a number of recommendations for the livestock board.

They include a ban on veal crates by 2017; a ban on new pig gestation crates and a 15-year deadline to do away with such existing practices; a moratorium on permits for new battery cages for egg-laying hens; and a ban on the transport of downer cows.

Other agreements include the enactment of legislation toughening penalties on cockfighting and so-called puppy mills, and a ban on exotic animals.

"This agreement moves us forward on all of the components of the proposed ballot measure as well as other important advances for animals, too," said Wayne Pacelle, HSUS president and CEO.

"We were confident in our ability to prevail, but not certain, and I think the Farm Bureau had the same take," he said.

Farm Bureau officials said the deal will leave the livestock industry "less vulnerable to emotional video used to sway public opinion on farm animal care. Farmers, their organizations and allies will not be forced into a multi-million dollar media battle."

Food Safety a Top Issue for Agriculture Candidates

Atlanta Journal Constitution

Gary Black and Darwin Carter have a rough row to hoe: explaining to Republicans in metro Atlanta not only why they should vote for them but why they should care.

Black and Carter are battling to be the GOP nominee for agriculture commissioner on the November ballot against J.B. Powell, the sole Democrat vying for the spot. When the office was created in 1874, most residents of the Peach State knew it was an important job, but now with about the half the GOP primary voters in suburban Atlanta, fewer and fewer interested parties know why they should be interested, the men said.

One reason is pure economics. Agriculture and its related industries and businesses -- much of which are regulated by the commissioner -- have a $65 billion impact on the state's $786 billion economy, according to the University of Georgia's Center for Agribusiness and Economic Development.

The other is that the commissioner regulates a lot more things than agriculture: He or she is responsible for calibrating gasoline pumps, regulating pest control companies and, most importantly, inspecting food processing plants.

"It really is the Georgia Department of Agriculture and consumer affairs," said Carter of Jesup in South Georgia. "Many people do not understand that. Many people think it is just agriculture and it has nothing to do with me."

Last year, more than 700 people around the nation were sickened from salmonella after the department's inspectors overlooked sanitation violations at a peanut butter plant in Blakely in southwest Georgia. (A Texas plant belonging to the same company also was investigated in the outbreak.) Nine deaths were linked to the salmonella outbreak. Peanut Corp. of America declared bankruptcy after the outbreak.

"It's an important job," said Tony Carbo, a lobbyist for the nonprofit Food and Water Watch. "At the plant in Georgia, they obviously missed several key indicators such as dead vermin. ... Georgians and the rest of the consumers in the country are relying on the Georgia Department of Agriculture to do effective inspections."

Whoever ends up as the next commissioner will be replacing a Georgia political legend, Tommy Irvin, who has ruled the Agriculture Department since 1969. The department, which both regulates and promotes agricultural interests, will touch most Georgians in one way or another.

Both Black and Carter say they will focus on food safety if elected commissioner.

"If we don't have safe foods, we won't have strong farms," said Black of Commerce in northeast Georgia, who headed the Georgia Agribusiness Council -- a kind of chamber of commerce for agriculture -- for 21 years. He resigned to qualify for the commissioner race. "Folks in agriculture are champions of food safety because when the system is compromised, the public loses confidence in the market."

Black said that he would push for improvements in training for inspectors -- although Carbo said that the Georgia department actually had a good overall safety record -- and improve accountability up the chain of command. Carter said food safety would be his highest priority.

They also both emphasized expanding Georgia's agricultural market internationally would be the second pillar of their administration. The state has three ports -- including the barge port at Bainbridge, which connects to the Gulf of Mexico via the Apalachicola River -- and Colonel's Island at Brunswick is a major hub for agricultural exports. A recent article in the Atlantic magazine contended agriculture would eventually replace oil as the top commodity because arable land is becoming scarcer worldwide.

Carter said he worked eight years in the Reagan administration heading up international affairs for the U.S. Department of Agriculture. He said he still maintains many of the international contacts he made in that job and later as a consultant in Africa. "That gave me, a South Georgia farmer, an international perspective and made me a household name in the United Nations for years," he said. "I want to see those Georgia seaports active with our agriculture products going out rather than Chinese, Chilean or Guatemalan products coming in."

Black said he hoped that he would be able to work with the next governor to be a part of international trade missions. "I want agriculture to be represented wherever Georgia goes on a trade mission because it is such an important component of what we do," he said.

He noted that the state's name had not only ties to King George but even longer ones to those who work the earth. George comes from the ancient Greek, Georgios.

"It means, ‘A farmer,' " Black said.

Deere to Build 500-Job Center in Olathe

Kansas City Star

John Deere today announced it has given the green light to build a marketing and sales center in northwest Olathe that will house up to 500 employees.

No new jobs are immediately expected to be created since the project essentially involves shifting workers from a Lenexa location.

The 126,150-square-foot building will be constructed in the Corporate Ridge Office Park, near K10 and Ridgeview Road.

The employees will provide support and service to Deere sales branches and dealerships in the U.S., Canada, Australia and New Zealand.

The company, which currently has operations in Lenexa, proposed building this facility several years ago.

The economic downturn prompted Deere to push the construction plan to the backburner. Now, construction is scheduled to begin in June, with completed pegged for August 2011.

John Deere's Gator 825i can Really Gallop

Orlando Sentinel

For years, the unofficial work vehicle of Central Florida has been the John Deere Gator, given our heavy concentration of golf courses, nurseries, ball fields and other labor-intensive outdoor facilities.

You've seen them, but perhaps overlooked them, given their industrial nature. Being a Deere, they are, of course, usually green and yellow, but a lot of them I notice are pretty much brown. Dirt, dust and rust is how they often look after decades on duty.

For 2011, though, Deere wants to change that. Oh, sure, this next generation of Gators will still be the draft horses they always have been, especially the models powered by the three-cylinder Yanmar diesel engine, or the three-cylinder Kawasaki.

But there's a new model, the 825i, that Deere hopes to establish as the playboy of industrial utility vehicles. It's powered by a 50-horsepower, three-cylinder automobile engine, manufactured by Chery, the Chinese automaker that, for years, has been trying to find a way to bring its own vehicles to the U.S. market. Former Orlando resident Malcolm Bricklin, the serial entrepreneur who imported the Yugo, struck a deal to import Chery cars, but it ended in tears and lawsuits. Another deal with Chrysler to bring Chery to America fell through. But here Chery is, under the hood of a Gator.

I got a chance to test a Gator 825i, and while this little Chery engine might not be much fun in their Chinese microcars, in the Gator, it flies. The CVT (continuously variable transmission) works like an automatic, so punch the throttle and you go – right up to a top speed of 44 mph. Which might not sound like much, but 44 mph on tight, twisting trails through the woods is fast – and thanks to the Gator's independent suspension, it rides so smoothly that you'll probably try to test that 44 mph top speed.

"Press the gas, and make monotony eat dust!" says Deere in its hyperbolic press materials. But it's true – as a legitimate cross between a Jeep Wrangler and a conventional ATV, this would be my absolute, ultimate choice for blasting through the trails in the Ocala National Forest.

Still, with this power and top speed, Deere expects the Gator 825i will be its best seller even among industrial customers. And, oddly, a company spokesman says they have, as yet, no way to govern that top speed down to, say, 25 mph. As a site foreman, I'd be a little nervous tossing the keys to an 825i to an 18-year-old day worker – this thing is quick. The Gator with the 25-horsepower Yanmar diesel may not be fun, but it won't get you in trouble.

Deere dealers should have the new Gator 825i in stock shortly. For residents of The Villages, here are the answers to the two questions you have: Price starts at around $12,000, and no, I don't know if the Gator 825i is legal for all those golf cart-only roads you have in that retirement community. But if you want to one-up your neighbor's new electric, this is the hot ticket.

And then there was one

Speaking of electric power, on Thursday the city of Orlando unveiled the first public electric charging station to be installed as part of the ChargePoint America program. It is one out of nine cities that have been chosen to be a part a $37 million program that will install 300 charging stations for electric vehicles.

This first station was installed at City Hall, right by the "media parking" area, presumably since someone figures news-media members are so forward-thinking that we'll all be driving electric cars any day now. Good luck with that. The other eight cities that are part of the program: Austin, Texas, Detroit, Los Angeles, New York, Sacramento, the San Jose/San Francisco Bay Area, Bellevue/Redmond, Wash.; and Washington, D.C.

For reasons I can't quite explain, Orlando is at the forefront of alternative power initiatives, be it electricity, hydrogen or ethanol. Good for us, I think.