of
Secretary Ann M. Veneman's remarks to The 7^th Farm Journal Forum: Your Stake in the Food Chain
Washington, D.C.
December 4, 2002

"Thank you Sonja for that kind of introduction. I really appreciate the opportunity to be with you today. There are so many friends in the audience and I have a chance to share a little bit with you and I hope you all have a happy holiday. It is hard to believe that we've been here for almost two years already particularly the last year; I have no idea where the time went. But it's been a very, very busy year and it's as someone said to me 'we've faced many challenges but we've also accomplished a great deal."

"You all had the opportunity last year at this forum to see the President up close and personal and you see what a strong leader he is. I must say I continue to be very proud to have the opportunity to serve in his Cabinet.

"I also want to compliment the Farm Journal for holding this Forum because I think it is very important that we continue to work proactively at the issues facing food and agriculture today. And I commend you on your topic: The Food Chain. As you all know we put out a book last year called: Food and Agricultural Policy Taking Stock for a New Century. One of the things we talked about very distinctly was looking at the importance of the entire food chain-that it is consumer driven, globalized, and driven today by technology and so as I look through your agenda -and I have been reading all the press stories about what every one has said-I really commend you on putting together a first-class agenda (inaudible). So what I want to do today is talk about some of the issues and then leave a little time for us to have a conversation about them and have you raise some issues as well.

"One of the issues that continues to be very important to USDA is that of Homeland Security.

The President just last week signed a new Department of Homeland Security bill, a very big accomplishment, creating a huge federal department to coordinate all of the activities related to Homeland Security, some of which, of course, involve agriculture. I think it is important that we clearly understand the role that agriculture plays in the homeland security issue and the importance of food in that process. This department will unify federal resources and it will include USDA's border inspection system (inaudible) abatement, the Animal Health Plant Inspection Service that oversees the people coming through our airports together with Customs and Immigration and Naturalization-all of the border agencies.

"I think the hardest thing for me to lose is our Beagles. We have Beagles as part of that force that sniff the luggage when you come in from overseas and will now become part of the Department of Homeland Security. It's always been nice to say we had Beagles employed by us.

"But we will continue a very strong focus on Homeland Security-everything from looking at how to respond to a terrorist attack on the food supply, something like the intentional introduction of Foot and Mouth disease, strengthening food safety, working with producer groups and the entire food chain. I want to commend Deputy Secretary Moseley and the leadership role he has taken in this area.

"Another issue I wanted to discuss today is that of international trade. As you know we've had some significant progress this past year. The President was finally able to get Trade Promotion Authority from Congress and signed it. We made significant progress on the Doha Development Agenda including the U.S. proposal, which we put forward at the end of July, which is a very visionary proposal that calls for further reform from the Uruguay Round in the area of agriculture. As those negotiations continue they are focused somewhat differently than the Uruguay Round in that the Doha Development Round is much more focused on the developing world. We are also working on several bilateral trade negotiations, Chile, Morocco, Singapore and as well the Free Trade Agreement of the Americas and so we work closely with USTR as we negotiate agricultural portions of all of these agreements.

"But at the same time we continue to experience a number of issues we might call trade irritants whether it is the Russian poultry situation which I know you talked about earlier today or soybeans in China, (inaudible)--we have a whole host of these issues that involve sanitary and phytosanitary issues that continue to be trade irritants--very difficult for our exporters and producers. So we have spent a great deal of time on what we call market maintenance and that is really maintaining markets that we have and protecting them against these kind of -what we believe are unjustified barriers to trade. We have a strong team in place that is working together in this regard...JB Penn, David Hegwood, and Bill Hawks, of course, who is head of marketing and regulatory has a strong role to play to make sure that sanitary/phytosanitary issues are dealt with.

"That brings me to another issue that we discussed at lunch-(inaudible)-- and this is something else that is becoming another global issue and that is biotechnology. Think about the fact that we had this year something we never thought we would see--our food aid turned down. And it was turned down because of biotechnology. But basically not because the countries were afraid of the food, they were afraid of losing their licenses in Europe if it happened to get in their animal byproducts and they couldn't export it.

"So we've seen the impact of biotechnology on trade in that respect along with our continuing issues with Europe and our inability to get new regulations (inaudible)-as a result they've had a moratorium on new product approvals which has been in place now for over four years. And I know that has been a tremendous burden on our food exporters as well as our producers. But as we all know biotechnology remains one of the most important technologies in the agricultural area. It offers so much promise for the future and I know that you are going to have a session about that this afternoon and discuss some of the new products that are coming down the pike. And I believe that we will see more consumer acceptance of these products (inaudible) as they become aware of the health benefits of some of these food products and I believe that is what the consumer wants to see.

"There is also interest in the developing world in this technology. I spoke yesterday with the 1890s task force -one of the issues they have been very involved in is research with some of the African countries to develop the products of biotechnology-to develop drought-resistant strains, disease resistant strains that will help Africa feed itself.

"I think we haven't gotten enough credit for the environmental gains we've seen from Bt cotton and corn and soybeans. Because we are seeing already broad benefits from biotechnology. But we are also seeing some challenges from biotechnology. Sometimes it is challenges to our legal and regulatory systems but we've been proactive in dealing with these issues and are moving forward to adapt to the issues of the future.

"We have new units in the Foreign Agricultural Service to deal with biotech trade issues. In APHIS we have an aggressive team in place to deal with regulatory issues and coordinate biotech matters across all agencies of the Department.

"We have to ensure enforcement of biotech regulations in order to maintain confidence in the systems and the new technologies.

"And, so when companies don't adhere to those rules, we will take action as we did recently in the dealing with the case of the Prodigene issues. We are continuing to work very closely with FDA to ensure regulatory requirements are clear and that monitoring of licensees that are issued is effective and efficient. But we also don't want to stifle growth but we have to have strong and credible regulatory systems. And so that is (inaudible).

"We also, and you had the opportunity to hear from our Undersecretary Elsa Murano last night, and I've heard some very good comments about her presentation last night, but this issue has been very prominent in the past year and we think will continue to be on the forefront as go forward into next year. We have strong programs that protect consumers and they are a critical part of what we do at USDA. The responsibility to protect the public health-we take that responsibility very, very seriously.

"Just five years ago USDA scrapped its old system of food safety and put in the HAACP system looking at critical control points. (Inaudible). We continue the number of food borne illnesses go down because of the progress that has been made. But on the other hand we have to continue to look at our inspection system, our training system, our enforcement activities to protect the public health.

"We continue to invest in our food safety inspection workforce - our inspectors are on the frontlines for ensuring regulatory compliance.

"As I said we have a strong team in place led by Dr. Murano, her deputy Dr. Pierson and Dr. Gary McKee some of you may have read the Wall Street Journal article about him yesterday, all scientists, microbiologists who are working and refocusing our efforts to protect the public health in the best way we can.

"We are looking at our research. Where are the gaps? We are looking at our training, where do we need to provide more training? How do we use technology to protect the public health? We have made progress on putting in place new policies and procedures on E-coli 0:157 H7 (inaudible) and listeria.

"And, when plants have failed to live up to expectations, when we have had a problem, we have not hesitated to withdraw our inspectors, which is effective in shutting down a plant. We are going to continue next year our ongoing series of various scientific conferences with Dr. Murano to get cutting edge science on food safety issues. These were effective in the past year and provided valuable input. It is important that education all throughout the food chain continue in the area of food safety so we can make our system as strong as possible in protecting the public health.

"I want to address just a few more issues before I take questions-that are not exactly related to the food chain but nevertheless important to agriculture. One is the full area of energy. It's become a major part of what we do at USDA. We've focused a lot on ethanol in the last decade and that was very important to us. But this is an area that continues to broaden and produce more opportunities and potential for agriculture like biobased products. And there are several factors that are playing into this additional focus. One is, as you know, the President put together an energy policy and strategy, the first of its kind in a generation and very forward-looking energy legislation, which unfortunately did not pass the Congress this past year. However this administration will continue to pursue this legislation, which contains some key, issues which boost renewable energy fuels. And renewable energy was an important component of the President's national energy policy. And he continues to say we must become more energy self-sufficient and renewable energy, particularly from agriculture, is one way to do that.

"The bill contains a renewable fuel standard that would result in 5 billion gallons of ethanol and biodiesel consumption by the year 2012. That is a provision the administration supported and will continue to support next year.

"Also the new farm bill contained an Energy Title for the first time ever. And this would provide mandatory funding to strengthen USDA's ability to grow these areas of energy. One of the farm bill provisions makes $23 million per year for grants, loans and guaranteed loans to farms, ranches and small businesses for renewable energy systems and energy efficiency improvements.

Our rural development mission area under the leadership of Under Secretary Tom Dorr is responsible for that program. Just yesterday, we held a public meeting to get input on how to operate the program. They had 40 people signed up to make presentations on possible types of projects, from wind and solar to methane digesters to more traditional projects.

We expect to have this program announced by late spring 2003. In the rural development area, we also have increased our lending for energy projects. During the past two years, we have made over 70 loans and grants in 25 states totaling $75 million for bioenergy and bioproducts.

"We also have farm bill funding of the Biomass Research and Development Act of 2000.

This under our environment area. Under Secretary Mark Rey is working with the Department of Energy to identify and fund projects that will advance the development of biomass as a feedstock.

"The Farm Bill also gave USDA leadership to develop a biobased procurement and testing program for federal agencies and a biodiesel education program. We are also in the process of putting together those guidelines.

"We also have our CCC Bioenergy Program that share the cost of feedstock's like corn and soybean oil for firms increasing their production of ethanol and biodiesel.

And we are also working with the Forest Service as we look for opportunities for biomass.

"One other area before I close. Another area in the farm bill that we worked hard to achieve was a strong conservation title. And we are on schedule now as (inaudible) to implement the various conservation provisions of the farm bill. And I appreciate your compliment; I think our team that has worked on this has done an incredible job on the farm bill implementation. But we are now focusing our efforts on the conservation title and it is important to note that this bill provided an 80 percent increase in funding for conservation-85% of which will go for conservation on working farmlands, helping farmers with conservation. So these programs continue to be a priority for this Administration.

"I want to thank the Farm Journal for hosting this, for inviting me to be a part of it and for all of you for giving me the opportunity to speak today. I think it is a very important topic and I applaud all of you for participating. Thank you."