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ODA Director previews 2012
Katy Coba remarks
Oregon agriculture 2012
 
Jaunuary 1, 2012:  ODA Director of Communications Bruce Pokarney conducted this interview with ODA Director Katy Coba regarding the prospects for Oregon agriculture in 2012.

As we head into 2012, do you have your usual sense of optimism for Oregon agriculture?

I do have my usual sense of optimism. Clearly, part of it is because we've weathered an incredible [economic] storm. We are starting to see signs that the industry is coming out the other side and we're hoping that trend line continues. Clearly, it's been a slow recovery for the whole economy, not just in Oregon, but the US- and it's been a slow recovery for agriculture. But we're definitely seeing improvements. Certainly in specific commodity sectors, we're seeing a lot of opportunity. So I'm optimistic for 2012 and hope that all of Oregon agriculture can see improvements.

What are some of the bright spots in Oregon agriculture production?

Certainly in our top categories, you have to mention wheat. It has been a pretty long time, relatively speaking, for wheat growers where the price has been very good. On the national scale, we see that as well. Prices dipped a little bit, but wheat producers in this state have to be feeling pretty happy about how things are going.

Hay is another commodity that the price is just through the roof right now, which makes hay growers happy but makes livestock producers not so happy. But hay is at a premium and we grow some terrific hay here in the State of Oregon.

Beef cattle- again, we're seeing, relatively speaking again, very low numbers of beef cattle across the US. Of course, that has driven the price up even in these down economic times. So I think beef producers are feeling pretty good about things.

You also have to mention blueberries. There are great opportunities for the blueberry industry. We've seen a lot of growth on the production side and now I think we're going to see some expansion on the market side, and I think some real opportunities for our blueberry growers.

Even some of those commodities that have been struggling the past few years, do you see a brighter future for them?

Yes, I do. Specifically for nursery and grass seed, which were the sectors probably hit the hardest by the economic downturn because of their tie to construction and the complete wipeout of the construction industry in the US. Nursery and grass seed definitely struggled. We are starting to hear from some nursery producers that are seeing upward trends in the market, which is a good thing. With grass seed, we are starting to see the inventories that had built up start to be reduced and almost eliminated in some cases. Hopefully even for these sectors that have really been hit hard, we're going to see an upturn in 2012.

What might be some of the challenges producers may face in 2012, even those that they seem to always face?

I think if you talk to the farmers and ranchers in this state, as always, they have concerns about regulations and duplication of regulatory agencies. That's clearly going to continue to be a concern. There is a lot of focus at the national level on environmental regulations. Some of those are being tapered or will not be moving forward. But it has raised enough concern that producers are just on edge right now, and understandably so. Even with that, we have cases of regulation that are going through- a brand new NPDES permit for aerial applications of pesticides on, over, or near water. Again, we think that is more than adequately covered under FIFRA regulations, but now because of a court decision, we've got a new NPDES required under the Clean Water Act. That's very, very frustrating for growers. We certainly hear it. I think from an Oregon Department of Agriculture perspective, it makes our job even more important as we try to reach out and help producers meet regulations, even if they are our own regulations- making sure we're trying to implement them in a way that's workable on the ground, and are flexible and not providing any more challenges to our producers than they currently have.

Once production has taken place, we are a state that has always tried to add value through food processing. What's on the horizon for our food processing industry?

We are hearing some mixed things. Certainly, again in this economic downturn, for our food processors to try to compete with processors in other countries that have lower costs, it's a challenge. I'm proud of our processing industry. I really have not heard of many- knock on wood- that have gone out of business during this downturn. They, like our farmers and ranchers, have maybe been able to weather through the storm, but they are an absolutely critical component to Oregon agriculture. I sometimes laugh and say it's a love-hate relationship, but producers and processors certainly can't live without each other. Anything we can do to strengthen and encourage that strong relationship- and again, add value to ag products here in the State of Oregon before we either consume them here or ship them out of state- is a benefit for all of us.

When it comes to marketing, I'm sure you haven't budged from your "three-legged stool" approach, have you? (Oregon agriculture needs local, domestic, and international markets).

I would say two of the three legs are really rockin' and rollin' right now. Clearly, [one is] the interest and heightened desire for all things local. We see it everywhere we turn. It really started at the restaurant level, but we're seeing it at the grocery store level. People want to know where their food comes from, they want to know how it's grown, and they want to support their local farmer and rancher- which is a good thing if you are in Oregon producing products. Sometimes getting our local products into a local market can be a bit of a challenge. I'm very aware of that. But I think there is a lot of interest, particularly at the federal level, to try to figure out a way to facilitate allowing local products to stay in the local market. Then you've got the farm to school program, which in Oregon, is just a huge success- not just due to the Oregon Department of Agriculture, but we are certainly on that team moving that issue forward- and we're hoping to see other opportunities for farm to something. Farm to hospital, maybe, or other things where we can really help local farmers and ranchers.

The other leg out there that is really rockin' and rollin' is the international market. International exports for agriculture reached an all time high this past year. We are seeing that trend continue. The opportunities for Oregon into Asia, because of our proximity to that market, right now seem to be endless. That coupled with, in particularly, the recent ratification of the US-Korea Free Trade Agreement means that South Korea is definitely a renewed focus for us at ODA, working with the industry, to get Oregon products into that market. They love our stuff and the more we can do there with the now slow ratcheting down of tariffs, we think there are great opportunities. And finally, that nice little blueberry [development]- Oregon being the first and only state to be allowed to ship fresh blueberries into South Korea. We'll start doing that next year and we are working hard now to set up the mechanisms to do that so we can be successful in getting our product into that market.

People are always interested to hear if there might be any newly emerging market in the next year or we can see something on the horizon that we haven't seen before. Obviously, Oregon wants to maintain and strengthen existing trade ties with other countries, but are there some new players?

Probably the one that jumps to mind for me, and we were just there on a mission with the Oregon and Washington potato commissions, is Vietnam. Oregon agriculture, at least from ODA's standpoint, has not been real active in that country. Washington has a little bit more. Washington apples are in that market. That is definitely a new market opportunity that we are trying to explore, where there may be some good options for Oregon agriculture. Fresh potatoes kind of dipped their toe in there first, but I think there are definitely some other products we'd like to see if they can be successful in Vietnam.

Another area we hear about each year is food safety. What do you hear will be going on in 2012?

I would say in 2012, the big question mark is the federal Food Safety Modernization Act. There are just so many questions surrounding the implementation of that act. FDA is slowly developing rules and guidance that they will be getting out for comment. It's going to be absolutely critical that the industry pays attention to those rules coming out and does comment on them so we can try to structure them in the best way to be successful. That's issue number one. Issue number two is that I don't see any way that FDA is going to be adequately funded and staffed to implement the new Food Safety Modernization Act. That's going to pose a real challenge because there are such high expectations around this. It just seems that right now, we can't get a break from food borne illnesses. We just had the very tragic outbreak involving cantaloupe. So food safety, is going to continue to be a huge topic for us at ODA, for the industry, and how we move forward to hopefully and successfully implement the Food Safety Modernization Act.

What do you see in 2012 regarding environmental issues?

I think if there is another environmental issue that I would touch on, it would be water and, for us, water quality. Another hot topic, if you will, during the past year with the adoption of a new toxics standard for human health centered around fish consumption in the State of Oregon raised a lot of concern with farmers and ranchers around the state. Frankly, there is a recommitment by farmers and ranchers to the success of ODA's ag water quality program. There is a lot of interest in that program right now. Producers want to show that it is working. We are working hard to document and be able to tell that story. I think that's going to be a real focus for us in the next year, and being able to tell and show successes to those outside of the agriculture industry. There's just a lot of interest in water quality right now. Everyone wants to make sure that everyone is carrying their fair share. We in agriculture are determined to show that we are indeed doing that.

There will be a huge need for increased food production to meet future population growth. You've said in the past that research holds the key to making that possible. Do you see advances in research and development in 2012?

I think there is going to have to be advances in research and development. I'm a little concerned about how that's going to be funded. We're seeing cuts certainly here at the state level. Oregon State University is scrambling to keep support for their experiment stations and extension service going at the level that it should be going. The federal budget is no better. So a lot of critical research is funded with federal funds that I'm concerned aren't going to be there in the next few years. Will the private sector be able to pick up the cost of that research? In some cases, they will. In other cases, I think they are going to struggle. At the same time, we can't feed a projected world population by the year 2040 with our current technology and our current ability to produce food. The pressure is on, we've just got to keep paying attention to that issue, knowing that the need for research and development is only going to intensify.

What do you see happening with the Farm Bill this coming year?

I think the Farm Bill is going to be very contentious. We saw a sneak preview of that with the Super Committee work and the concerns that the agreement reached around the Farm Bill reductions were kept secret. No one knew what they were and they were trying to push them through in a hurried fashion through the Super Committee. Now that that fell apart, there are many saying what was proposed to the Super Committee is going to be the starting point for the Farm Bill negotiations. We already know there are people on all sides of the issue that are unhappy with one of more provisions. It's going to be a very difficult political negotiation, and as every one says, it's going to be an election year, could it really be done this year? We may find come September that they are just going to have to extend the current Farm Bill and try to deal with it after the election. I think it's going to be very difficult to get a Farm Bill completed in 2012.

How is ODA going to do its job in 2012?

No new news here, in terms of us again facing a budget shortfall. We don't know to what extent that shortfall will be. I would say that we at ODA are getting pretty good at dealing with budget shortfalls. It seems like I've done that a lot more than anything else. So we will be going into the February session just as every other agency, looking at potential cuts. We've tried to manage to what we expect that cut level is going to be. We're really trying hard to move forward with programs and a budget that was approved for 11-13 biennium where we are already facing cuts 4 to 5 months into that biennium. It depends a lot on what happens in the February session and how legislators choose to balance the budget statewide. It also depends on Oregon's future economy and if we can hold steady from an economic perspective or if we are looking at additional downturns in revenue. I'm hoping we can hold steady. We've seen a little bit of a dip and we can manage to that dip. If we see additional reductions, we are going to be cutting programs. I've been pretty straightforward with this topic. There are no longer places where we can get enough efficiencies to not impact programs.

Having said that, ODA's customers can still expect to get the same level of excellent service they've had in the past, correct?

We pride ourselves on customer service. It has been a challenge for our employees, frankly, to realize that can't do everything they want to do and yet, how do they continue to provide excellent customer service. We want to hear from our customers if they are having issues with the way we deliver our services. But if we cut programs, I hope we can be clear about what we can't do anymore, and those things that we can do, we do to the very best of our abilities.

Where does the non-ag public fit in when it comes to the agriculture industry this coming year?

The message I like to share with the non-agricultural public is, first and foremost, agriculture is a very, very important part of Oregon's economy still, and will be an even more important part of its economy moving into the future just because the growing worldwide demand for food and fiber products. We in the US will be picking up a lot of the burden of meeting that increased demand and, guess what? Oregon happens to be a state in the US. We grow wonderful products here in our state that we can share locally, domestically, and internationally. So Oregon agriculture is here to stay. It's not going away, it's not a dying industry. It's an industry, I think, that will grow in importance as part of Oregon's economy.

Secondly, I think Oregonians love their farmers and ranchers. They don't always love the things that they think [the farmers] are doing to raise food and fiber products in this state. You have to understand that farming is a business. It does take the full suite of tools to grow the products we grow. On the other hand, Oregon's farmers and ranchers are all about what is wonderful about this state- our environment, our wildlife. We provide most of the wildlife habitat, certainly from the private lands perspective, in the state. If we don't' take care of our land and our water, guess what? We can't grow a crop. Give us a little more credit for the way we do manage the natural resources we take care of and the animals we raise. And continue to love us as much as you currently do.

Audio of Katy Coba remarks
Audio of remarks