Easy for you to say

After a press conference by Agriculture Secretary Mike Johanns, I took an opportunity to ask his chief economist Keith Collins a question about the planting restriction on program crop acres in the farm bill. As you know, that issue is real bone of contention, as produce advocates want to keep the long standing provision in the bill and most everybody else wants it gone. Why? In short, because the WTO ruled its presence in farm policy is evidence that subsidies to cotton are market distorting. And market distorting subsidies are being phased back severely, so the USDA has to make its subsidies to farmers non distorting.
I asked Dr. Collins what was the Administration's estimate of the economic impact of lifting the planting restriction.
He acknowledged that USDA economists haven't put a number on it - "such estimates are highly speculative," he said - but generally Collins believes acreage shifts wouldn't be that extensive.
He noted the USDA Economic Research Service did study the issue but assigned no dollar values to the planting restriction. Generally, he said the USDA study shows the effect on fruit and vegetable prices would be “modest,” with dry beans and potatoes likely to experience a bigger effect than other crops.
A recent study commissioned by United Fresh Produce Association and other groups reflects a $4 billion impact, and Collins said he does not think the impact would be that high.

TK: While such estimates are "highly speculative," the USDA should have stepped up with its own dollars and cents assessment of the economic hit that would accompany the loss of the planting restriction.
In other news, Collins projected that growth in demand for fruits and vegetables may slow in 2006-07, as higher prices could reduce consumption. He noted consumer prices for fruits and vegetables have been rising much faster than other foods over the past five years. This year, retail prices for fruits and vegetables are forecast to increase 3% to 4% this year, compared with 2% to 3% for other foods.
Meanwhile, Collins said U.S. imports of horticultural products are forecast at $32 billion in fiscal year 2007, up $3 billion from last year. Fresh and frozen fruits and vegetables, wine and beer led the increased imports, Collins said. Total U.S. ag exports will have a record $78 billion performance in 2007, mainly owed to corn and oilseeds.
More coming on immigration this afternoon; Western Growers Tom Nassif tomorrow....