USDA Set to Restructure due to Trimmed Budget

Ag Secretary Tom Vilsack rang in the New Year with budget issues weighing heavily on his mind.  Vilsack revealed in a year-end interview that he’ll be making a series of announcements early in 2012 that will detail how USDA plans to operate within budget constraints mandated by Congress:

“I will tell you that we have encouraged those that are at or near retirement to consider that, so that that frees up opportunity.  We have asked our teams to look at ways in which we can substantially reduce the paperwork associated with USDA.”

Vilsack suggested the impending changes will alter the size, structure and scope of USDA for decades to come:

“We obviously will continue to look at the footprint of USDA, both domestically and internationally, and make sure that we are putting our resources in places that will strengthen service. I still have a great belief in the need for us to continue to invest in technology. Farmers and ranchers and producers are interested in being able to have convenient service.”

USDA’s discretionary funding has been cut by 15 percent since fiscal 2009. Vilsack said he's working to ensure that USDA manages the change needed to fit within the new budget reality – not the other way around.
 

Oil Prices Leap

As tensions rise over the Strait of Hormuz, oil prices are also rising as nervous investors wait to see if Iran will try and close the key passageway for oil shipments. Energy Analyst Phil Flynn says that's only half the story behind yesterday's price increase:

“Here in the US and in China we’ve exceeded the expectations on manufacturing, and that’s very bullish for oil.”
 

December Manufacturing Numbers Rise

Some good news from the nation's manufacturers. The Institute for Supply Management says its measure of the manufacturing sector increased in December at its fastest pace in 6 months — up just over 1 percent from the month before. Economist Kurt Rankin says it shows a recovery is happening, albeit slowly.  And looking ahead, it seems companies plan to invest in manufacturing even more:

“Looking over the first six months of 2012 businesses are looking at investing in capital equipment and that should keep manufacturing of high-tech goods, computer equipment rolling as we enter the new year.”
 

Some Farm Activists Feel Let Down

The water-downed Grain Inspection Packers Stockyards Act rule and continuing corporate concentration in agriculture have some farm activists feeling let down by President Obama.

For Fred Stokes, president of the Organization for Competitive Markets, USDA’s final rule to reform livestock and poultry marketing practices was a bitter disappointment. He says the Obama Administration has…  “Thrown the people under the bus that brung them to the dance, in the vain hope of currying favor with some people who are never ever going to favor them in anything. It’s doesn’t make any political sense at all to me.”

During the 2008 campaign, then-candidate Barack Obama supported a ban on packer ownership of livestock and pledged to strengthen producer protections to ensure independent farmers have fair access to markets and fair prices for their products.