By Robert Pore
robert.pore@theindependent.com

Jay Rempe, Nebraska Farm Bureau state director of governmental relations, said his organization is working to secure emergency funding to continue the state's participation in the Feeder Cattle Price Index through the end of the state's 2009 fiscal year.

Rempe said state Sen. Phil Erdman offered a successful amendment to the state budget bill to redirect $30,000 in unused funds from another program to continue the price reporting program.

He said a U.S. Department of Agriculture grant provided significant funding for the program, but the grant is out of money.

"The program needs an additional $5,000 to $10,000 to continue through June 30, 2009," Rempe said. "The rest of the redirected funds will need to be reauthorized in the state's next budget."

Several states participate in the Feeder Cattle Price Index, which is a weighted average of the largest and most important markets in the United States, Rempe said.

He said the USDA determines the index from prices reported by the participating states. The index is reported by the Chicago Mercantile Exchange and serves as the "actual end value" in Livestock Risk Protection crop insurance products.

"They monitor each of the livestock auctions and monitor the sales of feeder cattle, and it gets put into a price index that the USDA then puts on their Web site," Rempe said. "It's a good barometer and a good form of transparency that producers can monitor to see what's happening in the feeder cattle market so they get a sense of their prices they are seeing and how it stacks up with the rest of the state."

Rempe said the more market information that's available, the better off producers are.

And with JBS Swift & Co. planning to buy National Beef and Smithfield Beef, that market transparency will be more valuable than ever, he said.

"Anything we can do to enhance market transparency it is critical, and this is what this program intends to do," he said.

JBS Swift & Co. operates a packing plant in Grand Island that employs more than 2,500 people.

More than 70 farm, rural, conservation and faith-based organizations opposed to the JBS Swift deal recently sent a letter to U.S. Assistant Attorney General Thomas Barnett stating, "This is an unprecedented five-to-three merger that will harm price, choice, innovation and competition in the beef industry."

According to the letter: "No efficiencies or benefits will arise from this acquisition. Each of the enterprises is substantially larger than necessary for efficient operation, and National is already a leading exporter of beef even though it ranks fourth in volume.

"New entry requires extraordinary amounts of cash and liquidity to compete beyond a niche level. Indeed, the current configuration of the Smithfield beef operation makes it a uniquely positioned potential entrant into direct competition in the Texas, Kansas, Nebraska region (especially in light of its substantial feeding operations in the region), and as a result it may well exercise a 'wings' effect on competition in that region as well as being a future actual competitor whether under its current ownership or some other owner. Beef packing is a mature industry in which competition must be preserved."

State senators have yet to take final action on the budget bill.