Michigan Farm News 1-=1 June 24, 1994 Vol. 71, No. 11 Sandoz Acquisition of Gerber Positive for Michigan Farmers Plans by Sandoz Ltd. to acquire the Gerber " Products Company, based in Fremont, should be Sandoz Ltd. Profile: good news for Michigan farmers, with no major Headquarters: Basel, Switzerland change expected currently, and growth antici- Annual Sales (1993): $10 billion pated in the future, according to Gerber's agri- Net Income: $1.1 billion cultural purchasing manager, Pat Chase. Cash Flow: $1.8 billion "At this point, everything will continue as R & 0 Spending: $1.2 billion they have been. We'll be buying a lot of Michi- Employees: 52,000 gan produce," Chase said. "The transaction Businesses: should be a real positive, since Sandoz is already Pharmaceutical Division quite active in the food and nutrition business." - $5.0 billion in annual sales Gerber's Fremont facility annually pur- Nutrition Division chases 50,000 to 60,000 tons of fresh produce - $1.2 billion in annual sales from within the state of Michigan. The company contracts most of its vegetables from producers Seed Division in Montcalm, Newaygo and Oceana Counties, - $0.7 billion in annual sales based on location, soil type and irrigation capa- Develops, produces and markets seed bilities. for field crops, vegetables and flowers. Gerber tends to be an even bigger player in fruit purchases which are more evenly spread Chemicals Division throughout western Michigan. According to - $1.7 billion in annual sales Chase, the company purchases most of its fruit products on the open market either at harvest, or Agro Division - $0.9 billion in annual sales. as needed. Apples, says Cllase, are a big ticket (Crop protection products such as herbi- item, since the Fremont plant produces most of "Another significant factor, in addition to product line, with few exceptions, according to cides, fungicides and insecticides.) the apple products for Gerber. quantities of apples purchased, is the fact that Chase. In addition to harvest purchases of apples, Gerber is a cash buyer, and the state's apple Apple products, based on availability, are president and CEO, says the transaction provides Gerber also makes year-round buys for apples industry needs all of the cash buyers we can get," predominantly Michigan based as are all of the Gerber "dynamic growth" opportunities in the out of cold storage facilities. Gerber Products is said Butler. "We just hope, in the final analysis, pea products, while sweet potato products are international market, thanks to the necessary in- currently one of the top three processors in the that Gerber will be bigger and stronger than they processed at the southern plants. Produce will frastructure already in place through Sandoz. state making apple juice and applesauce for the were before this takeover, because it could be also be trucked in, such as carrots from Texas Gerber had sales of $1.2 billion in fiscal Gerber baby food product line, according to Tom real good news for Michigan producers." and California, during Michigan's off-season. 1994, with an operating income of $212 million Butler, manager of the Apple Division of the Besides the Fremont facility, Gerber has In a company press release, Sandoz said it and a net income of $127 million. Nearly 89 Michigan Agricultural Cooperative Marketing two other U.S. processing facilities, located in expects the approval process for the Gerber ac- percent of the company's sales were domestic, Association. North Carolina and Arkansas. All three plants quisition to be completed within three to six with a 70 percent market share. Gerber employs are capable of processing the entire Gerber months. Alfred Piergallini, Gerber chairman, 12,000 people worldwide. In This Issue ... Cooler and Wetter? Michigan BST Labeling Legislation Introduced in Both Houses Get the Latest 30 and gO-day Bills have been introduced in both the regulations which require that labeling claims be "Michigan dairy farmers simply can't afford Weather Forecast page 4 House and the Senate calling for labeling of milk provable by testing, which isn't possible with the bad press over arguments about management and dairy products which are produced by cows BST treated milk, since all milk contains the tools, such as BST," said Kirk. "Now, more than Washington, D.C., Farm Bill not treated with BST, according to MFB legis- protein BST. ever, dairy farmers need to be working together, Commodity Programs lative counsel Ron Nelson. MFB dairy specialist Kevin Kirk, says the promoting their dairy product~ .for what t~ey ~re What are the options? page 5 "Senator DiNello (R-East Detroit) has intro- legislation could also cause the dairy industry - safe, wholesome and nutntlous. Legislative Markets: duced a five-bill package which would require unnecessary bad publicity at a time when con- labeling requirements will ultimately raise false The roller coaster is just getting labeling on all products - milk, butter, cheese, sumer perception and consumption is critical. safety fears and reduce consumption." started page 6 powder, ice cream - stating the product was Heifer Contracting an Option? produced by cows not treated with BST,'~ ex- plained Nelson .. A Picture of Pesticide Exposure It should be, says this MSU Ag A similar five-bill package was later intro- Economist page 7 Protective Gear Part of MSU Ag duced in the House by Reps. Gnodtke, Randall, Expo Field Demonstration .~ Gernaat and McManus that would also provide ~ for labeling on all dairy products. As of press As a part of the MSU Ag Expo field demonstra- ~ time, those bills were referred to the House tions, participants will be able to see the latest in "iij CD Agriculture Committee with no hearing sched- protective gear for pesticide application during "~ uled on the bills. one of the stops on the field tour. The picture at ::> right was one of many taken during a pesticide o Farm Bureau is opposed to state labeling (5 since milk flows across state lines and is com- exposure study conducted by the University of &. mingled from a variety of sources. In addition, Illinois, in cooperation with American Cyanamid there is no test nor regulatory or enforcement and Successful Farming Magazine. mechanism to ensure the milk is meeting the standards as stated on the label says Nelson. Using "blank" insecticide granules with a fluores- "There are no documented health implica- cent tracer mixed in, this photo shows the level of tions for cattle or for humans who consume dairy exposure and the importance of protective cloth- products, because the milk produced from cows ing. Notice the contamination and clean areas on treated with BST is identical to the milk from the neck and face where the applicator's goggles untreated cows," said Nelson. "Farm Bureau and respirator were worn, protecting the applica- opposes state legislation dealing with labeling tors eyes, nose, and mouth. of milk and dairy products produced by cows treated with BST." This was the level of exposure from filling just eight insecticide boxes using bags as opposed to Nelson said MFB will continue to monitor the legislation in both houses. The legislation a closed handling system. For more photos and details, see the Ag Expo Extra in this issue. may very well hit a snag in regard to federal Michigan Farm News 1994 Ag Expo Extra Section in This Issue! Michigan Farm News! June 24, , 1994 BST Labeling - In Brief ... USDA Announces Flex Acreage Plans A Mandate for The USDA says farmers will plant 4.7 million acres of "flex" acreage to soybeans this year, False 428,191 acres to minor oilseeds and 93,846 acres to other "non-program" crops, according to a United Press Illtemational story. Advertising "Flex" acres are a provision of the federal acreage reduction program. Producers have the option to plant specific crops -- other than the crop covered by the reduction program -- on up to 25 percent of their acres enrolled in the program. For example, a farmer reducing cotton acreage by 100 acres could plant 25 of those acres to soybeans. At first glance, permitting milk to be labeled as "free of bovine somatotropin (BS1) " sounds like an innocent-enough proposal. After all, who could be against giving consumers more information, and choice, about the food products they buy? Zero Set-Aside Proposed for 1995 Wheat Crop Farm Bureau agrees that consumers should be able to purchase the food products they As expected, the USDA said in a preliminary announcement that it will not require wheat desire. That's the free market at work. Agricultural producers thrive when they follow the farmers to idle any of their base acres from production of wheat in 1995. The USDA must market signals sent by their customers. Our highly diversified farm industry here in Michigan make its final annoucement of the set-aside for next year's crop by July 31, 1994. prospers by presenting food shoppers with many high quality, wholesome food choices. If the recommendations offarm groups, including the American Farm Bureau, are followed, But permitting milk to be labeled as "free of bovine somatotropin (BST), " as some groups farmers will be allowed to plant their entire base wheat acreage next year. The zero set-aside have demanded, would present consumers with a false and misleading choice. It's false option provides the best prospect for farm income from the 1995 wheat crop, according to because milk produced by cows treated with BST is absolutely as safe and wholesome as Farm Bureau, the National Association of Wheat Growers, and other groups. milk from cows not treated with BST, and misleading because there is no way to verify claims or to test whether or not milk is produced with BST. USDA did not require any wheat acres to be idled for the 1993 and 1994 crops, and even with zero set-aside in 1994, wheat planting is expected to be down about 2 percent from The Food and Drug Administration, National Institute of Health, Congressional Office of 1993, according to Kendall Keith, president of the National Grain and Feed Association. Technology Assessment, American Medical Association, American Dietetic Association and American Academy of Family Physicians, agree that milk and meat from BST-treated cows EPA Expected to Decide on Ethanol Rule June 15 is safe and essentially the same as milk and meat from untreated cows. Regulatory agencies from 20 other nations, including the United Kingdom, France, Germany and Canada, agree. The EPA was expected to rule June 15 on its mandate that 30 percent of fuel in the nation's smoggiest cities must contain ethanol. The EPA may mandate a 15 percent market share There is little value in labeling milk as "free of BST, " because there is literally no way to tell for ethanol in 1995 and phase in the 30 percent share by 1996, taking the more gradual the difference between milk from supplemented and non-supplemented cows. The milk is approach to avoid possible difficulty in ethanol supply. EPA's Richard Wilson said, "We the same in appearance, taste, nutrition, composition and safety. A label would imply a want to do this in a way that will not be disruptive to the public." hazard where there is none, because using BST on a cow is similar to using commercial fertilizer on a crop. BST is a production tool that a farmer uses to produce a safe and Ethanol opponents have argued the government should not reserve any market share for wholesome product, nothing more. any particular type of fuel. The American Petroleum Institute may back a "legal challenge to the rule," reports GREENWlRE, an environmental newsletter. Furthermore, labeling dairy products from BST-treated cows would trivialize real health and nutrition information. "Warning" consumers about a safe product or establishing a difference The "Rest of the Story" on Ethanol where there is none diminishes the effectiveness of truly informative labels. Paul Harvey, the widely traveled, outspoken, believable columnist-commentator, did a In 1940, each American farmer fed about 19 people. Today, each farmer produces enough recent column comparing methanol and ethanol, the two additives locked in a battle for food and fiber to feed nearly 130 people at home and abroad. Well managed technological approval by the Environmental Protection Agency as a cleaner burning fuel. Harvey says innovation has been the driving force behind this agricultural success story. methanol, made from petroleum, is highly toxic if ingested or absorbed through the skin. It can be explosive if tightly confined. And it does nothing to help our balance of trade, Biotechnology products are poised to further advance agricultural innovation. These tech- since it is made from the same oil sold to us by the oil cart~1 of the Middle East. nologies have the potential to boost productivity, enhance the environment and improve food labeling requirements for safe products. ~ ~ t~ safety and quality. Let's not short circuit this process by mandating false and misleading Ethanol, on the other hand, is manufactured in America from com produced by American farmers. "In the mid-1800s, Americans lit their homes and businesses with it. Henry Ford built the Model-Tto run on it. No worries about accidental spills. No fears over an infrequent (J Jack Laurie, President sniff. And little danger of fires, explosions and death," extols Harvey. "So, Americans," the" columnist asks, "what'll it be? Methanol with an 'm' or ethanol with an 'e?' Michigan Farm Bureau A Huge Market for Soy Ink? Low Beef Prices Tone Farm Receipts Down U.S. legislators are considering the merits of ink made from vegetable oil, which would be A six-year"low in market prices for steers and heifers set a lower tone for farm receipts and required for use in all government printing, "whenever technically feasible," in the helped cause a 1.4 percent drop in prices received by farmers for their commodities sold in proposed Vegetable Ink Act (S. 716, H.R. 1595), sponsored by Sen. Paul Wellstone May, the USDA reports. Prices were also lower in the month for milk, eggs and corn, more (D-Minn.) and Rep. Richard Durbin (0-111.). than offsetting higher prices for tomatoes, broilers, celery and peaches. The use of soybean-based ink for printing began in the newspaper industry in 1985 as a T~e monthly drop in beef cattle prices brought the average to $67.70 per cwt., down $4.30 response to the volatility of petroleum prices during this period, according to Larry Dietrich, from April and $9.40 lower than a year ago. The USDA monthly report said the average of president of the American Soybean Association. The Department of Agriculture already $70.30 for steers and heifers, the chief slaughter animals, was the lowest monthly price uses soy ink for all of its printing. Use of vegetable ink will add little, if any, cost to since August 1988. The report said dry conditions in the Southeast and Southern Plains government printing, according to the Government Printing Office (GPO), the largest caused farmers to sell more animals rather than feed them, which added to heavy marketings provider of federal printing services. GPO supports the bill, said Public Printer Michael from the glut of cattle in feedlots where the bulk of cattle are fattened for market. DiMario, according to the Congressional Monitor. Farm Bureau Opposed to Wetlands Conversion for Genetically Altered Tomato Now on Sale Flood Control A new genetically-altered tomato dubbed "Flavr-Savr" by its developer, Calgene Fresh Inc., A draft report rele~s~d by the A,rmy Corps of Engineers calls for a drastic change in federal is now available in about 70 stores around the country. First to market the new tomato was flood control. poltcles, accordmg to the Reuters News Service. The report includes a a store in Northbrook, III. The proprietor said customers who tasted the tomato liked it, but recommendatIOn for the federal government to convert farms and towns into wetlands, may not like the price. The Carrot Top Market listed the Flavr-Savr at $2.79 a pound, more instead of building new flood-control structures. than double that of varieties whose genes have not been tampered with. Experts are asking the government to relocate businesses and farms to higher ground and Calgene, which said it spent eight years and $20 million developing the tomato, hopes resto~e the natural f1~od cyc1.es, according to. a New York Times story. Farm Bureau, consumers will be willing to pay the extra price to get a more flavorful, better-keeping convmced that the natIon can III afford to turn Its back on highly-productive river bottom tomato, especially between October and June. Quality of tomatoes has traditionally dropped land, continues to be in favor of rebuilding flood-control levees ravaged by last year's flood. during that period and sales decline an average of 30 percent. Availability is limited now because the Flavr-Savr has been grown only on small experimental plots in California, Florida and Mexico, but it is expected to be more generally available by 1995. The MICHIGAN FARM NEWS (ISSN:0743-9962) is published semi-monthly except in the months of November, December, June, and July when only one issue is printed, as a service to regular members, by Michigan Farm Bureau, 7373 West Saginaw Highway, Lansing, MI 48917. Member subscription price of $1.50 included in annual u.S. Ag Exports Rose in March dues of Michigan Farm Bureau regular members. Additional subscription fees required for mailing Michigan Farm News to non-members and outside the continental U.S,A. Second-Class Postage paid at Lansing, MI and U.S. agricultural exports in March totaled $3.9 billion in March, up 1 percent from the same additional mailing offices. Letters to the editor and statewide news articles should be sent to: Editor, Michigan month a year ago. Bulk commodity exports, at $1.7 billion, were off7 percent from March Farm News, P.O. Box 30960, Lansing, MI 48909-8460. POSTMASTER: Send address changes to: Michigan Farm News, P.O. Box 30960, Lansing, MI48909-8460. 1993 sales, mainly because of lower shipments of wheat, soybeans and tobacco, according to the report from the Foreign Agricultural Service. Editorial: Dennis Rudat, Editor and Business Manager. Staff Contributors: Mike Rogers; Connie Lawson; Donna Wilber; Henry Huisjen. Exports of intermediate products remained virtually unchanged from a year earlier at $836 Officers: President, Jack Laurie, Cass City; Vice President, Tom Guthrie, Delton; Administrative Director, Chuck million for the month. Gains in hides and skins, sugar and sweeteners, live animals and Burkett; Treasurer and Chief Financial Officer, Tom Parker; Secretary, William S. Wilkinson. Directors: District 1, animal fats were offset by declines for soybean meal, vegetable oils and planting seeds. Jim Miller, Coloma; District 2, Blaine VanSickle, Marshall; District 3, Douglas Darling, Maybee; District 4, Tom Double digit increases in sales occurred for chilled and frozen meats, poultry, dairy Guthrie, Delton; District 5, Mark Smuts, Charlotte; District 6, Wayne Wood, Marlette; District 7, Larry Snider, Hart; products, eggs and produce, tree nuts, wine and beer and pet foods, the report said. District 8, Richard Leach, Saginaw; District 9, Joshua Wunsch, Traverse City; District 10, Margaret Kartes, West Branch; District 11, Robert Wahmhoff, Baraga. At-Large: Jack Laurie, Cass City; Faye Adam, Snover; Jan Combined U.S. exports of agricultural, fish, and wood products for the first six months of Vosburg, Climax; Judy Emmons, Sheridan. Promotion and Education, Paul Swartzendruber, Pigeon; Young this fiscal year totaled $27.7 billion, nearly matching the 1993 pace which ended in a Farmers, Andy Hagenow, Rockford. record-high $52.7 billion for the year. Michigan Farm News . ITOL o -. June 24, 1994 o :JJ Z m :JJ Equine Liability MFB POSITION Rep. Llewellyn (R-Fremont) has introduced H.B. 5006 to MFB supports the bill. limit the liability for equine owners. Although the bill doesn't provide liability exemption, it does limit the liabil- ity under certain circumstances unless there was negli- gence or the users were not advised of the potential risk. 'P.A. 232 Amendments MFB POSITION H.B. 5393, introduced by Rep. Gnodtke (R-Sawyer), Farm Bureau no longer would revise several sections of P.A. 232, the Agricultural opposes the bill with the Commodities Marketing Act. The revisions include: . substitutes. The bill is on • Revising the $800 qualification floor. .the House calendar wait- ing for debate. • Provide for the administration of assessment collections .~ which would mandate that the Department of Agriculture MFBCONTACT follow up on complaints, investigate and carry out court ac- Ron Nelson, Ext. 2043 tion if necessary. • Provide an unlimited cap on borrowing money and unlim- ited pe~ diem for committee members. MFB was successful in having an amendment attached that dropped the 10 percent or 100 grower signature requirement to initiate a referendum. MFB policy specifically supports the 25 percent or 200 minimum signature requirement to initiate a referendum for any Present statute has for decades been interpreted to limit banks to credit insurance sales where loans are paid in full upon death. A recent court ruling had created questions about banking authorities. Business and consumer groups expressed concern that banking customers would feel obligated to purchase insur- ance products from their banker, especially when a loan is in question. Michigan Farm Bureau (517) 323-7000 Proven Farm Tough .. In 1990, Congress passed amendments to the Coastal Zone Management Act (CZMA). Section 6217 requires ....states to establish coastal nonpoint programs which must . be approved by both the National Oceanic and Atmos- Choose from a wide range of pheric Administration (NOAA) and the Environmental standard or aJStom lester wood Protection Agency (EPA). frame buildings. Each feabJres Beginning in fiscal year 1996, states that fail to submit an advanced Uni-Fram~ engineer- approvable coastal nonpoint program to NOAA and EPA ing. Top quality materials. The face statutory reductions in federal funds awarded under industry's leading warranty. Call MFBCONTACT your local Lester Builder or both section 306 of the CZMA and section 319 of the Vicki Pontz, Ext. 2046 1-800-826-4439 today. Clean Water Act (CWA), which are programs to address nonpoint source pollution voluntarily with cost share assis- tance. The agricultural best management measures include ero- Ag Expo - July 19-21 - at MSU Open at 9 a.m. Each Day '2 :) o <5 Bill Bickert, Ag Expo Chairperson This is a cluster of tents at the western end We have a reputation for providing an en- &. of the site which represents MSU's depart- joyable setting where visitors can make ments of Ag Engineering, Animal Sci- evaluations, develop ideas, and talk with fu Expo 1994 may very well be our best ences, Crop and Soil Sciences, Fisheries university and industry experts about op- year for Ag Expo ever. From the inception and Wildlife, Telfarm, Forestry, Institute of portunities to improve their farm business. of the show, exhibitor numbers have stead- Water Research, and the College of Veteri- ily increased each year, which we attribute nary Medicine. Ag Expo is the only place in Michigan to the environmental setting and the serv- where farm families can, in a single setting, ices we offer, and most importantly, the The size of the show enables farm families see as wide a range of new agricultural number of farm families that return year to get around to all the exhibits and spend technology and services. after year to the show. time with company representatives - an im- portant information exchange for both. In- We're confident that farm families will Included in the 35 acres of new equipment stead of being confronted by a constant enjoy a trip to Ag Expo because of its exhibits and service displays will be a wide stream of smiling faces, Ag Expo's setting variety of things to see and do in a safe, range of demonstrations and information provides exhibitors the opportunity to learn clean and friendly environment. centers in "education row." about and discuss the farm family's goals and ideas. Michigan Farm News 1994 Ag Expo Extra! . •• June 24, 1994 Bpossibly Raven Chemical Injection Spray Systems Part of Ag Expo Field Demos one of the hottest advancements reducing chemical the environmental wastes. exposure of in spray systems are chemical injection sys- tems. Chemical injection spraying differs There is no need to rinse the spray tank and because only water goes into the spray ONE OR TWO from conventional spraying in one major way: Instead of mixing the chemical with tank, there is no chance of back siphoning CHEMICALS water in the sprayer tank, injection spraying spray solution into your water supply. In INTO WATER meters a precise amount of chemical into conventional spraying, certain chemicals the line carrying water to the booms. are incompatible and cannot be sprayed Chemical Injector together; however, with the injection sys- University and independent research sup- tem, each chemical is held in separate con- port injection systems and there is proof that tainers and only contact each other briefly such a system is the optimum method for in the spray line. applying chemicals. The injection systems are cost effective for everyone from the The Raven chemical Injection system is Water average farmer to the larger custom appli- monitored by a control console which can cator, anyone who has to work with tight be mounted in a truck or tractor. The con- schedules or a variety of chemicals and sole automatically monitors and controls jobs. the precise amount of chemical being in- jected. It will control injection of two sepa- rate rates of application simultaneously. Advantages. of injectio.n system sprayers In companson to Once the application rate has been deter- traditIOnal spraying systems. mined, the control console maintains that 1. Improved Spraying Efficiency rate on every acre. Changes in vehicle speed are immediately sensed. The control The economics of injection systems are console also provides instant read-outs of centered around two areas. First, you will total acres, total ounces, vehicle speed, dis- no longer have left-over tank mix at the end tance traveled, and the amount of chemical of a job, nor wi II you run short. You wi II use left in the tank. the exact amount of chemical required to complete the job with no chemical waste. Other features of the chemical Injection Second, a substantial amount of time will system are a positive displacement meter- be saved by eliminating the need to mix ing pump with a flow sensor. The sensors chemicals. Further, spray pressure and vol- monitor pump RPM speed. The control ume are kept constant and the rate of chemi- console then converts RPM to chemical cal injection is regulated, maintaining the flow rate which ensures accurate delivery same spray pattern regardless of speed or of chemical at the pre-determined rate. The terrain. pumps are belt-driven by a 12-volt motor. 2. Maximum Operating Flexibility A motor control, which receives an elec- tronic signal from the control console, var- One of the maximum benefits of chemical ies the pump speed to maintain chemical injection sprayers is the time saved in injection rate at the preset amount. changing chemicals. Injection systems of- fer a valve to shut off the chemical and Addi tional features are 15 or 30 gallon allow water to flow until the line is flushed. polyethylene chemical tanks, vehicle speed Unused chemical in the injector tank is sensors, magnetic type which is bolted to a drained back into its original container, thus non-driven wheel, speedometer type which connects to the vehicle speedometer or ra- dar-type for installation on four wheel drive tractors, in-line mixer and optional tip monitors that detect plugged tips and dis- play the location of the plugged tip on the • control console . Raven SCS700 chemical injection spray HERITAGE systems are available in three different con- BUILDING SYSTEMS 800-643-5555 figurations: 1) one chemical into water; 2) two chemicals into water; or 3) single ~j.illJ12YIIIIE IIIH [IIIE Iililli IE lll:~m chemical into carrier. BUILD IT YOURSELF AND SAVE MONEY Conmertial steel buikings IeaUilg easy boll 141 ~ lor lhe do l youselIll.tilr from Amer'ca's IaIgesl cislrtlulcr, We haw over 5,000 stlndard sizes 01 shop, farm, irdlslrial. amnerciaI and nlnI-wate- house bttings. AI on lXllT'PeIe wiIh ~ ~ pem1il aaw. ings lD meet 1986 MaMA lXldes, 20 year rool wamJnly, and painted the smith brothers waIs. Cat us nlay lor a free illormalion pad