Elections and Reopening of China Market Loom on the Horizon

By Tom Cook, President, National Renderers Association


As you receive this issue of Render magazine, the United States will be less than one month from its mid-term elections. I don’t know about you, but it can’t come too soon. Even for dedicated political junkies, of whom I do not consider myself one, it has been a long and divisive year.

All polls and other political gauges are predicting a good year for the Republicans. If the Republicans are successful in taking the majority in the House of Representatives, and maybe the Senate, we can expect some major changes. It might mean nothing will get done for another two years or there might be some bipartisanship legislation accomplished. I doubt much of the latter will get done, but in either case, things will change.

The Republicans are talking about repealing “Obamacare,” which will be unlikely unless there is a veto-proof Congress. Republicans will be expected to reduce spending, one reason why most voters will have elected them. However, this will not be easily done. Politically, it is difficult to undo programs already in place. Every program has advocates that will be fighting to keep them, including renderers. The U.S. Department of Agriculture (USDA) Foreign Market Development program and Market Access Program (MAP) are good examples. The National Renderers Association (NRA) has been a beneficiary of these export development programs for over 50 years and they have proven to be successful and cost-effective. USDA studies show that for every MAP dollar spent, there is a $30 return. These programs require an industry cost share for organizations such as the NRA to qualify.

Research spending is another area that will be scrutinized. Agriculture research is always on the cutting block and some energy related tax credits will be debated. These are all areas the rendering industry has benefited from.

There is little doubt that any government spending, except maybe for defense, will be spared debate and scrutiny in the upcoming 112th Congress. If renderers want these programs that benefit them to continue, the industry will have to be at the table and be heard. The saying, “out of sight, out of mind” will never be truer. The NRA’s 2011 Washington fly-in could be the most important ever.

A more conservative shift in Congress will also likely slow down the regulatory juggernaut. The threat with this will be just how far the Obama administration will go with rulemaking on its own. The Environmental Protection Agency and USDA have already been accused of going far beyond congressional intent in some of its rulemaking this past year.

Don’t expect President Barack Obama to just sit back and take what a potentially Republican-controlled Congress sends him. The veto pen is very powerful, and he will still have leverage to make some things happen.

On Wednesday, November 3, 2010, the presidential race for 2012 will begin in earnest. By the end of this year, the country will have a pretty good idea of all of the Republicans who intend to challenge President Obama. I wouldn’t be surprised to see some Democrats surface to challenge the president in his own party.

China Tallow Market
China, the second largest importer of animal fats in the world, still bans the import of tallow from the United States due to unjustified bovine spongiform encephalopathy (BSE) concerns. China is the only country that NRA is aware of that bans the importation of U.S. tallow for industrial purposes. For several years the NRA has attempted to open the tallow market into China. USDA officials in the United States and in China have worked with NRA to open the market.

In August 2010, Chinese officials announced, “According to the legislations and regulations of People’s Republic of China, recommended by OIE tallow safety guidelines, supported by scientific risk assessment, China allows tallow (a maximum level of 0.15 percent insoluble impurities by weight) and relative products in BSE countries that meet requirements of AQSIQ1, to be imported for industrial uses starting from the day of the announcement release.”

Hence, China is ready to negotiate with USDA on import requirements for U.S. tallow. This is good news for both U.S. and Canadian renderers. NRA is working with USDA to hopefully make this happen.

USDA Undersecretary Jim Miller traveled to China in mid-September to discuss a number of trade issues with Chinese officials. NRA visited with and provided Miller with information on U.S. tallow and a briefing on the potential market. NRA Asian Director Peng Li is also engaged with the Chinese and U.S. embassy officials, providing them with important information on the U.S. rendering industry.

Let’s hope all these efforts pay off in the near future.

Reference:
1. Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ) of the People’s Republic of China.


From the Association – October 2010 RENDER | back