News Release Distributed 12/15/11

AUSTIN, Texas – The LSU AgCenter announced the release of two new rice varieties on Dec. 8 during the USA Rice Federation Outlook Conference.

LSU AgCenter rice breeder Steve Linscombe announced a new long-grain variety named Mermentau, formerly designated as LA2085.

“This is a high-yielding long grain with good quality potential,” Linscombe said.

A new aromatic rice, Della 2, also has been given the go-ahead for release. It was developed by LSU AgCenter rice breeder Xueyan Sha.

In addition, seed will be available for a new Clearfield variety, CL152, that will have improved quality and better lodging resistance than CL151, although slightly lower yield, Linscombe said.

LSU AgCenter rice researcher Ida Wenefrida continues work on rice lines with increased protein, and she said the hybrid program at the Rice Research Station in Crowley, La., continues to progress.

Louisiana rice acreage slipped to 412,000 this year, but yields were approximately 6,500 pounds per acre – a near-record harvest, said LSU AgCenter rice specialist Johnny Saichuk.

The acreage could decline more in Louisiana in 2012 if farmers in southwest Louisiana don’t get adequate rainfall this winter and spring to flush salt water out of the coastal areas, Saichuk said.

Jackie Loewer, a rice farmer from Branch, La., and USA Rice Federation chairman, said the conference identified several challenges facing the rice industry.

The grain quality issue must be addressed because quality is improving in other countries, Loewer said. “At one time, our rice was the standard for quality.”

However, he said, rice from Southeast Asia and South American is becoming competitive with American rice.

Rice farmer Richard Fontenot, of Vidrine, La., said the message he got out of the conference is to be prepared for the possibility of another recession. “Things are good now, but have a little reserve for the future.”

The future for Texas rice is uncertain for next year. Texas growers face a possible acreage reduction because of a drought that has cut water allocations by the Lower Colorado River Authority.

The three largest rice-growing counties affected by the cuts have half of the Texas rice acreage, at 180,000 acres this year, said Texas A&M economist Larry Falconer. The water cuts would mean 62,000 acres of rice land would be without water in 2012, and that would result in the lowest Texas rice acreage since 1901.

Two new rice varieties have been developed with the Cocodrie variety as a parent, said Texas A&M rice breeder Ted Wilson. The new variety Antonio is a cross between Cypress and Cocodrie, both developed by the LSU AgCenter, and the new variety Colorado has Cocodrie as a parent.

Much of the outlook focused on farm bill negotiations.

“The process is going to get very, very ugly this spring,” said Joe Outlaw, economist with Texas A&M.

Outlaw said he doubts the farm bill will be finalized next year because it is an election year, although another analyst said he expects passage by 2012.

Two congressional staffers said unity among agriculture groups is essential in the farm bill debate.

Commodity infighting has been evident, said Bart Fischer, staff member for U.S. Rep. John Lucas, R-Okla., House Agriculture Committee chairman. But he said non-agriculture interests have also played a role in disrupting passage of a farm bill.

Agriculture program are under attack for cuts, said Joe Shultz, senior economist for U.S. Sen. Debbie Stabenow, D-Mich. “Now, more than ever, we have to be able to defend these programs to the public.”

He said crop insurance is being considered the basis for a safety net.

Agriculture groups have to solidify their message to help passage of a farm bill soon, Shultz said. “The challenges between us are much, much less than the challenges facing the passage of a farm bill in 2012.”

If an agreement on a farm bill is not reached by the end of September, he said, the current farm bill will be extended. “The cuts to agriculture only get worse as we move through the budget process.”

Jim Wiesemeyer of Informa Economics in Washington said he expects passage of a farm bill in 2012. He said Congress will not tackle many other issues during an election year, which leaves agriculture policy on the table.

He agreed that Europe’s economic problems could trigger another recession because of inaction. “We have no leaders both around the world and in this country.”

Two other speakers, Peter Zeihan, vice president of analysis for STRATFOR, and Michael Dwyer, director of the U.S. Department of Agriculture Global Policy Analysis, agreed a recession that could originate with problems in the European Union would hurt U.S. agriculture.

Commodity prices have slipped lately because of a stronger dollar, Dwyer said.

Cuts to agriculture are being considered for the federal budget, Wiesemeyer said. “You are the low-hanging fruit. You are the easy money.”

Agriculture programs are miniscule compared with the rest of the federal budget, and other expenditures could be trimmed, Wiesemeyer said. The United States spends more money on defense than all other nations combined, and food and nutrition assistance spending that makes up 77 percent of the current farm bill at $700 billion is ripe for cuts.

He also said he expects President Obama to get re-elected because the incumbent has a better get-out-the-vote system.

By 2030, the demand for rice is expected to increase by 28 percent, yet the world’s arable land is expected to decline by 29 percent, said Texas agriculture secretary Todd Staples.

Payments made to U.S. farmers are at a 20-year low, a reflection of increased commodity prices, Dwyer said. “When prices go up, payments go down. The price outlook for rice is pretty darned good.”

The increased use of land to grow feedstock for biofuels could cause less land to be used to grow rice, affecting rice prices, Dwyer said. U.S. farmers have not had a net increase in cropland in 20 years, which means production growth has come from yield improvements.

But he said yield increases cannot keep up with demand.

The biggest increases in cropland are expected in Brazil and countries that made up the former Soviet Union to meet China’s demand for agricultural products, Dwyer said. Venture capital funds are eager to put money into agriculture now, especially in the United States, which has a transparent legal system.

Water is an issue, but drought-resistant crop varieties have been created through genetic modification, but companies have yet to release them, Dwyer said. The problem is that many countries will not accept genetically altered crops. “If consumers won’t eat it, farmers won’t grow it,” he said.

Bruce Schultz