StarLink^TM corn continues to be in the news. Here’s the latest information and its effect on you. The National Grain and Feed Assn., along with the National Corn Growers Assn. and other groups, has petitioned the US Secretary of Agriculture. The letter asks the Secretary to allow the US Department of Agriculture (USDA) to fully compensate grain handlers and processors for financial losses incurred as a result of the inadvertent commingling of StarLink^TM corn with other varieties whose uses are not restricted. The letter further suggested that USDA be fully reimbursed by Aventis for these costs, just as it now is for purchases of on-farm StarLink^TM and buffer stocks. The letter is based on a concern that Aventis and its seed partners have not provided adequate assurances that they will fully compensate grain handlers and processors for costs associated with redirecting StarLink^TM-commingled stocks to approved uses.

Specifically, the letter urged that such compensation include documented costs associated with:

1. the actual market differences between the original contract price and the sales price in the feed or non-food industrial-use market that ultimately accepts delivery of commercial corn stocks containing StarLink^TM;
2. testing costs (both direct and for additional workforce and logistics) resulting from delays required to conduct tests at both elevators and processing facilities;
3. demurrage costs resulting from rejection and/or rerouting of shipments to alternative markets;
4. additional freight and leasing costs;
5. direct costs and losses involved in temporary shut-downs of processing facilities to purge mills of StarLink^TM corn and derivative products; and
6. processor costs associated with recalls.

In addition to this letter to Secretary Glickman, Attorneys General from 16 states (Wisconsin was not one of them) sent a letter to Aventis urging the company to take further actions to "meet its responsibilities." Specifically, they want Aventis to:

1. quickly establish a claims handling system and pay all undisputed claims within 30 days;
2. markedly increase logistic capabilities to move StarLink^TM and commingled grain to approved feed and industrial usage sites (see the following paragraphs for one such plan);
3. take further, concrete steps to accept responsibility for economic losses.

The Attorneys General want further discussions with Aventis regarding the company’s pledge "to work with" affected grain handlers and producers. Separately, Aventis is exploring alternatives to sell its crop-protection division. Alternatives include either an outright sale or an IPO of the division as a whole. Obviously, responsibility for outstanding liabilities will be a factor in this decision.

In related StarLink^TM news, Aventis has also, through "StarLink^TM Logistics," developed a program under which grain handling facilities can agree to handle StarLink^TM corn and direct all corn stocks to feed and approved non-food industrial uses. This is a departure from the earlier Aventis program in which only direct domestic end-users could be designated a StarLink^TM destination. A "Request for Receiver Approval" form developed by "StarLink^TM Logistics" obligates grain handlers entering into the agreement to several conditions, including concurrence that:

1. all corn currently stored at the facility, as well as future corn deliveries during the facility's participation in the program, will be considered to be StarLink^TM corn and delivered only to approved uses;
2. the grain handling facility will provide documentation proving that all corn leaving the facility will be delivered to an approved, domestic end use location, and consumed there;
3. the grain handling facility's participation in the program cannot be ended until documentation is provided that the facility is completely clean (empty); and
4. no corn from the facility will be directly or indirectly sold to food channels during the duration of the agreement.

Upon receiving approval to participate in the program, the grain handling facility is required to agree to provide Aventis/"StarLink^TM Logistics" with a daily position record or stock record to verify beginning inventories and a copy of a cutoff inbound and outbound weight tickets from the initial approval date. At the end of each month, the facility is required to provide:

1. the total number of bushels unloaded and loaded during the month; and
2. an estimate of the total stocks stored at the facility at month's end.

Upon leaving the program, the facility will be required to agree to provide Aventis/"StarLink^TM Logistics" with data on:

1. the numerical sequence of all unload and loadout tickets, including quantity and date information, for the entire period the facility participated in the program;
2. full stock reconciliation, including a "clean-house adjustment," through the duration of the facility's participation; and
3. a signed confirmation of corn disposition from all end users to which the corn was shipped, indicating that it was used for approved domestic uses.

All this said, you would note there is nothing listed above in the requirements and duties of a grain handler that wishes to participate that explains why someone would want to do this. As of this writing, there are no direct financial incentives to handle StarLink^TM. As we have stated in earlier communications, this entire situation is evolving and will be with us all for a while to come. As more information becomes available, we’ll keep you up-to-date.

Enclosed is the schedule for the 2001 UW Department of Agronomy Seed Dealers Update meeting series to be held January 4-10, 2001. This annual meeting series is designed to bring current information to consultants, farmer/seed dealers, seed company and industry representatives, and crop contact agents. The latest information on hybrid/variety performance, an analysis and discussion of last year's production season, and updated recommendations for field crop production will be presented. Certified Crop Advisor CEU credits (2.5 hours) in crop production were requested for each session.

There is a $10.00 registration fee per participant; meal cost is extra. The meeting information packet will contain 2000 variety trial results, plus numerous new seed related reference materials. Additional copies of the packet will be available for purchase at the meeting. All meetings begin with a "Dutch treat" dinner or lunch, followed by the formal meeting. Meal price information must be obtained from the appropriate host agent. If you intend to attend a dinner or lunch, be sure the host agent (see included schedule) receives your dinner of lunch registration no later than one week before the meeting you plan to attend.

If you have question or suggestions concerning these meeting, please contact the UW Agronomy Department at (608) 262-1390.

In an "eleventh hour" action, OSHA has published their controversial ergonomics standard, with an effective date of mid-January 2001. This standard has been described as the most all-encompassing and potentially costly standard for American businesses that has ever been proposed and covers ALL general industry employers. While there is an exemption for agriculture, agri-businesses do not qualify for it. WASA, along with other affiliated trade associations, are working to analyze the potential impact on your operations and we will keep you informed of any new information, as it becomes available. OSHA has established an Ergonomics webpage, which can be accessed on-line at: www.osha.gov, or you can contact RB Willder, in the WASA office.

As a reminder to those WASA members that may plow snow on their own property or under contract to others, if your plow is over 8’-6" in width, you may need an Oversize Permit from WisDOT to legally operate it on a highway. There are only a few exceptions to the 8’-6" width requirement found in the state statutes. These include: snowplows on milk trucks, municipal snowplows, as well as farm tractors and implements of husbandry when used in the normal course of their work [agricultural use…not plowing snow]. For further details on obtaining a permit you can contact WisDOT’s Permit Unit, in Madison at: 608-266-7320, or RB Willder in the WASA office.

In last month’s Newsletter, we discussed the settlement in 23 states and jurisdictions regarding indirect purchasers in the vitamin price fixing case. We have received numerous phone calls from the membership seeking more information. Unfortunately, today we have no new direct news for the members that may be affected by the settlement. (There will be someone directly involved with the settlement speaking at the Annual Convention this coming January, so we will have answers to some of the "nuts and bolts" questions for you at that time.) There is however a point that needs to be reinforced to those possibly affected.

The indirect purchaser group includes both the end purchasers and the feed mills that sold the vitamins to them. In some cases, a regional distributor is also added to the mix. The important point to remember is that every one of these purchasers, no matter where they were in the buying string, has equal standing in terms of filing a claim. There are no "priority liens" in this scenario. A quick exercise may be helpful to see how much a typical feed mill might collect. According to the Wisconsin Agricultural Statistics Service, there are 3.4 million cattle in Wisconsin. I’ll ignore hogs, sheep, chickens and turkeys for the purpose of illustration and to keep the numbers conservative. Of the $107 million available to the 23 jurisdictions, if everyone eligible files, it is estimated Wisconsinites would be eligible for around $7 million of the pool. Take that 3.4 million head and divide it into the seven million. You get two dollars per head just counting cattle. That’s a max of two dollars per head to be split between all the claimants. Look at the number of head your feed mill supports and multiply the number by $2. Then divide that number by two or three (variously the number of levels in the buying string) to get a possible payout to you. Remember everyone in the string throughout the state has equal standing, so we don’t know what the divisor will be, but it should sort out somewhere between two and three.