1
Date:
23
January
2004
To:
Chris
Miller
and
Renee
Johnson
,
EPA
From:
Maureen
F.
Kaplan,
ERG
Subject:
Technical
Directive
No.
1,
Item
6
Information
Sources
for
Aquaculture
Earnings
Forecasts:
USDA
Trade
Adjustment
Program
1.
BACKGROUND
In
the
16
December
20003
JSA/
EPA
meeting,
Carole
Engle
and
Jack
Whetstone
requested
EPA
to
acknowledge
any
new
information,
indices,
adjusters,
or
price
index
information
that
might
be
used
to
account
for
increases
in
foreign
competition
from
the
USDA's
Trade
Adjustment
Program.
ERG
was
directed
to
pursue
this
information
in
e­
mails
dated
23
December
2003
(
which
labeled
the
request
as
TD
Item
6)
and
16
January
2004
(
where
it
was
listed
under
Item
1).
This
is
a
new
request,
hence
it
is
considered
Item
6
under
the
TD.

2.
TELEPHONE/
E­
MAIL
COMMUNICATION
Date
of
Contact:
19
January
2004
Originator:
Maureen
Kaplan,
ERG
Contact:
Prof.
Carole
Engle,
University
of
Arkansas
at
Pine
Bluff
Contact
Information:
cengle@
uaex.
edu
I
sent
an
e­
mail
request
to
Professor
Engle
asking
for
further
details
about
the
price
information
discussed
at
the
JSA/
EPA
meeting.
Professor
Engle
replied
on
20
January
and
said:

 
I
believe
that
the
information
that
Jack
Whetstone
is
referring
to
is
annual
price
data
used
recently
by
the
Risk
Management
Agency
in
determining
the
eligibility
of
various
segments
of
the
aquaculture
industry
for
assistance
under
the
Agricultural
Trade
Assistance
Adjustment
Act.
I
do
not
have
the
actual
numbers
that
were
used
as
criteria
for
approving
or
rejecting
each
petition,
but
a
good
contact
for
it
would
be:

Ken
Stokes,
Risk
Management
Agency
k­
stokes@
tamu.
edu 

Date
of
Contact:
21
January
2004
Originator:
Maureen
Kaplan,
ERG
Contact:
Prof.
Kenneth
Stokes,
Texas
A&
M
University,
Texas
Agricultural
Extension
Service
1Department
of
Agriculture.
Foreign
Agricultural
Service.
7
CFR
Part
1580.
Trade
Adjustment
Assistance
for
Farmers.
Federal
Register
68:
50048­
50053.
20
August
2003.

2
Contact
Information:
k­
stokes@
tamu.
edu
I
sent
an
introductory
e­
mail
to
Professor
Stokes
that
explained
(
1)
ERG
was
a
contractor
to
EPA
to
provide
technical
support
on
the
aquaculture
effluent
guideline,
and
(
2)
Carole
Engle
suggested
him
as
a
contact
for
information
about
the
Trade
Adjustment
Assistance
(
TAA)
program.

Professor
Stokes
outlined
the
program
and
stated
that
there
was
no
reference
list
of
prices.
He
directed
me
to
a
page
on
his
website
at
<
http://
smrre.
tamu.
edu/
smrretaa.
html>
with
links
to
the
United
States
Department
of
Agriculture,
Foreign
Agricultural
Service's
Trade
Adjustment
Assistance
(
TAA)
for
Farmers
home
page.
Once
FAS
approves
a
petition,
his
role
is
to
render
technical
assistance
to
a
petitioner.

3.
TRADE
ADJUSTMENT
ASSISTANCE
(
TAA)
PROGRAM
In
August
2002,
Congress
enacted
the
Trade
Act
of
2002
(
Public
Law
107­
210).
The
Act
establishes
a
new
program
 
Trade
Adjustment
Assistance
(
TAA)
for
farmers.
The
program
is
administered
by
the
United
States
Department
of
Agriculture's
(
USDA's)
Foreign
Agricultural
Service
(
FAS).
FAS
published
a
final
rule
implementing
the
TAA
on
20
August
2003.1
Under
the
program,
a
group
of
at
least
three
agricultural
commodity
producers
submits
a
petition
to
FAS.
FAS
reviews
the
petition
and,
if
acceptable,
publishes
a
notice
in
the
Federal
Register
that
the
petition
has
been
received.
Another
part
of
USDA,
the
Economic
Research
Service,
conducts
a
market
study
to
verify
the
decline
in
prices,
the
potential
impact
of
imports,
etc.,
and
reports
the
findings
back
to
FAS.
FAS
then
determines
whether
the
petitioners
are
eligible
for
trade
adjustment
assistance.
Assistance
takes
two
forms:
technical
expertise
and
cash
benefits.
The
Extension
Service
(
e.
g.,
Professor
Stokes)
tailors
a
technical
assistance
package
to
the
commodity
and
region
(
e.
g.,
technical
publications,
group
seminars
and
presentations,
and
one­
on­
one
meetings).

To
be
eligible,
a
petition
must
meet
the
following
test
and
conditions:

#
"...
the
national
average
price
for
a
commodity
is
less
than
80
percent
of
the
preceding
5­
year
average
and
that
an
increase
in
imports
has
contributed
importantly
to
the
decline
in
commodity
prices..."
(
7
CFR
1580.101,
Federal
Register
68:
50050).

#
The
five­
year
average
is
calculated
as
the
average
of
the
national
average
price
for
the
preceding
five
years
(
Federal
Register
68:
50048).

#
"
If
the
petition
is
filed
on
behalf
of
all
producers
of
the
agricultural
commodity
in
the
United
States,
the
Administrator
shall
use
national
average
prices
compiled
by
the
National
Agricultural
Statistics
Service
(
NASS)
whenever
possible."
(
7
CFR
1580.201(
c)(
6)(
i),
Federal
Register
68:
50051).
Otherwise
the
petitioners
supply
the
data
and
identify
the
source
of
the
data.
3
#
Aquaculture
is
included
(
7
CFR
1580.102,
Federal
Register
68:
50050)

4.
PETITIONS
SO
FAR
FAS
maintains
a
registry
for
petitions
and
outcomes
at
http://
www.
fas.
usda.
gov/
itp/
taa/
registry.
htm.
Table
1
summarizes
the
aquaculture
entries
as
of
22
January
2004.

Table
1
Aquaculture
TAA
Petitions
as
of
22
January
2004
Petition
Number
Commodity
Impacted
Area
Approved
Data
Source
for
Prices
(
if
stated)

P3­
0002­
0402
Pacific
Salmon
Alaska
Yes
P3­
0003­
0400
Pacific
Salmon
Oregon
No
Petitioner
submitted
average
price
data
for
salmon
landed
in
Alaska
prepared
by
the
Alaska
Department
of
Fish
and
Game.
ERS
regarded
the
data
as
irrelevant
and
used
salmon
prices
compiled
by
the
Oregon
Department
of
Fish
and
Wildlife
P3­
0004­
0403
Pacific
Salmon
Washington
Yes
P4­
001­
0404
Shrimp
S.
Carolina
Yes
P4­
0002­
0405
Catfish
Regional
Yes
P4­
0003­
0406
Shrimp
Georgia
Yes
P4­
0004­
0407
Shrimp
Texas
Yes
P4­
0007­
0400
Shrimp
Florida
No
P4­
0008­
0400
Shrimp
Mississippi
No
National
Marine
Fisheries
Service.

P4­
0010­
0408
Shrimp
Alabama
Yes
P4­
0011­
0400
Freshwater
Crayfish
Louisiana
No
Louisiana
Agricultural
Statistics
Report
4
5
5.
APPLICABILITY
OF
TAA
PRICE
DATA
TO
EPA
FORECASTING
METHODS
With
the
exception
of
some
of
the
denied
petitions,
price
data
submitted
with
petitions
are
not
publicly
available.
However,
we
can
make
several
observations
about
the
applicability
of
TAA
price
data
to
EPA
forecasting
methods.

#
NASS
data
are
the
preferred
source
of
data.
The
EPA
forecasts
use
NASS
price
data
for
trout,
a
major
commodity
considered
under
the
rule.

#
ERA
and
FAS
use
National
Marine
Fisheries
Service
(
NMFS)
data
when
NASS
data
are
not
available.
EPA
examined
both
NASS
and
MMFS
trout
price
data
when
developing
its
forecasts.

#
Alaska
non­
profit
facilities
are
no
longer
within
the
scope
of
the
rule
and
EPA
does
not
envision
the
rule
causing
net
pen
facilities
to
incur
additional
costs.
The
salmon
data,
then,
are
moot.

#
Catfish
and
crayfish
are
typically
raised
in
ponds,
a
production
system
not
within
the
scope
of
the
rule.

#
TAA
petitions
examine
six
years
of
data
(
the
current
year
and
the
previous
five
years).
EPA
projections
are
made
on
the
basis
of
time
series
data
that
reflect
24,
12,
and
9
years
of
data
for
Fish
PPI,
Shrimp
PPI,
and
NASS
Trout
prices,
respectively.

The
TAA
data,
even
if
available,
would
not
cause
us
to
modify
the
forecasting
methods.
