Call to Order and Roll Call
The 2nd meeting of the Interim Joint Committee on Agriculture was held on Wednesday, July 10, 2013, at<MeetTime> 10:00 AM, at the Webster County Extension Office, Dixon, Kentucky. Senator Paul Hornback, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Paul Hornback, Co-Chair; Representative Tom McKee, Co-Chair; Senators Carroll Gibson, David Givens, Stan Humphries, Dennis Parrett, Dorsey Ridley, Kathy W. Stein, Robin Webb, and Whitney Westerfield; Representatives Lynn Bechler, Johnny Bell, Jim DeCesare, Myron Dossett, C.B. Embry Jr., Jim Glenn, Derrick Graham, Richard Heath, Kim King, Martha Jane King, Terry Mills, Ryan Quarles, Tom Riner, Steven Rudy, Jonathan Shell, and Wilson Stone.
Legislative Guests: Senator Dorsey Ridley and Representative Jim Gooch.
Guests: Jim Townsend, Webster County Judge-Executive; Joel Sappenfield, Tyson Foods Inc., VP and GM IF and Cornish; Craig Coberley, Complex Manager, Robards; Dave Phillips, Complex Human Resources Manager, Robards; Jeff Wood, Manager, Community Relations; Chuck Penry, VP, Government Relations; Matt Mika, Director, Government Relations; Jamie Guffey, Kentucky Poultry Federation; Mike Burchett, Kentucky Soybean Association; Laura Knoth and Ray Allen Mackey, Kentucky Corn Growers Association; Josh Lancaster, Webster County farmer; Eddie Melton, Kentucky Farm Bureau.
LRC Staff: Lowell Atchley, Kelly Ludwig, and Susan Spoonamore, Committee Assistant.
Jim Townsend, Webster County Judge Executive, Senator Dorsey Ridley, and Representative Jim Gooch welcomed the members to the Webster County area.
Impact of Kentucky's Poultry Industry on Agriculture
Joel Sappenfield, Vice President and General Manager of Individual Frozen and Cornish at Tyson Foods, stated that Tyson is one of the world's largest producers of meat and poultry, producing approximately one quarter of all protein consumed by Americans. Tyson is also a leader in hunger and disaster relief.
Tyson produces prepared foods such as tortilla shells, chips, and pet food. Tyson employs approximately 100,000 people in the United States and 15,000 people abroad. The Robards, Kentucky, complex has approximately 1,700 employees. Tyson works with about 12,000 independent livestock and poultry farmers.
Tyson ships to approximately 85 foreign countries, exporting drumsticks from Robards, Kentucky, to Singapore and wing tips to China. Since 2000, Tyson has donated more than 92 million pounds of protein to U.S. food banks and has served more than 73,000 meals in Moore, Oklahoma, since it was struck by the May tornado.
Tyson relies on 130 Kentucky poultry farmers, who about 2 million bushels of corn purchased from farms in Henderson County. The total economic impact is roughly $15 million in corn purchases.
Mr. Sappenfield stated that because of the closing of Century Aluminum in August, Tyson's energy costs could rise 30 percent, equivalent to $960,000 per year. Ninety-six poultry farmers could see an annual increase of $7,000-$8,000 in energy costs.
Mr. Sappenfield discussed truck weight issues relating to KRS 189.222(2)(b). In recent months, the interpretation of the statute has changed, forcing Tyson to run lighter loads to comply. As a result, more loads must be hauled, and fuel consumption increases. Tyson encourages legislation increasing the weight limit to 88,000 pounds on two axles. The current weight limit is 80,000 pounds.
Mr. Sappenfield discussed Tyson’s high costs for water, which is supplied by the Henderson County Water District. The high electric rate and water costs will make the Robards plant one of the highest in total utility costs in the United States.
In response to Senator Hornback, Mr. Sappenfield stated that some parts of the chicken, in particular the bottom of the breast frame, are ground up and used in pharmaceuticals.
In response to Representative Riner, Mr. Sappenfield stated that Tyson may be interested in purchasing free-range chickens. However, the possibility gives concern about the Avian Influenza virus. Tyson's first steps would be to evaluate the purchase of antibiotic free poultry, organic poultry, and then free-range poultry.
In response to Senator Parrett, Mr. Sappenfield stated that Tyson uses 1.8 to 2 million gallons of water per day at an annual water cost of $5 million.
In response to Senator Stein, Tyson speakers stated the company produces Fresh Pet food, which is a refrigerated product, and products such as True Chews, which is a dog treat.
In response to Senator Hornback, Dave Phillips, the Tyson Complex Human Resources Manager in Robards, explained that Tyson team members represent 43 countries, and those employees often speak multiple languages. There is a 50 percent turnover that usually occurs within the first 90 days of employment and that is due to the repetitive nature and motion of the job. Seventy-six percent of the turnover is made up of local residents.
In response to Representative Rudy, Tyson employees stated that the restricted weight limits result in about eight additional loads per day.
In response to Representative McKee, Jeff Wood, Community Relations Manager, stated that Tyson has donated approximately 17,000 pounds of food to local food banks. Tyson donates a total of about 6 million pounds of food annually.
In response to Representative Stone, Mr. Sappenfield stated that each location has a United States Department of Agriculture inspector in charge. Each line has four inspectors, and each inspects for visible problems. There are two additional USDA inspectors who assist with inspecting and grading the chickens.
In response to Senator Hornback, Joel Sappenfield stated that Tyson's traceability uses the Julian date code, which tracks the plant, grower, date, line, and minute the product was produced.
In response to Senator Webb, Tyson representatives stated that the company publicizes that it complies with regulatory issues, and informs consumers about its use of best practice standards. The message is more easily accepted when it comes from a grassroots organization.
Jamie Guffey, Executive Director, Kentucky Poultry Federation, gave an overview of Kentucky's poultry industry. Poultry is Kentucky's number one commodity. More than 850 farm families in 42 counties represent the industry. The Kentucky Poultry Federation provides over $13,000 in educational materials and supplies for poultry items to school systems. It is instrumental in bringing federal money into the state to support the University of Kentucky and Murray State University veterinary laboratories.
The federation's goal is to increase the number of family-owned poultry farms in Kentucky to 1,000. Its efforts will also focus on bringing one additional company or secondary processor to the state.
Mr. Guffey stated that the Kentucky Poultry Federation supports an increase in truck weight limits, increasing the limit to 88,000 pounds, and would like poultry bedding and veterinarian supplies to be included in the agriculture-exempt sales tax status.
Mike Burchett, Kentucky Soybean Association, stated that soybean check-off dollars help fund soybean promotion and gather data on growing soybeans. Most soybeans have been planted this year, but there was some delay due to wet weather. Animal agriculture is the soybean industry's number one customer, and many producers are concerned about continued attacks on animal agriculture and production.
Laura Knoth and Ray Allen Mackey, Kentucky Corn Growers Association, and Josh Lancaster, a Webster County farmer, discussed the impact of the corn industry on Kentucky's poultry industry.
Ms. Knoth stated that 1.6 million acres have been planted in 2013 and more than 80 percent is in good-to-excellent condition. In 2012, total production was 104 million bushels at an average price of $7.20 per bushel. The total estimated value of production, in 2012, was $749 billion. Each year, 45 million bushels of corn are used to feed 320 million chickens. An additional 35 million bushels feed beef and dairy cattle and hogs. Approximately 28 million bushels of Kentucky corn are distilled into ethanol and spirits.
Eddie Melton, Kentucky Farm Bureau, stated that Kentucky Farm Bureau is beginning its legislative policy process, which will be ready to present in November. Webster County has 110,000 crop acres and 10,000 head of cattle. The poultry industry is a great industry for Webster County. Kentucky Farm Bureau is working to offer more opportunities to young people and encourage young people to stay on the farm.
The meeting adjourned at 12:00 p.m.