This afternoon the Committee turns its attention to livestock issues.  We will examine structural changes taking place in the industry as well as world events that are affecting the economic outlook of the livestock industry.

 There are a number of explanations for our current livestock market situation.  These include competition among the various protein products, structural changes in processing and retailing, and changing consumer preferences for convenient, nutritious products.  Our supply of red meat and poultry has increased at the same time that exports have suffered a short-term decline.  The livestock industry must respond to all of these factors in order to stay competitive in the marketplace.

 Over the last decade, exports of beef and pork have grown substantially.  Fifteen years ago beef and pork exports accounted for less than one percent of total U.S. production.  Today they have increased so that they account for 9 percent and 7 percent respectively.  This growth in U.S. beef and pork exports can be linked to several trade liberalizing agreements:  the Japan-U.S. Beef-Citrus Agreement of 1988, the North American Free Trade Agreement, and the Uruguay Round Agreements.  These agreements have helped open new marketing opportunities for U.S. beef and pork products.  Although the financial crisis in Asia is having a negative effect on exports, continued strong demand from countries such as Japan and Mexico, as well as the expectation that financial reforms in Asia will stimulate consumer confidence, should provide for a net increase in exports through 1999.  We have made significant progress in breaking down trade barriers for the livestock industry.  It is important that Congress, the Administration and the livestock industry work together to expand our export market through the next decade.

 This afternoon we look forward to hearing from a number of witnesses with expertise in the livestock industry.  We will begin the hearing with Dr. Keith Collins, Chief Economist at the Department of Agriculture and David Nelson, Director of Equity Research, Food and Agribusiness at C S First Boston.  We will then hear from George Swan of the National Cattlemen’s Beef Association, Richard Kjerstad from the American Farm Bureau Federation, Leland Swenson of the National Farmers Union, Donna Reifschneider of the National Pork Producers Council, Lorin Moensch of the American Sheep Industry, Herman Schumacher, a livestock market operator from South Dakota, and Patrick Boyle of the American Meat Industry.

 Before I turn to Dr. Collins, I yield to the distinguished ranking member, Senator Harkin, for any opening remarks.