The U.S. sheep industry today is at a critical crossroads in its fight for existence going into the next millennium. The industry has over 75,000 producers in which over 22 percent are seed stock producers raising 48 different breeds of sheep. With this high number of seed stock producers, it is extremely competitive and maintains a large wealth of genetics. However, it has been difficult to compete due to the inability of the U.S. industry to access world markets and the ability to gain access to these markets effectively as our competitors do. I am aware of the various overtures the USDA and the Clinton Administration have done.

The mandate of the Section 201 Trade Action that showed that the U.S. sheep industry has been seriously affected is needed. The support and actions must be established from this gives the industry three to four years to enact positive change and effort. According to information supplied from New Zealand, more than $65 million is used in the New Zealand sheep industry for promotion and research, a full 16 percent of which comes directly from the backs of sheep. We must be able to access this action financially to develop more competitive means of global marketing and the ability to trade with other countries.

As technologies continue to advance our lives, business structure and marketing to easier global access, our well-being as U.S. sheep producers, as well as any sheep-producing country around the world is essential to have the ability to export sheep and sheep products. The major issue that inhibits this ability to compete in the world market for the sheep industry is health protocols. We are not allowed to compete on an equal level by many countries that do not recognize the march of science due to the effects this recognition would have on their own sheep producers and their own marketplace.

They refuse to acknowledge science in these issues. Globally the United States has to initiate this action repeatedly to be able to export semen or live animals with each and every country. That takes months if not years. That obviously inhibits economic growth.

The best example of this is the disease know as scrapie. Research has recognized several new scientifically proven ways to control and eventually eradicate the disease including the first live animal test. Secretary Glickman announced the existence of this test last summer that can now identify scrapie in live animals. Scrapie-infected sheep have been scientifically shown not to be a cause of developing or spreading BSE to cattle through contact or oral ingestion. The disease has been shown not to be able to be transmitted through the use of cryopreserved or frozen sheep semen. The United States is the only country in the world with a surveillance program and a voluntary scrapie certification program. Such countries as China and Brazil refuse to acknowledge these issues as well as many others.

Another issue to the U.S. sheep industry is the negotiation of export and import issues with potential countries as part of the livestock industry negotiation team. Oftentimes we must negotiate from an industry level up to APHIS which does not allow it to be an agricultural agenda issue. The sheep industry is a very important aspect of the livestock sector. When negotiating trade policies and issues with other nations, this is a must.

A further issue, the sheep industry has had ineffective support in certain regions of the world, Latin America for example, for the U.S. structure of health protocol development negotiations at the APHIS level. Such examples as exporting just 25 units of sheep semen to Barbados is taking months and months, and it is their agricultural sector requesting the importation or the shipment of 500 sheep to Chile that's stalled for six months because of ineffective action.

This level of negotiations needs to have an aggressive stance from the U.S. side applying science and objective decisions using risk assessment rather than using the most ideal subjective model that gives zero tolerance. The latter seems to be the current importing and exporting stance of the USDA APHIS that allows other exporting countries such an advantage with little or no risk to their sheep industry. The U.S. sheep industry needs USDA to recognize its own work, for example, the issue of scrapie.

Such an action was the effective negotiations of the development of sheep exports with Mexico in 1997 and 1998 in which APHIS negotiated and played a major part. From the peak of our exports in 1993, approximately 830,000 head, live sheep exports fell to 280,000 in 1997 and now have fallen even more dramatically. Major sheep exporting countries such as Canada, Latin America, South America may export sheep to Mexico just as the United States did prior to the summer of 1998 even with the same sheep health status as the U.S.

Finally and importantly, according to estimates of the U.S. Livestock Genetics Export and the American Sheep Industry Association, these actions cost the industry $3 to 7 million per year. This action has reportedly been a $35 to 40 million additive lost to the United States sheep industry.

I stand ready to visit with you about any questions you have. The sheep industry needs your help with these issues to be able to compete on a worldwide basis. The U.S. Sheep Seed Stock Alliance has information that having access to simply 1 percent of the seed stock flocks worldwide, the world breeding sheep market as it is known today would double the current demand and sales of semen, embryos, and live animals to U.S. Seed stock producers. Thank you again for your time.