By Julie Tomascik
Editor

Texas Farm Bureau (TFB) and other agricultural organizations are concerned about two bills that fall short of reaching the intended goal of creating transparency and fairness in cattle markets.

Cattle Price Discovery and Transparency Act (S 4030)
The bill would require packers responsible for more than 5% of fed cattle to buy a certain percentage of negotiated cash cattle rather than by contract or formula. The secretary of agriculture would establish up to seven regions of the country for cash cattle trade. The bill also establishes a contract library and mandates annual reporting of the cutout yield.

TFB reiterated its opposition to the Cattle Price Discovery and Transparency Act (S 4030) in a recent letter to Majority Leader Chuck Schumer, Minority Leader Mitch McConnell, Senate Ag Committee Chair Debbie Stabenow and Senate Ag Committee Ranking Member John Boozman.

“TFB remains strongly opposed to provisions included in Sections 2 and 7 specific to the establishment of federal mandatory minimum thresholds under which certain percentages of cattle are purchased,” TFB President Russell Boening wrote. “There is no economic evidence to show regional mandates will increase prices for cow-calf and stocker operators.”

A report released by the Agricultural and Food Policy Center at Texas A&M University concluded negotiated trade mandates are expected to have negative effects on short-term cattle and calf prices. The report also showed the region that includes Texas would see the greatest negative impact from the imposition of mandatory trade minimums.

“Many studies and analyses from top universities conclude a federal mandate in the market will cost cow-calf and stocker operators up to $80 per head, if not more, on the price of their cattle,” Boening wrote. “It is clear the mandate is not the solution to higher cattle prices and profitability for farmers and ranchers.”

TFB also has concerns with the establishment of five to seven new “covered regions” that would fall under price reporting and recommends that additional analysis should be completed by USDA prior to any federally mandated changes.

Meat and Poultry Special Investigator Act (S 3870)
The bill would establish a new office in the United States Department of Agriculture (USDA) focused on investigating and prosecuting violations of the Packers and Stockyard Act. Its duties would also include acting as a liaison between the Department of Justice and Federal Trade Commission, consult with the Department of Homeland Security and maintain a staff of attorneys. The office would hold authority to bring civil or administrative action allowed by the Packers and Stockyards Act.

However, these processes are already authorized by the Packers and Stockyards Division within USDA’s Agricultural Marketing Service.

“While we appreciate the intentions, the Department of Justice and USDA already have the authority to investigate and prosecute violations and anti-competitive practices,” Boening wrote. “If the current laws and regulations are applied, there is no reason to create a duplicative effort of enforcement. This bill has numerous unanswered questions and concerns that should be addressed for farmers and ranchers.”

American Farm Bureau Federation (AFBF) also wrote a letter to House and Senate Agriculture Committee leadership and bill sponsors regarding AFBF’s concerns about USDA implementation of the Meat and Poultry Special Investigator Act.

“As you are aware, AFBF policy, which grassroots Farm Bureau members develop, supports strengthening the ability of the USDA to stop predatory practices in the meatpacking industry,” AFBF President Zippy Duvall wrote. “Our members also believe the USDA should be provided with enhanced investigation and enforcement authority to ensure that all instruments used to quantity quality factors for livestock value determination perform to a set standard.”

The questions submitted by AFBF are listed below.

  1. Can you please specify where the office for the Special Investigator for Competition Matters would be housed within the USDA? Specifically, will the office be housed in the Office of the Secretary or at the Agricultural Marketing Service?
  2. If the Secretary appoints an individual to serve as Special Investigator, would this individual be a Schedule C, Senior Executive Service, or a General Schedule employee?
  3. Are there any other entities that could be investigated or prosecuted that are not packers or live poultry dealers? Does this only apply to those regulated under the Packers and Stockyards Act?
  4. Would custom exempt facilities be treated the same as a packer?
  5. How will the Special Investigator liaise and consult with the Department of Justice, Federal Trade Commission, and the Department of Homeland Security?
  6. If the Secretary appoints a Schedule C employee, would there be additional Schedule C employees in leadership or decision-making roles associated with this office? AFBF would be very concerned if an appointee and their relevant staff had a history of statements or actions that could be perceived as anti-agriculture or particularly hostile to animal agriculture.
  7. AFBF is also concerned that the Special investigator would have the ability to prosecute any civil or administrative action authorized under the Packers and Stockyards Act against a packer, but not a live poultry buyer, as referenced in Sec. 217 (c)(1) of the underlying legislation. Is this an oversight or purposeful exclusion?
  8. Would the prosecution of any civil or administrative action be in coordination with the Department of Justice and other relevant federal agencies?
  9. Citing the lack of authorization for appropriation, what will be the cost to establish this office?

In conclusion
TFB and AFBF remain committed to working with Congress to find commonsense solutions to cattle market legislation with broad industry support that is backed by analysis showing it will help, not hurt, cattlemen and women.

“As discussions surrounding cattle markets and producer profitability continue, TFB looks forward to working with Congress to identify reasonable solutions that will benefit cattle ranchers nationwide,” Boening wrote. “TFB respectfully encourages you to oppose and prevent further consideration of the Cattle Price Discovery and Transparency Act unless the mandate portions of the bill are removed. We also request a thorough review of the issues brought forward from farmers and ranchers pertaining to the Meat and Poultry Special Investigator Act.”