Under a new rule proposed by the U.S. Department of Agriculture (USDA), poultry farmers would be guaranteed a base price for growing their broiler chickens.

The proposal is the agency’s latest attempt to address competition in the meat and poultry sector.

According to USDA, the Poultry Grower Payment Systems and Capital Improvement Systems rule would address a range of abuses that have occurred in relation to grower ranking (commonly known as “tournament”) payment systems and additional capital investment requirements that poultry companies commonly ask of their contract growers for broiler chickens.

It’s the third rule under the Packers and Stockyards Act that USDA has undertaken to create fairer markets.

“Poultry growers deserve a fair shake, and consumers deserve fair prices,” said USDA Senior Advisor for Fair and Competitive Markets Andy Green. “This proposed rule is intended to provide growers with a clear base price in contracts, a contracting partner that designs and operates any comparisons fairly and access to the information that growers—and USDA—need to identify and halt coercive investment demands before growers take on large debts. We look forward to taking comment from all interested parties.”

If finalized, the proposed rule would prohibit deductions from the base price in contracts for broiler chicken growers, permitting only bonuses for performance. It would also provide critical tools to enable growers to better identify risks that may arise on capital improvement practices and enhance the ability for USDA to enforce existing prohibitions on unfair capital improvement practices.

The rule would also establish a duty of fair comparison to ensure grower comparisons (tournaments) are conducted in a reasonable and equitable way that does not disadvantage specific growers.

The proposed rule is posted on the AMS website in advance of formal publication in the Federal Register when it will be available for public comment. Stakeholders and other interested parties have 60 days from the date of publication in the Federal Register to submit comments via the Regulations.gov web portal. All comments submitted will be considered as USDA develops a final rule. The final rule will be published in the Federal Register.

Livestock Mandatory Reporting Live Cattle Dashboard
USDA also announced new publicly available cattle market transparency tools.

USDA is launching a new data visualization tool, the Livestock Mandatory Reporting (LMR) Live Cattle Data Dashboard.

It will provide users the ability to view and access LMR live cattle market information in a manner that is easy to use and understand.

USDA’s Agricultural Marketing Service (AMS) also will begin publishing additional information on the actual net premiums and discounts paid to cattle producers by packers under formula marketing arrangements and detailed quality grade price distribution information.

Agency officials said the enhanced insight gained from these tools places producers on a more equal footing with large volume data users and fosters a fairer and more competitive marketplace.

This dashboard is another new tool offered by USDA that aims to make access to AMS Market News information more user-friendly. AMS is conducting demos and testing with interested stakeholders. Public access to this dashboard will be available this summer.