In this file:
· Senate Ag approves two cattle bills
· Legislation Would Require Minimum Levels of Negotiated Cash Trade for Cattle
· Sen. Grassley: Bipartisan Meat Packing Special Investigator Act Passes Senate Agriculture Committee
Senate Ag approves two cattle bills
-The Hagstrom Report
via The Fence Post (CO) - June 22, 2022
The Senate Agriculture Committee today, June 22, passed two bills dealing with the regulation of the cattle industry: The Cattle Price Discovery and Transparency Act and the Meat and Poultry Special Investigator Act.
The two bills were approved by voice vote. Senate Agriculture Committee ranking member John Boozman, R-Ark., and Sen. Roger Marshall, R-Kan., asked that they be recorded as “No” votes.
Sens. Jon Tester, D-Mont., Chuck Grassley, R-Iowa, and Mike Rounds, R-S.D., today applauded the committee and urged full Senate approval.
The committee also approved amendments by Sen. Chuck Grassley, R-Iowa, to confirm the special investigator section to the House-passed bill and an amendment offered by Sen. Michael Bennet, D-Colo., to deal with confidentiality issues in his state.
In an opening statement, Stabenow said she was supporting the bills because they “will make progress toward a more competitive, transparent, and fair supply chain that is better for American farmers and better able to keep food on all our tables.”
Stabenow added, “A supply chain with less competition and transparency poses serious risks. Fewer options mean fewer bids for the cattle that producers sell. And as the largest meatpackers muscle out smaller competitors, farmers have limited local alternatives and longer wait times.”
In his opening statement, Boozman said he understood producers’ frustrations, but “The question I have is whether the proposals before us this morning are solutions to those problems.”
“What I fear are the unintended consequences,” he said.
“The cattle industry has made tremendous strides in meeting consumer demand since the 1990s. Investments in genetics and breeding decisions and specialized marketing have brought real returns to ranch families that have chosen to take those steps.
“These investments have kept families ranching while producing high quality beef demanded by consumers.
“If the incentive for those investments is taken away and the focus becomes producing the most pounds for the lowest cost, I think the industry, our ranch families, and our rural communities all will suffer.
“If we insert the federal government into day-to-day business decisions, repealing that heavy hand of the government is nearly impossible,” Boozman said.
Boozman and Marshall noted that state chapters of the American Farm Bureau Federation opposed the bills
Marshall said he could not support a bill that would hurt Kansas cattle producers. He also said there is often not enough shackle space for animals during the cattle cycle, and had an amendment with Sen. Tommy Tuberville, R-Ala. to offer, but would not offer it.
Sen. John Thune, R-S.D., said cattle groups in South Dakota are divided on the bills, but united in their support for country-of-origin labeling for beef and pork.
But Thune added that there will be pressure in the next farm bill to come up with a labeling program that would pass World Trade Organization muster. He noted that the previous mandatory labeling bill was repealed after the WTO ruled it was illegal under WTO standards...
Senate Ag Advances Cattle Markets Bill
Legislation Would Require Minimum Levels of Negotiated Cash Trade for Cattle
By Chris Clayton, DTN/Progressive Farmer
OMAHA (DTN) -- After roughly two years of political wrangling, the U.S. Senate Agriculture Committee on Wednesday advanced a bill that would require major meatpackers to buy a certain percentage of their cattle through negotiated cash trade sales.
In a business meeting, senators spotlighted their support or opposition to the cattle markets bill, as well as a second bill that would create a special investigation office at USDA to watch over packers.
The main legislation, S. 4030, the Cattle Price Discovery and Transparency Act, would require USDA to establish minimum levels of negotiated cash trade for fed cattle by dividing up five to seven regions of the country. The cash trade volumes would depend on the number of packers in a region, availability of fed cattle, and the number of contractual arrangements -- alternative marketing agreements (AMAs) -- in each region. The mandate for cash trade would fall to packers that on average handle at least 5% of daily fed cattle slaughter.
Packers would also be required to report the number of cattle to be delivered for slaughter each day for the next 14 days.
The legislation was sparked by a string of incidents over the past three years that caused live cattle prices to fall while boxed beef prices soared. Those include a fire at a Tyson packing plant in 2019 and the COVID-19 pandemic that shut down packers temporarily in spring 2020.
The bill also would create a library at USDA of AMA contracts that would allow cattle producers to see the premiums others are receiving as well as mandate reporting of boxed beef prices.
The bill was led by Sens. Deb Fischer, R-Neb.; Chuck Grassley, R-Iowa; Jon Tester, D-Mont.; and Ron Wyden, D-Ore. Fischer's bill has 19 co-sponsors, including 12 members of the Senate Ag Committee.
Sen. John Boozman, R-Ark., ranking member of the committee, cited support for provisions to improve price reporting by packers and the establishment of a cattle contract library. But Boozman said he could not support the key provision of the bill that establishes regional mandatory minimums for negotiated cash trade. Boozman said it would roll back years of investment in the cattle industry to improve the quality of beef.
"If those investments are taken away, the focus becomes producing the most pounds for the lowest costs. Industry, ranch families and our rural communities all suffer," Boozman said.
After a voice vote advancing the bill out of committee, Boozman and Sen. Roger Marshall, R-Kan., wanted their opposition to it on the record.
Fischer, a Nebraska cattle producer, praised the bipartisan backing she got for the bill, particularly given she was the lead sponsor of a bill coming out of a committee led by Democrats.
"The goal of the legislation is to ensure every segment of the beef supply chain can succeed by ensuring robust price discovery and market transparency," Fischer said. "We know negotiated transactions involve a bid and an ask. They facilitate price discovery to establish the going rate for cattle. We also know that negotiated transactions have drastically declined over the past 20 years."
Fischer said she understands the value of AMAs, but those contracts rely on the cash trade to set base prices. She noted there have been voluntary efforts by cattle organizations to try to boost cash trade, but they have largely failed because packers did not participate. "Producer groups almost uniformly acknowledged concerns about cash price information becoming too thin."
Fischer also acknowledged Grassley, who has worked on similar cattle market legislation for two decades.
SPECIAL INVESTIGATOR ...
CASH TRADE NUMBERS ...
AG GROUPS SPLIT ...
Bipartisan Meat Packing Special Investigator Act Passes Senate Agriculture Committee
Source: U.S. Senator Chuck Grassley (R-Iowa)
WASHINGTON – Sens. Chuck Grassley (R-Iowa), Jon Tester (D-Mont.) and Mike Rounds (R-S.D.) today applauded passage of their bipartisan Meat Packing Special Investigator Act through the Senate Agriculture Committee. The senators’ legislation will address anticompetitive practices in the meat and poultry industries that hurt consumers and producers, threaten the nation's food supply and endanger America’s food security.
“With the passage of this bill, my years-long beef with Big Cattle is one step closer to being settled,” said Grassley. “Iowa cattle producers have struggled to receive a fair price for years – long before inflation hit a 40-year high. It’s past time for Congress to stand with independent cattle producers and put an end to the cozy relationship between large meat packers and big cattle feedlots.”
“Anticompetitive behavior by the large meatpackers have raised prices on consumers and pushed family ranchers out of business, so this is a critical step toward making sure capitalism works like it’s supposed to work,” said Tester. “I want to thank Chairwoman Stabenow and Ranking Member Boozman for their leadership, feedback, and rigorous debate during the committee process. Now we need to put this bill on the Senate floor so we can make sure there is fair competition in the marketplace because when free markets work, consumers see lower prices at the meat counter, producers get a fair return on their product, and our economy grows stronger in rural America and across the country.”
“Anticompetitive behavior in the meat packing industry hurts both consumers and producers,” said Rounds. “Unfortunately, packer concentration in the beef industry is more consolidated today than it was when the Packers and Stockyards Act was first signed into law over 100 years ago. It’s long past time to address this problem. I thank my colleagues on the committee for their bipartisan support of our legislation and look forward to working across the aisle to get this bill signed into law.”
The senators' Meat Packing Special Investigator Act would create the "Office of the Special Investigator for Competition Matters" within the U.S. Department of Agriculture's (USDA) Packers and Stockyards Division.
The new USDA special investigator will have a team of investigators, with subpoena power, dedicated to preventing and addressing anticompetitive practices in the meat and poultry industries and enforcing our nation's antitrust laws. They will coordinate and act in consultation with the Department of Justice and the Federal Trade Commission and create a new bridge between the USDA and the Department of Homeland Security to protect the continuation of the food supply and increase our national security. With a team of dedicated staff, the USDA will now have the ability to investigate the tough issues facing producers and hold bad actors accountable.
Grassley, Tester and Rounds have led efforts to combat corporate consolidation and protect the livelihood of family farmers and ranchers. All three joined a bipartisan group of colleagues in demanding the Department of Justice investigate whether the control large meatpackers have over the beef processing market violates U.S. antitrust laws and principles of fair competition.