House Agriculture Committee largely yawns at Grassley's call for reform in livestock markets; USDA regs in the works

In an unusual across-the-Capitol appearance, Republican Sen. Chuck Grassley of Iowa urged the House Agriculture Committee to reauthorize mandatory price reporting by livestock markets as "the ideal vehicle for ensuring cattle producers get a fair price from meatpackers," Chuck Abbott reports for Successful Farming. "But few committee members got on board with the idea, preferring to switch topics and complain that the USDA’s proposals for fair play in the marketplace would boomerang and mean lower sale prices."

The National Farmers Union, noting that that consumer prices for beef have not meant stronger prices for cattle, said in July that Congress and federal regulators should ensure that meatpackers offer producers prices or, “if need be, bust them up.” Abbott notes, "Four packers dominate beef processing."

Committee Chairman David Scott, D-Georgia, said he was working with Republicans on a long-term extension of the price-reporting law, which was to expire on Sept. 30 but was extended through Dec. 3 by an omnibus spending resolution.

"Cash sales are a small portion of cattle sales, but spot prices are often the starting point for sales made under pricing agreements," Abbott notes. "Cattle activists say a larger volume of cash sales is needed to assure fair prices." Grassley's reauthorization bill "has been idled in the Senate Agriculture Committee since it was introduced in March."

Abbott reports "Only a couple of House Agriculture members spoke up for Grassley’s approach. Republicans tended to warn that USDA proposals to give farmers more leverage in dealing with packers would backfire, an argument also made by a meat industry witness. . .. In particular, Republicans pointed to a proposal that would make it easier for producers to win a complaint of unfair treatment by processors. The change in standards might overturn contracts and other arrangements that pay a premium to producers who, for example, raise cattle yielding high-quality beef, they said."

Agriculture Secretary Tom Vilsack, who followed Grassley as a witness, said “The goal is to assure there is a fair price for producers,” while seeing that “as we try to provide greater transparency, we don’t necessarily sacrifice the benefits of the existing system in terms of efficiency.” USDA is working on three regulations on livestock marketing.

To watch a video of the House Agriculture hearing, click here. Written testimony of witnesses is here.