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Tuesday, January 25, 2022

Farm Bureau backs bipartisan cattle market reform bill but opposes making packers buy certain share on cash market

The American Farm Bureau Federation says it supports a bipartisan Senate bill that aims to increase price transparency in regional cattle markets, except for a key portion that would require meatpackers to buy slaughter cattle on the cash market.

"Two sponsors of the Senate bill, Republicans Deb Fischer of Nebraska and Chuck Grassley of Iowa, said the Farm Bureau supported the overall goals of the bill — more competition and fair prices — despite its call for revisions to, or even elimination of, the language allowing the USDA to set regional mandatory minimum thresholds for cash and related 'grid' purchases," Chuck Abbott reports for the Food & Environment Reporting Network. "Their bill, S 3229, also would create a cattle contract library and require packers to report how many cattle are scheduled for slaughter in each of the next 14 days. Backers say those provisions would help producers know if they are being offered fair terms for their stock and the best time to ship cattle to market." The bill would also increase fines for meatpackers that violate the Packers and Stockyards Act.

Delegates at the recent annual Farm Bureau convention voted to oppose government mandates that force meatpackers to buy a certain percentage of their slaughter cattle on the cash market. Farm Bureau President Zippy Duvall said in a statement Sunday that, while the organization appreciates the work being done to increase transparency, "we cannot support mandatory cash sales." However, Abbott reports, Grassley noted that "the market clearly isn't working."

The bill is a response to complaints from cattle farmers and their advocates that the major meat processors Cargill, JBS, Tyson Foods and National Beef, which control over 80 percent of the beef processed in the U.S., have colluded to raise meat prices by limiting supply. The Agriculture Department is investigating claims against the Big Four, and President Biden recently announced $800 million in support for smaller meatpackers in an effort to increase competition.

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