Members of Congress Criticize USDA Livestock Marketing Proposal
WASHINGTON - In a hearing on Tuesday by the House Agriculture Subcommittee on Livestock, Dairy, and Poultry, members from both sides of the aisle criticized USDA officials for a livestock marketing rule proposed last month by the Grain Inspection Packers and Stockyards Administration (GIPSA). According to Subcommittee Chairman David Scott (D-Ga.), USDA officials seriously overstepped their boundaries in proposing a rule including several provisions "soundly rejected" in both the House and Senate during 2008 farm bill debate. The Committee expressed bipartisan support for extending the public comment period from 60 to 120 days.
The following is a statement from NCBA Vice President of Government Affairs Colin Woodall:
"We're glad to see Congress bringing attention to this serious issue. As evidenced in the bipartisan comments made in yesterday's hearing, USDA has defied the intent of Congress and moved forward on the most sweeping changes to the Packers and Stockyards Act in nearly 100 years - all while making little initial effort to seek feedback from the livestock and poultry industry.
"While USDA officials stressed this is only a 'proposed rule' and industry will have the opportunity to provide comments, they have yet to answer our requests to extend the comment period. No matter where you stand on the issue, everyone would benefit from additional time to analyze and provide feedback on this extremely complex rule.
"Even though the proposed regulation targets packers, it's the producer that will ultimately be hurt. The requirement to report and justify contractual purchases from producers, while being measured on 'fairness,' could result in packers responding to the regulation through 'risk avoidance' by stopping marketing agreements with producers.
"Marketing agreements have been the foundation for producer financing and producer profitability for more than 60 percent of beef marketed. Without these agreements, all cattle could be valued on the average, regardless of quality, resulting in a generic market and generic product. History has proven that generic products do not meet consumer demand. Without consumer demand, prices to producers fall.
"The rule poses serious privacy concerns and provides no guarantee that producer's private information would not be exposed to the general public, including competitors. The rule also places all producers in jeopardy of litigation by their competitors or the government. Opening the cattle markets to trial lawyers is not in the best interest of the marketplace, and we do not support litigation as a means of securing producer profitability."
To learn more about the proposed rule and its impacts on cattle producers, visit our blog at www.beltwaybeef.com. For more information on the hearing, visit house.gov.