USDA Livestock Marketing Competition Rule Gets Broad Support

Despite a tepid response from the Senate Agriculture Committee, and actual hostility in the House, 141 agriculture organizations (see list below) signed a letter in support of USDA's new livestock marketing competition rule (also known as GIPSA), and delivered it to legislators on Thursday, April 21st, 2011. The content of the letter is as follows: As a result of rapid consolidation and vertical integration, the livestock and poultry markets of this nation have reached a point where anti-competitive practices dominate, to the detriment of producers and consumers. Numerous economic studies in recent years have demonstrated the economic harm of current market structures and practices, and have called for greater enforcement of existing federal laws in order to restore competition to livestock and poultry markets. Until recently, Congress and the U.S. Department of Agriculture have largely ignored these trends. Fortunately, Congress included language in the 2008 Farm Bill to require the U.S. Department of Agriculture to write regulations, using its existing Packers and Stockyards Act authorities, to begin to restore fairness and competition in livestock and poultry markets. On June 22, 2010, the Grain Inspection Packers and Stockyards Agency (GIPSA) issued proposed rules to implement the 2008 Farm Bill mandates, and to address related anticompetitive practices in the livestock and poultry industries. These reforms are long overdue and begin to respond to the criticisms by farm groups, consumer groups, the Government Accountability Office and USDA’s Inspector General about USDA’s past lack of enforcement of the Packers and Stockyards Act. The proposed GIPSA rules define and clarify terms in the Act in order to make enforcement more effective, and to provide clarity to all players in livestock and poultry markets.

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The Packers and Stockyards Act of 1921 makes it unlawful for packers, swine contractors, and live poultry dealers to engage in any “unfair, unjustly discriminatory, or deceptive practice or device,” or to “make or give any undue or unreasonable preference or advantage to any particular person or locality in any respect, or subject any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect.” The ambiguity of these terms has resulted in uncertainty in the marketplace and hindered enforcement of the Act.

Key provisions of the proposed GIPSA rules would:

• Provide contract growers with commonsense protections when making expensive investments in facilities on their farms to meet the packer or poultry company requirements;

• Provide growers, farmers, and ranchers with access to the information necessary to make wise business decisions regarding their operations;

• Require transparency and eliminate deception in the way packers, swine contractor and poultry companies pay farmers;

• Eliminate collusion between packers in auction markets;

• Provide clarity about the types of industry practices the agency will consider to be unfair, unjustly discriminatory, or when certain practices give unreasonable preference or advantage. These are all terms used in the existing statute, which have never been adequately defined;

• Prohibit retaliation by packers, swine contractors or poultry companies against farmers for speaking about the problems within industry or joining with other farmers to voice their concerns and seek improvements. Currently, many farmers are often retaliated against economically for exercising these legal rights;

• Allow premiums to be paid to livestock producers who produce a premium product, but requires the packer or swine contractors to keep records to detail why they provide certain pricing and contract terms to certain producers;

• Reduce litigation in the industry by eliminating the ambiguity in interpretation of the terms of the Packers and Stockyards Act. Such ambiguity leads to litigation as farmers and packers seek court action to clarify the intent of the Act.

GIPSA has received approximately 60,000 comments on the proposed rule during the five-month public comment period that ended in November 22, of 2010. USDA is in the process of analyzing those comments, and providing the in-depth cost-benefit analysis necessary before issuing the final rule.

Because of the great importance of this rule to livestock and poultry producers and consumers, and the large volume of misinformation about the rule perpetuated by livestock and poultry trade associations and packer-producer groups, the undersigned organizations are writing to reiterate our strong support for the GIPSA rule and for its swift publication in final form.

We urge your support for the GIPSA rulemaking process, and its efforts to restore fairness and competition in our nation’s livestock and poultry markets.

The letter was signed by the following organizations:

Agriculture and Land Based Training Association (CA)

Alabama Contract Poultry Growers Association

Alliance for a Sustainable Future (PA)

Alternative Energy Resources Organization (AERO) -MT

Ambler Environmental Advisory Council

American Agriculture Movement

American Corn Growers Association

American Federation of Government Employees (AFL-CIO), Local 3354, USDA-St.

Louis (representing Rural Development and Farm Loan employees in Missouri,

Oklahoma, and Kansas)

American Grassfed Association

American Raw Milk Producers Pricing Association

Ashtabula-Lake-Geauga County Farmers Union

BioRegional Strategies

Buckeye Quality Beef Association (Ohio)

C.A.S.A. del Llano (TX)

California Dairy Campaign

California Farmers Union

California Food & Justice Coalition

Campaign for Contract Agriculture Reform

Campaign for Family Farms and the Environment

Carolina Farm Stewardship Association

Cattle Producers of Louisiana

Cattle Producers of Washington

Center for Celebration of Creation

Center for Food Safety

Center for Rural Affairs

Chemung County Church Women United (NY)

Chemung County Council of Churches (NY)

Chemung County Council of Women (NY)

Church Women United of Chemung County (NY)

Church Women United of New York State

Citizens for Sanity.Com, Inc.

Citizens for Sludge-Free Land

Colorado Independent CattleGrowers Association

Community Alliance for Global Justice

Community Farm Alliance (Kentucky)

Community Food Security Coalition

Contract Poultry Growers Association of the Virginias

Court St Joseph #139, Corning/Elmira, Catholic Daughters of the Americas, Corning, NY

Crawford Stewardship Project

Cumberland Counties for Peace & Justice

Dakota Resource Council

Dakota Rural Action

Davidson College Office of Sustainability

Ecological Farming Association

Endangered Habitats League

Family Farm Defenders

Farm Aid

Farm and Ranch Freedom Alliance

Farmworker Association of Florida

Fay-Penn Economic Development Council

Federation of Southern Cooperatives

Food & Water Watch

Food Chain Workers Alliance

Food Democracy Now!

Food for Maine’s Future

Gardenshare: Healthy Farms, Healthy Food, Everybody Eats

Georgia Poultry Justice Alliance

Grassroots International

Heartland Center / Office of Peace and Justice for the Diocese of Gary, Indiana and the

Integrity of Creation

Hispanic Organizations Leadership Alliance

Idaho Rural Council

Illinois Stewardship Alliance

Independent Beef Association of North Dakota (I-BAND)

Independent Cattlemen of Nebraska

Independent Cattlemen of Wyoming

Institute for Agriculture and Trade Policy

Iowa Citizens for Community Improvement

Iowa Farmers Union

Island Grown Initiative

Izaak Walton League

Kansas Cattlemen’s Association

Kansas Farmers Union

Kansas Rural Center

Ladies of Charity of Chemung County (NY)

Land Stewardship Project

Main Street Opportunity Lab

Maryknoll Office for Global Concerns

Michael Fields Agricultural Institute

Michigan Farmers Union

Michigan Land Trustees

Michigan Organic Food and Farm Alliance

Midwest Environmental Advocates

Midwest Organic Dairy Producers Association

Minnesota Farmers Union

Missionary Society of St. Columban

Mississippi Livestock Markets Association

Missouri Farmers Union

Missouri Rural Crisis Center

National Catholic Rural Life Conference

National Family Farm Coalition

National Farmers Organization

National Farmers Union

National Latino Farmers & Ranchers Trade Association

National Sustainable Agriculture Coalition

Nebraska Farmers Union

Nebraska Sustainable Agriculture Society

Nebraska Wildlife Federation

Network for Environmental & Economic Responsibility

New England Small Farm Institute

Nonviolent Economics

North Carolina Contract Poultry Growers Association

Northeast Organic Dairy Producers Alliance

Northeast Organic Farming Association – NY

Northeast Organic Farming Association, Interstate Council

Northern Plains Resource Council

Northwest Atlantic Marine Alliance

Ohio Ecological Food and Farm Association

Ohio Environmental Stewardship Alliance

Ohio Farmers Union

Oregon Livestock Producers Association

Oregon Physicians for Social Responsibility

Oregon Rural Action

Organic Consumers Association

Organic Farming Research Foundation

Organic Seed Alliance

Organization for Competitive Markets

Partnership for Earth Spirituality

Past Regents Club, Catholic Daughters of the Americas, Diocese of Rochester, NY

PCC Natural Markets

Pennsylvania Farmers Union

Pennypack Farm and Education Center (PA)

Pesticide Action Network North America

Pomona Grange #1, Chemung County NY

Powder River Basin Resource Council (WY)

R-CALF United Stockgrowers of America

Rocky Mountain Farmers Union

Rural Advancement Foundation International – USA (RAFI-USA)

Rural Coalition

Sisters of St. Francis of Philadelphia

Slow Food USA

South Dakota Livestock Auction Markets Association

South Dakota Stockgrowers Association

St John the Baptist Fraternity of the Secular Franciscan Order, Elmira, NY

Sustain LA

Taos County Economic Development Corporation

Texas Farmers Union

The Cornucopia Institute

Tilth Producers of Washington

Trappe Landing Farm & Native Sanctuary

Veteran Grange #1118, Chemung County, NY

Virginia Association for Biological Farming

Western Organization of Resource Councils (WORC)

WhyHunger

Women, Food and Agriculture Network