The Senate Agriculture Committee and the House Agriculture Livestock Subcommittee held hearings this week to review competition issues affecting the livestock and meat industries. There was a wide variation of opinions expressed by the various farm organizations, producer groups and industry about the study that concluded that restrictions on the use of contractual agreements would have a negative economic effect on packers, producers and consumers.

  • The National Cattlemen's Beef Association (NCBA) said, "We ask that the government not tell us how we can or cannot market our cattle."
  • The American Meat Institute (AMI) testified that the recent USDA "Livestock and Meat Marketing Study" found that "contractual marketing agreements between producers and packers increase the economic efficiency of the cattle, hog and lamb markets and that these benefits are distributed to consumers, as well as to producers and packers."
  • The National Pork Producers Council (NPPC) said several bills before Congress could adversely affect pork producers' ability to market their hogs, including a ban on packer ownership and a requirement that packers buy at least 25% of their pigs on the spot market. According to NPPC, "Punitive actions against packers do not necessarily benefit pork producers in the long run unless the packers are clearly in the wrong. We have seen no evidence of this, and Congress must proceed with caution, weighing the costs and benefits of such important public-policy decisions."
  • The National Farmers Union (NFU) told the committees that Congress needs to take action to "restore true competition" in the market place. NFU would like the farm bill to include: mandatory country-of-origin labeling; require USDA and all federal agencies enforce the Packers and Stockyards Act and antitrust laws; require contracts to be traded in open, transparent and public markets; and prohibit mandatory arbitration.
-- P. Scott Shearer, Washington, D.C., correspondent