The USDA has been busy answering questions regarding how mandatory price reporting (MPR) will be implemented. One major question is the responsibilities of the various market participants under the new law.

Under MPR, packers that annually slaughter an average of 125,000 cattle or 100,000 swine, or slaughter or process an average of 75,000 lambs, must report transaction details. MPR covers slaughter cattle, boxed beef, slaughter hogs, and slaughter, carcass and boxed lambs.

MPR does not cover feeder cattle, animals sold through auctions, pork or pork cuts, wool, mohair or feeder pigs. USDA expects current voluntary reports covering these commodities and/or sales methods will continue.

Under MPR, USDA's Agricultural Marketing Service (AMS) will have the authority to audit packing plant records. Currently, plans are being developed to conduct random audits. Under the MPR legislation, USDA can fine a plant up to $10,000 per violation of MPR rules. Also, each new day that a violation occurs constitutes an additional violation.

MPR was scheduled to begin January 30. Because of confusion and possible market disruption, the USDA postponed the system's launch to April 2.

When a mandatory report is introduced, the voluntary reports carrying the same information will be discontinued. There will be no overlap of reports in order to avoid confusion.

AMS will initially report only national numbers under MPR. In time, they expect to report regional or possibly state breakouts.

Because the MPR legislation mandates individual plant confidentiality, rules will be established so that a report does not reveal the activity of an individual company.

Although not absolute, the current criteria for a regional identification is being called the “3/60” rule.

Under the 3/60 rule, there must be three packers reporting from a region and each must account for 60% or less of the activity in that region.

The original law mandates daily and weekly deadlines for packers, though AMS recognizes some situations will make deadline compliance impossible.

One example is that cattle slaughtered Thursday through Saturday may not be graded until after the deadline for reporting previous week's information. That deadline is 9 a.m. on the first day of the week.

Therefore, AMS is requiring that packers submit all information they have available as of the deadline. Additional information that becomes available after the deadline will be reported as part of the next sequential report.

The previously reported information will not be revised to include updated information.