On June 22, USDA published its proposed rule aimed at “increasing fairness in the marketing of livestock and poultry.” The document seems to apply most to the poultry sector, but, as expected, it drew bravos and boos from free-market advocates and proponents of government intervention, respectively.
National Cattlemen’s Beef Association (NCBA) President Steve Foglesong, an Illinois cow-calf producer and cattle feeder, said he had “serious concerns with any efforts to increase government intrusion in the marketplace.
“Cattle producers support free-market principles and we deserve the right to enter into private negotiations between willing buyers and sellers – just like other sectors of American business,” he said. He adds NCBA “will fight to protect the use of contract and alternative marketing arrangements in the cattle industry to satisfy the demands of our consumers.”
Meanwhile, Wenonah Hauter, Food & Water Watch executive director, said the proposed changes provided “long-overdue steps to level the playing field between livestock farmers and the consolidated market power of the meatpacking and poultry processing industry.” Hauter, however, lamented the “modest first step” taken against cattle and hog marketing arrangements as being “nowhere near what is needed to counterbalance the massive market power of the meatpackers.”
And, Max Thornsberry, DVM, R-CALF USA president, called the proposed rule “a bold and absolutely essential step in ridding the U.S. cattle market of anticompetitive practices.” He blamed the exodus of 150,000 U.S. cattle operations since the mid 1990s on a lack of Packers and Stockyards Act enforcement.
However, the American Meat Institute (AMI) panned the proposals calling it a “regulatory end-run” around judicial rulings, and warning of a severe and detrimental impact on livestock producers and the meat industry. Mark Dopp, AMI general counsel, said: “USDA is attempting to turn the clock back on the livestock and meat marketing practices that have made the U.S. meat production system the envy of the world.”
Incidentally, a poll in June on beefmagazine.com posed this question: The Department of Justice and USDA are conducting joint workshops to discuss competition and regulatory issues in the ag industry. In your opinion, will the final result be positive or negative for the U.S. beef industry? With a final tally of about 650 votes, only 13% of readers felt such governmental activity would be positive for the industry, while a whopping 78% saw it as a negative. The remainder didn’t know.
Judging from that, it seems a majority of folks in the beef industry don’t much relish the idea of government mixing in their business. We side with our readers.
Deadline for comments on the proposal (http://archive.gipsa.usda.gov/rulemaking/fr10/06-22-10.pdf) is Aug. 23.