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New livestock and poultry rule a step in right direction
Whether it was on my Rural Tour or at workshops with the Department of Justice to discuss competition in agriculture, time and again livestock and poultry producers emphasized the need for a fair and competitive industry and workable, commonsense rules to address bad actors. USDA recently finalized a rule to implement the 2008 Farm Bill to help remedy some of these concerns.
We were committed to taking even further steps to prevent anti-competitive behavior and address bad actors, but we were stopped from completing the rulemaking process by Congress. Despite this unprecedented action by Congress, we will continue our effort to make sure markets are fair and as transparent as possible.
In the last 30 years the livestock and poultry marketplace has not only become more concentrated, but also more vertically integrated. Although some important efficiencies come with concentration, the potential for increased unfairness and decreased transparency persists. Just as I observed these trends with concern, so did Congress in the 2008 Farm Bill when it required USDA to update our regulations in several areas to promote fairness in the livestock and poultry marketplace.
Don’t get me wrong, much of the livestock and poultry industry does a good job and treats their producers well. But as with any industry, there are some bad actors that do not follow the rules.
Since the enactment of the 2008 Farm Bill, there has been a healthy debate about what these rules should look like. As the discussions carried on in Washington, D.C., it was easy for some outside of farm country to lose sight of what is most important—the men, women and families that wake up before dawn each day to care for the poultry, hogs and cattle destined for our dinner table. These folks work hard and don’t ask for much in return, but they expect to make a fair and decent living.
Eighteen months ago we proposed a rule to implement the 2008 Farm Bill provisions on livestock and poultry market and collected over 60,000 public comments to help guide the rulemaking process. Input from the public was essential in shaping our decisions, especially for making sure we targeted areas where farmers, ranchers and poultry growers are susceptible to unfair treatment in the production or marketing of livestock and poultry, while avoiding costs to areas where the market was functioning properly. For example, the comments helped identify of the proposed rule that may have hindered the ability for producers to receive higher income through more specialized products such as grass-fed, organic, source or breed verification and those provisions were not included in the final rule. In the end, the rule was changed for the better.
Our new rule, while smaller in scope than we had initially anticipated, does provide real and meaningful improvements. It will set new criteria to determine whether a poultry dealer has provided reasonable notice to growers when delivery of birds is suspended, when requiring additional capital investments is a violation of the Packers and Stockyards Act and when determining if a packer, swine contractor, or live poultry dealer has provided a grower reasonable time to remedy a breach of contract. Finally, the rule allows growers to decline arbitration and provides criteria for considering if the arbitration process is fair for the producer.
Farmers, ranchers, and producers of all sizes deserve to compete in a marketplace that treats producers with respect and equity. Despite significant setbacks from Congress, President Obama’s strong commitment to our nation’s farm and ranch families hasn’t diminished and we will continue to look for ways to make sure they are treated fairly and enjoy the benefits of robust competition.
Tom Vilsack is the U.S. agriculture secretary.