NSAC's Blog

Letter to Congress in Support of Increased Fairness for Farmers and Ranchers

April 22, 2011

This week, the National Sustainable Agriculture Coalition joined a total of 144 organizations from around the country on a letter delivered to members of Congress urging them to support a fair competition rule proposed by USDA’s Grain Inspection, Packers & Stockyards Administration (GIPSA).  USDA issued the proposed rule in response to directives from Congress in the 2008 Farm Bill and to fulfill USDA’s duty to provide clear rules for implementing the Packers & Stockyards Act.

The proposed rule is intended to increase fairness to farmer and ranchers in the marketplace for poultry, hogs and cattle.  Key provisions of the GIPSA proposed rule 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 specific 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 for joining with other farmers to voice their concerns and seek improvements.  Currently, many farmers are retaliated against economically for exercising these legal rights.
  • Allow premiums to be paid to livestock producers who produce a premium product, but also require 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.

USDA is currently going through over 60,000 public comments submitted on the proposed rule as part of drafting the final rule.  The letter urges members of Congress to support the rule as proposed and to let USDA complete the rulemaking process and issue a final rule.

Categories: Competition & Anti-trust

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