NSAC's Blog

National Farmers Union and R-CALF Respond to Industry-backed GIPSA Study

November 11, 2010

On Wednesday, November 10, the National Farmers Union, Ranchers-Cattleman United Legal Fund (R-CALF), and Organization for Competitive Markets (OCM) held a press conference in support of the Agriculture Department’s Grain Inspection, Packers and Stockyards Administration (GIPSA) proposed rule.

The press conference coincided with the release of a new study by Informa Economics, commissioned by meatpacker trade groups and aimed at debasing the GIPSA rule.  The study claims, in dramatic fashion, that the GIPSA rule would cost the meat industry billions of dollars and tens of thousands of jobs over ten years or more.  It’s findings are based in large part on the processors own hyper-inflated estimates of the cost of complying with the GIPSA rule.

According to Chris Clayton of DTN, “Roger Johnson, president of the National Farmers Union, said in the pro-GIPSA briefing that farmers are constantly receiving a smaller share of the meat dollar, while packers and retailers receive more.  Johnson added there is something wrong with a system in which packers can force a producer to sign a marketing contract without allowing the producer to have the contract reviewed by an attorney.  That’s an example of onerous market power, he said, that would be fixed under the proposed rule.”  You can read the full DTN article here.

The press conference built upon a briefing paper issued last week by the Organization for Competitive Markets in response to an article published by Cattle Network.  In that paper, OCM countered a number of the faulty economic assumptions common to the meatpacker lobby’s anti-GIPSA argument.  According to R-CALF, the packer industry is “making outrageous claims that misrepresent the purpose and effect of the GIPSA rule.”

NSAC is encouraging our member and partner organizations to submit comments to USDA in support of the GIPSA rule before the November 22 comment deadline.  This is our best shot in decades to restore a level playing field for family farm livestock and poultry producers.  We need to let USDA know that these rules are needed.  Click here to learn more, read the rule, and submit your comments.

Categories: Competition & Anti-trust, Local & Regional Food Systems

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