Livestock News

Legislation hopes to improve cattle market transparency

Published:

The U.S. House voted to pass two pieces of legislation that are critical to providing producers with greater transparency in the cattle markets. 

Livestock Mandatory Reporting (LMR)

The House voted 418-9 to advance H.R. 5290, introduced by House Agriculture Committee Chairman David Scott (D-GA). This legislation, which was supported by Ranking Member Glenn “G.T.” Thompson (R-PA) and unanimously approved by the Committee, would extend authorization for livestock mandatory reporting (LMR) through September 30, 2022.

Livestock Mandatory Reporting was developed to facilitate open, transparent price discovery and provide all market participants, both large and small, with comparable levels of market information for slaughter cattle, swine, sheep, boxed beef, lamb meat, and wholesale pork.

The authorization for LMR — the most important tool cattle producers have for understanding transactions and trends in the cattle markets — is currently set to expire along with federal funding on February 18, 2022. 

Cattle Contract Library Act

By an overwhelming vote of 411-13, the House also passed the Cattle Contract Library Act of 2021. 

The Cattle Contract Library Act of 2021 would direct USDA’s Agriculture Marketing Service to establish a contract library for cattle contracts. The bill amends the Agricultural Marketing Act of 1946 (Livestock Mandatory Reporting) to ensure this information is reported and published along with other ongoing reports authorized by the Act.

The bill instructs USDA to regularly update the library in a user-friendly format and provide weekly or monthly reports as applicable. Additionally, the bill authorizes USDA to issue grants to universities, associations, or other institutions who can work directly with producers to disseminate and analyze data to drive marketing decisions.

Industry thoughts

American Farm Bureau Federation President Zippy Duvall said, “American Farm Bureau appreciates the House of Representatives taking positive steps toward ensuring fairness and transparency in America’s cattle industry. The Livestock Mandatory Reporting Act and the Cattle Contract Library Act both provide crucial information, which is needed now more than ever as prices skyrocket at the grocery store while payments to farmers lag behind.”

National Cattlemen’s Beef Association President Jerry Bohn said, “The fact that House Agriculture Committee Chairman Scott and Ranking Member Thompson have both been vocal champions for LMR reauthorization is yet another indication of the broad-base support this measure has among producers across the country. LMR is absolutely essential to fair, competitive, and transparent cattle markets. We appreciate Chairman Scott’s leadership, and the heavy engagement we have seen from both sides of the committee on this issue. We also thank Rep. Johnson and Rep. Cuellar for their work to equip producers with vital market data through a cattle contract library,” said 

R-CALF USA’s board of directors reviewed the Cattle Contract Library Act of 2021 and determined it does not address the competition-disrupting leverage the highly concentrated beef packers now hold over the cattle market and that new methods of cattle procurement in use today by the largest beef packers may fall outside the scope of the bill.

“The problem with our broken market is not that we don’t know the details of the contracts that confer market leverage to the packers, the problem is there are too many contracts and because of that, our price discovery market is being destroyed,” said Iowa cattle feeder and R-CALF USA Director Eric Nelson.

 

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