Senators Chuck Grassley (R-Iowa), Deb Fischer (R-Neb.), Jon Tester (D-Mont.), and Ron Wyden (D-Ore.) announced a compromise cattle market proposal, known as the Cattle Price Discovery and Transparency Act. The bill is part of the ongoing effort that’s intended to return fairness to the cattle marketplace dominated by four major meat packers.
The senators plan to introduce the Cattle Price Discovery and Transparency Act in the coming days. The legislation will:
- Establish regional mandatory minimum thresholds of negotiated cash and negotiated grid trades based on each region’s 18 month average trade to enable price discovery in cattle marketing regions. In order to establish regionally sufficient levels of negotiated cash and negotiated grid trade, the Secretary of Agriculture in consultation with the Chief Economist, would seek public comment on those levels, set the minimums, and then implement them. No regional minimum level can be more than three times that of the lowest regional minimum, and no regional minimum can be lower than the 18-month average trade at the time the bill is enacted.
- Require the U.S. Department of Agriculture to create and maintain a publicly available library of marketing contracts between packers and producers in a manner that ensures confidentiality.
- Prohibit the USDA from using confidentiality as a justification for not reporting and make clear that USDA must report all LMR information, and they must do so in a manner that ensures confidentiality.
- Require more timely reporting of cattle carcass weights as well as requiring a packer to report the number of cattle scheduled to be delivered for slaughter each day for the next 14 days.
The proposal is endorsed by a number of state and national organizations, including the Iowa Cattlemen’s Association, Iowa Farm Bureau, American Farm Bureau, National Farmers Union and U.S. Cattlemen’s Association.
However, not ever cattle group received the bill with optimism. The North American Meat Institute (NAMI) said the new Senate bill ignores the analysis of beef and cattle markets by the country’s leading agricultural economists and the bill’s mandated government intervention will have unintended consequences that will hurt livestock producers and consumers.
“Beef and cattle markets are dynamic. This fall prices cattle producers received for their livestock have risen without any government interference,” said Julie Anna Potts, President and CEO of the North American Meat Institute. “In a rush to do ‘something,’ this bill would replace the free market with government mandates and harm those it is intended to protect: livestock producers.”
In a press release, NAMI stated that the bill ignores economic analysis of the beef and cattle market’s behavior while also ignoring expert testimony before the House and Senate Agriculture Committees.