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USDA to strengthen enforcement of the Packers & Stockyards Act

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The U.S. Department of Agriculture will begin work on three proposed rules to support enforcement of the Packers and Stockyards (P&S) Act, the 100-year old law that was originally designed to protect poultry and hog farmers and cattle ranchers from unfair, deceptive, and anti-competitive practices in the meat markets.

USDA intends to take three actions related to rulemaking in the months ahead.

  1. USDA intends to propose a new rule that will provide greater clarity to strengthen enforcement of unfair and deceptive practices, undue preferences, and unjust prejudices.
  2. USDA will propose a new poultry grower tournament system rule, with the current inactive proposal to be withdrawn.
  3. USDA will re-propose a rule to clarify that parties do not need to demonstrate harm to competition in order to bring an action under section 202 (a) and 202 (b) of the P&S Act.

“The pandemic and other recent events have revealed how concentration can take a painful toll on independent farmers and ranchers, while exposing working family consumers to higher prices and uncertain output,” said Agriculture Secretary Tom Vilsack. “The Packers and Stockyards Act is a vital tool for protecting farmers and ranchers from excessive concentration and unfair, deceptive practices in the poultry, hog, and cattle markets, but the law is 100 years old and needs to take into account modern market dynamics. It should not be used as a safe harbor for bad actors. The process we’re beginning today will seek to strengthen the fairness and resiliency of livestock markets on behalf of farmers, ranchers and growers.”

The planned P&S Act proposals will support USDA’s efforts to ensure fairer and more resilient markets for farmers, ranchers, and producers. In the last five years, stresses and disruptions caused by concentration in livestock markets have impacted not only producers, but consumers as well. As USDA works to strengthen the resiliency of supply chains, enforcement of the P&S Act will be critically important.

Earlier this week, USDA announced $4 billion in assistance as part of the Build Back Better initiative, an effort designed to strengthen and transform critical parts of the U.S. food system so the food system of the future is fair, competitive, distributed, and resilient. Investments made through Build Back Better will include a mix of grants, loans and innovative financing to address problems throughout the food supply chain; these investments will include efforts to address the shortage of small meat processing facilities across the country as well as the necessary local and regional food system infrastructure needed to support them.

Complementary efforts such as the P&S Act proposals announced will also seek to put a spotlight on the need for greater transparency and competition in livestock markets and the meat processing sector, including unfair treatment of some farmers, ranchers and small processors.

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