Senate committee holds legislative hearing

Washington, D.C. – The U.S. Senate Committee on Agriculture, Nutrition and Forestry held a legislative hearing on April 26 to review S.4030, The Cattle Price Discovery and Transparency Act of 2022, and S.3870, The Meat and Poultry Special Investigator Act of 2022.  

“The Cattle Price Discovery and Transparency Act includes several reforms aimed to improve price discovery and transparency in cattle markets,” shares Sen. Debbie Stabenow (D-MI), chairwoman of the committee. 

Stabenow adds, “The Meat and Poultry Special Investigator Act would further support fairness in capital markets be creating a new U.S. Department of Agriculture (USDA) office dedicated to enforcing competition rules under the Packers and Stockyards Act.”

“There is no doubt the bills we are discussing are the result of the frustrations at the prices America’s farmers and ranchers receive for their cattle in relation to the prices consumers ultimately pay for their beef products,” says Sen. John Boozeman (R-AR).

USDA statement

“America has the greatest cattle and beef in the world, but our markets are not working fairly and they are increasingly vulnerable to shocks, crisis and risks, leaving them not working well for anyone,” says USDA Senior Advisor, Fair and Competitive Markets Andy Green. 

“The cattle market is a diverse and complex market, but for markets to function, the industry needs transparency and choice,” he adds. “The solution, no matter how you approach it, is competition – competition supports expanded markets and gives producers more leverage to negotiate a fairer price.”

The challenges the industry faces have been decades in the making. To tackle these challenges, the USDA deploys as many tools as they have available through programs and financing for processing plants, he explains. 

“There is no silver bullet for a fair and competitive market, but there are steps we can take to ensure producers are getting a fair shake,” Green adds. “A new position and office at USDA with enhanced authority would, if appropriately resourced, be a focal point for accountability and enhance enforcement, effectiveness and signal the importance Congress has on meaningful competition and fairness in the livestock and poultry industry.” 

Green suggests the new USDA office and position would provide adequate staffing and resources to deliver enforcement the market needs.  

Industry testimony 

Several leaders were in attendance to provide their testimony, some for the proposed bill and some against. 

“Price discovery, transparency, access to additional processing capacity and proper oversight of cattle markets is important to me and all cattle producers,” shares Kansas Livestock Association President-Elect and Tiffany Cattle Company Owner Shawn Tiffany. “However, neither of the bills discussed today represent the right approach to these issues.” 

“The vast majority of cattle producers oppose mandating a minimum level of negotiated trade,” he adds. “Cattle producers should have the opportunity to market their cattle how they see fit without arbitrary limitations opposed by the federal government.” 

Alternative marketing agreements (AMAs) help the cattle industry better meet consumer preferences, says Tiffany. He asked Congress to not limit his use of AMAs. 

“It’s important to note every industry starts with consumer dollars,” says Colorado State University Agricultural and Resource Economics Professor Dr. Stephen R. Koontz. “Price discovery happens in very thick and thin markets. It is not driven by the volume of cash trades, and there is not any research indicating mandating cash trade is going to make for better cattle prices.” 

In contrast, Shelley Ziesch, North Dakota Farmers Union board member expressed support for the bill. 

“As the cash market thins, local livestock auctions are going out of business, and if the trend continues, producers will lose those important marketing options,” says Ziesch. “The Cattle Price Discovery and Transparency Act is an important step towards protecting transparency in the cattle market.” 

The bill proposes several provisions which will promote fairness and transparency in cattle markets. They include: establishing regional minimums for negotiated trade; require 14-day slaughter reporting; expedited carcass reporting; mandatory reporting of cutout yield; and establishing a cattle contract library, she says. 

In addition, Ziesch offered strong support for the Meat and Poultry Special Investigator Act, which will strengthen enforcement of existing laws. 

“USDA and Department of Justice needs stronger tools to enforce existing laws. Senate Bill 3870 would give USDA the authority and resources it needs to make sure our laws are enforced the way Congress originally intended.”   

Closing remarks 

“With the funding we secured in the American Rescue Plan, USDA is investing more than $1 billion towards remote competition, expanding local and regional processing capacity and providing more options for farmers,” says Stabenow.  

“There’s no shortage of complex challenges facing our livestock producers, and it’s in the interest of all Americans to make our food supply chain more resilient,” concludes Stabenow. “USDA has made progress in expanding opportunities for small and mid-size processors but there is a lot more to do.” 

The U.S. Senate Committee on Agriculture, Nutrition and Forestry remained opened for five business days post-hearing to take additional questions and statements.  

Brittany Gunn is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.