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GIPSA Rule Concerns Agricultural Panel

by 5m Editor
21 July 2010, at 11:51a.m.

US - Members of a House Agriculture subcommittee expressed deep concern with the US Department of Agriculture’s proposed rule on livestock and poultry contracts and marketing arrangements, a regulation that would limit pork producers’ options in selling pigs to processors, according to the National Pork Producers Council.

Representatives David Scott, D-Georgia, and Randy Neugebauer, R-Texas, the chairman and ranking member, respectively, of the Agriculture Committee’s Livestock, Dairy, and Poultry Subcommittee, in a hearing today said they are troubled that the proposed rule amending the Packers and Stockyards Act (PSA) goes beyond the congressional intent of the 2008 Farm Bill. The legislation authorized USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) to issue rules clarifying certain provisions of the PSA and implementing new ones related to capital investments, arbitration and poultry contracts.

Agriculture Committee Chairman Collin Peterson, D-Minnesota, who attended the hearing, and other subcommittee members also voiced concerns with the broad scope of the rule and its likely adverse effects on the livestock and poultry industries. One panel member said the rule would put livestock producers in his district out of business. Some lawmakers who participated in crafting the 2008 Farm Bill pointed out that Congress chose not to act on some proposals now included in the GIPSA rule they because would disrupt and destroy the US livestock industry.

“Several of the rule’s provisions go further than what was required by the Farm Bill,” said NPPC President Sam Carney. “NPPC believes the proposed rule is overly broad and very vague, with many terms not well defined. As written, it appears the rule would have a negative effect on the ability of pork producers to enter into arrangements to produce hogs under contracts and to sell hogs through marketing arrangements.”

Panel members also expressed concern that GIPSA – so far – has refused to extend for the “most significant regulation on livestock markets in nearly 100 years” the 60-day period for submitting comments on the rule. The current deadline is 23 August.

NPPC, in a 6 July letter to GIPSA Administrator J. Dudley Butler, requested a 120-day extension of the comment period. It said the scope of the proposed rule and the lack of an adequate economic analysis of its impact on the livestock industry warrant an extension.

Last week, 22 members of the House Agriculture Committee signed a letter to USDA Secretary Tom Vilsack requesting an extension of the comment period for 120 days past a 27 August “workshop” on competition in the livestock industry in Ft. Collins, Colorado.