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Briefings on GIPSA; Positive Impacts for Producers

by 5m Editor
2 March 2011, at 9:34am

US - National Farmers Union (NFU) held briefings on Monday, 28 February, for US House of Representatives Committee on Agriculture and US Senate Agriculture Committee members and their staff on the Grain Inspection and Stockyards Administration (GIPSA) proposed rule.

The panel was comprised of livestock producers from across the country and moderated by NFU Vice President of Government Relations Chandler Goule.

"It is critical to ensure that the voices of US producers are heard through this rulemaking process,” said NFU President Roger Johnson. “The proposed rule is essentially a Farmer and Rancher Bill of Rights. It puts teeth into the Packers and Stockyards Act and ensures US farmers and ranchers can compete in a fair and open market.”

The broken livestock marketing system has taken a toll on rural America. The number of US beef and hog operations has been rapidly declining over the last 30 years. In 1980, there were 660,000 hog farms, while only 67,000 remain today. Thirty years ago there were 1.3 million beef cattle operations, but only 950,000 today. The GIPSA rule would prevent packers and processors from abusing their market power and would protect the rights of producers.

“The current system is broken, and now is the time to make a change,” said Mr Johnson. “Some aspects of the proposed rule would benefit from additional clarification, but overall the rule is a much-needed regulatory measure to combat the market concentration that has taken place in the last 30 years. The top four beef packers control over 81 per cent of the sales of cattle for slaughter in the US, and the top four swine processors control about 65 per cent of hog sales. This concentration allows packers monopsony power and significantly harms farmers and ranchers.”

The proposed rule addresses concerns that have been discussed in the industry for decades. The rule is within the scope of GIPSA’s authority granted by the Packers and Stockyards Act and was developed in response to the 2008 Farm Bill, which requires USDA to carry out specific rulemaking to improve fairness in the marketing of livestock and poultry.