Source:  tom Johnston, MEATINGPLACE.COM, 5/27/10

As the Obama administration bears down on antitrust issues in agriculture, USDA is preparing to issue changes to federal rules that govern sales contracts between livestock and poultry producers and major meatpackers.

Agriculture Tom Vilsack, speaking earlier this week at a press availability following a meeting of the Agribusiness Club of Washington, told reporters new rules would be announced in June.

"The secretary only repeated what he had said at the competition workshop," USDA spokesman Caleb Weaver told Meatingplace, referring to Vilsack's participation late last week in the second of five workshops USDA and the Department of Justice are holding to gather input about competition issues in agriculture. The rules would help USDA address issues raised by farmers, he said.

The proposed rules, as required by the 2008 farm bill, would essentially prevent meatpackers from favoring large cattle feedlots and provide poultry producers more leverage in sales contracts.

"This has been on our policy agenda for close to a decade, so at least it feels good that something is finally happening," Ferd Hoefner, spokesman for the National Sustainable Agriculture Coalition, told Meatingplace. "Whether it turns out to be good or not remains to be seen."

The meatpacking industry says the current structure regarding contracts between producers and packers has fostered production efficiencies that benefit consumers by keeping food prices affordable.

"[Marketing agreements] have emerged as one of the most effective ways to enhance product safety, ensure consistent products and manage risks in a still volatile industry," wrote J. Patrick Boyle, president and CEO of the American Meat Institute," in a guest column published in the Des Moines Register following USDA's launch of its competition workshops.

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