Source: Tom Johnston, MEATINGPLACE, 5/27/16


Trade groups representing the beef, pork and poultry industries testified Thursday to the Senate Agriculture Committee against the so-called GIPSA rule that would change how producers contract with meatpackers and processors.

The Senage Ag Committee held “A Review of the U.S. Livestock and Poultry Sectors: Marketplace Opportunities and Challenges,” which comes about a week after the Senate Appropriations Committee’s markup of the fiscal year 2017 appropriations bill that excluded language that would block implementation of the rule.

The Senate side’s action counters that of the House Appropriations Committee, which last month approved an amendment blocking implementation of the rule that, as originally proposed in 2010, effectively would make it easier for farmers to sue major meat and poultry processors for what the farmers deem to be unfair marketing contracts.

Neither the House nor the Senate has passed their version of the fiscal 2017 appropriations bill.

Congress has blocked implementation of the GIPSA rule since USDA finalized a portion of the proposed rule in December 2011. But no language barring USDA from working to advance the rule was included in the fiscal 2016 appropriations bill, and it remains to be seen whether it will be included in the fiscal 2017 version.

Meanwhile, USDA is pressing on to implement the rule.

Industry lobbyists used the occasion of the review on Thursday to denounce the rule and press for passage of the Trans-Pacific Partnership (TPP) trade deal, saying the former would cost the industry too much money and the other will make it a lot of money.

The National Pork Producers Council noted, for example, that a study by Informa Economics estimated the GIPSA rule would give a $330 million hit annually to the pork industry. The National Cattlemen’s Beef Association said TPP would add almost $1 billion in beef exports.

“We’re not asking the Senate to intervene in our contracts; we’re asking the Senate to play [its] rolein expanding market access and make sure we are not regulated out of business,” NCBA President Tracy Brunner said in a news release following the hearing.

Other industry groups expressed the need for more market transparency.

Joe Goggins, who testified on behalf of the U.S. Cattlemen's Association, said, “The 2018 Farm Bill offers a timely vehicle for addressing many of the issues discussed today. Whether it be a continued emphasis on beginning farmer and rancher programs or addressing necessary revisions and modernizations in current market regulations, today’s hearing offered a chance to spotlight these issues and begin constructive dialogue on each.

“We look forward to working with everyone in the livestock industry to examine the fundamentals and functions of the cattle market in order to bring back competition, transparency, and true price discovery."

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