The Department of Agriculture plans to unveil three proposed rules meant to strengthen enforcement of the Packers and Stockyards Act, potentially restarting another contentious debate about the government’s role in the relationship between processors and producers.
USDA said Friday that the rules should be released in the coming months. One of those rules will aim to “offer greater clarity to strengthen enforcement of unfair and deceptive practices, undue preferences, and unjust prejudices.”
Another rule will address the poultry grower “tournament” system and a final action will re-propose language “to clarify that parties do not need to demonstrate harm to competition in order to bring an action under section 202 (a) and 202 (b) of the P&S Act.”
“The pandemic and other recent events have revealed how concentration can take a painful toll on independent farmers and ranchers, while exposing working family consumers to higher prices and uncertain output,” said Agriculture Secretary Tom Vilsack.
“The Packers and Stockyards Act is a vital tool for protecting farmers and ranchers from excessive concentration and unfair, deceptive practices in the poultry, hog, and cattle markets, but the law is 100 years old and needs to take into account modern market dynamic,” he added, noting the law “should not be used as a safe harbor for bad actors.”
Richard Powers – acting assistant attorney general in the Justice Department's antitrust division – said the move would “strengthen enforcement … to improve competition in our agricultural markets.
“The Antitrust Division remains committed to vigorous enforcement of the antitrust laws to protect American farmers, ranchers, and consumers, and to ensure they all benefit from robust competition,” Powers said. “We stand ready to work hand in hand with the USDA to use our combined enforcement authorities to pursue these shared goals.”
In his previous tenure as secretary during the Obama administration, one of Vilsack’s final actions was to roll out a final “Fair Farmer Practices” rule that infuriated meat and livestock groups worried about its broad implications. The Trump administration withdrew that rule the next year and eventually rolled out its own replacement in 2020.
Ag groups were mostly mum on the news, opting to wait for the rule text before offering any comment. National Farmers Union President Rob Larew cheered the news.
“After decades of lax antitrust enforcement, farmers are once again subject to many of the same injustices that their ancestors endured; in just the last year, essentially every category of livestock has been accused of manipulating prices and defrauding farmers,” he said.
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However, some were willing to signal early concern over the move. In a statement, North American Meat Institute President and CEO Julie Anna Potts said NAMI "will continue to oppose unnecessary and burdensome government intervention in livestock markets."
“In the past, these sorts of proposals have been opposed by many livestock producers and Congress. In fact, the concepts embodied in these proposals have been rejected by eight federal appellate courts," she said. "They were a bad idea in 2010, they were a bad idea in 2016, and they are a bad idea in 2021. Should these proposals be implemented, they will limit producers’ ability to market their livestock the way they see fit and will lead to costly, specious lawsuits.”
National Cattlemen's Beef Association Colin Woodall cautioned that the news "signals the start of a lengthy process, not the conclusion or result."
"As we did in 2010 and again in 2020, NCBA will fight hard to ensure that any regulations created or revised under the Packers and Stockyards Act do not reduce cattle producers' ability to realize higher profits and make the decisions that are best for their business," he said.
The news was included in an updated Unified Regulatory Agenda rolled out by the White House Office of Management and Budget Friday.
According to the agenda, further action on the Packers and Stockyards Act issues can be expected by November. An advanced notice of proposed Rulemaking on the labeling of cell-cultured meat is expected in July; OMB says addressing animals produced or modified with genetic engineering as well as a rule to modify indemnity payments for livestock are both in the pre-rule stage.
Under the animal biotech framework being considered, USDA's Animal and Plant Health Inspection Service would conduct a safety assessment of biotech animals to analyze their susceptibility to pests or diseases or ability to transmit them. The Food Safety and Inspection Service would conduct a pre-slaughter food safety assessment to ensure that the meat would be safe.
This story has been updated to include additional reaction.
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