The Senate Agriculture Committee approved bills Wednesday authorizing USDA to mandate minimum levels of cash trading in cattle and establish a special investigator’s office in USDA to probe allegations of unfair marketing practices.
The committee approved both bills by voice vote. The Cattle Price Discovery and Transparency Act of 2022 (S. 4030) was approved with opposition from the committee's ranking Republican, John Boozman of Arkansas, and Sen. Roger Marshall, R-Kan.
Boozman said that if not for the mandatory minimums in S. 4030, he would support it. “These bills were born out of frustration,” he said. “Many of these frustrations I share.”
“The cattle industry has made tremendous strides in meeting consumer demand since the 1990s,” he said, citing “investments in genetics and breeding decisions and specialized marketing.”
However, “I think the industry, our ranch families, and our rural communities will all suffer if we insert the federal government into day-to-day business decisions.”
He also said he feared creating a special investigator would unduly burden small cattle operations: “The large packers have legal departments and regulatory compliance experts on staff — not so for the smaller processors. Are we creating an additional burden on small business?”
But Ag Committee Chairwoman Debbie Stabenow, D-Mich., said the bills “will make progress toward a more competitive, transparent and fair supply chain that is better for American farmers, and better able to keep food on our tables.”
Similar to the Senate bill, a bill passed by the House in December would establish a cattle contract library.
The Cattle Price Discovery and Transparency Act would require USDA to divide the country in five to seven regions and then set minimum levels of cash trading for each. The bill's lead sponsors are Sens. Deb Fischer, R-Neb., Chuck Grassley, R-Iowa, Jon Tester, D-Mont., and Ron Wyden, D-Ore.
"Approved pricing mechanisms are fed cattle purchases made through negotiated cash, negotiated grid, at a stockyard, and through trading systems that multiple buyers and sellers regularly can make and accept bids," said a release from bill sponsors he bill sponsors Sens. Deb Fischer, R-Neb., Chuck Grassley, R-Iowa, Jon Tester, D-Mont., and Ron Wyden, D-Ore. "These pricing mechanisms will ensure robust price discovery."
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The House passed a version of the special investigator bill last week as part of a package of measures Democrats say would lower food and fuel costs.
An amendment introduced by Grassley and adopted by the committee would conform the Senate investigator bill to the House version and add language requiring that the investigator be a senior career employee at USDA. The amendment also clarifies that the investigator may not bring an action forward unless it concerns violations of the Packers and Stockyards Act.
The bills are opposed by the National Cattlemen’s Beef Association and North American Meat Institute. Ahead of the Ag Committee markup, 21 state Farm Bureau presidents signed a letter opposing the Cattle Price Discovery and Transparency Act that says leading economists have determined that “a federal mandate in the market will cost cow-calf and stocker operators anywhere from $50-85 per head, if not more, on the price they receive for their cattle. It is clear the mandate is not the solution to higher cattle prices and profitability for farmers and ranchers.”
Fischer said she hopes the full Senate will consider the price discovery bill this fall.
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