USDA announced that on June 22, 2010, the USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) will publish a proposed rule, as required by the 2008 farm bill and through existing authority under the Packers and Stockyards Act, that would provide significant new protections for producers against unfair, fraudulent or retaliatory practices. Secretary of Agriculture Tom Vilsack said this will be the “most aggressive rulemaking” since the Packers and Stockyards Act was established in 1921. Vilsack said, “Concerns about a lack of fairness and commonsense treatment for livestock and poultry producers have gone unaddressed far too long. This proposed rule will help ensure a level playing field for producers by providing additional protections against unfair practices and addressing new market conditions not covered by existing rules.” According to USDA, the proposed rule announced today would provide the following protections:

• Provide further definition to practices that are unfair, unjustly discriminatory or deceptive, including outlining actions that are retaliatory in nature, efforts that would limit a producer’s legal rights, or representations that would be fraudulent or misleading. Additionally, the proposed rule reiterates USDA’s position that a producer need not overcome unnecessary obstacles and have to always prove a harm to competition when they have suffered a violation under the Packers and Stockyards Act ;

• Define undue or unreasonable preferences or advantages;

• Establish new protections for producers required to provide expensive capital upgrades to their growing facilities, including protections to ensure producers have the opportunity to recoup 80% of the cost of a required capital investment;

• Prohibit packers from purchasing, acquiring or receiving livestock from other packers, and communicate prices to competitors;

• Enable a fair and equitable process for producers who choose to use arbitration to remedy a dispute. Additionally, clear and conspicuous print in the contract will be required to ensure producers are provided the option to decline the use of arbitration to settle a dispute.

• Require that companies paying growers under a tournament system provide the same base pay to growers who raise the same type and kind of poultry, including ensuring that the growers pay cannot go below the base pay amount;

• Provide poultry growers with a written notice of a company’s intent to suspend the delivery of birds under a poultry growing arrangement at least 90 days prior to the date it intends to suspend the delivery;

• Improve market transparency by making sample contracts (except for trade secrets or other confidential information) be made available on GIPSA’s website for producers;

• Outline protections so that producers can remedy a breach of contract;

• Improve competition in markets by limiting exclusive arrangements between packers and dealers.
USDA will consider public comments until Aug. 23, 2010. Copies of the proposed rule and additional information can be found at: www.gipsa.usda.gov by clicking on Federal Register.

USDA Should Increase Antibiotics Monitoring — Senator Dianne Feinstein (D-CA) and Congresswoman Louise Slaughter (D-NY) sent a letter to Secretary of Agriculture Tom Vilsack urging USDA to expand its efforts to gather data on antibiotic use in agriculture and educate producers about “animal husbandry techniques” that reduce antibiotic use. Feinstein and Slaughter said, “The lack of data regarding agricultural usage of antibiotics makes it impossible to assess whether or not current usage is either prudent or responsible. We believe that existing USDA monitoring systems can and should help address this information deficit.” The letter outlines efforts that should be made by USDA regarding antibiotics:

• Use the National Animal Health Monitoring & Surveillance System (NAHMS) as a tool to monitor trends in the volume and type of antibiotics used on farms.

• Enhance the Agricultural Resource Management Survey’s (ARMS) monitoring of antibiotic practices on farms.

• Expand the National Antimicrobial Resistance Monitoring System (NARMS) to collect data on Staphylococcus aureus resistance.

• Create annual reports that synthesize data on antibiotic usage in agriculture.

• Require an additional module during the Category II veterinary accreditation processes, which reviews husbandry practices that reduce antibiotic usage.

• Enhance the role of extension agents in educating farmers on judicious antibiotic usage.
The House Energy and Commerce Committee plans to hold a hearing in mid-July on the use of antibiotics and animals.

Free Trade Agreements Offer Real Potential for U.S. Meats — Implementing the three free trade agreements (FTAs) pending would represent an additional $2.3 billion in meat and poultry exports, according to a study completed by the American Meat Institute (AMI). The FTAs with South Korea, Panama, and Columbia would increase U.S. beef exports by $1.4 billion, pork by $772 million, and poultry by $102 million. The report also indicated these FTAs could potentially create over 29,000 new jobs.

Dietary Guidelines Advisory Report — USDA and the Department of Health and Human Services (HHS) released an advisory report on the 2010 Dietary Guidelines for Americans that proposes changes to the current dietary guidelines to promote health and reduce obesity. It recommends individuals decrease caloric intake and increase physical activity. The report urges increased consumption of low-fat milk and milk products and seafood and moderate consumption of lean meats, poultry and eggs. The report urges a more plant-based diet of cooked dry beans and peas, fruits and vegetables, whole grains, nuts and seeds. It recommends cutting daily sodium intake from the current 2,300 mg to 1,500 mg. A public hearing on the report is scheduled for July 8 in Washington, DC. Written comments may be submitted at www.dietaryguidelines.gov.

P. Scott Shearer
Vice President
Bockorny Group
Washington, D.C.