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Packer Issues Addressed In Senate Farm Bill

posted on February 15, 2002


Whatever emerges from the House-Senate conference committee, one thing is certain ... the next farm bill will mark a dramatic departure from the 1996 farm act, commonly referred to as the "Freedom to Farm" law. That measure was designed to wean farmers from government subsidies. But market forces wreaked havoc with the plan. Persistent low commodity prices forced Congress to spend billions of dollars over the past four years in emergency assistance to farmers.

As part of their farm bill deliberations this week, lawmakers also moved toward correcting what many see as a flaw in the livestock markets. And in refusing to back off a ban on meatpacker ownership of livestock, they hoped to level the playing field for independent cattle, hog and sheep producers.

 

Packer Issues Addressed In Senate Farm Bill

Before adjourning last December, the Senate narrowly passed a ban on meatpacker ownership of livestock until 14 days before slaughter. Supporters of the measure argued that vertical integration in the livestock industry was costing smaller, independent producers millions in lost profits. The packers, they claim, process their own animals when market prices rise ... and purchase livestock on the cheap from independent producers when prices fall.

As Congress reconvened last month, the measure was called to the floor for a second look. Idaho Republican Larry Craig introduced a measure requiring a delay in the bill's enactment to allow time for study.

Sen. Larry Craig, R-Idaho: "I'm not opposed to fixing something that's broken, but I'm not at all convinced that's it's yet broken. It may be influenced. It might be tampered with. I don't know that yet and I think an effective study could do that."

Several meatpackers issued warnings following initial passage of the measure in December, saying it would cause upheaval in the beef and pork industries. They said the restrictions would make it harder for them to procure adequate supplies of top-quality meat. They also said the ban placed the practice of forward contracting in doubt.

Supporters of the measure labeled the charge "a red herring" and said there were broader economic issues at stake.

Sen. Tim Johnson, D-South Dakota: "I don't believe that the future of livestock production in our nation ought to be a series of low-paid employees of the packers on their own land bearing all the risk and little of the profit for the production of their animals. That's not the direction that I want livestock production in America to go."

In the end, by a 55-45 vote, the Senate rejected attempts to shelve the legislation and it was included in the farm bill that was passed a day later.

 


Tags: agriculture Congress livestock meat news policy politics