Farm Action Encouraged by USDA’s Continued Work to Address Corporate Power in the Food and Agriculture System
USDA announced three new efforts to promote fair and competitive markets for farmers and ranchers and lower food prices for consumers.
It’s time to restore one of our best protections against the meatpacking monopoly.
More than 100 years ago, the U.S. passed a critical law to protect farmers and ranchers from concentrated, abusive monopoly power in the livestock industry.
The Packers and Stockyards Act (P&S Act) successfully leveled the economic playing field for decades, until the erosion of its power by courts in the 1980s allowed corporations to gain unprecedented control over meat and poultry production.
The result of all this? Cattle, poultry, and hog farmers are going out of business, workers are subjected to low pay and hazardous conditions, and consumers are facing skyrocketing prices at the grocery store — all while corporations like JBS, Smithfield, and Tyson Foods line their pockets with record profits.
In June of 2021, the USDA announced it would begin work on new rules to strengthen this landmark law, and we are seizing this critical opportunity. Below is a quick rundown of the rulemaking processes and how we are engaging.
About: This proposal brings transparency to the inner workings of the poultry tournament system, a corrupt and abusive scheme in which contract poultry farmers must compete for a price they will be paid for raising poultry.
Status: This rule is final and went into effect on February 12, 2024. Farm Action’s comments argued that this rule doesn’t go far enough, and unequivocally urged the USDA to follow the Justice Department’s lead and ban the tournament system once and for all.
To learn more about this issue, check out our short video on YouTube.
About: In order to facilitate enforcement of the P&S Act, USDA is proposing to clarify what conduct is considered discriminatory, prejudicial, retaliatory, or deceptive, and therefore illegal.
Status: This rule is final and will go into effect on May 6, 2024. Farm Action’s comments were supportive of the rule but also included specific recommendations to more effectively hold poultry integrators and meatpackers accountable for their widespread discriminatory and retaliatory conduct.
About: USDA is proposing a rule that addresses the payment and financial structures of our poultry production system, which grossly favor corporations over chicken producers, and provide an easy and discreet avenue to exploit and punish farmers for perceived noncompliance.
Status: This proposed rule was issued by the USDA on June 10, 2024. Farm Action’s comments were generally supportive of the rule, but also urged USDA to strengthen the rule to better protect poultry growers.
Previously, USDA issued an advanced notice of a proposed rulemaking (ANPR) in June of 2022 to collect information from stakeholders. Farm Action’s response to the ANPR condemned the inherent unfairness of the tournament system and stated that it violates the ban on unfair practices within the P&S Act.
About: Currently, producers who have been harmed by unfair practices must prove harm to the entire industry — a prohibitively high burden of proof that protects corporate monopolies from legal action. In addition to defining unfair practices and undue preferences, we will advocate for this regulation to clarify that farmers do not need to demonstrate sector-wide harm in order to bring legal action against corporations for market abuses.
Status: This proposed rule was issued by the USDA on June 25, 2024. Farm Action’s comments requested that USDA clarify parts of this rule but supported the proposal overall.
About: USDA is considering an upcoming rule that could bring greater transparency to the cattle industry, and may address alternative marketing arrangements (AMAs) and other non-cash-negotiated sales. These contracts depress the cash prices for live cattle, making it harder for producers to get a fair price.
Status: This proposed rule was announced by the USDA on October 11, 2024. The comment period is open until December 10, 2024.
We were encouraged when a momentous executive order to promote competition throughout the U.S. economy opened a critical window of opportunity to strengthen the P&S Act.
But USDA’s pace has been slow. In our routine work with the agency, we regularly push them to move on the rules and give the P&S Act the boost it needs to prevent massive corporations from accruing and abusing power.
In 2022, we convened a coalition of food and farm groups to show public support for these reforms. With a team of attorneys carefully documenting the USDA’s legal authority to issue and implement the rules, our letter demonstrated that the USDA can and should act without delay to help farmers and ranchers struggling under the thumb of anti-competitive corporate monopolies.
We then held an event in Washington, D.C. to publicly hold the USDA’s feet to the fire, where we released our report card grading the agency’s progress on its directives from the executive order. Following this event, USDA Secretary Vilsack told the press that he’s looking for “guidance and direction” from Farm Action on competition issues.
In July 2023, we issued the second annual report card at an online event. We saw some progress towards the goals of the executive order — but we won’t let up our pressure campaign until the P&S Act has been restored to its full strength.
Speakers and panelists at our 2022 event: “Making the Grade? A Midterm Review of the Biden Administration’s Commitment to Food System Competition.”
We’re also working with members of Congress, who have the power to step up in this fight for fairness in our livestock and poultry markets by legislating reforms to the Packers & Stockyards Act.
We helped develop the Protecting America’s Meatpacking Workers Act, which contains policies that would empower workers and farmers in the extremely consolidated meatpacking industry, where hazardous conditions and unfair pay have long been the norm. By forcing the big meatpackers to play by a different set of rules, we can stop them from squeezing their employees and contract growers — who often have no other choice of employer — in the pursuit of excessive profit.
Another policy we developed would shift influence over the food system to the farmers and workers who power it. By cracking down on monopolistic practices and placing a moratorium on factory farms, the Farm System Reform Act helps farmers who have for too long been displaced and shut out of markets by huge corporations. Our political partner Farm Action Fund champions this bill and is calling for co-sponsors.
In April of 2022, Farm Action’s Angela Huffman spoke at the world’s largest antitrust conference, hosted by the American Bar Association, on a panel titled “Is Competition in Agriculture Suffering a Drought?”
For this event, the Farm Action team produced a research report demonstrating the importance of the Packers and Stockyards Act (P&S Act) and antitrust law for American farmers raising livestock and poultry.
USDA announced three new efforts to promote fair and competitive markets for farmers and ranchers and lower food prices for consumers.
Farm Action submitted a public comment commending the U.S. Department of Agriculture (USDA) for its Fair and Competitive Livestock and Poultry Markets proposal.
“Farmers have long deserved this certainty,” said Sarah Carden, research and policy development director for Farm Action.
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