More than 100 years ago, the U.S. passed its first law to protect farmers and ranchers from concentrated, abusive monopoly power in the livestock industry. Farm Action has demonstrated how the Packers and Stockyards Act (P&S Act) successfully leveled the economic playing field for decades, and how 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 response to pressure from farmers, policymakers, and advocacy groups, the USDA is taking steps to strengthen the P&S Act with a set of new rules meant to rein in corporate power.
You can take action RIGHT NOW! The USDA has opened a public comment period on the proposed addition of stronger definitions, which will make it possible to actually enforce the law and hold monopolies accountable.
Comments are due January 17, 2023, so head over to our easy guide to submitting a comment and tell the USDA to put the backbone back in the P&S Act!
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 three rulemaking processes and how we are engaging. More detail is available in USDA’s Agricultural Competition report.
#1) Transparency in Poultry Grower Contracting and Tournaments
About: This proposal shines a light on 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. To learn more about this system, check out our short explainer video on YouTube.
Status: The comment period for this rule ended in August of 2022. Farm Action’s comments unequivocally urged the USDA to follow the Justice Department’s lead and ban the tournament system once and for all.
#2) Inclusive Competition and Market Integrity
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. This proposed rule will:
Status: The comment period for this rule ended on January 17, 2023. Farm Action’s comments included specific recommendations to more effectively hold poultry integrators and meatpackers accountable for their widespread discriminatory and retaliatory conduct.
#3) Unfair Practices, Undue Preferences, and Harm to Competition
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, this regulation would clarify that parties do not need to demonstrate sector-wide harm in order to bring action for market abuses.
Status: This proposed rule has not yet been issued by the USDA.
We should note that this isn’t the first attempt to strengthen the Packers and Stockyards Act. Over the past century, farmers and rural communities have been caught in the middle as ever-larger and more powerful corporations lobbied against any changes to the system that benefits them — and no one else.
For a vivid illustration of this history, check out Farm Action’s blog about the Farmer Fair Practices Rules, a set of reforms proposed in 2010 that would have fortified the Packers and Stockyards Act. If these rules had been enacted rather than defeated by corporate lobbyists, they would have shifted the balance of power into the hands of livestock and poultry producers, giving them more tools to protect themselves against massive meatpackers and legal ground to stand on in the case of abuse.
Here at Farm Action, we’re using everything at our disposal to get the P&S Act the boost it needs to prevent massive corporations from accruing and abusing power. There are some signs that things might be different under an administration that has made a sweeping commitment to improving competition across the U.S. economy.
In our ongoing pressure campaign on the USDA, we’ve publicly urged them to act without delay to help farmers and ranchers escape from under the thumb of corporate monopolies. We’re not afraid to hold USDA’s feet to the fire, and even call them out for their slow pace of progress.
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.
Farm Action is encouraged by efforts to strengthen antitrust enforcement by reinvigorating the Packers & Stockyards Act, and offered recommendations to USDA.
Meatpackers pay a pittance in settlements compared to the record profits they make off these pricing schemes. There must be serious consequences for corporations that get rich by cheating consumers.
The Justice Department’s consent decree “enforces the law against brazen violations that have gone unchecked for decades,” Farm Action said in its comment.
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