New Livestock Rules Could Change Balance of Power

The federal agency sees this as a way to reinvigorate rural communities.

The Obama Administration issued rules late last week that could bring the most significant reforms to the livestock industry in nearly 100 years.

The proposed rules would provide poultry growers with new protections in their relations with large companies. They would make it easier for livestock raisers to sue the industry giants that control the nation’s meat markets and the rules proposed by the U.S. Department of Agriculture help level the playing field for small livestock raisers who have been squeezed out of business in the last few years.

The rules announced by Ag Secretary Tom Vilsack amount to the “most aggressive, significant livestock market reform to come out of Washington, perhaps since the passage of the Packers and Stockyards Act (of 1921) itself,” said John Crabtree of the Center for Rural Affairs. 

The rules will be published Tuesday by the USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) and could be altered before they are adopted formally in the fall. The USDA’s official release on the rules can be found here. 

The USDA’s attention to market fairness and competition in the livestock industry comes in response to decades of agitation among producers and a rapid decline of independent livestock producers.

The USDA reports that there were over 666,000 hog farms in 1980, but only 71,000 today. In 1980, there were over 1.6 million cattle farms and ranches, but only 950,000 today.

Meanwhile, farmers are receiving an increasingly smaller portion of the dollar American consumers spend for meat. Hog producers received 50% of the retail price of pork in 1980, but only 24.5% today. The share of the retail dollars going to beef producers has dropped from 62% in 1980 to 42.5% today.

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