USDA has announced the second of its promised rules under the Packers and Stockyards (P&S) Act, which will have a direct impact on competition in the cattle markets. In addition, the department is allocating $15 million to partner with state attorneys general to enforce competition laws.
The agency released the first of its proposed three rules earlier this summer, but it was mainly directed at the poultry industry and the tournament-style system used in poultry growing. The proposed rule announced on Sept. 26 will address inclusive competition and market integrity rules under the Packers and Stockyards Act, according to USDA.
“Highly concentrated local markets in livestock and poultry have increasingly left farmers, ranchers, growers and producers vulnerable to a range of practices that unjustly exclude them from economic opportunities and undermine a transparent, competitive, and open market—which harms producers’ ability to deliver the quality, affordable food working families depend upon,” said Agriculture Secretary Tom Vilsack in a press release.
The proposed rule, Inclusive Competition and Market Integrity under the Packers and Stockyards Act, would prohibit certain prejudices against “market-vulnerable individuals” that tend to exclude or disadvantage covered producers in those markets, according to the proposed rule’s text. Market-vulnerable individuals could include those at risk of adverse or exclusionary treatment in the marketplace, which could be on the basis of their race, gender, sexual orientation or religious affiliation, USDA said.
The revised regulations would prohibit retaliatory practices that interfere with lawful communications, assertion of rights and participation in associations, among other protected activities. An example of other protected activities would be retaliation against a rancher or farmer blowing the whistle on price fixing.
The new rule would also identify unlawfully deceptive practices that violate the P&S Act. Violations could relate to contract formation, contract performance, contract termination and contract refusal.
Finally, the rule proposes record-keeping requirements to support compliance, including the ability to inspect relevant records, staff training and producer information materials, data and testing, board of directors’ oversight materials and other records.
The rule was not published in the Federal Register as of WLJ press time, but a draft rule was available. Once the rule is published in the Federal Register, comments may be submitted within 60 days. Comments may be submitted at regulations.gov by searching for the docket ID AMS-FTPP-21-0045. Written comments may also be submitted by mail to S. Brett Offutt, Chief Legal Officer, Packers and Stockyards Division, USDA, AMS, FTPP; Room 2097-S, Mail Stop 3601, 1400 Independence Ave. SW, Washington, D.C., 20250-3601.
Enforcement funding
USDA also announced the allocation of up to $15 million in funding to increase enforcement of competition laws. Through renewable cooperative agreements and memorandums of understanding, the USDA and state attorneys general partnered to pursue anti-competitive practices.
“Specifically, this initiative will improve state (attorneys general’s) capacity to conduct on-the-ground investigations of competition issues, enhance coordination between Federal and state agriculture and competition enforcement authorities, create new and more independent research programs, and ultimately result in more rigorous enforcement of the competition laws,” USDA said.
The department is working with the offices of state attorneys general to solicit applications and requests for funding under the initiative. USDA and the Department of Justice also announced earlier this year their plans to partner more closely to enforce federal competition laws. The agencies released the www.FarmerFairness.gov portal for producers to report suspected competition violations.
The proposed rule and funding announcement was released on Sept. 26 at the third meeting of the White House Competition Council, which was created in 2021. A readout of the meeting noted, “USDA will soon announce the distribution of millions in funding to help expand and diversify meat and poultry processing capacity, helping give consumers more and cheaper options.” — Anna Miller, WLJ managing editor
