GIPSA updates set to come out soon
October 12, 2017
After seven years, the time for changes to the Packers and Stockyards Act could be just around the corner.
The Grain Inspection, Packers and Stockyards Administration (GIPSA) put together rule changes in 2010 that the agency believed would give independent producers more leverage in marketing situations.
Funding was withheld so most of the proposed changes were never enacted.
Finally armed with funding from Congress, the agency might be on track to enact a slightly updated version of the rules by the end of this month.
“These rules are just as troubling as they were when USDA initially proposed them in 2010, after which Congress immediately stepped in to defund the rules, recognizing them as a flawed concept that limits producers’ ability to market their cattle and adding layers of crippling bureaucracy,” – Craig Uden , NCBA president –
The delayed Farmer Fair Practices rules were originally set to be effective on December 20, 2016. When that didn't happen, the USDA announced in April that GIPSA delayed the implementation of the Farmer Fair Practices rules until October 19, 2017.
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Allan Sents, United States Cattlemen Association member and former Kansas cattle feeder said GIPSA may or may not choose to edit the earlier published version, and may decide not to implement it the the rule changes at all.
"They could still decide not to implement it, to discard it, or to tweak it in some way. We'll know more sometime this month," he said.
His group believes the rule changes are necessary to provide clarity and give GIPSA better tools to enforce regulatory action.
Sents said that earlier this year, the agency published the rules and accepted comments on them (see "Cattle industry talks possible effects of GIPSA rule" at http://www.tsln.com or the Jan. 28, 2017, edition of Tri-State Livestock News).
The USDA said at that time, that no major immediate effect was expected from the implementation of the rules.
"It will take time to see the judicial interpretation of the rule. That's the frustrating aspect – they come up with a rule change but it boils down to this: how will the courts interpret it?" said Sents.
Two of the three pieces of the January rule changes were geared more to the poultry industry, but the first one is expected to affect cattle producers and feeders. It would give a seller of cattle legal standing when the Packers and Stockyards Act has been violated, and the seller was harmed in the process. Previously, the court wanted proof that the "entire industry" was harmed in an unfair marketing agreement. Under the new rules, if it is found that even one feeder or marketer of cattle was treated unfairly or discriminated against, he or she would have standing to seek resolution through GIPSA.
The National Cattlemen's Beef Association doesn't believe any changes are needed, and the group asked GIPSA to withdraw the proposal earlier this year.
Craig Uden, NCBA president, said the rules stand to threaten market incentives, the quality of American beef the industry is known for, and will ultimately cost $954 million to the cattle industry, said a news release.
"These rules are just as troubling as they were when USDA initially proposed them in 2010, after which Congress immediately stepped in to defund the rules, recognizing them as a flawed concept that limits producers' ability to market their cattle and adding layers of crippling bureaucracy," said Uden in the release.
R-CALF USA's CEO Bill Bullard doesn't know how likely it is that the rules will be implemented at the end of October.
"I do not know what the Secretary will do but I can only hope he does not kowtow to the meatpackers and their allies like all his predecessors have done by not finalizing the rule," he said. "President Trump promised to drain the swamp by ending the reign of corporate lobbyists who continually and successfully sought favors from Congress and from past Administrations so they could control our markets with impunity. It is time for that reign to end," said Bullard.
The Farmers Fair Practices Rule gives ranchers tools to prevent the packers from exploiting the market by empowering ranchers to protect their own marketplace, without having to wait on the government to act, said Bullard. "Is it unfair for a packer to refuse market access to a rancher because the packer doesn't' like the organization the rancher is a member of? We'll never know if these rules are not fully implemented."