OMAHA (DTN) -- Two United States senators are taking a shot at improving transparency in the cattle market, reintroducing a piece of legislation on Tuesday that was originally offered last year.
The Cattle Market Transparency Act of 2021 would establish regional cash minimums and equip producers with more market information.
Sens. Deb Fischer, R-Neb., and Ron Wyden, D-Ore., introduced the legislation that has been years in the making. Rep. Vicky Hartzler, R-Mo., is expected to introduce companion legislation in the U.S. House of Representatives.
The Senate bill would establish regional mandatory minimum thresholds of negotiated cash and negotiated grid trades to enable price discovery in cattle marketing regions.
It would require the U.S. secretary of Agriculture, in consultation with USDA's chief economist, to establish regionally sufficient levels of negotiated cash and negotiated grid trade, and then to seek public comment on those levels.
USDA would be required to create and maintain a publicly available library of marketing contracts between packers and producers while ensuring confidentiality for producers.
The bill also would require packers to report to USDA the number of cattle scheduled to be delivered for slaughter each day for the next 14 days and require USDA to report the information daily.
The legislation also would prohibit USDA from using confidentiality as a justification for not reporting all information.
"Cattle producers continue to face serious obstacles when it comes to increasing profitability and gaining leverage in the marketplace," said National Cattlemen's Beef Association Vice President of Government Affairs Ethan Lane.
"Leveling the playing field and putting more of the beef dollar in producer pockets remains the top priority of this association. NCBA shares Sen. Fischer's objectives, as do its affiliates and indeed the entire industry. The best way to achieve those objectives, however, continues to be hotly debated by the very cattle producers this legislation would directly impact."
Last fall, 17 state affiliates of NCBA and other livestock groups supported nearly identical legislation introduced by Fischer and Hartzler.
The legislation also has received backing from the American Farm Bureau Federation and the United States Cattlemen's Association.
"America's ranchers don't control the prices they are paid for their products, and those raising livestock have legitimate questions about pricing," AFBF President Zippy Duvall said in a statement.
"When the pandemic hit, meat prices at grocery stores went up while the prices paid to farmers fell through the floor. This legislation will ensure farmers and ranchers have fair access to markets and are fully informed on pricing so they can continue to put food on the table in homes across the country."
USCA President Brooke Miller said the legislation would help the industry achieve its goals.
"The current conversations on increasing transparency and price discovery in the cattle marketplace began at the 2020 Winter Thaw in Billings, Montana, where USCA brought together industry leaders to brainstorm solutions to a thinning cash market," Miller said in a statement.
"Those solutions are incorporated within the Cattle Market Transparency Act, and USCA stands ready to see this piece of legislation through to the finish line."
USCA board member Lee Reichmuth said the bill is much needed.
"As a Nebraska cattle producer, I echo the same sentiments expressed by Sen. Fischer on the impacts to our livelihood of increased packer competition, decreased competition, and a declining cash market," he said in a statement.
"This bill builds off the recommendations provided by the U.S. Department of Agriculture in its 'Boxed Beef and Fed Cattle Price Spread Investigation' report and discussions producers across the U.S. are having in response to historically low cattle prices and a dysfunctional marketplace."
Fischer said in a statement she would work across the aisle to advance the bill.
"It will help facilitate price discovery and provide cattle producers with the information they need to make informed marketing decisions," she said.
Wyden said the difficulties faced by ranchers during the COVID-19 economic shutdown early in 2020 exposed the need for more market transparency.
"Cattle ranchers and rural economies have been hit especially hard during the COVID-19 public health crisis," he said.
"And that economic fallout gets compounded for Oregon producers who face both a lack of processing facilities and opaque cattle markets that add up to a serious disadvantage. This detailed and common-sense bipartisan bill would provide our state's rural producers the transparency and accountability they need to negotiate fair prices, stay in business and continue generating jobs throughout Oregon."
Read the Senate bill here: https://mcusercontent.com/….
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