A-PLUS Act Introduced in House

More Livestock Processing Facility Investment Opportunities Could Be Coming

Victoria G Myers
By  Victoria G. Myers , Progressive Farmer Senior Editor
The A-Plus Act was introduced in the House of Representatives, as legislators attempt to make a change to the Packers and Stockyards Act. (DTN/Progressive Farmer file photo by Victoria G. Myers)

Change to the century-old Packers and Stockyards Act (PSA) may be coming this year, as legislators consider allowing livestock marketers to invest in processing facilities. There has long been a prohibition against livestock auction yards financing or managing processing facilities, originally intended to create separation between buying and selling agents.

"The Packers and Stockyards Act is over one hundred years old -- it's time to modernize parts of this historic legislation that no longer make sense in the modern world," said Brooke Miller, president of the U.S. Cattlemen's Association (USCA).

The bill that would make this change is called the Amplifying Processing of Livestock in the United States Act (A-PLUS Act). It is a bipartisan bill introduced by Reps. Vicky Hartzler, R-Mo., and Jimmy Panetta, D-Calif.

The bill says that within one year of enactment, the Secretary of Agriculture will revise the code of federal regulations and specifies the following: "that market agencies may have an ownership interest in, finance, or participate in the management or operation of a packing entity so long as such packing entity has a cumulative slaughter capacity of less than 2,000 animals per day or 700,000 animals per year."

Rep. Hartzler said, "The A-PLUS Act would even the playing field and fix these regulations for the benefit of our livestock auctions and small packers." Rep. Panetta noted that removing outdated regulations would be a way to support small businesses, increase competition and drive down costs to consumers.

The USCA is joined by the National Cattlemen's Beef Association (NCBA) in support of the bill.

Tanner Beymer, NCBA senior director of government affairs, said opening more small- and medium-sized processing facilities increases opportunities for producers to market their cattle and helps balance leverage in pricing negotiations.

Clint Berry, chairman of the NCBA's Livestock Marketing Council, noted the need for new packing facilities has become a critical issue for the cattle industry.

"Huge amounts of capital are required to get new facilities up and running," Berry said. "Understanding the need for these new facilities, producers themselves have invested in these efforts, but outdated regulations still prevent livestock markets from having ownership in packing facilities. The A-PLUS Act paves the way for the marketing segment of the cattle industry to be included as investors in these facilities, helping reduce dependence on major packers and improving the competitiveness of the live cattle market."

Victoria Myers can be reached at vicki.myers@dtn.com

Follow her on Twitter @myersPF

Victoria Myers