Ag Policy Blog

Farm Bureau Supports GIPSA Withdrawal

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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Despite objections in some agriculture circles to USDA's announcement it plans to withdraw the livestock portion of the Grain Inspection, Packers and Stockyards Administration, or GIPSA, rule, the American Farm Bureau Federation on Wednesday came out in support of the proposal.

The agency is set to publish the proposed withdrawal in the Federal Register on Wednesday.

AFBF President Zippy Duvall said in a statement the withdrawal will give the industry time to work on poultry fair practice issues.

"This is good news for farmers and ranchers," he said.

"We thank Secretary (Sonny) Perdue for his diligent efforts on these rules. The livestock scope rule would have disrupted key marketing arrangements in our livestock sectors.

"As to the unfair and undue preferences rule, we encourage the agency to continue to work toward solutions that protect our farmers and ranchers from unjust practices and strengthen GIPSA's ability to enforce these issues. In particular, we urge the department to continue working to achieve more fairness for growers. The USDA can and should stop predatory practices that continue in the chicken industry.

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"We look forward to working with the administration on specific measures that will ensure our growers operate in competitive markets, markets that do not include unfair, deceptive or discriminatory practices."

Sen. Charles Grassley, R-Iowa, who has been pushing for GIPSA implementation for years told agriculture journalists on Tuesday that President Donald Trump's administration was "pandering" to big corporations.

"They don't care about family farms," Grassley said during a teleconference. "The legislative authority to write rules has been dormant for some time. This (GIPSA) is something to do with draining the swamp. This is an example of a swamp being refilled."

The livestock marketing rules under GIPSA date back to language in the 2008 farm bill. The rules were controversial throughout President Barack Obama's administration.

Early proposals from USDA drew fire from major industry groups and Congress. The rules were then blocked by Congress. Lawmakers refused to fund any efforts to advance the rules. Congress relented in the fiscal year 2016 funding bill and USDA advanced the rules again.

The three rules were dubbed as the "Farmer Fair Practices Rules."

The rules included an interim final rule on how USDA wanted courts to interpret a provision of the Packers and Stockyards Act. Courts have ruled in cases between poultry growers and poultry companies that a grower has to demonstrate a company's action against the individual grower harmed the entire poultry market.

Since the 1980s, USDA used the standard in beef or pork cases that a livestock producer doesn't have to show harm to competition to bring a Packers and Stockyards case against a company. USDA has pushed to apply the same language to poultry contracts.

Another proposed rule would have given producers more rights when dealing with marketing contracts. The rule would ensure packers can't retaliate against producers who show their contracts to attorneys. The rule also would have prevented packers from giving undue price preferences in marketing contracts.

The final proposed rule would have restructured the tournament payment system by giving USDA authority to determine if a ranking system for poultry growers' prices is fair or unjustly discriminatory, or deceptive. The poultry industry has opposed any USDA rules that could create problems with the company tournament systems.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow me on Twitter @toddneeleyDTN

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