Helping Iowa Family Farmers Stay Competitive

In recent years, the meat-packing industry has become increasingly concentrated, and this concentration is one of the biggest challenges facing the family farmer.  Right now, four meat-packing companies control almost 85 percent of the domestic slaughter capacity in the United States.  That puts family farmers at a distinct disadvantage when marketing their own livestock.

That’s why I introduced legislation with three other senators that would target unfair meat packer practices which negatively influence and impact independent producers.  This legislation builds on my long-standing efforts to help ensure a competitive environment for family farmers.
  
The bipartisan Livestock Marketing Fairness Act, introduced with Senators Mike Enzi of Wyoming, Tim Johnson of South Dakota, and Jon Tester of Montana, works to help ensure that independent livestock producers are given a level playing field and aren’t forced out of business by the big packers.  

Our bill has four main components.  First, the bill would require marketing agreements to have a firm base price derived from an external source, which helps guarantee that local contract prices are not subject to manipulation by packer-owned herds.   Second, our bill calls for future forward contracts for livestock (cattle, hogs and lambs) to be traded in public markets where buyers and sellers can witness bids and make their own offers, which helps ensures market competition through multiple offers.  Third, the bill exempts producer-owned cooperatives, packers with low volumes and packers who own only one processing plant, which targets the source of price manipulation and ensures that the business practices of small family-owned processors are not impacted by the law.  And, fourth, the bill guarantees that trading is done in quantities that provide market access for both small and large livestock producers.

Family farmers in the United States are the most productive in the world, yet they have a hard time getting a fair shake in the marketplace.  Bringing transparency to the marketplace and ending price-manipulating practices carried on by some of the large packers will create a healthy, competitive environment for small and large producers alike.