Meat Institute criticizes USDA’s proposed cattle market regulations

Legislative Watch: Alternative Marketing Arrangements impact; $250M in assistance for distressed farmers; EU proposes to delay deforestation regulations.

Eric Bohl

October 11, 2024

4 Min Read
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The USDA is considering new rules under the Packers and Stockyards Act to address price discovery in cattle markets, but the proposal has drawn criticism from some industry leaders. Julie Anna Potts, president and CEO of the Meat Institute, expressed strong opposition to the potential regulations this week, accusing the Biden administration of government overreach in an already transparent industry.

“Biden’s USDA is once again attempting to assert government control over the free market to the detriment of cattle producers, packers and consumers,” Potts said. “This is not about transparency. This is about the government dictating how cattle may be bought and sold.”

Potts specifically voiced concerns about the impact on Alternative Marketing Arrangements, which allow producers to invest in herd genetics, sustainability, and quality, leading to higher financial rewards. She believes the proposed rules would force producers and packers into the traditional cash market, which could stifle competition and innovation. Potts emphasized that AMAs help maintain a high standard of product quality while giving producers higher prices and consumers consistent access to quality beef at stable prices.

Potts highlighted that the cattle and beef markets already have established price discovery mechanisms, such as the Livestock Mandatory Reporting Act, which requires packers to report daily prices and other market data. She noted that these reports, released by the Agricultural Marketing Service, ensure transparency across the market. She also mentioned the Cattle Contracts Library Pilot Program, launched in 2022, which further enhances market transparency by making contract data available in a searchable database. According to Potts’ statement, the Meat Institute opposes all of USDA’s proposed rule changes, asserting that they exceed the agency’s authority and could harm the cattle industry.

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USDA announces additional $250M in assistance for distressed farmers

USDA’s Farm Service Agency announced an additional $250 million in automatic payments for distressed farm loan borrowers, utilizing funds provided by the Inflation Reduction Act. Since the Act's signing in 2022, USDA has provided over $2.4 billion in assistance to nearly 44,000 borrowers, helping them retain their land and continue operations.

The new assistance will benefit approximately 4,650 distressed borrowers, including $235 million for delinquent direct and guaranteed borrowers who had not received previous assistance, and $15 million for borrowers with Shared Appreciation Agreements. This support aims to alleviate the debt burden for those impacted by paused loan servicing actions, including those delayed due to the COVID-19 pandemic. The payments will be automatically applied to delinquent accounts.

Related:Q4 demand for both hogs and pork is robust

In addition to this financial assistance, USDA has introduced several improvements to the Farm Loan Programs to expand opportunities for farmers. These include streamlined loan application processes, an interactive Loan Assistance Tool, online loan repayment options, and simplified loan applications. These efforts are designed to make the loan process more accessible and help borrowers make strategic investments in their agricultural operations.

According to FSA, USDA’s actions taken under the IRA have significantly reduced farm foreclosures and bankruptcies, helping nearly 4,000 farmers avoid foreclosure since 2021. The new payments are expected to generate substantial economic benefits, supporting nearly 49,000 jobs and contributing billions to the U.S. economy. As USDA strengthens its loan programs, it encourages farmers to reach out to their local FSA offices for assistance.

EU proposes to delay deforestation regulations

The European Commission is proposing to delay implementation of the EU Deforestation Regulation to give stakeholders more time to prepare. If approved by the European Parliament and Council, large companies would need to comply by Dec. 30, 2025, and micro- and small enterprises by June 30, 2026. The proposal comes after the EU received substantial feedback, with some citing challenges posed by the regulation’s strict requirements for preventing deforestation.

Related:U.S. pork exports may face some risks, but opportunities abound

The Commission also published additional guidance to address key concerns and clarify the rules. The guidance includes detailed information on critical definitions like “forest degradation,” traceability requirements and compliance for small businesses. Many stakeholders have voiced worries about the complexity of the new requirements and their potential economic impact on global trade.

To address these concerns, the commission also released a framework to classify countries based on their deforestation risk. This system is designed to focus efforts on high-risk regions, where deforestation challenges are most pressing. However, some critics remain concerned that these measures may not sufficiently mitigate the economic strain on smaller businesses and developing countries.

About the Author

Eric Bohl

Eric Bohl is an agricultural policy leader with extensive experience on Capitol Hill. He served six years as Chief of Staff to Congressman Jason Smith (R-MO) and Congresswoman Vicky Hartzler (R-MO), and previously served as Legislative Director to Rep. Hartzler. During that time, he led her work on the House Agriculture Committee and was influential in efforts to craft the 2014 Farm Bill, as well as handling environmental, energy, transportation and infrastructure, and agricultural trade issues.

Eric’s experience starts at the ground level. His family has deep roots in both animal and row-crop farming going back several generations. This understanding of the unique challenges real farmers face brings valuable perspective to help solve clients’ needs. His midwestern values also allow him to build meaningful relationships with people on both sides of the political aisle and find common-sense solutions that transcend partisan lines.

This approach has continued to be the cornerstone of Eric’s career in grassroots advocacy. He served more than five years as Director of Public Affairs and Advocacy for Missouri Farm Bureau. He was a senior member of the organization’s legislative team and led communications and coalition advocacy efforts, including on the 2018 Farm Bill. His writings on agriculture and rural policy have been published in newspapers across the nation. He serves as First Vice President of the St. Louis Agribusiness Club and is a board member of the Agricultural Business Council of Kansas City, two of the nation’s largest and strongest organizations supporting agribusinesses.

Before his career in public policy, Eric was a practicing attorney for nearly five years, focusing on real estate and agricultural law, commercial transactions, and commercial litigation. Eric earned undergraduate and law degrees from the University of Missouri, graduating from both programs with honors, and served as the Managing Editor of the Missouri Law Review.

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