When corporate agribusinesses pitch a fit, we must be doing something right.

In June 2010, the U.S. Department of Agriculture (USDA) proposed a new rule regarding how meatpackers must treat farmers and ranchers when they buy livestock - they have to be fair. The new rule is not perfect, but it will breathe life and competition back into our livestock markets. It is the most aggressive livestock market reform to come out of Washington since the passage of the Packers and Stockyards Act itself back in 1921.

Get in on the Action: USDA gives people like you the opportunity to comment on proposed rules, and for this rule we have until November 22, 2010. You can submit your own comment here, and keep reading for suggestions on what say below. You can read the draft rule here or here [PDF], and more about the background of the issue can be found at www.cfra.org/competition. 

The Backstory: For decades, USDA has allowed meatpackers to pay family farmers and ranchers less than they pay mega-producers for the same quality hogs and cattle.  This is bald-faced discrimination and specifically against the law - premiums based on the number of animals raised violates the Packers and Stockyards Act already on the books.

Competitive markets are the foundation of America's economy, and family farmers and ranchers asking for a level playing field where the value and quality of their livestock determine price, not the volume. The packers and their allies are complaining about this new rule because they like being able to control the market and fix prices.

Suggested Comments to USDA: There are three areas where USDA’s draft rule needs improvement:

1. The rule must specifically disallow premiums based purely on volume (i.e. the more a farmer produces, the more the meatpacker pays)
2. The “unreasonable preference” section should not focus so heavily on very large-volume livestock producers at the expense of independent, small-volume livestock producers.
3. The final rule should exclude premiums based on unclear, shadowy so-called “operational efficiencies” that meatpackers claim occur within their own plants. Premiums should only be based real and verifiable differences in transactional costs.

USDA's draft rule provides a fighting chance of enforcing that law for the first time in 40 years. Be a part of that history, and submit your own comments today!