|
|
New Rule on Mandatory Livestock Price Reporting is
Improvement, Billings, Mont. (May 15, 2008) – In tomorrow’s Federal Register, the U.S. Department of Agriculture’s (USDA’s) Agricultural Marketing Service (AMS) will publish its final regulation to re-establish and revise the Livestock Mandatory Reporting (LMR) program, which becomes effective July 15, 2008. This rule facilitates market information for cattle, swine, sheep, beef and lamb meat. “Previously, the AMS price reports contained numerous errors and in many instances were inaccurate, so during the rule’s public comment period, R-CALF asked AMS to incorporate the GAO (Government Accountability Office) recommendations into this final rule, but AMS chose not to,” said R-CALF USA CEO Bill Bullard. “AMS states that while it concurs with the GAO recommendations, and while it intends to eventually implement those recommendations, AMS says it was not appropriate to include those recommendations in the rule. “Specifically, we wanted them to require additional auditing in order to ensure the accuracy of the information in the reports, as well as to ensure that data were not being excluded,” he continued. “AMS did not do that, but says it is committed to addressing those concerns.” R-CALF USA also had asked AMS to maintain the reporting for animals that are committed to a packer for between 7 – 14 days before slaughter, and AMS chose not to do that. Instead, AMS now requires packers to distinguish negotiated transactions that are scheduled to be delivered for slaughter within 14 days versus cattle that are to be delivered more than 14 days but fewer than 30 days before slaughter. “We were concerned that AMS is requiring less reporting for cows and bulls than they are for steers and heifers,” Bullard explained. “AMS essentially kept the same procedures on the basis that there are fewer variances in terms of how packers procure cows and bulls, as compared to steers and heifers. AMS said additional data for cows and bulls are not needed because most are sold as culls, not fed and then subject to some type of forward contract. “AMS also eliminated the weekly reporting by packers, justifying that decision by saying they can aggregate the daily information to obtain the weekly reports,” he added. The new rule, Bullard noted, does contain a number of improvements, such as: * Disclosure of the nature of premiums and discounts that are paid by packers for live cattle. The final rule now requires the age of the animal(s) to be included if there are discounts associated with an animal’s age. * Better delineation between negotiated grid purchases and formula contracts. Before, these two items were combined into one category. * Now requiring the reporting of many marketing tools currently in use in the industry. There are a number of different terms and conditions, many of them relatively new, and AMS attempts to distinguish between the various terms of sales in the cattle industry. For example, you can have forward contracts, formula contracts, negotiated grid purchases, and negotiated purchases, all of those various cattle procurement methods are better distinguished within this new rule. “All in all, this is indeed an improvement over what we had,” Bullard said. “This rule should provide us with additional information that’s important in determining the timely value of livestock. “R-CALF is looking forward to the rule that would now need to be promulgated with the passage of the new Farm Bill,” he concluded. “In the new Farm Bill, there are requirements that AMS further improve the transparency and readability of its market reports for the benefit of U.S. producers.” Note: To read the final Livestock Mandatory Reporting rule, visit the “Competition Issues” link at www.r-calfusa.com. # # # R-CALF USA (Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America) is a national, non-profit organization dedicated to ensuring the continued profitability and viability of the U.S. cattle industry. R-CALF USA represents thousands of U.S. cattle producers on trade and marketing issues. Members are located across 47 states and are primarily cow/calf operators, cattle backgrounders, and/or feedlot owners. R-CALF USA has dozens of affiliate organizations and various main-street businesses are associate members. For more information, visit www.r-calfusa.com or, call 406-252-2516. |
|
This page was last updated on Wednesday, December 24, 2008. |
