New Law May Protect Small Meat Producers

The law aims to narrow the gap between the worst excesses of the factory farming system and the small producers that exists outside of the vertically integrated production process.

Also, the law would protect the smaller producers that supply livestock to the large-scale producers from incurring massive amounts of debt and providing product at a loss for fear of losing supplier contracts.

The grim statistics:

They would bar cattle dealers from acting as exclusive buyers for more than one meat packer in order to keep packers from sharing information on pricing, which could lead to collusion to keep prices down.

They would enhance market transparency by requiring processors to submit to the U.S.D.A. samples of contracts they offer producers.

And they address the concerns of many poultry growers that they must go deeply into debt to build poultry houses required by processors. The rules would require that processors give growers contracts that last long enough for them to recoup 80 percent of their capital investment.

In describing the consolidation in the livestock industry, the U.S.D.A. said the number of hog farms in the United States had fallen to 71,000 today, from 666,000 in 1980. A hog farmer today is paid on average 25 percent of the retail value of a hog, which is half of what farmers received 30 years ago, the department said.

In the cattle industry, the number of farms, ranches and feedlots has dropped to 950,000 from 1.6 million in 1980, according to the department. It said that cattle farmers received 43 percent of the retail value of a steer, compared with 62 percent in 1980.

Source

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