990560 Meatpackers & Farmers Agree on Price Reporting

Washington - The U.S. meatpacking industry and livestock producers ended weeks of sometimes bitter negotiations by agreeing on draft legislation that would require plants to report prices paid for cattle and hogs.

The proposed bill, which was requested by the Republican and Democratic leaders of the House Agriculture Committee, is expected to move swiftly through Congress this summer.

The legislation comes at a time when several states have threatened to enact their own versions of mandatory price reporting to help livestock producers cope with another year of low prices. Last December, hog prices paid to farmers briefly dipped to Depression-era levels of less than 10 cents a pound while retail prices remained steady.

Farm groups have also stirred congressional concern in recent months with complaints about the dominance of a handful of big grain and livestock companies in U.S. markets.

The momentum was enough for the big packing companies to give up their longtime opposition to price reporting and agree to work on a bill with farmers.

“We hope that Congress will pick this up and move it forward immediately to get it on the president's desk for signing by the August recess,” said Chandler Keys, vice president of the National Cattlemen's Beef Association.

The new bill, drafted in a series of marathon meetings between the packing industry and livestock groups, will get its first scrutiny on Wednesday when a Senate Agriculture subcommittee holds a hearing on price reporting.

The proposal would require the U.S. Agriculture Department to collect daily data on prices, volume and terms of sales of hogs, cattle and boxed beef products.

The information would be made available to farmers via the Internet, newspapers, broadcast stations and other news media.

The USDA would also issue weekly data about U.S. exports of beef and a monthly report -- instead of the current quarterly one -- on U.S. inventories of hogs.

To help track the relationship of consumer and producer prices, the USDA would collect and publish monthly information about retail prices of all kinds of meat products sold by grocery stores.

Four packing companies -- IBP Inc., ConAgra Inc., privately held Cargill Inc unit Excel, and Farmland National Beef -- control an estimated 80 percent of the U.S. beef market.

The same firms plus Smithfield Foods Inc. control more than half of the U.S. pork market.

Congressional aides said they welcomed the joint legislation from industry and farmers as a starting point for debate.

“We'd like to have something finished up this legislative year,” said one source close to the Republican-controlled House Agriculture panel. “Everyone has an interest in seeing that this is resolved.”

The farm groups and industry worked closely enough with Congress that any changes in the legislation are likely to be minor in nature, Keys said.

“I don't expect the cattlemen to be totally happy about this, or the packers to be totally happy,” he said. “We worked out something that we thought would be acceptable to everyone.”

The National Pork Producers Council developed a section of the legislation covering hog price reporting, which differs from cattle in how the animals are marketed.

“We have said that this has to be comprehensive legislation so that a producer can look at prices and make a good business decision,” said a spokesman for the pork council.

On the pork side, after more than 100 hours of negotiating farmers and packers said they were still unable to reach agreement on accounting for average trim loss, record-keeping of date of purchases, and additional information the USDA may require and publish.

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