Click here to watch an interview with Sam Carney sa he discusses NPPC's opposition to the new livestock marketing rules.
It remains unclear what USDA’s final GIPSA rule addressing livestock and poultry marketing and production contracts will look like, or for that matter, when it will be released.
At World Pork Expo on Wednesday, Mark Legan, National Pork Producers Council board of director and producer from Coatesville, Ind., said, “The proposed GIPSA rule reached well beyond the (2008) Farm Bill’s intent.”
As written, the proposed bill would increase packers’ risk of buying hogs from producers under contractual arrangements to the point that it would be safer for them to raise their own supply of market hogs. That, in fact, would be counter to USDA’s intention of the proposed rule. Legan cited Informa Economics calculations that showed the pork industry would contract further-- by another 2 percent-- should the GIPSA rule become law as proposed.
Informa’s economic analysis also showed that 23,000 rural jobs would be lost; the rule would present $740 million in direct costs to the pork industry and nearly another $250 million in in-direct costs. In the end, 56 percent of the GIPSA rule’s costs would come down on U.S. pork producers.
During the comment period, which concluded earlier this year, USDA received more than 60,000 comments. More than 16,000 came from the pork industry.
Within the last week, 147 congressmen asked USDA Secretary Tom Vilsack to withdraw the GIPSA rule as proposed, conduct an economic analysis and redraw the rule to be in line with the intentions outlined in the 2008 Farm Bill.
Also last week, the House Agriculture Appropriations Committee allocated no funding in its Fiscal Year 2012 budget to implement the GIPSA rule. Of course, that is only on the House side, “there has been no action on the Senate side,” said Audrey Adamson, NPPC’s vice president for domestic policy issues. She noted that USDA does have funds to continue to work on the rule through October.
“USDA is working on its economic analysis,” she added. “We have no indication when that will be done.” It typically takes five to six months.
“USDA has agreed that its economic analysis was inadequate,” Adamson said. Also unclear is whether USDA will allow a comment period following the economic analysis. Secretary Vilsack has said “no.”
However, Adamson argues that it’s a matter of process, and that this issue has too much impact not to allow for comments. “This rule-making will unwind 30 years of progress in pork production,” she said. “We need to take time out and let people review the impact before you make a rule effective.”
While USDA has offered no specific timeline to initiate a final rule, “We expect a rule later this year,” Legan said.