USDA officials will begin addressing some of the issues surrounding its Livestock Mandatory Price Reporting Program. The program has come under criticism as problems surfaced and in some cases lingered following its April 2 implementation.
“The review by our team outlines several important measures that USDA will immediately take to ensure the effectiveness and reliability of these programs,” says Agriculture Secretary Ann Veneman. “It is important that we continue to build and maintain a system of checks and balances.”
The Livestock Mandatory Reporting Act of 1999 required substantial changes to the livestock price-reporting system, including nearly doubling the number of reports and releasing reports in a more expeditious manner.
In May, Veneman created a team to review the program following problems with beef price reporting, which lingered through the program’s first six weeks. Last week, that team submitted its report, outlining the following points:
- There was not adequate testing before and after April 2 to ensure accuracy of reports. A programming error complicated matters.
AMS will upgrade and broaden its testing procedures. It also will work with the livestock/meat industry to develop realistic validation data sets and use those to test and adjust any future programming. Further, it will develop additional procedures to ensure correct input data.
- The auditing plan to ensure the accuracy of submitted data is behind schedule and needs improvement.
AMS will accelerate the audit process, hire additional personnel or utilize other agency personnel for auditing purposes.
- Confidentiality provisions are preventing the release of substantial portions of information, and require change.
USDA will move forward with an alternative confidentiality standard to the 3/60 rule. It will apply confidentiality standards to data collected over a multiple-day period vs. the current collection period of several hours.
- Cow-calf operators and feedlots incurred financial losses totaling $15 million to $25 million, while losses to packers and futures traders are undetermined.
Because producer losses are an indirect affect of the misreported data, loss estimates may vary widely depending on the assumptions used. The review team determined that USDA is not liable for any losses incurred and has no authority to make compensation payments as a result of misreported data. The review team did not recommend that USDA support legislation to provide payment to producers.