This issue gets to the heart of what the free enterprise system is all about – increase competition. The reason big government exist is to counterbalance big business, which, at its heart, is a bane to the free enterprise system. Regulate big business that creates a level playing field and small business will thrive and the need for large government will disappear. Much of the country’s economic troubles are linked to a basically unregulated system of big business that controls not only the marketplace, but also the halls of government.

These reforms are also necessary as the current system is unsustainable. When a handful of large businesses control all aspects of a business, the weight of its inefficiencies will cause it to collapse.

National Farmers Organization said that Friday’s DOJ/USDA listening session in Fort Collins, Col., National Farmers Organization re-affirmed its support for proposed GIPSA rules that would help improve competition and regulation in the industry.

“National Farmers certainly sides with independent farmers and ranchers in an increasingly anti-competitive marketing environment,” said National Farmers Ag Policy Analyst Gene Paul. “We believe the proposed GIPSA rules are akin to a farmer and rancher bill of rights, and would help producers get an equitable share of the retail dollar.”

Last week, Iowa Senator Tom Harkin, joined by 19 other senators, announced their support for strengthening protections for livestock, swine and poultry growers in a letter to Ag Secretary Tom Vilsack.

“We cannot agree enough with Iowa Senator Tom Harkin’s views that growers must receive fair, equitable and non-discriminatory treatment in marketing and contract arrangements,” Paul emphasized. “The provisions add protections for farmers and ranchers, addressing retaliation and fraud, and call for more reporting on the part of processing companies, which would significantly improve transparency.”

The proposed rule would:

• Provide further definition to practices that are unfair, unjustly discriminatory or deceptive, including outlining actions that are retaliatory in nature, efforts that would limit a producer’s legal rights, or representations that would be fraudulent or misleading

• Reiterate USDA’s position that a producer need not overcome unnecessary obstacles and have to always prove a harm to competition when they have suffered a violation under the Act

• Define undue or unreasonable preferences or advantages

• Establish new protections for producers required to provide expensive capital upgrades to their growing facilities, including protections to ensure producers have the opportunity to recoup 80 percent of the cost of a required capital investment

National Farmers Union President Roger Johnson is urging NFU members and all livestock producers to attend. The workshop is scheduled for Aug. 27, in Fort Collins, Colo.

 Johnson said the workshop’s timing is ideal, as the comment period on the proposed rule published by the Grain Inspection, Packers and Stockyards Administration (GIPSA) in the Federal Register of June 22, 2010 (75 Fed. Reg. 35338) has been extended.

 “U.S. farmers and ranchers should attend this workshop to have their voices heard directly by USDA and DOJ staff,” said Johnson. “We must be sure that the packer-producer organizations are not the only people at the table when discussing this important issue.”

 He said the proposed rule, essentially a Farmer and Rancher Bill of Rights, addresses concerns that have been discussed for many years and were developed at the direction of the 2008 Farm Bill, which requires USDA to carry out specific rulemaking to improve fairness in the marketing of livestock and poultry.

 Recent appeals court decisions have ruled against the intent of the Packers and Stockyards Act of 1921, much to the detriment of livestock producers. GIPSA’s proposed rule changes will bring clarity to the regulations, so that farmers and ranchers are able to take action if they are victims of market abuses by packer-processors. The rules will also allow for more transparency in price and contract negotiations.

 “The Farmer and Rancher Bill of Rights will ensure livestock producers the right to access competitive markets,” said Johnson. “These proposed changes are vital to U.S. farmers and ranchers, and I urge USDA to adopt and implement them promptly.”

 According to R-CALF USA, a strong supporter of changes in the livestock industry, the issue is about bringing free market enterprise back to the livestock industry.

Beef packer concentration is constraining the U.S. cattle industry, causing it to shrink and preventing it from keeping pace with increased domestic beef consumption: U.S. cattle operations declined 40 percent since 1980, with over 500,000 operations exiting the industry since that time. even in the face of growth in U.S. beef consumption (consumption outpaced production from 1996-2009).

Four packers control over 80 percent of the fed cattle market, which is a radical increase from the 36 percent they controlled in 1980. Concentration of the market outlets for fed cattle and boxed beef have surpassed levels known to elicit noncompetitive behavior and result in adverse economic performance:

• Four packers control over 50 percent of the cow/bull market, which is a radical increase from the 10 percent they controlled in 1980.

Concentration of the market outlets for fed cattle and boxed beef have surpassed levels known to elicit noncompetitive behavior and result in adverse economic performance:

• Four packers control over 50 percent of the cow/bull market, which is a radical increase from the 10 percent they controlled in 1980.

• The size of the U.S. cow herd is now the smallest since the 1950s.

• Contrary to claims that increased productivity offsets the need for more cattle operations and more cattle, U.S. beef production remained relatively stagnant during the past 14 years

Four packers control over 80 percent of the fed cattle market, which is a radical increase from the 36 percent they controlled in 1980.

Concentration in the feeder cattle market is increasing and the exodus of independent feedlots already has reduced the number of competitive bidders for feeder cattle:
• Feedlots with capacities under 1,000 head have been reduced by 30,000 just since 1996.
• The four largest feedlot companies: JBS-owned Fiver Rivers Ranch Cattle Feeding, Cactus Feeders, Cargill-owned Cargill Cattle Feeders, and Friona Industries, market about 20 percent of all fed cattle, though the actual selling price and terms for these cattle is not definitively known.