WILKESBORO
The U.S. Department of Agriculture is proposing rule changes to provide significant new protections for poultry growers and livestock producers, the agency announced Friday.
"Concerns about a lack of fairness and commonsense treatment for livestock and poultry producers have gone unaddressed far too long," Agriculture Secretary Tom Vilsack said in a written statement. "This proposed rule will help ensure a level playing field for producers by providing additional protections against unfair practices and addressing new market conditions not covered by existing rules."
The proposed rules include regulations that provide poultry growers with new protections when producers require them to provide expensive capital upgrades. The rules include a provision to ensure that poultry growers have the opportunity to recoup at least 80 percent of the cost.
Chicken houses may cost $300,000, but as things stand now poultry companies may terminate a grower's contract at any time, leaving the grower deep in debt without income.
Among other changes, the rules would also require that poultry growers receive a written notice of a company's intention to suspend the delivery of birds at least 90 days in advance; establish a fair process for using arbitration to remedy disputes; and provide further definitions of unfair practices.
The proposed rule changes have been discussed for years, and were developed at the behest of the 2008 Farm Bill, which required the USDA to develop new rules to improve fairness in the marketplace for livestock and poultry.
The USDA said that many of the concerns were raised during dozens of Rural Tour stops that the agriculture secretary attended last year and at joint USDA-Department of Justice workshops this year.
Becky Ceartas, who works on contract agriculture reform with the Rural Advancement Foundation International, based in Pittsboro, said that the proposal is a major step in protecting growers from such things as canceling contracts related to expensive upgrades to chicken houses.
"The USDA has never gone this far before in what are unfair practices," she said.
The USDA said that many of the concerns related to how the livestock and poultry industry is controlled through vertical integration, a system where corporations control the process, and how that's led to shrinking farm numbers and increased corporate power.
For example, the country had more than 666,000 hog farms in 1980, but only about 71,000 now. In the poultry industry, a typical grower might make about 34 cents a bird, and the processing company makes $3.23, according to the USDA.
The proposed rule changes will be published Tuesday in the Federal Register.
The public may comment to the Grain Inspection, Packers and Stockyard Administration, part of the USDA, through Aug. 23 by e-mail at comments.gipsa@usda.gov or by mail to Tess Butler, GIPSA, USDA, 1400 Independence Ave., SW, Room 1643-S, Washington, DC 20250-3604.
For more information, including details of the proposed rule changes, visit www.gipsa.usda.gov.
mmitchell@wsjournal.com
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