WASHINGTON, D.C – U.S. Senator Deb Fischer’s (R-Neb.) Cattle Price Discovery and Transparency Act today passed out of the Senate Agriculture Committee. The bill passed by voice vote with only two recorded no votes, and is now eligible for a final vote on the Senate floor. Sen. Fischer, along with Sens. Grassley, Tester, and Wyden unveiled the updated version of the legislation in March.
“Our bipartisan bill to facilitate price discovery and bring much needed transparency to the cattle market passed the committee by voice vote with only two recorded no votes. The broad support reflects the importance of restoring market fairness so that every segment of the cattle supply chain can succeed. These reforms are especially needed now at a time when family ranchers and consumers are all struggling to navigate a slow economy and record inflation,” said Senator Fischer, a member of the Senate Agriculture Committee.
“Price discovery is a public good. Negotiated market participants invest time and resources to discover fed cattle prices for their respective regions and the entire industry. Until price discovery participation is better valued at all points in the supply chain, live cattle market price negotiation will continue to decrease. Eventually, negotiated trade will become too thin to accurately discover price in the physical live cattle market, which will also undermine the functionality of the industry’s primary risk management mechanism – CME Live Cattle futures. We thank Senator Fischer for her continued work and dedication to identifying resolutions to this complex issue,” said Nebraska Cattlemen President Brenda Masek.
“USDA ranks Nebraska first in the nation in commercial cattle slaughter, and second in all cattle and calves, cattle on feed, and commercial red meat production. It is essential for our state that our cattle producers who do the work, invest the capital, take the risk and drive our state’s economy have cattle markets that function as they should to provide true price discovery and value allocation. When Nebraska’s beef sector does well, our state prospers. We thank Sen. Fischer and the Senate Agriculture Committee for their support for the ‘Cattle price discovery and Transparency Act’. This long overdue and badly needed legislation is a giant step forward in the right direction towards more competition, transparency, and fairness in cattle markets. This bipartisan bill deserves the support of all 100 Unites States Senators,” said Nebraska Farmers Union President John Hansen.
“Today’s successful Senate Ag Committee mark-up of the Cattle Price Discovery and Transparency Act is a win for Nebraska’s cattle producers who have long asked for additional price discovery and transparency opportunities. Without the hard work and dedication of Nebraska Senator Deb Fischer, this important piece of legislation would not have taken this significant step forward. Nebraska Farm Bureau members from around our great state stand firmly behind Sen. Fischer’s tireless efforts to find compromise on this unbelievably complex issue,” said Nebraska Farm Bureau Federation President Mark McHargue.
“Senator Deb Fischer led the introduction of the Cattle Price Discovery and Transparency Act as one of the much-needed solutions to an increasingly consolidated meat industry. Studies have shown that, without government intervention, negotiated trade in the U.S. marketplace will fall to zero percent by 2026 in parts of the country. When producers don’t have the ability to negotiate a fair price for their cattle based on current market conditions, it results in a vertically integrated, corporate-controlled beef supply chain. This threatens the livelihoods of producers and the security of our national food system,” said U.S. Cattlemen’s Association President Dr. Brooke Miller.
“For family farmers and ranchers to thrive, they need markets that offer adequate price discovery and transparency. NFU strongly supports the Cattle Price Discovery and Transparency Act of 2022, which will preserve the cash market as an option for cattle producers by establishing regional minimums for cash trades, and through other provisions. We would like to thank Senator Fischer and the cosponsors of the bill for their strong leadership on this issue, and we urge swift passage of this bill by the full Senate,” said National Farmers Union (NFU) President Rob Larew.
The updated bill would:
- Require the Secretary of Agriculture to establish 5-7 regions encompassing the entire continental U.S. and then establish minimum levels of fed cattle purchases made through approved pricing mechanisms. Approved pricing mechanisms are fed cattle purchases made through negotiated cash, negotiated grid, at a stockyard, and through trading systems that multiple buyers and sellers regularly can make and accept bids. These pricing mechanisms will ensure robust price discovery.
- Establish a maximum penalty for covered packers of $90,000 for mandatory minimum violations. Covered packers are defined as those packers that during the immediately preceding five years have slaughtered five percent or more of the number of fed cattle nationally.
- The bill also includes provisions to create a publicly available library of marketing contracts, mandating box beef reporting to ensure transparency, expediting the reporting of cattle carcass weights, and requiring a packer to report the number of cattle scheduled to be delivered for slaughter each day for the next 14 days. The contract library would be permanently authorized and specify key details about the contents that must be included in the library like the duration of the contract and provisions in the contract that may impact price such as schedules, premiums and discounts, and transportation arrangements.