Wednesday June 26 Ag News

Nebraska among four states to begin voluntary testing for bird flu in dairy farm milk tanks
Nebraska Examiner

The U.S. Department of Agriculture announced Tuesday that four states will launch voluntary pilot programs in the days ahead to test bulk milk tanks on dairy farms for bird flu — a move that’s aimed at making it easier for farmers to ship herds across state lines and for public health officials to track spread of the virus.

Kansas, Nebraska, New Mexico and Texas will be in the first round of voluntary participation, with other states likely to follow, officials said on a call with reporters.

“This list of participating states is just the beginning,” said Eric Deeble, the acting senior advisor for H5N1 response at USDA.

“We are in close conversation with about a dozen other states who are very interested in participating as well,” Deeble said. “But it was important for us to get these four states going so that other states could watch how the program works and gain additional confidence.”

The launch of the pilot program, he said, is “an important step forward” for efforts to reduce the spread of bird flu, also known as H5N1, as well as for expanding understanding of the virus.

Farmers who voluntarily enter the program will be able to move their herds across state lines without additional testing after bulk milk tanks or similar representative samples test negative for H5N1 for three consecutive weeks.

“Producers must also comply with continued regular weekly monitoring and testing of their herd for H5N1, but that process can happen with very little effort on the part of the producer, using routine bulk milk samples,” Deeble said.

126 cases of bird flu confirmed
The announcement is part of the federal government’s ongoing response to the months-long outbreak within dairy cattle and years-long challenges faced by the country’s poultry industry.

The USDA has confirmed 126 cases of bird flu in dairy cattle herds in a dozen states, including Colorado, Idaho, Iowa, Kansas, Michigan, Minnesota, New Mexico, North Carolina, Ohio, South Dakota, Texas and Wyoming.

Idaho has the most dairy herds affected, with a total of 27. That’s followed by Michigan with 25 herds and Texas with 21 herds. Colorado has reported 18 affected herds, while each of the other states has fewer than 10 herds testing positive for bird flu, according to the USDA data.

Three dairy farmworkers have contracted avian flu this year, though all cases were mild.

The U.S. Centers for Disease Control and Prevention reinforced during the call Tuesday that the risk to the general public remains low, though there is an increased risk of contracting the virus for workers, both on dairy farms and poultry farms.

FDA to do more testing
The U.S. Food and Drug Administration also announced Tuesday it’s broadening its testing for H5N1 to include about 155 additional samples of dairy products, including aged raw milk cheese, cream cheese, butter and ice cream.

The FDA has repeatedly tested pasteurized milk from store shelves in the months since the first dairy cattle herd tested positive for H5N1 and has continuously emphasized that he nation’s milk supply remains safe.

“This retail sampling effort is intended to address remaining geographic and product gaps from the initial sampling of the commercial milk supply that FDA conducted between April and May of this year,” said Don Prater, acting director of the Center for Food Safety and Applied Nutrition at the FDA.

It will likely take several weeks before those results are completed and made public, he said.

That second round of expanded food safety testing will not include raw milk, since it is not approved for interstate commerce, he said.

But the FDA has sent a letter to its local, state and tribal partners, cautioning those that do allow the sale of raw milk to talk with consumers about the additional risks, given that H5N1 is spreading through dairy herds in several parts of the country.

Prater, speaking on the call Tuesday, noted the FDA continues to strongly advise against drinking raw milk.

“We also recommend that the industry does not manufacture or sell raw milk or raw milk products, including raw milk cheese made with milk from cows showing symptoms of illness, including those infected with the avian influenza viruses or exposed to those infected with avian influenza viruses.”



Secretary Naig Provides Update on Highly Pathogenic Avian Influenza Response Measures within Iowa, Announces New Dairy Exhibition Requirements

Iowa Secretary of Agriculture Mike Naig today provided an update on Highly Pathogenic Avian Influenza (HPAI) state response measures, including announcing new testing requirements for dairy cattle participating in Iowa fairs and exhibitions. He also reiterated his request to the United States Department of Agriculture (USDA) for resources for impacted farmers, and extended his appreciation to Iowa farmers for their cooperation with testing and research efforts that are increasing the broader understanding of this virus.

“Highly Pathogenic Avian Influenza isn’t just a poultry issue or a dairy issue, it’s an issue for all of agriculture. Our approach is reflective of our significant livestock industry, and I want to thank our farmers who have stepped up to help contribute to the broader understanding, visibility and knowledge of this virus,” said Secretary Naig. “We should expect additional challenges ahead and as the situation continues to evolve, we will also continue to evaluate our response. We continue to support our farmers through the joint state and federal response team who are navigating this evolving and unpredictable situation.”

Dairy Exhibitions and Fairs
To help minimize the potential spread of virus, dairy exhibitors will be required to submit additional tests before their dairy cattle can be transported to a show. The Department is announcing an order for fairs and exhibitions that will go into effect on July 1, 2024. The order will require dairy exhibitors participating in Iowa fairs or exhibitions to complete testing for HPAI within 7 days of moving to the exhibition. The statewide order can be viewed on the Iowa Department of Agriculture and Land Stewardship’s website.

“The Department is issuing a statewide order effective July 1 that will require additional tests for HPAI prior to dairy cattle participating at our state’s many fairs and exhibitions,” said Secretary Naig. “We want to strike a balance between allowing our 4-H, FFA, and dairy exhibitors the opportunity to show their animals, while also requiring additional testing to protect our livestock and minimize the potential spread of the virus.”

Response Measures

Testing Update
Following the announcement made on June 7 of additional HPAI response measures in Iowa, including the required testing of dairy herds within a 20-kilometer radius around infected poultry farms, the quantity of tests has been ramping up. Additionally, farmers outside of testing radiuses have also been submitting tests for their herds. Iowa has detected additional positive tests because of increased testing, and it is likely that we will continue to report new positives as more tests are conducted. The Department encourages dairy farms not subject to mandatory testing to continue to voluntarily participate in testing to help with the broader research effort. Farms with cattle displaying clinical signs are required to report them. While the final details are still pending, the Department encourages Iowa farmers to participate in USDA’s voluntary herd status program.

Epidemiological Strike Teams
USDA has authorized additional epidemiological strike teams to assist with impacted poultry and dairy farms in Iowa. Researchers have been on the ground in Iowa over the past few weeks conducting interviews, looking for links between cases, and trying to better understand how the virus may have been introduced into the flocks and herds. Investigations are ongoing and are intended to result in specific biosecurity recommendations that can help farmers and producers better protect their livestock going forward.

USDA Wildlife Services
USDA Wildlife Services personnel continue to work with impacted farms to assist in the surveying of disease in wildlife around Iowa poultry and dairy facilities. From wild birds to rodents, these professionals are capturing wildlife samples for testing to determine the degree to which the virus is present in wildlife on these farms. These investigations, which are ongoing, are helping to inform biosecurity recommendations as well as aid in epidemiological investigations.

Further Research
In addition to research conducted through genomic sequencing, herd testing, wildlife surveys, epidemiological investigations and much more, the Iowa Department of Agriculture and Land Stewardship is also coordinating with USDA and the Iowa State University College of Veterinary Medicine to set up longer-term research studies to help learn more about the impact of this virus and how best to mitigate it.

Request for USDA Resources for Impacted Farmers
On June 7, Secretary Naig made several of requests of USDA to support impacted dairy and poultry farmers. Conversations are continuing, but as of June 25, USDA has not yet made any final decisions regarding Secretary Naig’s requests. These requests included compensation for cull dairy cattle at fair market value, compensation for lost milk production at a minimum 90 percent of fair market value, revisions to poultry indemnity tables to better reflect the fair market value of impacted birds and/or eggs, and a streamlined and timely process for farmers to be compensated for lost production and to receive indemnity. Secretary Naig will continue to request assistance for affected livestock producers.

“By cooperating with testing protocols, welcoming epidemiological researchers, coordinating with USDA Wildlife Service professionals and many other steps, our farmers are helping to provide valuable information that will assist the industry well beyond Iowa’s borders,” said Secretary Naig. “In recognition of the significant disruptions and production losses this virus is causing, and because they are working with researchers during this stressful time, dairy and poultry farmers should receive financial assistance from USDA. Many of these same farms are now also contending with significant and devasting flooding.”



By Following the Law, Iowa Utilities Board Opens Door to New Possibilities for Ethanol Producers, Farmers

Tuesday the Iowa Utilities Board (IUB) approved Summit Carbon Solutions’ carbon capture pipeline, granting a permit for the project to move forward. The decision follows dozens of community meetings, a public docket open almost three years, and the longest public hearing in the history of IUB. Yet the length of the process does not diminish the scale of the new possibilities for ethanol producers and farmers to capture low carbon market opportunities around the country and the world.

“We applaud the IUB for the thorough and fair process it took to reach this decision,” said Iowa Renewable Fuels Association Executive Director Monte Shaw. “Despite the overheated rhetoric of a few, we must not forget that the overwhelming majority of impacted landowners support this project. More importantly, it was the correct decision based on federal and state law. It is encouraging to see the large amount of disinformation did not prevail.”

Many existing fuel markets in the U.S. are transitioning to low carbon requirements. In addition, massive new markets are opening that require ethanol to lower its already low carbon footprint in order to participate. One example is the 35-billion-gallon sustainable aviation fuel (SAF) market.

“Today’s decision creates monumental opportunities for Iowa farmers faced with falling prices and growing stockpiles,” added Shaw. “Whether you think it’s smart or silly, the world’s largest airlines want to decarbonize their fuel. Carbon capture and sequestration gets Iowa ethanol into that market, potentially providing a generational boost to Iowa’s economy. This is just one of several potential new markets.”

SAF production creates a substantial opportunity for rural economies, farmers and renewable fuel producers to prosper. IRFA’s SAF study, released in January 2024, found key economic benefits:
·      770 million bushels of new corn grind per year in Iowa
·      Nearly 36,000 construction jobs adding over $3 billion to Iowa’s GDP and $2.2 billion in income
·      More than 22,000 permanent new jobs
·      About $950 million in new household income
·      $2.7 billion added to Iowa’s GDP
·      For a typical 1000-acre Iowa farm, $13,000 additional farm income per year

“Today’s decision was the first formal step forward,” said Shaw. “We hope and expect to see positive news in South Dakota and North Dakota in the near future. The light at the end of the tunnel is getting brighter and so are the prospects for boosting Iowa’s farm economy."



ASA Examines Potential of New Specialty Biotech Crop Varieties for Soy Farmers

A new article researched and co-authored by American Soybean Association staff explores how farmers can potentially benefit from new biotechnology innovations. The piece offers promising options for America’s half a million soy growers and was recently reviewed and published in the journal Frontiers in Plant Sciences. The article by ASA Director of Government Affairs Kyle Kunkler and Chief Economist Scott Gerlt, Ph.D., is part of a research topic symposium hosted by the journal. It considers how plant molecular farming can benefit U.S. soybean farmers and create new markets for consumers and the most successful ways to launch these varieties.

Molecular farming is when plants are genetically engineered for the purpose of creating new proteins that are not native to the plant; those proteins are then harvested at scale to meet a unique market purpose. Plant molecular farming is not a new technology and has long been considered by pharmaceutical manufacturers for producing vaccines and other biomedical compounds. In recent years, the technology has gained interest for food and feed applications. While there are other ways to produce these proteins, the article analyzes how growing them at scale in soybeans or another crop can be a more cost-effective option, especially for applications seeking to minimize production expenses.

Kunkler, head of ASA’s regulatory portfolio and an expert in biotechnology and crop production innovations, shared, “There is growing support for using plant molecular farming to enhance food or feed products. For our industry alone, potential uses range from creating more realistic soy-based alternative food products to enhancing the qualities of soybeans to develop better livestock feed. Given their high protein and oil content, soybeans are a natural fit for numerous plant molecular farming applications. That means there is enormous potential for U.S. soybean farmers to create new markets and income opportunities through this technology.”

An important point of the article is how U.S. farming operations could create new income opportunities by growing plant molecular farming specialty varieties relative to bulk commodity soybeans. After considering case studies, such as the roll-out of high oleic soybeans beginning in 2010, the article makes clear there may be significant premium possibilities for farmers who opt to grow these varieties in the years ahead.

Gerlt validated these opportunities, saying, “U.S. soybean farmers frequently run narrow profit margins. In markets like the one in which we currently find ourselves when commodity prices are down, many farms are at risk of very low profits and may need to look to alternative revenue sources to stay in the black. While potential premiums will vary significantly, plant molecular farming of specialty soybean varieties can create a meaningful source of extra on-farm income and help keep farm operations economically sustainable.”

The article also considers potential risks of plant molecular production that could require management. For example, if biotech varieties have not been approved by export partners and are inadvertently comingled with bulk commodity soybeans, it could lead to significant trade disruption.

Kunkler said of the potential risks identified, “There are certain risks, but we believe they can be carefully managed. Risks will vary depending on the application, but working with regulators and the farmer community in advance of launch to identify those challenges and how to best manage them will be vital for product success. A strong, closed-loop system may be necessary to prevent comingling for many products.”

Gerlt highlighted how closed-loop, identity preserved systems can be a winning proposition for farmers, product manufacturers and the public. “A manufacturer does not want to lose precious supplies of a specialty product any more than a farmer wants to lose that premium product they worked hard to grow. So long as closed-loop systems are robust and farmers are sufficiently compensated for helping to maintain those systems, these methods can be a win for everyone.”

ASA looks forward to working with the developer community and regulators to create a pathway for these innovations. With care and forethought, advancements in plant molecular farming can provide income opportunities for farmers and new markets for consumers, all while safeguarding the bulk commodity markets U.S. soybean farmers continue to serve.



USDA Cold Storage May 2024 Highlights

Total red meat supplies in freezers on May 31, 2024 were down 3 percent from the previous month and down 5 percent from last year. Total pounds of beef in freezers were down 3 percent from the previous month and down slightly from last year. Frozen pork supplies were down 3 percent from the previous month and down 9 percent from last year. Stocks of pork bellies were down 7 percent from last month and down 14 percent from last year.

Total frozen poultry supplies on May 31, 2024 were up 3 percent from the previous month but down 5 percent from a year ago. Total stocks of chicken were up 1 percent from the previous month but down 10 percent from last year. Total pounds of turkey in freezers were up 8 percent from last month and up 5 percent from May 31, 2023.

Total natural cheese stocks in refrigerated warehouses on May 31, 2024 were down slightly from the previous month and down 4 percent from May 31, 2023. Butter stocks were up 5 percent from last month and up 3 percent from a year ago.

Total frozen fruit stocks on May 31, 2024 were up 1 percent from last month and up 11 percent
from a year ago. Total frozen vegetable stocks were down 9 percent from last month and down
3 percent from a year ago.



USDA Proposes New Rule to Clarify Unfair Practices in the Livestock, Meat, and Poultry Industries

Tuesday, the U.S. Department of Agriculture announced new action to support the Biden-Harris Administration’s plan for a fairer, more competitive, and more resilient meat and poultry supply chain. USDA’s Fair and Competitive Livestock and Poultry Markets proposed rule would tackle longstanding challenges around interpretations of unfairness and competitive injury for the livestock, meat, and poultry sectors. This will support farmers and growers, and continues President Biden’s work to lower food costs for consumers.

Secretary Vilsack made the announcement during an event at the Center for American Progress showcasing the Administration’s agenda to create more affordable and competitive agricultural markets. The event highlighted USDA’s wide-ranging progress to enhance the Department’s ability to enforce the Packers and Stockyards Act, including previous rulemaking and an enforcement partnership with the Department of Justice. The event also provided a look back at USDA’s successful Investing in America Agenda efforts to enhance independent meat and poultry and other diversified food processing capacity; expand domestic, innovative fertilizer production; create a fairer market for seeds and other agricultural inputs; and support more robust and resilient supply chains. USDA also released a fact sheet highlighting its actions under the Biden-Harris Administration to spur competition in the agriculture sector.

“Entrenched market power and the abuses that flow from it remain an obstacle to achieving lower prices for consumers and fairer practices for producers,” said Agriculture Secretary Tom Vilsack. “Today’s proposed rule stands for clear, transparent standards so that markets function fairly and competitively for consumers and producers alike. With our whole-of-government approach to competition and resiliency, the Biden-Harris Administration is fighting every day to lower costs for American families and give farmers a fairer shake.”

The proposed rule will better protect farmers, ranchers, and other covered market participants by making clearer how prohibitions on unfair practices will be enforced under the Packers and Stockyards Act. Specifically, the rule provides clearer tests and frameworks around unfair practices that harm market participants individually and unfair practices that harm markets overall. If finalized, this rule would better enable USDA’s Agricultural Marketing Service to carry out its legal obligation to ensure fair and competitive national livestock, meat, and poultry markets and ensure livestock producers and poultry growers can secure the full value for their products and services.

“Farmers, ranchers, consumers, and smaller processors all depend upon the Packers & Stockyards Act to protect them from bad actors in the marketplace,” said USDA’s Senior Advisor for Fair and Competitive Markets Andy Green. “It’s time to provide the regulatory clarity and simplicity needed to put an end to unfair conduct that harms the market or that harms market participants.”

The proposal is based on USDA’s extensive administrative case law and builds off of precedent established under other unfair practices laws. The proposal follows well-understood approaches to unfair practices and unfair methods of competition.

The proposed rule will be published in the Federal Register for public comment. Upon publication, the public can submit comments at Regulations.gov for 60 days. All comments submitted will be considered as USDA develops a final rule. The final rule will be published in the Federal Register.

The publication of this proposed rule is part of a suite of USDA regulatory actions under the Packers and Stockyards Act to enhance transparency, stop discrimination, and support market fairness in the livestock and poultry industries. Previous actions include the Poultry Grower Payment Systems and Capital Improvement Systems proposed rule and the Transparency in Poultry Grower Contracting and Tournaments and Inclusive Competition and Market Integrity under the Packers and Stockyards Act final rules.



NeFU Thanks Sec. Vilsack for Fourth Proposed Rule to Strengthen Packers and Stockyards Act Enforcement

Nebraska Farmers Union (NeFU) thanks USDA Secretary of Agriculture Tom Vilsack for his leadership in pursuit of long overdue agricultural markets reforms and updates. Sec. Vilsack proposed his fourth rule in a series of efforts to strengthen the enforcement of the USDA Packers and Stockyards Act (P&S Act) by updating the definitions of prohibited unfair practices.

Secretary Vilsack’s previous proposed rules have dealt with retaliation against producers, deceptive marketing practices by meatpackers, discrimination against ag producers, and poultry contracting.

The P&S Act was originally passed 103 years ago in 1921 to enforce the Packers Consent Decree of the Sherman Anti-Trust Act. The 1918 Federal Trade Commission had previously found that 5 packers controlled 70% of the slaughter, and that conditions warranted prosecution under the Sherman Anti-Trust Act, which led to the creation of the Packers Consent Decree.

In addition to its Packers Consent Decree enforcement responsibilities, Congress gave the P&S Act and USDA broad based agricultural market oversight and regulatory responsibilities, which are still in force. In the past 100 years, in legal enforcement cases, the meatpackers lawyers have dulled the clear meaning of unfair practices which has undermined the effectiveness of P&S Act enforcement. When USDA enforcement actions are not successful in court, the case law results produce less aggressive enforcement.

As a result, for several decades, National Farmers Union, NeFU, and other Farmers Union states have been asking USDA to update and sharpen the P&S Act definitions in order to strengthen the effective enforcement of prohibited practices. At long last, the Biden Administration is positively responding.

NeFU President John Hansen said, “To his credit Secretary Vilsack has responded to the need to clarify and sharpen the definitions of prohibited actions by working closely with the anti-trust division of the Justice Department. Unfortunately, Congress is unwilling to address the need for agricultural market reforms or return competition to ag markets.  NeFU supports Secretary Vilsack’s proposed rules and hope they get finalized as soon as possible. Fortunately for agriculture, Secretary Vilsack and the Biden Administration are willing to step up and lead on ag market reform and competition issues.”

This proposal defines and updates the enforcement approach of “unfair practice”. This proposed rule “defines unfair practices as conduct that harms market participants and conduct that harms the market” according to the USDA Agricultural Marketing Service.



NCBA Statement on Latest USDA Packers & Stockyards Rule

Tuesday, National Cattlemen’s Beef Association Vice President of Government Affairs Ethan Lane released a statement on the U.S. Department of Agriculture’s latest proposed Packers and Stockyards rule Fair and Competitive Livestock and Poultry Markets:

“USDA’s newly proposed rule is a direct attack on cattle producer profitability. By creating criteria that effectively deems any innovation or differentiation in the marketplace improper, USDA is sending a clear message that cattle producers should not derive any benefit from the free market but instead be paid one low price regardless of quality, all in the name of so-called fairness.”



NFU COMMENDS CONTINUED PACKERS AND STOCKYARDS ACT PROGRESS

Agriculture Secretary Tom Vilsack today announced additional updates to the Packers and Stockyards Act (P&S Act) rules at an event with Assistant Attorney General for Antitrust Jonathan Kanter. The “Fair and Competitive Livestock and Poultry Markets” proposed rule is meant to strengthen P&S Act enforcement by creating a framework to assess “unfair practices” claims by family livestock producers who are harmed by meatpackers.

National Farmers Union (NFU) President Rob Larew expressed appreciation for the announcement: “We commend Secretary Vilsack and the Biden-Harris Administration for the continued progress in issuing important updates to the P&S Act. Family farmers and ranchers continue to face unfair practices at the hands of monopolistic meatpackers, and they need P&S Act rules that are clear, durable, and enforceable. NFU looks forward to fully reviewing the rule to ensure it protects farmers from abuses in the marketplace.”

NFU’s Fairness for Farmers campaign has brought the devastating impact of monopolies on family agriculture into the national spotlight. Updating and strengthening enforcement of the P&S Act is a central priority of the campaign and NFU’s grassroots policy.

This proposed rule is the fourth in a series of P&S Act updates issued by USDA in recent years, with two of the rules finalized over the past year. The rules have addressed issues of discrimination, retaliation and deception against livestock producers by meatpackers, and several issues specific to poultry contracting.



Proposed Changes to Packers & Stockyards Act Rules Will Hurt Meat and Poultry Producers, Consumers; Will Set Meat Quality & Consumer Demand Back Decades
 
The latest proposed rule change to the Packers and Stockyards Act by the Biden Administration is attempting to set meat production back decades by encouraging litigation and limiting how livestock producers can market their animals to packers.

In the proposed rule, USDA attempts to circumvent Congress and the courts to reverse the longstanding legal standard that parties must demonstrate harm to competition to sue and win under the Packers and Stockyards Act Section 202(a) or (b).

Removing the need to show harm to competition will encourage frivolous lawsuits. To protect themselves, meat packers may be forced to curtail the use of Alternative Marketing Agreements (AMAs) to minimize these costly litigation risks.

“Unfortunately for the Biden Administration, Secretary Vilsack has tried these changes before,” said Julie Anna Potts, President and CEO of the Meat Institute. “They have failed before the courts, conflict with Congressional intent and are a blatant attempt to pick winners and losers in the marketplace. Under these proposed rules, everyone loses, the livestock producer, the packer and ultimately the consumer.”

Portrayed as an effort to increase competition, this government interference comes when fed cattle prices were at record levels for most of 2023, surpassing the 2014-2015 previous record highs, and now, well into 2024, cattle prices remain at record levels.

“What is the Biden Administration trying to fix?” said Potts.

And the cattle price outlook for 2024 continues to be bullish, with USDA projecting the annual average price of cattle to increase over the 2023 record based on a smaller cattle supply.

Contrary to USDA’s assertion, these changes would introduce uncertainty into the market and de-couple the demand signals producers receive from beef consumers, including consumers’ willingness to pay for value-added attributes.  At low points in the cattle cycle, like this year’s historically small cattle herd, it puts at risk the value producers earn from sustained beef demand, and as the expansion phase of the cattle cycle begins it would undermine the benefits earned from growing beef demand.

“In response to consumer demands for value-added meat products like ‘no antibiotics ever,’ ‘grass-fed,’ or even someday ‘carbon neutral,’” said Potts, “AMAs have rewarded livestock producers for investing in these attributes while ensuring meat packers can make the high-quality products consumers want to feed their families.”

In addition, the Meat Institute believes the proposed change violates the “major questions doctrine,” as articulated in the Supreme Court’s ruling in West Virginia vs. Environmental Protection Agency, because the U.S. Department of Agriculture is acting without the permission of Congress and proposing administrative rules that will have a dramatic effect on all stakeholders in the meat and poultry markets.

“The President and his Administration continue to pursue policies that will increase costs for consumers. From Secretary Vilsack’s proposed changes to the Packers and Stockyards Act’s rules to USDA’s delayed modernization of pork inspection to EPA’s proposed wastewater guidelines, these policies will prove costly to the 98 percent of American households who purchase meat to feed their families,” said Potts.

Share of the Consumer Dollar
U.S. Secretary of Agriculture Tom Vilsack today said the share of the consumer dollar received by farmers and ranchers was dropping. In the beef market, the share of the consumer dollar is steady with the meat packer and processor receiving the smallest share.

Background on AMAs for Cattle
The American beef market has modernized to allow producer driven innovations or AMAs. AMAs allow producers more flexibility in how to market their cattle, protect themselves against risk and earn better prices.

AMAs for fed cattle include: forward contracts, formula pricing, negotiated grid trades, and packer-owned transfers.

A few examples:

Forward Contracts:
    a cattle producer signs a contract with a feedlot operator. They agree that in six months, the producer will deliver 100 head of cattle at a fixed price of $1000.00 per head. When the delivery arrives at the lot, despite the current market price, the producer receives $1000.00 per head. This forward contract gives the producer certainty and provides the feedlot operator a stable supply at a fixed cost.

Formula Pricing
    a cattle producer enters a formula pricing arrangement with a small beef packer/processor. The formula determines the price based on the agreed criteria: price per pound for carcass weight. For higher quality grades like “Choice or Prime,” $.10 per pound. It could also include a penalty like $0.05 per pound for below grade carcasses. Formula pricing also provides potential premiums for other value-added production practices that align with consumer demand. When the cattle are delivered, the pricing is calculated based on the formula. This lets the producer be rewarded for investments in the herd like improved genetics and high-quality feed, provides risk management opportunities for the producer, and ensures the processor receives high quality cattle to meet demand. Ironically, USDA has invested significant resources in establishing a cattle market library to support this method of pricing.

Experts Agree and Studies Show AMAs Increase Beef Demand
    AMAs have been studied for decades, see them here: http://www.themarketworks.org/studies
    USDA Commissioned IRI Study on Livestock and Meat Marketing Final Report
    Leading Agriculture Economists have this to say about AMA’s and government interference: https://www.meatinstitute.org/press/economists-academics-industry-agree-supply-demand-labor-economies-scale-drive-beef-and-cattle

The Legal Background: Showing “Harm to Competition” has been upheld by eight different appeals
The eight federal courts of appeals that have considered the issue have unanimously concluded that a plaintiff must show actual or likely harm to competition to make a claim and win under Section 202(a) or (b) of the PSA.   

The most recent circuit to address the issue, the Sixth Circuit, said it best:
    The tide has now become a tidal wave, with the recent issuance of the Fifth Circuit Court of Appeals’ en banc decision in Wheeler v. Pilgrim’s Pride Corp., 591 F.3d 355 (5th Cir. 2009) (en banc), in which that court joined the ranks of all other federal appellate courts that have addressed this precise issue when it held that “the purpose of the Packers and Stockyards Act of 1921 is to protect competition and, therefore, only those practices that will likely affect competition adversely violate the Act.” Wheeler, 591 F.3d at 357.  All told, seven circuits – the Fourth, Fifth, Seventh, Eighth, Ninth, Tenth, and Eleventh Circuits – have now weighed in on this issue, with unanimous results.