The Trump Administration’s abandonment of the Farmer Fair Practices Rules is an insult to farmers and ranchers across the country who seek a more just and fair marketplace. Farmers have sought justice for far too long, waiting for rules that level the playing field for farmers and ranchers who contract with giant multinational meatpackers and poultry integrators. Many farmers had looked to President Trump’s Administration to finish the job started under the Obama Administration, but now find themselves abandoned in their struggle for a fair marketplace.
“This withdrawal is a slap in the face to rural America and America’s farmers and ranchers. The administration is allowing multinational corporations led by foreign interests to hold America’s farmers and ranchers hostage with their monopolistic, retaliatory and predatory practices.” – Mike Weaver
After several delays, a long-awaited “Interim Final Rule,” (under the USDA’s Grain Inspection, Packers & Stockyards Administration, known as GIPSA) was set to go in effect on October 19. That “competitive injury” rule has now been formally withdrawn, and the agency also announced no further action on a proposed rule about unfair practices by meatpackers and poultry integrators.
It is important to remember that these rules were intended to ensure farmers and ranchers the most basic of protections. One of these protections would have allowed producers redress for anticompetitive behavior by companies without meeting the nearly impossible standard of proving that a company’s actions hurt the entire livestock industry. Another would have blocked companies from requiring that farmers make expensive and unnecessary upgrades to their operations, which often has the impact of keeping farmers in debt without any viable way of digging themselves out of it.
While the fate of these important rules were unknown as the Obama Administration passed the baton onto the next, we now know that the Trump Administration is standing on the side of multinational meatpackers, not America’s farmers and ranchers. The outpouring of support for the move coming from industry outfits like the National Chicken Council or the National Pork Producers Council is striking when compared to the deep hurt from farmers and ranchers, such as the following from Mike Weaver, a poultry grower and president of the Organization for Competitive Markets:
“This withdrawal is a slap in the face to rural America and America’s farmers and ranchers. The administration is allowing multinational corporations led by foreign interests to hold America’s farmers and ranchers hostage with their monopolistic, retaliatory and predatory practices.”
Farm Aid’s Background On the Farmer Fair Practice Rules
Farm Aid has long advocated for regulations that level the playing field between farmers and ranchers (and poultry growers, in particular) who market their goods through contracts with major corporate meatpackers and integrators.
In 2010, Farm Aid supported several farmers and ranchers to attend a series of listening sessions held by the USDA and Department of Justice (DOJ) on anticompetitive practices in food and agriculture and submitted our own testimony on the stranglehold that corporations have over the marketplace. Since that time, we have supported efforts to enact rules to protect farmers and fought against a series of attacks in Congress to get these rules completed (see coverage from Last Week Tonight with John Oliver and Farm Aid President Willie Nelson’s op-ed in The Washington Post with Representative Marcy Kaptur). After years of delay, public comments, and advocacy, last October the USDA released the Farmer Fair Practices Rules, providing basic protections for livestock producers and poultry growers who work in an industry dominated by corporations, which Farm Aid supported.
Despite today’s disappointing setback, Farm Aid’s work to establish a fair and competitive marketplace for all farmers and ranchers will continue. That work includes:
- Advocating for farmers on a national stage and working to ensure that livestock and poultry growers have a voice in key policy settings and that their stories are told in the media.
- Connecting farmers and ranchers who contact us via the 1-800-FARM-AID hotline with resources and support.
- Championing antitrust enforcement at the USDA and the DOJ, including the establishment of rules and regulations that will:
- Protect the First Amendment rights of farmers who exercise their right to free speech and association by prohibiting company retaliation.
- Increase market transparency by requiring companies 1) to provide sample contracts to USDA, made available to the public; 2) to maintain written records on data used to calculate farmers’ pay; and to provide farmers with information about their pay upon request;
- End the Tournament System and require companies to set a base payment for all growers raising the same type of poultry, and prohibit tournament or ranking systems that lower base payments;
- Establish Fair Contracts that give farmers at least 90 days notice before suspension and reasonable time to remedy a contract breach before termination; ban companies from requiring unnecessary expensive upgrades; and have terms long enough to allow growers to recoup 80% of their capital investments.
Farm Aid’s Comments Submitted to USDA
Farm Aid has long engaged on getting the Farmer Fair Practices Rules finalized. For those looking to dig deeper into what these rules are about and what Farm Aid had to say, we welcome you to read our comments submitted to USDA from March 2017: