Lucas Joins Effort Providing Pricing Leverage, Market Transparency to Cattle Producers

Oct 20, 2021
Agriculture
Press

Washington, DC – Today, Congressman Frank Lucas (OK-03) joined Representatives Dusty Johnson (R-S.D.) and Henry Cuellar (D-TX) as an original cosponsor introducing the Cattle Contract Library Act of 2021 (H.R. 5609). The bipartisan bill would direct the United State Department of Agriculture’s (USDA) Agriculture Marketing Service (AMS) to establish a contract library for cattle producers. The bill instructs USDA to regularly update the library in a user-friendly format and provide weekly or monthly reports as applicable. Additionally, the bill authorizes USDA to issue grants to universities, associations, or other institutions who can work directly with producers to disseminate and analyze data to drive marketing decisions.

Currently, cattlemen are unaware of contract terms being offered by packers, leading to a decline in leverage for smaller producers during price negotiations. USDA maintains a pork contract library, and following significant volatility in the cattle market and the release of the July 2020 Boxed Beef & Fed Cattle Price Spread Investigation Report, the creation of a library was recommended by experts and stakeholders.

“Last year, following the market strains caused by Tyson’s Holcomb fire and the COVID-19 pandemic, USDA released an analysis of beef market conditions. Both anomalies highlighted the vulnerabilities that plague both the beef supply chain and the American food supply chain. Congress and stakeholders have long been discussing needed reforms to ensure fair competition and price discovery in agriculture markets- and more recently solutions to the various policy recommendations framed by USDA in their Boxed Beef and Fed Cattle Price Spread Investigation report. In order for ranchers to have a truly transparent, market-driven economy, cattlemen and women must be able to leverage marketing data while negotiating the price of cattle,” said Congressman Frank Lucas. “While USDA currently collects livestock and meat price data, producers are being left in the dark as to the contract terms being offered by packers as alternative marketing arrangements continue to grow in popularity. The Cattle Contract Library Act and the creation of a cattle contract library is an important step forward in working to cultivate a fair and transparent finished cattle marketing system. I thank my friend and colleague, Congressman Dusty Johnson, for his work addressing the disparities faced by America’s cattle producers, and I look forward to continuing to work with my fellow cattle ranchers as we ensure a fair beef market, benefitting both producers and consumers.”

“Producers have been asking for increased transparency and leverage in the cattle market for years, the Cattle Contract Library Act will provide granular data in near real time, ensuring producers understand the value of marketing agreements,” said Johnson. “Data drives marketing decisions and a contract library will provide much-needed leverage for independent producers.”

“Throughout my time in Congress, I have worked hard to ensure the success of the agriculture industry—one that is a critical facet of our nation’s economy. The bipartisan Cattle Contract Library Act will further this agenda through the creation of a contract library that will provide cost transparency in the cattle market,” said Cuellar. “We must support all of our cattle businesses, including our small producers, who are indispensable for our country’s food supply chain. I thank Rep. Johnson for his leadership on this critical legislation for Texas farmers, ranchers, and the agriculture industry as a whole.”

Lucas has long been a leader on cattle market reform since before his time as Chairman of the House Agriculture Committee. Since 2019, Lucas has joined in introducing a number of legislative priorities for producers, including the PRICE Act and the RAMP-UP Act, which supported transparency in the cattle market and helped increase capacity for small and medium-sized meat processors.

The Cattle Contract Library Act of 2021 is supported by the American Farm Bureau Federation, National, Cattlemen’s Beef Association, U.S. Cattlemen’s Association, National Farmers Union, Livestock Marketing Association, and the Oklahoma Cattlemen’s Association.

“OCA members developed comprehensive policy at our 2021 Annual Convention to create and maintain more price transparency in the live cattle market. OCA is pleased to see and strongly supports the Cattle Contract Library Act which would create a cattle contract library within USDA’s Ag Marketing Service as a means to provide more price transparency to cattle producers engaged in live cattle marketing,” said Michael Kelsey, Executive Vice President of Oklahoma Cattlemen’s Association. “Representative Lucas, a cattle producer himself, is keenly aware of the need for more price transparency and we greatly appreciate his co-sponsor of this important legislation.  This is a positive and much needed step forward.”

Read the full bill here and a summarizing one-pager here.

 

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