February 2023
With the new Congress getting down to business and the House and Senate Agriculture Committee rosters recently finalized, NFU is eager to work with lawmakers to pursue our Fairness for Farmers campaign. This effort will carry into the 2023 Farm bill, as NFU continues to fight for legislation that establishes greater fairness and transparency in cattle markets, strengthens enforcement of the Packers and Stockyards, and ensures farmers and ranchers have the right to repair their own equipment.
RIGHT TO REPAIR STILL ISN’T FIXED
In early January, news broke of an agreement between John Deere, one of the largest manufacturers of farm equipment, and the American Farm Bureau Federation (AFBF). The agreement, formally a Memorandum of Understanding (MOU), asserts John Deere will provide farmers and independent repair firms with access to John Deere’s repair tools, parts, and documentation.
Right to Repair is a major issue across many industries but has a profound impact on farmers and ranchers. With only three companies dominating the market for large farm machinery, farmers have few choices in the marketplace. The major equipment manufacturers, including John Deere, have long refused to make critical repair tools fully available to farmers and independent mechanics, leaving them no choice but to take broken equipment to a licensed dealership. These restrictions, paired with dealership consolidation, have led to inflated service prices and lengthy delays during tight planting and harvest windows that can cost farmers their crop.
While the MOU states farmers will be able to access the same repair materials as John Deere’s technicians, it does not provide any guarantee. The agreement is not a contract with legally binding provisions, which means there are no means of enforcement that can hold either side to the terms. Additionally, a troubling provision within the MOU is a commitment to John Deere that AFBF refrain from supporting Right to Repair legislation.
The AFBF-John Deere MOU presents itself as a voluntary commitment and private sector resolution to achieve the goals of Right to Repair, but it falls far short of real repair protections. Legislation or regulation, either at the federal or state level, would apply to all equipment manufacturers and provide enforcement mechanisms – this is notably absent from the AFBF-John Deere MOU.
Farmers and ranchers need the legal right to obtain and access the documentation, parts, and software tools to fix their own equipment. NFU supports legislation that ensures the Right to Repair, and we will continue to advocate for Right to Repair legislation through the Fairness for Farmers campaign in the 118th Congress.
CATTLE PRICE DISCOVERY AND TRANSPARENCY ACT REINTRODUCED IN SENATE
On February 2, U.S. Senators Chuck Grassley (R-Iowa), Jon Tester (D-MT), Ron Wyden (D-OR), and Deb Fischer (R-NE) introduced the Cattle Price Discovery and Transparency Act of 2023. The legislation aims to restore transparency and accountability in cattle markets by establishing regional cash minimums and equipping producers with greater access to market information.
NFU was proud to support the Cattle Price Discovery and Transparency Act in the last Congress and has endorsed this legislation in the 118th Congress. The Cattle Price Discovery and Transparency Act of 2023 has twenty-two original cosponsors.
A significant challenge facing the cattle industry is the declining volume of negotiated cash trades. In an industry that is supposed to be the purest form of capitalism and competition, rampant consolidation has left its mark in the beef industry, as just four large companies control 85% of the market.
In turn, packers have been using their market power to establish “alternative marketing arrangements,” such as formula pricing and forward contracts with feedlots and slaughters, versus the traditional method of negotiated and auctioned cash markets that accurately reflect supply and demand. The latter inherently establishes robust price discovery at multiple points throughout the supply chain, providing ranchers with accurate information for the “going rate” of cattle.
With depressed demand for negotiated cash transfers, the prices cattle ranchers receive have plummeted while large corporations are raking in record profits, all while consumers are paying record prices at the grocery store.
The Cattle Price Discovery and Transparency Act of 2023 makes important reforms, including:
- Establishing mandatory minimum purchase volumes for packers through “approved pricing mechanisms” based on five to seven geographic regions, to be determined by the U.S. Department of Agriculture.
- Bringing more transparency by requiring reporting of cattle weights and slaughter deliveries two weeks in advance.
- Clarifying and implementing a cattle contract library.
- Increasing penalties for violations by packers.
- Requiring livestock mandatory reporting data be consistently available.
The Cattle Price Discovery and Transparency Act takes a big step toward ensuring fairness and transparency in cattle markets – a top Fairness for Farmers priority. NFU is committed to advocating for passage of this legislation in the 118th Congress.
SENATE TAKES ANOTHER SHOT AT COUNTRY-OF-ORIGIN LABELING
Senator John Thune (R-SD), joined by Senators Tester (D-MT), Lummis (R-WY), Booker (D-NJ), and Rounds (R-SD) recently introduced the American Beef Labeling Act of 2023, as the push for mandatory country-of-origin labeling (COOL) continues into the 118th Congress.
The American Beef Labeling Act would reinstate mandatory COOL for beef sold in grocery stores by inserting “beef” and “ground beef” back into the existing 2002 law, which continues to require COOL for other foods, such as lamb, chicken, fish, nuts, fruits, and vegetables.
NFU supports conspicuous, mandatory, and uniform labeling for food products throughout the processing chain and calls for reauthorization and full implementation of COOL for agricultural, aquaculture, and wild-caught seafood products. Clear and accurate food labels are a valuable tool that helps consumers make informed decisions and allows farmers and ranchers to differentiate their products.
COOL would promote a fairer, more competitive market for America’s cattle farmers and ranchers and quality family-sustaining jobs for meat processing workers. American consumers deserve the right to choose, American cattle farmers and ranchers deserve the right to compete for the consumers’ favor in their domestic market, and meat processing workers deserve quality jobs.
As with Right to Repair legislation and the Cattle Price Discovery and Transparency Act, NFU will be a staunch advocate for passage of the American Beef Labeling Act.