Policy of the National Farmers Union

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2022 Special Orders of Business

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A fair, open, and competitive marketplace is central to the health and wellbeing of the American economy and our democracy. Excessive market concentration in agriculture and the broader economy, threatens family farmers and ranchers, as well as national food security and sovereignty. In highly consolidated, uncompetitive markets, multinational corporations limit farmers’ and ranchers’ choices, pay them less, and charge them more. Markets dominated by monopolies lack resilience and are susceptible to disruptions that harm farmers and consumers.

For decades, the markets that farmers buy from and sell to have become increasingly consolidated. Concentration in many other industries has also decimated small businesses, especially in rural areas.

The four-firm concentration ratios (CR4), a commonly used metric for illustrating market concentration that specifies the market share for the top four firms in an industry, is high in nearly all sectors that touch the food supply chain. In 2018, the CR4 for companies slaughtering and processing beef, pork, and chicken was 85, 70, and 54 percent, respectively. As of 2015, the CR4 for corn and soybean seeds was 85 percent and 76 percent, respectively; this compares to 59 percent for corn seed in 1975, and 42 percent for soybean seed in 1988. Four firms account for 84 percent of the global herbicide and pesticide market, and just two companies manufacture about half of the tractors and other essential farm machinery used by farmers. The top four grocery retailers controlled approximately 65 percent of sales in 2018.

Additionally, the farmer’s share of every dollar consumers spend on food has fallen from 50 percent in 1952 to less than 16 percent today.

Considering the significant disadvantages farmers and ranchers face in the agricultural marketplace, NFU launched the Fairness for Farmers campaign. The campaign is a nationwide effort to give voice to farmers, ranchers, and communities being harmed by economic concentration, and to advocate for the revival of strong antitrust and competition law enforcement and the breakup of corporate monopolies.

To address the challenges outlined above, we support:

  • Legislation that would strengthen antitrust laws, reverse the trend of consolidation, and protect family farmers and ranchers from anticompetitive practices;
  • Fulfilling the goals and plans laid out by President Biden’s executive order on competition in the American economy, which emphasizes a whole-of-government approach to competition policy;
  • Legislation to bring greater transparency and price discovery to cattle markets, such as the Cattle Price Discovery and Transparency Act, including its provisions regarding mandatory minimum cash trade in cattle;
  • Requiring Livestock Mandatory Reporting (LMR) Act data to be consistently available;
  • Emphasis being placed across all agencies at USDA on combatting the abuse of market power in the agricultural and rural economies to encourage a more competitive, diverse food supply;
  • Robust enforcement of the Packers and Stockyards Act (P&SA);
  • Reinstatement of the Grain Inspection, Packers, and Stockyards Administration (GIPSA) as an independent agency to ensure strong P&SA enforcement, or the establishment of a new USDA antitrust and competition office if GIPSA is not reinstated;
  • Disallowing out-of-court settlements between federal antitrust agencies and companies in violation of federal antitrust laws;
  • Spurring development and expansion of local and regional markets and processing opportunities;
  • Supporting the expansion of local and regional markets by ensuring regulations are size- and risk-appropriate; and
  • Truthful and transparent labeling of agricultural products, including reauthorization and full implementation of mandatory country-of-origin (COOL) labeling.

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In recent years, the COVID-19 pandemic, unexpected shifts in supply and demand, natural disasters, and market concentration have caused significant supply chain disruptions for family farmers, ranchers, and rural communities. Supply chain disruptions have led to reduced access to markets, higher prices for farm inputs and other goods and services, inadequate access to labor, and other social and economic problems.

National Farmers Union supports the following principles or policies to address these challenges:

  • Increased enforcement of antitrust laws to spur competition throughout the agricultural supply chain, including for crop inputs such as seed, fertilizer, and crop protection products;
  • Incentives to build resilience and foster competition in the farm and food system through expansion of local and regional production, processing, distribution, and storage;
  • Relief to small business, including farms, food businesses, and others, through programs administered by USDA, the Small Business Administration, and other federal departments and agencies as appropriate, to ensure small businesses can survive and navigate continued disruptions;
  • Increased access to and improved high-speed broadband Internet infrastructure and service in rural areas;
  • Adequate funding for the United States Postal Service (USPS);
  • Prompt delivery and affordable rates through USPS in all parts of the country;
  • Funding and policy solutions that make emergency feeding operations, such as food banks and nonprofit feeding organizations, more resilient to supply chain disruptions;
  • Immigration reform, including agricultural workforce reform, that includes a sensible path to legal status for undocumented workers, and that reforms the H-2A temporary agricultural worker visa program so that it serves the needs of workers and family farmers and ranchers;
  • Incentives and programs to alleviate the labor shortage in the transportation industry;
  • A permanent hours-of-service waiver for truckers who need to make timely deliveries for transporting livestock and inputs such as fertilizer;
  • Allowing family farm operations to haul their own commodities with exemptions from mileage limitations, commercial driver’s licenses, and commercial truck licensing requirements;
  • Measures that resolve bottlenecks occurring at, to, and from, shipping ports;
  • Improvements to the efficiency and reliability of our transportation systems for shipping, including infrastructure projects, new technologies, and increased coordination between the maritime, rail, and trucking industries;
  • Streamlining of burdensome regulations needed to get products and inputs through the supply chain; and
  • Remedies for systemic barriers that have prevented access to farm programs, markets, land, and other tools and resources faced by socially disadvantaged groups.

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The COVID-19 pandemic exposed significant weaknesses in America’s agricultural and food supply chains. Chief among areas in need of reform are food (and especially livestock) processing and infrastructure, and the agricultural workforce.

Disruptions to highly centralized and consolidated processing infrastructure have resulted in lower prices paid to farmers, and higher prices for consumers at the grocery store. To achieve fairer, more competitive, and more resilient farm and food supply chains requires more local and regional processing options for farmers and ranchers. Expanded meat and poultry processing capacity are especially needed to ensure farmers, ranchers, and consumers have more choices in the marketplace.

As it is currently structured, our farm labor system does not work well for anyone. Farmers struggle to find skilled, stable, and affordable labor, and they often face excessive red tape in hiring. On the other hand, workers, whether in fields or processing plants, do not have adequate workplace protections. Our highly consolidated farm and food system is not only hurting family farmers and ranchers, but the workers they employ.

To address these issues, National Farmers Union supports the following principles or policies:

  • Increased funding to support new and expanded local and regional processing infrastructure;
  • Increased funding for farmers, food hubs, cooperatives, and others to construct food safety qualified infrastructure, such as washing stations, commercial kitchens, packaging, and other value-added facilities;
  • Increased funding for training for the agricultural workforce through work-based certification programs, vocational schools, and/or land grant universities, including to expand the pool of labor in meat and poultry processing, and to train and recruit more USDA inspectors;
  • Robust enforcement of worker safety measures and protections;
  • The right for workers to fair wages and a safe working environment;
  • The continued effort of Farmers Union to find common ground with agricultural workers, and groups representing the agricultural workforce – the needs of workers and farm and ranch owners are interdependent;
  • Immigration reform, including agricultural workforce reform, that includes a sensible path to legal status for undocumented workers, and that reforms the H-2A temporary agricultural worker visa program so that it serves the needs of workers and family farmers and ranchers;
  • The National Labor Relations Act should be extended to workers on corporate and other farms that employ enough hired help to be subject to the federal minimum wage provisions applicable to agricultural workers;
  • Regulations, fees, and requirements that are appropriate for the size and scale of operations, and that account for the differences between family farms and large corporations; and
  • Line speeds that are regulated to protect worker health and safety in warehouses, product handling facilities, and meat processing plants.

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Climate change poses a threat to family farmers and ranchers. Shifting seasons, new precipitation patterns, and more frequent and severe extreme weather events and natural disasters expose farmers and ranchers to greater risk. These risks are being enhanced by secondary carbon factors including wildfire, desertification, and the release of carbon dioxide from oceans and permafrost.

Family farmers and ranchers are working to adapt to the changing climate by implementing conservation practices to build soil health and make their land more resilient. Farmers and ranchers can play a key role in mitigating climate change by storing carbon in soils and restoring ecosystems.

National Farmers Union (NFU) believes policies intended to address climate change should leverage agriculture’s potential to be part of the solution. These policies should provide incentives to support farmers and ranchers as they tackle climate challenges. Public policy should also play a role in ensuring carbon and other ecosystem markets provide fair and transparent opportunities to farmers and ranchers. Additionally, it is essential to have a national energy policy that incentivizes carbon emission reductions using renewable energy, biofuels, and other technologies and products while balancing rural energy needs and jobs.

NFU supports a farmer-focused approach to climate change guided by the following principles or policies:

  • State and federal conservation programs should have a stronger focus on climate-friendly practices;
  • USDA should regulate carbon and other environmental credit markets to ensure they use consistent protocols and adhere to strict levels of fairness and transparency to ensure producers are adequately compensated;
  • Early adopters of conservation practices should be rewarded for contributing to carbon sequestration and for other ecosystem services;
  • Renewable fuels, including ethanol, biodiesel, and sustainable aviation fuels, must be a central feature of any effort to reduce carbon emissions;
  • Incentives for energy efficiency, renewable energy production, and further development of the bioeconomy on family farms and in rural communities;
  • Investment in public research on climate change, which is critical to reducing barriers for adoption of climate-smart agricultural practices;
  • Promotion of opportunities for family farmers to articulate their climate mitigation efforts to consumers through food processors and retailers;
  • Investments in USDA’s Climate Hub network;
  • Federal interagency coordination to develop or enhance the effectiveness of programs to assist agriculture and our nation’s communities adapt to and mitigate climate change; and
  • State and federal efforts to strengthen and expand our nation’s infrastructure to withstand the effects of climate change, while also ensuring the needs of farmers, ranchers, and rural communities are addressed; and we encourage regional, state, and local governmental entities to develop plans to prepare for and mitigate extreme weather events that are occurring more commonly due to climate change.

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U.S dairy farms are an important segment of our nation’s economy. As one of the world’s largest dairy-producing nations, the industry provides roughly $140 billion in economic output, $29 billion in household earnings, and more than 900,000 jobs.

Despite dairy’s economic contribution to our nation, federal programs are failing producers who face difficult economic conditions. Between 2014 and 2020, over 11,000 U.S dairy farms went out of business as low milk prices failed to cover the average cost of production. Meanwhile, total cow numbers increased slightly, and milk production remained relatively stable. The overproduction of milk and the inability for the market to stabilize following an economic downturn accelerated the loss of dairy farms throughout the U.S, particularly in dairy-heavy states.

National Farmers Union recognizes efforts made by Congress to improve federal dairy programs, but the Dairy Margin Coverage program does not address the fundamental problem of oversupply. Federal dairy policy must provide both a safety net for family dairy farms in all regions and of all herd sizes, and a mechanism to manage milk supply to meet profitable demand.

A 2019 economic analysis, supported by a 2021 follow-up study, showed that a system of managed growth in dairy production would have a positive impact on the dairy economy. The results show that managing growth would result in increased milk prices, reduced price volatility, fewer dairy farm exits, and reduced government expenditures.

There is growing support among U.S dairy farmers, farm organizations, and members of Congress for managing dairy production growth without issuing a strict quota, prohibiting expansion, or halting trade.

In addition to oversupply issues bringing down prices paid to farmers, 2018 Farm Bill Federal Milk Marketing Order (FMMO) price formula changes have led to lower prices paid to dairy farmers.

NFU calls on Congress to establish a mandatory program for managed growth based on market demand and price stability in the 2023 Farm Bill. Such a program should increase farmer profitability by:

  • Elevating milk prices;
  • Preventing overproduction; and
  • Reducing milk price volatility.

Such a program should also:

  • Allow for beginning farmer entry;
  • Reduce government expenditures;
  • Respond to global market conditions;
  • Be national and mandatory so that all dairy producers participate;
  • Allow for planned growth when the market can accept additional milk;
  • Be designed in such a way that any production base does not acquire value; and
  • Have meaningful farmer input in development, implementation, and governance.

NFU supports the Class I pricing formula reverting to higher value of Class III or Class IV instead of the average of Class III and Class IV that was put in place in the 2018 Farm Bill.