Third Biden Administration Rule of Packers and Stockyards Act Could Interrupt Competition and Harm Market Prices

Listen to Ron Hays talk with Ethan Lane about the Packers and Stockyards Rules.

After Monday’s announcement of a second rule to interpret the hundred year old Packers and Stockyards Act from the Biden Administration, Senior Farm and Ranch Broadcaster, Ron Hays, is talking with the Vice President of Governmental Affairs at the National Cattlemen’s Beef Association, Ethan Lane about how these changes will impact the beef industry and its consumers.

Formerly known as the GIPSA rules, the fairness rules within the Packers and Stockyards Act are being rolled out as separate rules. The first and second rules have already come out, and a third is now in the pipeline and may be on the way yet here in 2024.

While the first two rules have not had much of an impact, Lane said the last wave of rules has the potential to be very harmful. Lane said this third rule focusses specifically on the threshold by which the Packers and Stockyards division, USDA regulators would look at a practice in the marketplace. Lane says this is “a standard for harm to competition. If you get one price for your cattle and your neighbor gets a different price- if you don’t like that- what is the threshold where you could sue for damages because you didn’t get the same price.”

“This has been a real pet project of Secretary Vilsack’s throughout his two terms as secretary,” Lane said. “This is one of his marque issues, and he very much believes that there shouldn’t be a standard. Anybody should be able to sue anybody else if they don’t get the same price for their product, which is, in our opinion, a very dangerous road to go down.”

This possible interruption in the producer’s right to react to market signals means that all the premiums established by producing better carcasses and a better eating experience are in jeopardy.

“All of those different premiums we know are available in the marketplace are the result of market signals,” Lane said.

If the supply chain is afraid of being sued, Lane said everyone may begin receiving the same price for their cattle regardless of premiums.

The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Ag Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR at the top of the story for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.

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