Harkin Vows to Protect Livestock Ownership Ban

January 29, 2002

Senate Agriculture Committee Chairman Tom Harkin (D-IA) says he will fight any attempts to remove from the Senate farm bill a provision to ban meat packers from owning livestock prior to processing. He also pointed to a paper authored by a group of agricultural lawyers, including Neil Harl of Iowa State University which favors the amendment and refutes recent criticisms against the ban on packer ownership.

"I am very concerned that those in the meat packing industry who oppose the ban will stop at nothing to remove this provision from the farm bill (but) I will do everything I can to maintain this crucial provision," said Harkin. "Farmers across the nation deserve a fair and equal opportunity to sell their livestock in the open market. If we allow meat packers to take over the livestock market, we help them push the family producer out of business."

In December the full Senate approved an amendment offered by Sen. Tim Johnson (D-SD), and cosponsored by Harkin, to prohibit meat packers from owning or controlling livestock more than 14 days prior to processing. This provision will limit packers' ability to manipulate market conditions and will improve farmers' access to livestock markets.

The Harl paper claims the amendment would tighten restrictions against packer ownership of livestock without affecting marketing contracts, says Harkin. According to the paper packers would still have the ability to use contracting agreements to coordinate supply chains and assure markets. The paper also addressed a concern forwarded by packers that the amendment would prohibit marketing contracts, despite the fact that the sponsors of the amendment made it clear that the measure allows for forward contracting and marketing agreements.

Earlier this month a group of agricultural economists released a study critical of the law claiming the provision would hinder certain efficiencies in the packing industry. The study, however, based all of its findings on the false assumption that the word "control" would prohibit the type of forward contracting and marketing agreements in which many farmers participate.

"Livestock farmers across the country have been calling for this type of reform for years. Now that we have finally got the support of the full Senate, industry groups have ginned up some excuse to stop our progress," said Harkin. "Farmers have waited too long for this critical reform. To allow the meat-packing industry to bluff us back into the corner because of one word would be a huge mistake. We must take a stand and help level the playing field for our nation's farmers."