Cattlemen Meet with USDA on Price Reporting

May 22, 2001

The National Cattlemen's Beef Association (NCBA) was to meet Monday with USDA officials to address several initial concerns raised as the result of inaccurate price reports on beef cut-out values. USDA Secretary Ann Veneman requested a review of the livestock reporting system, which has been reporting inaccurate price reports since its induction April 2.

"The National Cattlemen's Beef Association is disappointed and outraged with the USDA Agricultural Marketing Service's error in reporting boxed beef cut-out values," said Lynn Cornwell, NCBA president and a Montana cattle producer. He noted that beef producers may have used the inaccurate information for six weeks prior to the USDA's announcement earlier this week reporting that the numbers were incorrect. "NCBA is committed to ensuring that producers are treated fairly and provided accurate information that is required by law," Cornwell said.

Thousands of contracts and cattle sales rely on the information in the reports, which were stating lower than market value prices for the sales. This mistake questions USDA's integrity and threatens producer confidence in the marketplace, according to Cornwell. Potentially, it could cost producers millions of dollars. According to USDA officials, products that were not quality graded, known as "no-roll," were mistakenly included into prices reported for select and choice box-beef. USDA attributes the error to a software problem.

Among the concerns NCBA said would be addressed in its meeting with USDA include USDA's plans to address losses experienced by producers; NCBA's need for assurances and guarantees that future prices reported will be accurate and truly reflective of the market; information on when the problems started and correct information on prior marketing information to allow producers to accurately define their losses and assurances that NCBA will be informed of other potential system weaknesses.

Cornwell says NCBA will work with USDA and Congress to ensure that price reporting is implemented consistent with the intent of Congress so producers have the confidence to make proper marketing decisions.