[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7639 Introduced in House (IH)]

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117th CONGRESS
  2d Session
                                H. R. 7639

 To amend the Agricultural Marketing Act of 1946 to establish a cattle 
               contract library, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 3, 2022

 Mrs. Axne (for herself, Mr. Feenstra, Mrs. Hinson, Mrs. Miller-Meeks, 
and Mrs. Hartzler) introduced the following bill; which was referred to 
                      the Committee on Agriculture

_______________________________________________________________________

                                 A BILL


 
 To amend the Agricultural Marketing Act of 1946 to establish a cattle 
               contract library, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Cattle Price Discovery and 
Transparency Act of 2022''.

SEC. 2. DEFINITIONS.

    (a) In General.--Section 212 of the Agricultural Marketing Act of 
1946 (7 U.S.C. 1635a) is amended--
            (1) in paragraph (5), by striking ``cattle,'' and inserting 
        ``cattle (including fed cattle),'';
            (2) by redesignating paragraphs (1) through (14) as 
        paragraphs (2), (3), (4), (6) through (8), (10), and (12) 
        through (18), respectively;
            (3) by inserting before paragraph (2) (as so redesignated) 
        the following:
            ``(1) Approved pricing mechanism.--The term `approved 
        pricing mechanism' means a purchase of fed cattle made--
                    ``(A) through a negotiated purchase;
                    ``(B) through a negotiated grid purchase;
                    ``(C) at a stockyard (as defined in section 302 of 
                the Packers and Stockyards Act, 1921 (7 U.S.C. 202)); 
                or
                    ``(D) through a trading system or platform for the 
                purchase or sale of cattle, or for an arrangement to 
                purchase or sell cattle, through any means in which 
                multiple buyer and seller participants have the ability 
                to, and regularly and consistently, make and accept 
                bids and offers on or at the trading system or 
                platform.'';
            (4) by inserting after paragraph (4) (as so redesignated) 
        the following:
            ``(5) Fed cattle.--The term `fed cattle' means a steer or 
        heifer that has been finished on a ration of roughage and feed 
        concentrates, such as grains, protein meal, grass (forage), and 
        other nutrient-rich feeds, prior to slaughter.'';
            (5) by inserting after paragraph (8) (as so redesignated) 
        the following:
            ``(9) Mandatory minimum.--The term `mandatory minimum' 
        means, of the quantity of fed cattle purchased for slaughter by 
        a covered packer (as defined in section 221) for each 
        processing plant, the minimum percentage of such cattle that 
        are required to be purchased through approved pricing 
        mechanisms from producers that are not packers.''; and
            (6) by inserting after paragraph (10) (as so redesignated) 
        the following:
            ``(11) Negotiated grid purchase.--The term `negotiated grid 
        purchase', with respect to cattle, means a purchase--
                    ``(A) involving the negotiation of a base price 
                from which premiums are added and discounts are 
                subtracted, determined by seller-buyer interaction and 
                agreement on a delivery day; and
                    ``(B) under which the cattle are scheduled for 
                delivery to the packer not later than 14 days after the 
                date on which the cattle are committed to the 
                packer.''.
    (b) Cattle Reporting Definitions.--Section 221 of the Agricultural 
Marketing Act of 1946 (7 U.S.C. 1635d) is amended--
            (1) in paragraph (1), by striking ``7-day'' and inserting 
        ``14-day'';
            (2) in paragraph (8)(B), by striking ``market'' and 
        inserting ``marketing'';
            (3) by redesignating paragraphs (3), (4), (5), (6), (7), 
        and (8) as paragraphs (5), (6), (8), (9), (11), and (12), 
        respectively;
            (4) by inserting after paragraph (2) the following:
            ``(3) Covered contract.--
                    ``(A) In general.--The term `covered contract' 
                means any agreement, written or oral, between a packer 
                and a producer for the purchase of fed cattle for 
                slaughter.
                    ``(B) Exclusion.--The term `covered contract' does 
                not include a contract for a negotiated purchase.
            ``(4) Covered packer.--The term `covered packer' means a 
        packer that has slaughtered during the immediately preceding 5 
        calendar years an average of not less than 5 percent of the 
        number of fed cattle slaughtered nationally during the 
        immediately preceding 5 calendar years.'';
            (5) by inserting after paragraph (6) (as so redesignated) 
        the following:
            ``(7) Heifer.--The term `heifer' means a bovine female that 
        has not given birth to a calf.''; and
            (6) by inserting after paragraph (9) (as so redesignated) 
        the following:
            ``(10) Steer.--The term `steer' means a bovine male 
        castrated before reaching sexual maturity.''.

SEC. 3. 14-DAY CATTLE SLAUGHTER REPORT.

    Section 222(c) of the Agricultural Marketing Act of 1946 (7 U.S.C. 
1635e(c)) is amended--
            (1) in paragraph (1)--
                    (A) by striking subparagraphs (B) and (C); and
                    (B) by redesignating subparagraph (D) as 
                subparagraph (B);
            (2) in paragraph (2), by striking ``the information'' and 
        inserting ``information reported under this subsection'';
            (3) by redesignating paragraph (2) as paragraph (3); and
            (4) by inserting after paragraph (1) the following:
            ``(2) Prior day reporting.--
                    ``(A) In general.--The corporate officers or 
                officially designated representatives of each packer 
                processing plant shall report to the Secretary, for 
                each business day of the packer processing plant, not 
                later than 10:00 a.m. Central Time on each reporting 
                day, the information from the prior business day 
                described in subparagraph (B).
                    ``(B) Information required.--The information 
                required under subparagraph (A) shall be, with respect 
                to the prior business day, the number of cattle 
                scheduled for delivery to a packer processing plant for 
                slaughter for each of the next 14 calendar days.''.

SEC. 4. EXPEDITED CARCASS WEIGHTS REPORTING.

    Section 222 of the Agricultural Marketing Act of 1946 (7 U.S.C. 
1635e) is amended by adding at the end the following:
    ``(f) Expedited Carcass Weights.--
            ``(1) Determination.--Not later than 180 days after the 
        date of enactment of the Cattle Price Discovery and 
        Transparency Act of 2022, the Secretary shall determine the 
        minimum amount of time needed by the Secretary to publicly 
        report the daily average carcass weight of cattle slaughtered 
        by packer processing plants.
            ``(2) Reporting.--Not later than 180 days after the 
        Secretary has made a determination under paragraph (1), the 
        Secretary shall begin publicly reporting the information 
        described in that paragraph within the time determined under 
        that paragraph.''.

SEC. 5. MANDATORY REPORTING OF CUTOUT YIELD.

    Section 223 of the Agricultural Marketing Act of 1946 (7 U.S.C. 
1635f) is amended--
            (1) in subsection (a)--
                    (A) in the subsection heading, by striking ``Daily 
                Reporting'' and inserting ``In General'';
                    (B) in paragraph (3)--
                            (i) in subparagraph (C), by striking the 
                        period at the end and inserting ``; and''; and
                            (ii) by redesignating subparagraphs (A) 
                        through (C) as clauses (i) through (iii), 
                        respectively, and indenting appropriately;
                    (C) by redesignating paragraphs (1) through (3) as 
                subparagraphs (A) through (C), respectively, and 
                indenting appropriately;
                    (D) in the matter preceding subparagraph (A) (as so 
                redesignated), by striking ``Secretary at least'' and 
                inserting the following: ``Secretary--
            ``(1) at least''; and
                    (E) by adding at the end the following:
            ``(2) at least once each year, at a time determined by the 
        Secretary, cutout yield data.''; and
            (2) in subsection (b)--
                    (A) by striking ``the information required to be 
                reported under subsection (a)''; and
                    (B) by striking ``day.'' and inserting the 
                following: ``day--
            ``(1) the information required to be reported under 
        subsection (a)(1); and
            ``(2) a composite price using the information required to 
        be reported under paragraphs (1) and (2) of subsection (a).''.

SEC. 6. CATTLE CONTRACT LIBRARY.

    The Agricultural Marketing Act of 1946 is amended--
            (1) by redesignating section 223 (7 U.S.C. 1635f) as 
        section 224; and
            (2) by inserting after section 222 (7 U.S.C. 1635e) the 
        following:

``SEC. 223. CATTLE CONTRACT LIBRARY.

    ``(a) In General.--Not later than 120 days after the date of 
enactment of the Cattle Price Discovery and Transparency Act of 2022, 
the Secretary shall establish and maintain, through the Livestock 
Mandatory Price Reporting program, a library or catalog (referred to in 
this section as the `library'), of each type of covered contract 
entered into between packers and producers for the purchase of fed 
cattle (including cattle that are purchased or committed for delivery), 
including any schedules of premiums or discounts associated with the 
covered contract.
    ``(b) Information Collection.--
            ``(1) In general.--To maintain the library, the Secretary 
        shall obtain information from each packer on each type of 
        existing covered contract of the packer by requiring a filing 
        or other form of information submission from each packer.
            ``(2) Contract information.--Information submitted to the 
        Secretary by a packer under paragraph (1) shall include, with 
        respect to each existing covered contract of a packer--
                    ``(A) the type of contract;
                    ``(B) the duration of the contract;
                    ``(C) a summary of the contract terms;
                    ``(D) provisions in the contract that may affect 
                the price of cattle covered by the contract, including 
                schedules, premiums and discounts, financing and risk-
                sharing arrangements, and transportation arrangements;
                    ``(E) the total number of cattle covered by the 
                contract solely committed to the packer each week 
                within the 6-month and 12-month periods following the 
                date of the contract and the percentage of cattle each 
                week that may vary for delivery or nondelivery at the 
                discretion of the packer, organized by reporting region 
                or in such other manner as the Secretary may determine;
                    ``(F) in the case of a contract in which a specific 
                number of cattle are not solely committed to the 
                packer--
                            ``(i) an indication that the contract is an 
                        open commitment; and
                            ``(ii) any weekly, monthly, annual, or 
                        other limitations or requirements on the number 
                        of cattle that may be delivered to the packer 
                        under the contract, including the percentage of 
                        cattle that may vary for delivery or 
                        nondelivery in a given time period at the 
                        discretion of the packer; and
                    ``(G) a description of the provisions in the 
                contract that provide for expansion in the numbers of 
                fed cattle to be delivered under the contract for the 
                6-month and 12-month periods following the date of the 
                contract.
    ``(c) Availability of Information.--
            ``(1) In general.--The Secretary shall make publicly 
        available to producers and other interested persons information 
        (including the information described in subsection (b)(2)), in 
        a user-friendly format, on the types of covered contracts in 
        the library, including notice (on a real-time basis, if 
        practicable) of the types of covered contracts that are entered 
        into between packers and producers for the purchase of fed 
        cattle.
            ``(2) Monthly report.--
                    ``(A) In general.--Beginning 30 days after the 
                library is established, the Secretary shall make the 
                information obtained each month in the library 
                available in a monthly report to producers and other 
                interested persons.
                    ``(B) Contents.--The monthly report described in 
                subparagraph (A) shall include--
                            ``(i) based on the information collected 
                        under subsection (b)(2)(E), an estimate by the 
                        Secretary of the total number of fed cattle 
                        committed under covered contracts for delivery 
                        to packers within the 6-month and 12-month 
                        periods following the date of the report, 
                        organized by reporting region and type of 
                        contract;
                            ``(ii) based on the information collected 
                        under subsection (b)(2)(F), the number of 
                        covered contracts with an open commitment and 
                        any weekly, monthly, annual, or other 
                        limitations or requirements on the number of 
                        cattle that may be delivered under such 
                        contracts, including the percentage of cattle 
                        that may vary for delivery or nondelivery in a 
                        given time period at the discretion of the 
                        packer; and
                            ``(iii) based on the information collected 
                        under subsection (b)(2)(G), an estimate by the 
                        Secretary of the total maximum number of fed 
                        cattle that may be delivered within the 6-month 
                        and 12-month periods following the date of the 
                        report, organized by reporting region and type 
                        of contract.
    ``(d) Maintenance of Library.--Information in the library about 
types of contracts that are no longer offered or in use shall be 
removed from the library.
    ``(e) Confidentiality.--The reporting requirements for packers 
under this section shall be subject to the confidentiality protections 
provided under section 251.
    ``(f) Violations.--It shall be unlawful and a violation of this Act 
for any packer to willfully fail or refuse--
            ``(1) to provide to the Secretary accurate information 
        required under this section; or
            ``(2) to comply with any other requirement of this section.
    ``(g) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary such sums as are necessary to carry out 
this section.''.

SEC. 7. MARKET ACQUISITION OF FED CATTLE.

    (a) Sense of the House of Representatives.--It is the sense of the 
House of Representatives that--
            (1) all participants in the fed cattle market have a 
        responsibility to contribute to sufficient levels of negotiated 
        trade of fed cattle in all cattle feeding regions in order to 
        achieve competitive bidding and maximum transparency in all 
        relevant markets and robust price discovery for the benefit of 
        all market participants;
            (2) covered packers that use negotiated market prices or 
        internal formulations thereof as the basis for formula 
        marketing arrangements may have incentives to not participate 
        in price discovery in fed cattle markets, including in order to 
        influence the price, especially if the majority of the cattle 
        purchases are under fed cattle formula marketing arrangements 
        under which it is particularly important to have minimum 
        participation; and
            (3) the Department of Agriculture should examine academic 
        literature regarding minimum levels of negotiated transactions 
        necessary to achieve robust price discovery, eliminate the 
        potential for price manipulation, and enhance cattle producer 
        leverage in the marketplace in each of the cattle marketing 
        regions.
    (b) Penalties.--Section 253(a) of the Agricultural Marketing Act of 
1946 (7 U.S.C. 1636b(a)) is amended--
            (1) in paragraph (1)--
                    (A) by striking the paragraph designation and 
                heading and all that follows through ``Any packer'' and 
                inserting the following:
            ``(1) Penalty amount.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), any packer''; and
                    (B) by adding at the end the following:
                    ``(B) Mandatory minimum violation.--Any packer or 
                other person that violates section 259 may be assessed 
                a civil penalty by the Secretary of not more than 
                $90,000 for each violation (as adjusted for 
                inflation).''; and
            (2) in paragraph (2)--
                    (A) by striking ``Each day'' and inserting the 
                following:
                    ``(A) In general.--Except as provided in 
                subparagraph (B), each day''; and
                    (B) by adding at the end the following:
                    ``(B) Mandatory minimum violation.--Each week 
                during which a violation of section 259 continues shall 
                be considered to be a separate violation.''.
    (c) Mandatory Minimums.--The Agricultural Marketing Act of 1946 is 
amended--
            (1) by redesignating sections 259 and 260 (7 U.S.C. 1636h, 
        1636i) as sections 260 and 261, respectively; and
            (2) by inserting after section 258 (7 U.S.C. 1636g) the 
        following:

``SEC. 259. MANDATORY MINIMUMS.

    ``(a) Purpose.--The purpose of this section is to establish 
mandatory minimums--
            ``(1) to enhance price discovery, transparency, and cattle 
        producer leverage for cattle market participants; and
            ``(2) to minimize and mitigate conflicts of interest and 
        other incentives for a covered packer to influence the base 
        price of formula marketing arrangements for the benefit of the 
        covered packer through action or inaction in the market in 
        which the base price is determined.
    ``(b) Establishment.--
            ``(1) In general.--Not later than 2 years after the date of 
        enactment of the Cattle Price Discovery and Transparency Act of 
        2022, the Secretary shall establish--
                    ``(A) 5 to 7 contiguous regions (referred to in 
                this section as `covered regions') that--
                            ``(i) together encompass the entire 
                        continental United States; and
                            ``(ii) to the extent practicable, 
                        reasonably reflect similar fed cattle purchase 
                        practices;
                    ``(B) a mandatory minimum--
                            ``(i) for each covered region established 
                        under subparagraph (A); and
                            ``(ii) that shall be applicable with 
                        respect to each processing plant of a covered 
                        packer located in that covered region; and
                    ``(C) a time period within which a covered packer 
                shall be required to meet the applicable mandatory 
                minimum, which shall be not less than 1 week but not 
                more than 30 days.
            ``(2) Modifications.--The Secretary--
                    ``(A) shall review the mandatory minimums 
                established under paragraph (1) not later than 2 years 
                after the date of establishment and periodically 
                thereafter, but not less frequently than once every 5 
                years; and
                    ``(B) modify any such mandatory minimum, as 
                necessary, after consulting with representatives of the 
                United States cattle and beef industry and in 
                accordance with paragraph (4).
            ``(3) Public input.--In carrying out this subsection, the 
        Secretary shall make all proposed mandatory minimums subject to 
        notice and comment rulemaking and a cost-benefit analysis.
            ``(4) Considerations.--In establishing or modifying 
        mandatory minimums under this subsection for any covered 
        region, the Secretary shall consider the following factors:
                    ``(A) The number of covered packers in the covered 
                region.
                    ``(B) The availability of fed cattle in the covered 
                region.
                    ``(C) Pre-existing contractual arrangements of 
                packers in the covered region.
                    ``(D) The number of pricing transactions (pens of 
                cattle sold) in the covered region.
                    ``(E) The proportion of fed cattle purchased in the 
                covered region through negotiated purchases or 
                negotiated grid purchases relative to the number of 
                formula marketing arrangements that use the negotiated 
                prices or negotiated grid prices as base prices.
            ``(5) Initial mandatory minimum requirement.--The initial 
        mandatory minimum established under paragraph (1)(B) for each 
        covered region shall be--
                    ``(A) not less than the average percentage of 
                negotiated purchases and negotiated grid purchases made 
                in that covered region between January 1, 2020, and 
                January 1, 2022; and
                    ``(B) not more than 50 percent.
    ``(c) Purchases.--A covered packer shall, with respect to each 
processing plant of the covered packer, purchase through an approved 
pricing mechanism not less than the percentage of fed cattle required 
under the mandatory minimum established under subsection (b) for the 
covered region in which the processing plant is located.
    ``(d) Enforcement.--
            ``(1) In general.--On establishing mandatory minimums under 
        subsection (b), the Secretary--
                    ``(A) shall regularly monitor compliance by covered 
                packers with those mandatory minimums; and
                    ``(B) in the case of noncompliance by a covered 
                packer in a given period, may allow the covered packer 
                to remedy the noncompliance by purchasing the 
                applicable shortfall in the approved pricing mechanism 
                in 1 or more subsequent periods, subject to paragraph 
                (2).
            ``(2) Nonremedy.--The Secretary shall not allow a covered 
        packer to remedy noncompliance under paragraph (1)(B) if the 
        covered packer has a pattern or practice of noncompliance, as 
        determined by the Secretary.
    ``(e) Effect on Premiums.--Nothing in this section prohibits a 
formula marketing arrangement from including a premium in addition to 
the base price, including a premium for meat quality, consistency, 
breed, production method, branding, or any other value-added effort.''.
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