[Congressional Record Volume 142, Number 65 (Friday, May 10, 1996)]
[Extensions of Remarks]
[Page E761]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             THE COMPETITIVE LIVESTOCK MARKETS ACT OF 1996

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                           HON. EARL POMEROY

                            of north dakota

                    in the house of representatives

                         Thursday, May 9, 1996

  Mr. POMEROY. Mr. Speaker, today I am introducing legislation to 
address the disastrous situation that livestock producers across this 
Nation are currently facing. At this time, livestock producers are 
suffering the double-whammy of the lowest prices since the Great 
Depression and the highest feed prices in a generation. Many producers 
in my State are facing no choice but to sell out this year as they face 
losses of several hundred dollars on every head they sell.
  Ranchers from across my State have told me that concentration in the 
meat packing industry has limited competition in the livestock markets. 
The three largest meat packing firms now control over 80 percent of the 
cattle slaughter in this country. Independent producers have been 
squeezed to the point where they are at the mercy of whatever price the 
giant meat packing firms are willing to offer. Congress must act to 
restore free and open competition in our Nation's livestock markets.
  The legislation I am introducing today will accomplish that goal in 
the following manner:
  First, it directs the Secretary of Agriculture to develop rules to 
prohibit noncompetitive captive supply arrangements. These captive 
supply arrangements include formula pricing, forward contracting and 
packer-owned cattle feeding. The bill does not prohibit all captive 
supply arrangements between a producer and a packer, only those 
determined to be detrimental to competition in the livestock markets. 
This provision will force the livestock trade to occur in a free and 
open market.
  Second, the bill requires the Secretary of Agriculture to implement 
mandatory reporting of the prices and terms of sale for slaughter 
livestock purchased by packers who have greater than a 5-percent share 
of the slaughter market. This information would be public knowledge and 
reported immediately. There would be no more secret deals between 
packers and large feedlots. All producers should have access to 
information on the terms of sale for slaughter livestock in order to 
take maximum advantage of free market forces.
  Finally, the bill would require the reporting of export sales of meat 
on a weekly basis. Access to this information will help all livestock 
producers gain a more realistic picture of supply and demand 
relationships.
  Mr. Speaker, we are facing a crisis of epic proportions among 
livestock producers in this Nation. From Texas to North Dakota 
independent family ranchers are facing financial ruin. We must take 
steps immediately to address what is wrong in this industry. With this 
bill, we are saying that the large meat packers can no longer control 
the cattle markets through secret deals and privileged information. We 
must restore the free markets that the United States is known for 
around the world. I urge my colleagues to join me in support of this 
legislation.

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