[Congressional Record Volume 145, Number 23 (Tuesday, February 9, 1999)]
[House]
[Pages H490-H492]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 PACKERS AND STOCKYARDS ACT AMENDMENTS

  Mr. COMBEST. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 169) to amend the Packers and Stockyards Act, 1921, to 
expand the pilot investigation for the collection of information 
regarding prices paid for the procurement of cattle and sheep for 
slaughter and of muscle cuts of beef and lamb to include swine and 
muscle cuts of swine, as amended.
  The Clerk read as follows:

                                H.R. 169

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

     SECTION 1. EXPANSION OF MANDATORY DOMESTIC REPORTING PILOT 
                   INVESTIGATION UNDER THE PACKERS AND STOCKYARDS 
                   ACT, 1921.

       (a) Inclusion of Swine; Reference to Forward Contracting.--
     Section 416 of the Packers and Stockyards Act, 1921 (7 U.S.C. 
     229a), as added by section 1127 of the Agriculture, Rural 
     Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 1999, (as contained in section 
     101(a) of division A of Public Law 105-277), is amended in 
     both paragraphs (1) and (2):
       (1) by striking ``beef, or'' and inserting ``beef,''; and
       (2) by inserting after ``lamb,'' the following: ``or 
     domestic or imported swine for immediate slaughter and fresh 
     muscle cuts of swine,''.
       (b) Technical Corrections.--Such section is further amended 
     by redesignating paragraphs (1), (2), and (3) as subsections 
     (a), (b), and (c), respectively.
       (c) Duration of Swine Pilot Investigation.--Such section is 
     further amended by adding at the end the following new 
     subsection:
       ``(d) Possible Extension of Pilot Investigation.--If the 
     pilot investigation required by this section is implemented 
     before the date on which the pilot investigation is expanded 
     to include swine, the Secretary of Agriculture shall continue 
     the pilot investigation beyond the 12-month period referred 
     to in subsection (a) so that price information regarding the 
     procurement of domestic or imported swine for immediate 
     slaughter and fresh muscle cuts of swine is collected under 
     the pilot investigation for 12 months.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Texas (Mr. Combest) and the gentleman from Minnesota (Mr. Peterson) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Texas (Mr. Combest).
  Mr. COMBEST. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, H.R. 169 is a simple bill and would simply add hogs and 
pork product to the pilot investigation on beef and lamb prices that 
was authorized last fall as a part of the omnibus appropriation.
  I would like to thank and commend my colleague on the Committee on 
Appropriations and on the Subcommittee on Agriculture who is very 
instrumental in agriculture policy, the gentleman from Iowa (Mr. 
Latham), for introducing this legislation and for calling for its swift 
adoption.

                              {time}  1415

  Many of our colleagues are aware that livestock prices, particularly 
those received by lamb and beef producers, have been distressingly low 
for some time. The pilot investigation that was included in last year's 
omnibus appropriations bill is a relatively nonintrusive way to shed 
some light on the workings of these complex markets.
  Last fall, when the omnibus bill was being crafted, the pork 
producers declined to be included in the USDA pilot investigation. 
However, recent and drastic declines in live hog prices have led pork 
producers to reconsider and ultimately reverse that decision. Thus, 
H.R. 169 will simply include pork in the ongoing pilot investigation.
  Tomorrow, the House Committee on Agriculture will conduct a hearing 
on livestock prices during which we will consider testimony outlining 
the current market conditions for beef, lamb and pork.
  I hope that in this hearing we will be able to illuminate trends, 
dispel myths and come to a common understanding of how these livestock 
markets operate so that we can responsibly consider many proposals 
currently being discussed in the agricultural community. In the same 
way, I am hopeful that H.R. 169 will aid our deliberation of these 
issues by providing needed information and insight into the hog market.
  I ask that Members support this legislation as a constructive step in 
this ongoing policy discussion.
  Mr. Speaker, I reserve the balance of my time.
  Mr. PETERSON of Minnesota. Mr. Speaker, I yield myself such time as I 
may consume.
  Mr. Speaker, as ranking member of the Subcommittee on Livestock, 
Dairy, and Poultry and a representative from northwestern Minnesota, I 
have been acutely aware of the downturn in many sectors of the farm 
economy. In particular, the U.S. livestock industry has been hard-hit 
with sustained low prices. Beef and lamb markets have been depressed 
for several years and, more recently, historically low prices have 
plagued the pork market.
  The economic explanation for low prices is a complicated mix of 
supply, demand and other factors such as trade. Legislative proposals 
have been pursued in an effort to return viability to the industry. 
However, I believe that we must be cautious in our approach. Whatever 
legislative actions are taken should not impede or wrongly dampen one 
aspect of the industry to benefit another. We need to ensure that we 
move carefully toward the combined goal of a stable and viable 
livestock industry.
  To this end, I believe that H.R. 169 is a prudent use of our 
authority. Building on last fall's effort to initiate a pilot study of 
comprehensive mandatory price reporting for beef and lamb, the bill 
simply seeks to add pork to that study. One of the unknown factors in 
the low price story is the impact of price information. It is unclear 
whether or not a full and open price reporting system operated through 
the Federal Government would allow producers to operate more 
effectively to market their products. A complete study of the impacts 
of price reporting with a quick turnaround on the results would help 
direct any future action in this area.
  Obviously, the passage of this bill and the resulting study will not 
cure the ills that are facing the livestock industry at this time. But 
it is a small piece that can answer an important question: Can greater 
price information aid livestock producers? The information obtained 
from the study should help us proceed in a logical and effective 
manner.
  Therefore, I ask that my colleagues join me in support of our 
livestock producers and support H.R. 169.
  Mr. Speaker, I reserve the balance of my time.
  Mr. COMBEST. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Iowa (Mr. Latham), the author of this proposal, and 
again, one of the strong advocates of American agriculture.
  Mr. LATHAM. Mr. Speaker, first of all, I want to express my thanks to 
the chairman of the full committee. He has done such a great job 
working for American agriculture, the gentleman from Texas (Mr. 
Combest) and his cooperation in working out a few technical 
difficulties we had, but I appreciate it very, very much. Also, I 
appreciate the comments of the gentleman from Minnesota (Mr. Peterson), 
who has worked so hard for all of agriculture.
  Mr. Speaker, on January 6, I introduced H.R. 169 in an effort to 
level the playing field for embattled American pork producers. I think 
the Speaker is acutely aware of the problems that pork producers have 
experienced in recent months with the prices dipping down to under $10 
per hundred. Currently, they moved back up to close to $28 per hundred, 
but certainly well below any level of profitability. We have 
experienced prices well below Depression Era prices, and it is so 
important that we do as much as possible

[[Page H491]]

and as quickly as possible to help our pork producers.
  My legislation amends the Packers and Stockyards Act of 1921 to 
include swine in a 12-month pilot investigation of live cattle and lamb 
prices that was included in last year's omnibus appropriations bill. 
This legislation contributes to our efforts to revive a farm economy 
that is in bad shape. The difficulties associated with low grain prices 
have been compounded by low livestock prices.
  At the very least, America's farmers want to know if they are 
receiving fair compensation for their very hard work. It is important 
that accurate information be available to the livestock industry in 
order for competitive markets to function properly. Without this 
pricing information, we risk supporting a business environment that 
gives too much control to too few.
  H.R. 169 will assist farmers by examining how we can best preserve 
the competitive nature of the farm economy. We cannot allow our 
Nation's farmers to be left without the tools for them to use to make 
sure they receive the best possible price for their livestock. It is 
important to consider that the four largest meat packers in this 
country process 57 percent of all of the hogs. As a result, the 
industry is looking to Congress to find out if this increase in packer 
concentration had a direct effect on the recent decline in live hog 
prices.
  If we can find methods in which accurate and timely pricing 
information can provide producers with the tools needed to make the 
best possible business decisions for their farm, we will be making a 
positive contribution to agriculture. It is my hope the results of this 
investigation will help Congress and the administration formulate 
additional policies that will be a result of more fair, effective 
market prices so that we all know what the real price of pork is.
  Mr. COMBEST. Mr. Speaker, I yield 5 minutes to the gentleman from 
Minnesota (Mr. Gutknecht), a very valued member of the Committee on 
Agriculture.
  Mr. GUTKNECHT. Mr. Speaker, I thank the gentleman for yielding me 
this time.
  I rise in strong support today of H.R. 169, the Competitive Pork 
Pricing Act. This is a very modest first step in terms of providing 
some transparency in terms of the pricing of pork.
  Mr. Speaker, 5 years ago, 80 percent of the finished hogs were sold 
at auction markets, and I know a little bit about the auction business. 
When people went to the auction ring, they could see what hogs were 
actually selling for. In fact, 5 years ago, 87 percent of the hogs 
being purchased by large packers were bought on a spot basis. Today, 
that situation is reversed, and with the increase of contracting, we 
now have big pork producers and large packing concerns who have worked 
out long term contracts for hogs.
  Contracts in and of themselves are not necessarily inherently evil, 
but they have had a profound impact on what is happening to smaller 
pork producers throughout the United States. What this has done out in 
farm country is created a tremendous amount of distrust. There is 
distrust among producers, because we may have one farmer on one side of 
the road who is being paid one price for his pigs, and another farmer 
who is paid a different price, and they could be in a situation where 
neither would know what the other one is actually receiving for their 
hog. This has caused distrust among producers, but it has caused 
intense distrust among the producers with the packers, and the packing 
industry itself has become the villain in this story, and perhaps there 
is some truth to that.
  But as we move inherently towards a much more market-oriented 
agriculture, it seems to me that we at the Federal level have some 
responsibility to make certain that those markets are orderly, and that 
the participants in those markets at least have equal access to 
information. As I say, this is a very modest step in the right 
direction in terms of providing some transparency to all producers as 
far as what prices are actually being paid.
  Now, we cannot guarantee here at the Federal level that everyone is 
going to make a profit, but we must guarantee that every producer gets 
better and more accurate information.
  A good example would be the New York Stock Exchange. We created the 
Securities and Exchange Commission many years ago, and that is an 
ongoing auction every day, and one can, on line, literally see every 
transaction and know what the price of a particular stock is at any 
moment in time. Such is not the case in the livestock industry. It 
seems to me we ought to create a system whereby producers have better 
access to better information.
  Mr. Speaker, it has often been said that America's farmers are like 
the ultimate gamblers; they sit down at the casino every day. I think 
the best way to think about this particular legislation is it is the 
first step to making certain that all of the cards in that casino are 
dealt face-up, and everybody knows that all the cards are on the table.
  Mr. COMBEST. Mr. Speaker, I yield 1 minute to the gentleman from 
Oklahoma (Mr. Watkins), who has a very intensive interest in 
agriculture and is always very helpful on agricultural issues.
  (Mr. WATKINS asked and was given permission to revise and extend his 
remarks.)
  Mr. WATKINS. Mr. Speaker, I would like to first and foremost extend 
my special thanks to the gentleman from Texas, the chairman of the 
Agriculture Authorizing Committee, for bringing forth this legislation 
and technical amendments.
  We know that agriculture is changing in this world, and we truly are 
in a global competitive world that our vast commodities must compete 
against. We must do as much in the global marketing area as we have in 
the production area. I have two degrees in agriculture, and basically 
when I was taking agriculture at Oklahoma State University, our study 
centered a lot on production. We had maybe some various electives that 
we could use in marketing, but marketing must in the 21st century be 
centered on beating the competition in a global economy. Anything less 
and we are selling out the farm families of this great United States.
  Yes times have changed, and there has to be changes in policies that 
meets or beats the production and marketing policies of other 
countries. I will say bringing to light the fact that our beef industry 
is hurting and our cattlemen and ranchers are having deep problems. Our 
lamb industries have been involved in this study, and I know adding the 
swine industry and allowing the pork producers to have a great deal 
more input into this study, the problems must be addressed before it is 
too late.
  Mr. Speaker, I thank the chairman for his leadership in moving this 
forward.
  Mr. BEREUTER. Mr. Speaker, this Member rises in reluctant opposition 
to H.R. 169, a bill which expands the pilot investigation into 
livestock price reporting to include pork.
  This Member would like to begin by stating his strong support for 
meaningful mandatory price reporting legislation. Pork producers 
throughout Nebraska consistently stress the need to have this vital 
information. It's time that we ensure that it's provided to them.
  Unfortunately, this Member is not convinced that H.R. 169 will 
accomplish that goal. This Member appreciates the efforts of the 
distinguished gentleman from Iowa (Mr. Latham) in introducing this bill 
and seeking to assist pork producers. However, the problem is that H.R. 
169 simply builds on the watered-down price reporting provisions 
included in last year's omnibus appropriations bill. Livestock 
producers see the study as an excuse or cover for the lack of action on 
imposing mandatory reporting. This Member was very disappointed that 
mandatory price reporting requirements were eliminated during the 
conference. In some respects, the provisions which survived were worse 
than none at all. In passing the flawed one-year pilot study last year, 
it needlessly delayed confronting the real issue, suppressed timely 
price reporting and lessened the pressure to take meaningful action.
  Although well-intentioned, H.R. 169 does nothing to overcome the 
underlying defects in the current price reporting pilot study. It 
offers convincing proof that you can't make a silk purse out of a sow's 
ear.
  A great many of this Member's pork-producing constituents (and 
cattlemen

[[Page H492]]

too) believe that it is time to stop studying this issue and start 
instituting mandatory price reporting, numerous Nebraska pork producers 
have expressed concern that this well-intended legislation, in fact, 
could delay meaningful price reporting.
  This Member intends to again support comprehensive and mandatory 
livestock price reporting legislation in this Congress that will offer 
transparency and a level playing field for all producers. That 
legislation should be enacted as soon as possible.
  Mr. STENHOLM. Mr. Speaker, the last few years have been very 
difficult for the U.S. livestock industry. In addition to the recent 
drought, an epidemic of low prices has further erased producer equity. 
During these years, producers of beef, lamb, and more recently, pork 
have all experienced prices that are simply too low to endure.
  Livestock products account for more than half the value of all our 
domestic agricultural production. Consequently, if we are to maintain a 
viable and stable rural America, we must pay particular attention to 
the livestock producers who help sustain those rural communities. When 
livestock producers suffer, their losses spill over to all the small, 
rural businesses that depend on their patronage.
  Reflecting on this economic difficulty, many have questioned whether 
the prices currently paid to livestock producers reflect the true 
market-value of their products. As more and more animals are sold in 
``closed'' trades, which are not included in reported average prices, 
the actual value of those remaining animals sold in open, ``cash'' 
markets has been cast into some doubt.
  With this in mind, language was added to last year's Omnibus 
Appropriations bill, requiring a one-year pilot study of comprehensive, 
mandatory price reporting for beef and lamb. Now, this bill before us, 
H.R. 169, would simply add pork to that one-year study. Given the 
recent disastrous drop in pork prices, it is not difficult to 
understand why pork producers are anxious to have insights into the 
curious behavior of their markets.
  While this pilot study does not begin to solve the problems facing 
U.S. livestock producers, it is a small step in the right direction. I 
hope that the information from this study will help us to decide if 
permanent price reporting would in fact result in more accurate markets 
for beef, lamb, and pork. It is logical and reasonable to settle that 
question once and for all, so we can consider whether further action is 
warranted. I encourage all members to support our livestock producers 
by voting for H.R. 169.
  Mr. PETERSON of Minnesota. Mr. Speaker, I have no further requests 
for time, and I yield back the balance of my time.
  Mr. COMBEST. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Texas (Mr. Combest) that the House suspend the rules and 
pass the bill, H.R. 169, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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