[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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