[Federal Register Volume 66, Number 152 (Tuesday, August 7, 2001)]
[Notices]
[Pages 41194-41195]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-19876]


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 Notices
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  Federal Register / Vol. 66, No. 152 / Tuesday, August 7, 2001 / 
Notices  

[[Page 41194]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

[Docket Number LS-01-10]


Livestock Mandatory Reporting: Confidentiality Guideline

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Notice of modification of confidentiality guideline.

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SUMMARY: This notice announces that the Secretary of Agriculture is 
modifying the confidentiality guideline currently used under the 
Livestock Mandatory Reporting Act program to protect the identity of 
reporting firms and preserve the confidentiality of proprietary 
business transactions. This modification would continue to preserve 
confidentiality while enabling USDA to issue more frequent and more 
accurate reports on livestock and meat, and provide all segments of the 
livestock and meat industries with relevant information on which to 
base market decisions.

EFFECTIVE DATE: This notice is effective August 20, 2001.

ADDRESSES: Comments may be sent to John E. Van Dyke, Chief, Livestock 
and Grain Market News Branch, Livestock and Seed Program, Agricultural 
Marketing Service, USDA, 1400 Independence Avenue, SW, Room 2619-South 
Building, Stop 0252, Washington, DC 20250-0242; telephone (202) 720-
6231, fax (202) 690-3732, E-mail [email protected]. Comments 
received may be inspected at 1400 Independence Avenue, SW, Room 2619-
South Building, Stop 0252, Washington, DC between 7:30 a.m. and 4 p.m. 
The comments will also be posted on the Livestock and Grain Market News 
Branch web site. The address is www.ams.usda.gov/lsg/mncs/LS_MPR.htm.

FOR FURTHER INFORMATION CONTACT: If you have questions about the 
modification of the confidentiality guideline for livestock mandatory 
reporting, please contact John E. Van Dyke, Chief, Livestock and Grain 
Market News Branch at (202) 720-6231, facsimile (202) 690-3732, or E-
mail at [email protected].

SUPPLEMENTARY INFORMATION:

Background

    The Livestock Mandatory Reporting Act of 1999 (Act) (Pub. L. 106-
78; 113 Stat. 1188; 7 U.S.C. 1635-1636(h)) as an amendment to the 
Agricultural Marketing Act of 1946 (7 U.S.C. 1621 et seq.) was intended 
to enhance the transparency of market information in the livestock and 
meat industries by providing market participants with access to 
information on price trends, contracting arrangements and supply and 
demand conditions. As required by the Act, AMS publishes such 
information in a manner designed to protect the identity of reporting 
entities and preserve the confidentiality of transactions.
    On April 2, 2001, AMS began the process of collecting and reporting 
mandatory data, as authorized by the Act. The reporting program 
differed from most other Federal data reporting programs with respect 
to the frequency of data collection (two to three times daily, within 
intervals as short as four hours) and reporting (one hour after receipt 
of data). As required by statute, a guideline was developed to protect 
the confidentiality of proprietary business information.
    The confidentiality guideline adopted for the program, the so-
called ``3/60'' guideline, was based on similar guidelines used 
throughout the Federal government. To satisfy the ``3/60'' 
confidentiality guideline, the following two conditions were required:
    (1) At least three reporting entities must be reflected in each 
category of data being reported during an individual reporting period, 
and
    (2) No single reporting entity could account for 60 percent or more 
of the total volume reported in any single data category during an 
individual reporting period.
    Because much of the data required by the Act had not been available 
before implementation of the new program, AMS could not predict the 
level or pattern of market activity by reporting entities for each 
reporting period. AMS therefore chose to apply the confidentiality 
guideline in a very conservative manner. Essentially, the ``3/60'' 
guideline was applied to each data cell in each report that was to be 
released.
    With several weeks of data collection now completed, a much clearer 
understanding has been developed regarding the purchasing patterns of 
entities required to provide data under the program. This database 
permits several observations about the unique nature of the data 
collection that takes place under the livestock mandatory reporting 
program. As already noted, this program differs significantly from most 
other Federal data reporting programs with respect to the frequency of 
data collection and reporting. Given the extremely short time horizon 
of most reporting periods, the level of market participation during an 
individual reporting period frequently does not meet the current 
confidentiality standard. The consequence of the current approach to 
protecting confidentiality has been to severely limit the extent to 
which collected data can be released. Nearly one-third of scheduled 
daily cattle and swine reports were withheld from publication between 
April 2 and June 14, 2001, for reasons of confidentiality, and many 
other reports were released with missing line items or sections.
    In addition, the data now available show that for most reports the 
pattern of entities submitting data is random, even when fewer than 
three entities supply data for a morning or afternoon report. The data 
also indicate that, for most reports, no single entity provides the 
majority of collected data.
    Upon review of the current program and the data that have been 
collected continuously since April 2, 2001, AMS has determined that the 
level of market participation is sufficiently diverse to permit the 
release of much of the data currently withheld from the public without 
compromising the confidentiality of business transactions. To maximize 
the availability of market information to the public while protecting 
the identity of individual market participants, AMS intends to extend 
the time frame over which the required level of market participation 
may be met, and establish an additional

[[Page 41195]]

safeguard during those instances when only one entity supplies data 
during individual reporting periods. By making these adjustments in the 
confidentiality guideline used in the livestock mandatory reporting 
program, AMS anticipates a significant improvement in the percentage of 
market information that can be released to the public without 
jeopardizing the confidentiality of proprietary transactions.
    AMS will continue the practice of withholding the number and 
identity of entities providing data for an individual report. In 
addition, given the frequency of data collection, the following 
guideline elements will be adopted:
    (1) At least three entities must provide data at least 50 percent 
of the time over the most recent 60-day time period;
    (2) No one entity may provide more than 70 percent of the data for 
a report over the most recent 60-day time period--to ensure that no 
single entity is providing such a large proportion of the data that its 
identity might be revealed; and
    (3) No one entity may provide data more than 20 percent of the 
time, as the only entity, over the most recent 60-day time period--to 
protect the identity of an entity when it is the only plant providing 
data.
    To determine levels of market participation over the most recent 
60-day time period, the computer program currently used to collect and 
publish mandatory data from reporting entities--known as the Mandatory 
Price Reporting (MPR) system--will be modified to develop a daily 
computer-generated log detailing application of a ``3/70/20'' 
confidentiality guideline over the most recent 60-day period for all 
reports generated by the MPR system. The 60-day time period evaluated 
in this process will consist of both required reporting days and any 
Federal or State government holidays that have fallen on a weekday. The 
computer-generated log will be reviewed to determine whether reports 
and/or data items have failed to meet the ``3/70/20'' guideline, and 
identify possible aberrations in market activity that could have caused 
such a problem. Importantly, the computer-generated log will be 
reviewed to identify any trends in levels or patterns of market 
participation by reporting entities in current reporting areas. This 
latter review should prove helpful in anticipating situations where 
changing market participation could create confidentiality concerns.
    AMS anticipates that this modification in the confidentiality 
guideline for livestock mandatory reporting will result in a 
significant improvement in the percentage of market reports made 
available to the public while continuing to maintain confidentiality. 
For example, under the current ``3/60'' confidentiality guideline, 
approximately 30 percent of all scheduled daily cattle and swine 
reports (703 out of 2,376) were withheld from publication between April 
2 and June 14, 2001. Using the newly developed confidentiality 
guideline, fewer than 2 percent of these same reports would have been 
withheld from publication.
    The software changes necessary to provide the daily computer-
generated logs for review of the ``3/70/20'' confidentiality guideline 
over the most recent 60-day time period will require approximately 12 
weeks to implement. In the interim, AMS will ensure adherence to the 
``3/70/20'' confidentiality guideline by conducting bi-weekly reviews 
of all reports and individual data items, using individual queries to 
examine collected data and determine whether required levels of market 
participation and diversity are being met.

    Authority: 7 U.S.C. 1621 et seq.

    Dated: August 3, 2001.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 01-19876 Filed 8-3-01; 2:48 pm]
BILLING CODE 3410-02-P