New Packers and Stockyards Act Regulations Issued
Effective June 18, 2008, the 2008 Farm Bill amended the Packers and Stockyards Act (PSA) by establishing new requirements for participants in the livestock and poultry industries. In particular, the 2008 Farm Bill directed the United States Department of Agriculture (USDA) to promulgate rules governing certain livestock contracts that are consistent with the new contracting requirements contained in the Farm Bill.
The Farm Bill also directed the USDA to develop regulations by June 18, 2010, governing certain aspects of livestock marketing and production contracts as governed by the PSA. Recently, USDA published regulations that it believes are consistent with the PSA, and are designed to facilitate the functioning of livestock markets which have become characterized by relatively few livestock buyers and the increasing use of non-public market transactions for the acquisition of livestock. Those developments have resulted in the reduction of market information available to livestock sellers. Some producers and agricultural groups have claimed those developments have also resulted in a dysfunctional marketplace. That is what USDA is responding to by promulgating the regulations.
Perhaps the most controversial aspect of the new rules concerns those providing guidance on the handling of antitrust-related issues under the PSA – those rules that provide insight into the USDA’s current position with respect to the ability of livestock and poultry buyers to manipulate markets.
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