Small farmers sue USDA after rollback of meatpacking rules - Entrepreneur Generations

In mid-October the U.S. Department of Agriculture announced it was rolling back Obama-era rules that provided basic legal protections for small poultry and livestock producers who are under contract with corporate meatpackers; now an organization representing the interests of small farmers is suing the USDA, Nancy Matsumoto reports for NPR.

The lawsuit was filed by three farmers and the Organization for Competitive Markets, a think tank in Lincoln, Nebraska, that represents the interests of 40,000 contract poultry farmers, 900,000 cattle ranchers, and 70,000 hog farmers. The small farmers say they're being exploited by the meatpacking companies they supply, and that the Obama-era GIPSA rules (short for Grain Inspection, Packers and Stockyard Administration) made it easier for individual farmers to sue the meatpackers for anti-competitive behavior.

"Four packers control 82 percent of the market and they've carved the country into regions and don't compete with each other," OCM Executive Director Joe Maxwell told Matsumoto. "Farmers feel threatened by packers because in their area, there's only one choice."

And farmers can feel trapped by meatpackers because many have to go into substantial debt to buy in. West Virginia poultry farmer Mike Weaver said that farmers "have to put their home in hock" to raise the $1.5-2 million needed to start a poultry operation. "Then you have to take what the companies give you . . . or take your chances on losing the farm," he told Matsumoto. "Companies abuse that, shamefully."

Corporate meatpackers say the rollback of the rules was fair because it discouraged farmers from filing frivolous lawsuits that cost them a lot of money to defend and result in higher meat prices for consumers.

"Another rule the USDA withdrew would have helped define which actions are considered unfair, discriminatory or deceptive. Left intact was a third rule, clarifying the rules governing the "tournament system" of poultry producing — which pits producers against each other in a contest of who can produce the biggest chickens with the least amount of feed," Matsumoto reports.




from The Rural Blog http://ift.tt/2ChjqIr Small farmers sue USDA after rollback of meatpacking rules - Entrepreneur Generations

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