Be on Notice: GIPSA Farmer Fair Practice Rules


USDA programs are the product of good democratic compromise. While some farm constituencies may not benefit directly, as is the case with small-scale vegetable farmers and safety-net programs like Agriculture Risk Coverage and Price Loss Coverage, they are not actively discriminated against in the rule-making. Rather, the more populous, prosperous, and influential group — row-crop producers, for example — has the loudest voice and the final say. While the outcome may not always be equitable for all of USDA's stakeholders, at least it is without nefarious intent.

It's what happens outside of USDA that creates problems.

The Grain Inspection, Packers & Stockyards Administration’s (GIPSA) “Farmer Fair Practices Rules,” as mandated by the 2008 Farm Bill, are designed to protect contract livestock and poultry farmers from anti-competitive, unfair, discriminatory, and downright abusive practices by vertically-integrated meat processors, who have monopolized their relative markets to a monstrous degree (see Michael Pollan's quote). It's hard to imagine arguing the worth of such a measure — tantamount to the political sacrilege of demeaning the American farmer. However, lawmakers are infinitely subject to suasion, particularly if they hail from states with large poultry companies. Since 2008, the rules have never gone into effect, neutered by what has become known as the GIPSA Rider, a recurring amendment tacked on in the appropriations process to prevent the rules from going into effect. Despite a law on the books to protect farmers, the regulations and enforcement have never made it out of the legislature ... until last fall.

According to one traditional yardstick, an industry is deemed excessively concentrated when the top four companies in it controls more than 40 percent of the market. In the case of food and agriculture, that percentage is exceeded in beef slaughter (82 percent of steers and heifers), chicken processing (53 percent), corn and soy processing (roughly 85 percent), pesticides (62 percent) and seeds (58 percent).
— Michael Pollan, "Big Food Strikes Back"

Per the National Sustainable Agriculture Coalition, the point group advocating on behalf of farmers on this matter, the Farmer Fair Practices Rules, at last finalized, contain two proposed rules, plus an interim final rule:

"The proposed rules address the poultry tournament payment system and issues of undue preference, while the interim final rule clarifies that farmers need only prove they were treated unfairly by a company to secure legal remedy. Currently, farmers are required to not only prove harm to themselves and their businesses, but they must also prove that the result of the harm impacted competition industry-wide. The interim final rule will clarify and underscore the plain language of the Packers and Stockyards Act, which requires no proof of harm to competition from a complainant."

But we're not out of the woods yet. With the Trump administration's pause on new regulations, the comment period and effective dates have been pushed back, with the comment period extending for all rules at least until March.

In the ceaseless hue and cry of current politics, remember GIPSA. The end is so close. As the son of a chicken farmer who suffered the fearful intimidations of the poultry industry, we can't let this die now.


Further Reading

The other side's take on GIPSA:

From the National Cattlemen's Beef Association (it's curious that a cattle organization would be so vociferous against GIPSA since the diffuse and individualized nature of the industry would seem to leave it the least affected):

Here's The Poultry Federation's take.