The new GIPSA (Grain Inspection, Packers and Stockyards Administration) final rules were passed on Dec. 9, 2011, and will become effective on Feb. 7, 2012. A summary provided by the poultry industry was published in the Jan. 2, 2012, issue of “Poultry Times”and is reprinted below for your information. If you would like to read the rules in their entirety you may go to the following website: http://www.gipsa.usda.gov/Farm_Bill.html. USDA has published the final rule implementing the 2008 Farm Bill provisions ‘to better protect’ livestock producers and poultry growers under the Grain Inspection, Packers and Stockyards Administration (GIPSA).
“As I travel throughout the countryside, I often hear from farmers and ranchers about their concerns with the marketplace becoming more concentrated,” Agriculture Secretary Tom Vilsack said.
While concentration certainly comes with some efficiencies, Congress recognized in the 2008 Farm Bill that additional protections for producers are warranted,” Vilsack said, adding that the rule, will implement these targeted protections and help provide more fairness and transparency in the marketplace.”
The provisions in the final rule were required by the 2008 Farm Bill and modified from a June 22, 2010 proposed rule.
These sections include criteria the secretary may consider when determining:
• Whether a live poultry dealer has provided reasonable notice to poultry growers of any suspension of the delivery of birds,
• Whether a requirement of additional capital investments over the life of a poultry growing arrangement or swine production contract constitutes a violation of the Packers and Stockyards Act, and
• If a packer, swine contractor, or live poultry dealer has provided a reasonable period of time for a grower to remedy a breach of contract that could lead to termination of a production contract.
The rule also includes a section requiring contracts that require the use of arbitration to include language on the signature page that allows the producer or grower to decline arbitration and provides criteria the secretary may consider when determining if the arbitration process provided in a contract provides a meaningful opportunity for growers and producers to participate fully in the arbitration process.
National Chicken Council President Mike Brown noted that the council appreciates the work of Congress to limit the final regulations to the requirements of the 2008 Farm Bill, as Congress intended, and we will work with our members to facilitate compliance with the rule when it takes effect on Feb. 7, 2012.
However, Brown continued, “We are disappointed that the final rule still includes provisions estimated to cost the chicken industry as much as $55.5 million annually. This is especially burdensome on an industry that has struggled financially in the face of this difficult economic climate and record-high costs of production.”
USDA said it had planned to seek additional public comment on several other revised provisions from the June 22, 2010, proposed rule including changes to the tournament system of payment for poultry growers, requirements to collect and post sample contracts and to address the issue of need for producers to show harm to competition prior to asserting a violation of the Packer and Stockyards Act. However, the FY2012 Agriculture Appropriations bill passed by Congress included language prohibiting the department from moving forward on these provisions.