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The South Dakota Stockgrowers Association is a grassroots organization whose individual producer members determine issues of importance to the state's livestock industry. With input into the policy development, each member has the opportunity to influence SDSGA's policy and priorities. Individual members of the Association pull together to make powerful decisions - dedicated to promoting the livestock industry and enhancing the opportunity for profitability.

SD Stockgrowers News

Supporters Urge Congress to Take Action and Pass Meaningful Commodity Checkoff Program Reform

 Supporters Urge Congress to Take Action and Pass Meaningful Commodity Checkoff Program Reform

 

Washington, DC – More than 140 organizations, ranchers, farmers and businesses applaud Senators Booker and Lee for filing legislation that, when passed, will stop commodity checkoff program abuses. Yesterday, the Senators filed the Commodity Checkoff Program Improvement Act (S. 3201), which would put an end to the most egregious abuses committed by the boards of the federally-mandated commodity checkoff programs. In addition, Senator Lee filed the Voluntary Checkoff Program Participation Act (S. 3200), which would ensure no farmer or rancher is forced to pay fees into programs that do not promote their market segment. The 143 organizations, individuals and businesses delivered to the sponsors and to other Senate offices a joint letter of support.

Checkoff programs were established to provide equal benefits to all producers of a particular commodity by using funds gained from mandatory assessments to conduct promotion and research for that commodity. Laws establishing checkoff programs explicitly prohibit the use of funds in ways that would directly influence legislation or government action in order to prevent unfair distribution of benefits amongst producers. Despite this aim, misuse of checkoff programs has allowed for inappropriate relationships between checkoff boards and lobbying organizations. This has created an anticompetitive effect, benefiting certain producers to the detriment of others, and forcing some producers to pay into a system that actively works against them.

For over six years, the National Cattlemen’s Beef Association (NCBA) ignored the U.S. Agriculture Secretary’s direct warning about the need for checkoff integrity, which would require, for example, the independence of the Federation of State Beef Councils from the control of the NCBA. During that entire time, the Secretary waited while industry groups self- selected participants to work harmoniously with the NCBA to develop a plan for reforming the Beef Checkoff Program. No meaningful plan was ever developed.

Fred Stokes, spokesman for the Organization for Competitive Markets, said: “These checkoff programs were designed to help the U.S. farmer and rancher, but they have been hijacked by corporate interests. The half-billion dollars that these programs generate each year has been mostly diverted and used to the detriment of producers. These funds have mostly become the cash cow for organizations that work against fair competition and market transparency. The National Cattlemen’s Beef Association is a glaring example of such abuse. The NCBA derives more than eighty percent of its total revenue from the beef checkoff, while working against the interests of nearly all U.S. cattle producers. They opposed country of origin labeling, blocked efforts to renew market competition through enforcement of the Packers and Stockyards Act of 1921, and used checkoff dollars to defend big packers’ anticompetitive ownership of livestock.

The millions of checkoff dollars NCBA receives is their life-blood. Successful passage of this proposed legislation is critically important to restoring fair markets and rebuilding our domestic family farm and ranch agriculture.”

R-CALF USA CEO Bill Bullard said: “Our joint letter provides clear evidence that independent cattle producers are tired of the conflicts of interest, misspending, and other abuses rampant in our beef checkoff program. We are now appealing to Congress to take action to stop these commodity programs from harming the very individuals who are forced to pay into the checkoff funds, such as the $1 per head cattle tax that U.S. cattle producers must pay each time they sell an animal.”

The joint letter highlights the major reform provisions of S. 3201, which would end the glaring abuses of the program boards.

The legislation would:

1. Stop federally mandated checkoff dollars from being transferred to parties that seek to influence government policies or action relating to agriculture issues.

2. Enforce the prohibition against conflicts of interest in contracting and all other decision- making operations of the checkoff program.

3. Stop federally mandated funds from being used for anti-competitive programs or from being spent to disparage another commodity in the marketplace.

4. Increase transparency of the individual boards’ actions by shedding light on how federal checkoff funds are spent and the purpose of their expenditures.

5. Require audits of each program every five years to ensure their activities are in compliance with the law.

Further, the joint letter requests Congress pass S. 3200, ensuring that in this complicated, multifaceted market, no farmer or rancher is forced to pay into a joint marketing and research program unless they see a benefit to their farm, ranch or business by doing so.

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Stockgrowers Respond to Senate Judiciary Committee’s Investigation of Cattle Price Collapse

Stockgrowers Respond to Senate Judiciary Committee’s Investigation of Cattle Price Collapse

 

Statement from Stockgrowers President Bill Kluck, Mud Butte, SD:

“The members of the South Dakota Stockgrowers Association are really impressed and want to say thanks to the Senators who have agreed to move this investigation forward. The price collapse that we saw in the fall of 2015 was a serious downturn in our industry and strained the finances of our family ranches. If you figure that the average ranch had $500 per head less income in 2015, that’s a lot of money that isn’t circulating in our rural economy right now.

We appreciate that the leadership of the Senate Judiciary Committee took this seriously and is conducting this investigation to make sure our markets aren’t being influenced unfairly.”

 Statement from SD Stockgrowers Marketing Committee Chair, Vaughn Meyer, Reva, SD:

“This investigation is great news, and we extend our thanks to Senators Grassley, Leahy, Lee and Klobuchar for their ongoing commitment to keeping our markets fair. The best way to keep our independent family ranches going is to keep our markets strong and competitive so that we get fair prices for the high quality cattle we’re raising.

The types of market swings that we’ve seen over the last year make it hard for our family ranch businesses to plan for the future and make us question just what is causing the drops. This investigation and full enforcement of the Packers and Stockyards Act are critical to making sure we don’t have anti-competitive forces trying to break the market.”

 

Press Release from R-CALF USA

Senate Judiciary Committee Approves R-CALF USA’s 

Request to Investigate Cattle Price Collapse

In response to R-CALF USA’s January request, the Senate Judiciary Committee last week requested the Comptroller General of the United States to use his agency, the Government Accountability Office (GAO), to initiate an investigation into the 2015 cattle price collapse.

In a letter signed by the chairman and ranking Member of the U.S. Senate Judiciary Committee, Sens. Chuck Grassley (R-Iowa) and Patrick Leahy (D-Vt.), respectively, along with the chairman and ranking member of the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights, Sens. Mike Lee (R-Utah) and Amy Klobuchar (D-Minn.), respectively, the GAO is asked to investigate the cause of the sudden 15.1 percent drop in fed cattle prices that occurred during the latter half of 2015.

“We are pleased the Judiciary Committee agrees that the evidence we provided regarding the dysfunctionality of our fed cattle market warrants a careful investigation into the current structure of our industry and our industry’s susceptibility to anticompetitive practices,” said R-CALF USA CEO Bill Bullard.

The Judiciary Committee’s letter specifically requested the GAO to conduct “a review of the structure of the market and of any possible anticompetitive conduct.”

According to the agency’s Website, the GAO is an independent, nonpartisan agency often called the ‘government watchdog’ because it investigates how the federal government spends taxpayer dollars. The Comptroller General of the United States, who heads the GAO, is appointed to a 15-year term by the President. Comptroller General Gene L. Dodaro was appointed by President Barack Obama in 2010.

“This is our last best chance to stop the chickenization of our cattle industry,” said Bullard, referring to the vertically integrated structure of the U.S. chicken industry that is under the complete control of large, corporate meatpackers.

“We don’t want our cattle industry to follow the chicken industry’s path and the only way to reverse our present trajectory towards it is to defend and protect competition in our cattle markets,” he added.

In 2010 the U.S. Department of Agriculture and the U.S. Department of Justice held joint hearings across the country during which both agencies indicated they would begin protecting competition in livestock markets by enforcing antitrust laws and the Packers and Stockyards Act, which prohibits anticompetitive conduct. However, no such actions have been initiated by either agency.