Current Cattle Market Daily Headlines for Wednesday, October 21, 2020

Mackenzie Johnston

6 years ago

Federal judge won’t dismiss pork price-fixing suit

Judge John R. Tunheim of the U.S. District Court of Minnesota has denied a request by pork processors to dismiss a lawsuit accusing them of fixing prices.
- Judge Tunheim ruled that amended complaints by the plaintiffs “adequately pleaded a continuing violation” of price manipulation. These amended complaints were enough for Judge Tunheim to deny the defendants request for dismissal.
The defendants include: Agri Stats, Celemens, Hormel, JBS USA, Seaboard, Smithfield Foods, Triumph and Tyson Foods in a consolidation of three class-action filings alleging illegal price fixing of pork since at least 2009.
The plaintiff’s first complaint was dismissed without prejudice in August 2019. They then filed a second amended complaint last year.
When the pandemic hit, the plaintiffs argued that President Trump’s executive order to keep meat plants open supported their claim that small changes in production output often result in a severe disruption of protein supplies throughout the market.

Government subsidies are expected to make up more than a third of farm income this year. Those aid programs may be key to President Trump’s success in swing states such as Wisconsin, Ohio, Iowa and Minnesota.
- In 2016, farmers overwhelming voted for President Trump.
Since Trump took office, government payments ranging from crop insurance payments to new programs compensating farmers for lost sales during the U.S.-China trade war have risen every year.
In 2018, farmers pleaded with Trump for “trade not aid,” but have since received repeated bailouts while millions of other Americans continue to wait for their Covid-19 stimulus that has stalled out in Congress.
Just this year, federal payments are expected to reach a record $51.2 billion. The government will make up 39.7 percent of farmers’ net cash income this year, the largest percentage seen in 20 years.
According to the Environmental Working Group, a health and environmental advocacy group, the Covid-19 relief program put together for farmers and ranchers was “old-fashioned vote buying.” The group claims the relief funds were not sent to groups truly at risk.
- But according to Secretary Sonny Perdue, the USDA talked to farmers and ranchers when designing the relief program to best accommodate their losses.

Last week, Representative Vicky Hartzler (R., Mo.) introduced the Cattle Market Transparency Act of 2020; a bill that will serve as a companion bill to Senator Fischer’s (R., NE) bill that she recently introduced to improve price discovery and transparency within the cattle market.
This legislation includes the same details as Fischer’s bill:
- Directs the USDA to create and maintain a library of marketing contracts between packers and producers.
- Mandates that a packer report the number of cattle scheduled to be delivered for slaughter each day for the next 14 days.
- Bolsters the public availability of data collected through the Livestock Mandatory Price Reporting Act.
- Requires the Secretary of Agriculture to establish regionally sufficient levels of negotiated cash trade and to consider stakeholder input through a public comment period.
According to Missouri Cattlemen’s Association President, Marvin Dieckman, Hartzler’s legislation will work to achieve robust price discovery and market transparency through a methodical approach, rather than a one-size fits all, heavy handed approach.