The omnibus spending bill includes a pilot program to establish a cattle contract library system to improve the transparency of prices paid and contracts offered to cattle producers. A similar contract exists in the hog market and has been a common request from cattle groups, however, the North American Meat Institute voiced concerns on the inclusion.

Senate Appropriations Agriculture Subcommittee Chairman Tammy Baldwin, D-Wisc., and John Hoeven, R-N.D., helped ensure the pilot program was included in the $1.4 trillion omnibus spending package to fund the government the rest of the fiscal year.

“A cattle contract library pilot program is an important step in trying to level the playing field between producers and packers,” according to a statement from Hoeven’s office. “The goal of the contract library is to provide producers with additional information to use when making marketing and business decisions, and to improve overall cattle market transparency.”

In December 2021, Rep. Dusty Johnson’s Cattle Contract Library Act (H.R. 5609) passed by 411-13, however did not come up for a vote in the U.S. Senate. H.R. 5609 creates a library for cattle contracts within USDA’s Agriculture Marketing Service Department. Currently, cattlemen are unaware of contract terms being offered by packers, leading to a decline in leverage for smaller producers during price negotiations.

Ethan Lane, National Cattlemen’s Beef Association vice president of government affairs, thanked those on Capitol Hill for their efforts to advance what he called an important transparency tool for cattle producers.  

“This pilot program will allow USDA to work on the model for a contract library that works for everyone in the supply chain while Congress and industry continue to work out the details of a permanent library in subsequent legislation like the Cattle Contract Library Act,” Lane says.

However, the North American Meat Institute criticized the pilot program for failing to obtain industry input. The group notes the Cattle Contract Library pilot program will require beef packers to report private business information to the government that will then be published, but it blocks public comment on the proposed rules for the program.

“Congress and the administration say they value transparency in the beef and cattle market, yet they bury this rider without debate in a giant spending bill and direct USDA to create the pilot program without any feedback from beef companies or cattle producers,” says Meat Institute President and CEO Julie Anna Potts. “There will be no opportunity for companies to provide valuable perspective on what information should be included or how it should be reported.”

Under the pilot, Meat Institute members who purchase beef cattle with an Alternative Marketing Arrangement will be legally obligated to report proprietary and sensitive data to the government for publication.

The Meat Institute adds the law is “vague and provides no guardrails” for the type or amount of data and leaves program development up to USDA’s Agriculture Marketing Service. “Finally, the law contains a provision that allows AMS to promulgate the rules without a comment period as normally required by law,” the Meat Institute adds.

“The Congress directs the administration to create another onerous USDA program with the sole purpose of collecting private business information and making it public without any input from the regulated industry,” says Potts. “This is not transparent or responsible.”

The Meat Institute says AMS already requires significant reporting requirements of beef packer facilities.

Under the Livestock Mandatory Reporting Act, packers must report to AMS daily the prices they pay to procure cattle and other information, including slaughter data for cattle harvested during a specified time period and with net prices, actual weights, dressing percentages, percent of beef grading Choice, and price ranges, and then AMS publishes the anonymized data.

AMS publishes 24 daily and 20 weekly cattle reports each week. Weekly reports start Monday afternoon and end the next Monday morning. These reports cover time periods, regions and activities and the data include actual cattle prices.

Hoeven’s spokesman, Kami Capener, notes this provision was included in the Senate FY22 Agriculture Appropriations bill that was “debated, amended, and reported out by the full Senate Appropriations Committee in August.”