Lack of Packer Participation Moves Government-Induced Regulation Closer

AMARILLO, TX – The beef cattle industry appears to be close to more regulation following the meatpacker’s lack of participation in a voluntary program. According to the Texas Cattle Feeders Association (TCFA), a Live Cattle Marketing Working Group established the cattle industry’s “Voluntary Framework to Achieve Price Discovery in the Fed Cattle Market” proposal which launched on January 1, 2021. The plan, also known as the 75 percent plan, was developed by the Group’s Regional Triggers Subgroup and was designed to increase negotiated trade and price discovery in an effort to avoid either legislative or regulatory mandates for future fed cattle marketing. The organization that represents the cattle feeding industry in the three-state region of Texas, Oklahoma, and New Mexico, known as Cattle Feeding Country, is the largest cattle feeding region in the United States and its members market more than 6 million fed cattle every year, or almost one-third of the nation’s fed cattle. While negotiated trade in the TCFA area increased during the first quarter, it was not enough to achieve the weekly goal of 9,750 head 75 percent of the time, failing in 5 of the 13 weeks, and tripping a minor trigger as defined in the plan. The proposal requires a region to meet the weekly goal of 10 out of 13 weeks to be considered passing. Failing to meet the plan’s goal in the TCFA and Kansas regions, coupled with the lack of packer participation, tripped a major trigger as determined by the subgroup. According to grassroots policy at the National Cattlemen’s Beef Association (NCBA), if another major trigger is tripped during any of the remaining quarters of the year, NCBA will pursue a legislative or regulatory solution to increase negotiated trade.
(SOURCE: All Ag News)