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Strong competition bill introduced in Senate

Agriculture.com Staff 02/16/2006 @ 1:32pm

A bipartisan group of Senators introduced a bill today that would give USDA clout to enforce laws against unfair price manipulation in livestock markets as well as strengthening the ability of all farmers to bargain for fair prices from processors.

"The Competitive and Fair Agricultural Markets Act of 2006" has the backing of Senator Tom Harkin, and Iowan who's the ranking Democrat on the Senate Agriculture Committee, and two Republican Senators from Wyoming, Mike Enzi and Craig Thomas, who is also on the Ag Committee.

The bill strengthens the Packers and Stockyards Act, defining for the first time in 80 years the unfair pricing practices banned by that law, said Enzi.

"Recent actions by courts across the county have put producers on the defensive. They've been forced to carry an unfair burden by being required to show the competitive harm to themselves as well as to everyone in the industry. This is an almost impossible situation. This bill would put fairness into the system by making it so producers only have to prove competitive harm to themselves for the particular case in question," said Enzi.

Harkin told reporters Thursday that the bill "would light a fire under USDA to enforce the law."

A recent investigation of USDA requested by Harkin showed that the Department not only isn't enforcing the Packers and Stockyards Act, it prevented USDa employees from investigating complaints of unfair pricing. It even covered up its lack of enforcement.

The bill would take those employees out of the Grain Inspection Packers and Stockyards Administration and put them under a Special Counsel appointed by the President and approved by the Senate.

The bill also bans deceptive practices by companies that contract with producers for farm commodities.

And it strengthens another law, the Agricultural Fair Practices Act of 1967. This law is intended to protect farmers who form bargaining groups from retribution by processors. But the law also has a "disclaimer clause" that says processors don't' have to bargain with farmers. The Enzi-Harkin-Thomas bill would remove that disclaimer clause.

That part of the law would apply to all commodities, not just livestock, Harkin's spokesman, Dave Townsend told Agriculture Online Thursday.

When asked if the bill has a good chance of passage this year, Townsend said it's part of the groundwork that Harkin is laying for the next Farm Bill and that it may be tough to get it passed in an election year.

"We understand the political environment isn't such that a stand-alone bill is going to sail through the Senate," he said.

The bill already has the backing of several farm groups, including National Farmers Union and the Sustainable Agriculture Coalition.

"The Competitive and Fair Agricultural Markets Act of 2006 will work to combat the increased consolidation that currently dominates many of our markets," NFU President Dave Frederickson said. "This legislation would prohibit unfair or deceptive practices, and is a step toward ensuring farmers and ranchers do not continue to be victims of anticompetitive practices."

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