Why New GIPSA Rules Support Family Farms

The USDA has a law on the books that levels the playing field between family farmers who raise cattle, hogs and poultry and the large meat packers who purchase their livestock and bring it to market. It's called the Packers and Stockyard Act, and...

October 28, 2010 | Source: Civil Eats | by Haven Bourque

The USDA has a law on the books that levels the playing field between family farmers who raise cattle, hogs and poultry and the large meat packers who purchase their livestock and bring it to market. It’s called the Packers and Stockyard Act, and its overseen by the USDA’s Grain Inspection, Packers and Stockyard Administration or GIPSA. But don’t tussle with that mouthful because it doesn’t explain what you need to know about the complex livestock market system. Just keep reading. GIPSA makes sure small producers have equal access to market that larger producers do. It’s fair competition, which is, of course, the American way.

Sounds great, right? And just in time for the good food revolution. But instead, this law has been gathering dust because the USDA hasn’t enforced it. New proposed rules (previously covered here on Civil Eats) amending the act would prevent large meat packers from artificially lowering the price of cattle, hogs and lamb. But four companies control over 80 percent of the U.S. meat market, and these “Big Four” are fighting an effort to strengthen the rule.

For all you urban food geeks who’ve never ridden the North Dakota range or shoveled chicken manure in central North Carolina, here’s some context. When you’re raising livestock, timely access to market is critical because a meat animal is a perishable product. When the animal has reached optimal weight, it must be sold in a narrow window of time, typically within two to three weeks. If it cannot be processed, it begins to degrade in quality, and a producer is subject to a significant price deflation. If a packer won’t purchase your animals for slaughter, you’re stuck selling your animal either too early or too late, competitive bidding isn’t possible, and the packer conspires to give you a ridiculously low price for your labors.