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Competition in Agriculture Focus of Year Long Debate

December 29, 2010
By: Kim Watson Potts, Beef Today

Editors note: AgWeb editors and readers have weighed in on the top stories of 2010 that will continue to be a major story in 2011. This is the third in a five-part series. (Read all of the major stories.) 

This year provided an almost year-long debate on issues affecting farmer’s ability to compete in this industry as the Department of Justice and USDA conducted workshops at various locations seeking input on the issue. The five joint public workshops were set up to explore competition issues and examine the appropriate role for antitrust and regulatory enforcement in that industry.

“Farmers have the right to know if their markets are fair, competitive and transparent, especially if they're going to make a significant investment to allow them to get in or to stay in agriculture,” said Agriculture Secretary Vilsack at one of the workshops. “At the same time, consumers across the country have the right to know if the food products they're buying are safe and are fairly priced at the grocery store.”

The workshops began in March in Iowa with the focus on crop and hog production. Approximately 700 people attended that event which focused on innovation and competition in the seed industry and also looked at the spot market for hogs. During that event, DOJ Assistant Attorney General for Antitrust, Christine Varney, said that while there is nothing wrong with being "big” in agriculture, "big" comes with responsibility to act in a way that keeps competition open.

Then in May, the focus shifted to the poultry industry and more specifically production contracts, concentration, and buyer power. In December of 2009 USDA published a final rule aimed at improving fairness in contracting in the poultry industry. “Specifically this final rule ensures that growers are provided a 90-day notice before a company can terminate their contracts,” said Vilsack. He also discussed how the Obama administration planned to increase funding for GIPSA investigation and enforcement.

June’s workshop focused on the dairy industry and examined the roll of coops and other marketing arrangements. Jim Dickrell, Dairy Today Editor, wrote after the meeting that there is serious concern over that competition among processors is lacking. But the flipside of that, he says, supply management advocates say there’s too much farm-to-farm competition and production must be capped.

Competition and market access in the livestock sector was the focus of the August meeting in Colorado.  This workshop brought in 1,300 attendees from all sides of the issue.  And this particular meeting provided serious heated debate that focused on GIPSA’s proposed rule on livestock marketing and whether or not it would help or hurt producers.

The final meeting focused on margins and retail issues and served as a wrap up for all the workshops.. This meeting was in Washington DC and was well attended as well.

While nothing concrete has come from these workshops, it is evident that this administration wants to seek more investigation of competition issues. And these meetings helped to raise awareness of farmer concerns to help the Department of Justice conduct investigations. So 2011 may provide the answer on just what was the purpose of the workshops  and what actions will follow.

You can access all the hearing information at the DOJ Web site or use this link.

 

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