H.R.5609 — Introduced in House 10/19/2021
Sponsor: Rep. Johnson, Dusty [R-SD-At Large]
H.R. 5609, the Cattle Contract Library Act of 2021, likely made the biggest splash in the agriculture community. Sponsored by Rep. Dusty Johnson (R-SD) and 23 co-sponsors on both sides of the aisle, the legislation would address beef supply and pricing transparency issues by requiring:
A mandatory reporting program for packers, who must file information with USDA for:
The type of each contract offered to producers of fed cattle, classified by the mechanism used to determine the base price for the fed cattle committed to the packer, including formula purchases, negotiated grid purchases, and forward contracts;
A contract’s duration;
All contract summary information;
Contract provisions that may affect the price of cattle, including base price, schedules of premiums or discounts, and transportation;
Total number of cattle covered by a contract that is solely committed to the packer each week within the 6 and 12-month periods following the date of the contract;
For contracts where a specific number of cattle aren’t committed solely to the packer, an indication that the contract is an open commitment and any weekly, monthly, annual, or other limitations on the number of cattle that may be delivered to the packer under the contract;
A description of contract terms that provide for expansion in the committed numbers of fed cattle to be delivered under the contract for the 6 and 12-month periods after its date.
USDA must maintain the information submitted by packers in a publicly available library in a “user-friendly format,” including real-time notice, if practicable, of the types of contracts that are being offered by packers that are open to acceptance by producers.
USDA must establish a competitive program to award Producer Education Grants for producer outreach and education on the best uses of cattle market information, including the Cattle Contract Library.
USDA must also provide weekly or monthly reports based on the information collected from packers of:
The total number of fed cattle committed under contracts for delivery to packers within the 6-month and 12-month periods following the date of the report, organized by reporting region and type of contract;
The number of contracts with an open commitment along with any weekly, monthly, annual or other limitations on the number of cattle that may be delivered under such contracts; and
The total maximum number of fed cattle that may be delivered within the 6-month and 12-month periods following the date of the report, organized by reporting region and type of contract.