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114th Congress { } Report
1st Session { HOUSE OF REPRESENTATIVES } 114-132
======================================================================
MANDATORY PRICE REPORTING ACT OF 2015
_______
May 29, 2015.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Conaway, from the Committee on Agriculture, submitted the following
R E P O R T
[To accompany H.R. 2051]
[Including cost estimate of the Congressional Budget Office]
The Committee on Agriculture, to whom was referred the bill
(H.R. 2051) to amend the Agricultural Marketing Act of 1946 to
extend the livestock mandatory price reporting requirements,
and for other purposes, having considered the same, report
favorably thereon with an amendment and recommend that the bill
as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE .
This Act may be cited as the ``Mandatory Price Reporting Act of
2015''.
SEC. 2. EXTENSION OF LIVESTOCK MANDATORY REPORTING.
(a) Extension of Authority.--Section 260 of the Agricultural
Marketing Act of 1946 (7 U.S.C. 1636i) is amended by striking
``September 30, 2015'' and inserting ``September 30, 2020''.
(b) Emergency Authority.--Section 212(12)(C) of the Agricultural
Marketing Act of 1946 (7 U.S.C. 1635a(12)(C)) is amended by inserting
``, including any day on which any Department employee is on shutdown
or emergency furlough as a result of a lapse in appropriations'' after
``conduct business''.
(c) Conforming Amendment.--Section 942 of the Livestock Mandatory
Reporting Act of 1999 (7 U.S.C. 1635 note; Public Law 106-78) is
amended by striking ``September 30, 2015'' and inserting ``September
30, 2020''.
SEC. 3. SWINE REPORTING.
(a) Definitions.--Section 231 of the Agricultural Marketing Act of
1946 (7 U.S.C. 1635i) is amended--
(1) by redesignating paragraphs (9) through (22) as
paragraphs (10) through (23), respectively;
(2) by inserting after paragraph (8) the following new
paragraph:
``(9) Negotiated formula purchase.--The term `negotiated
formula purchase' means a purchase of swine by a packer from a
producer under which--
``(A) the pricing mechanism is a formula price for
which the formula is determined by negotiation on a
lot-by-lot basis; and
``(B) the swine are scheduled for delivery to the
packer not later than 14 days after the date on which
the formula is negotiated and swine are committed to
the packer.'';
(3) in paragraph (12)(A) (as so redesignated), by inserting
``negotiated formula purchase,'' after ``pork market formula
purchase,''; and
(4) in paragraph (23) (as so redesignated)--
(A) in subparagraph (C), by striking ``and'' at the
end;
(B) by redesignating subparagraph (D) as subparagraph
(E); and
(C) by inserting after subparagraph (C) the following
new subparagraph:
``(D) a negotiated formula purchase; and''.
(b) Daily Reporting.--Section 232(c) of the Agricultural Marketing
Act of 1946 (7 U.S.C. 1635j(c)) is amended--
(1) in paragraph (1)(D), by striking clause (ii) and
inserting the following new clause:
``(ii) Price distributions.--The information
published by the Secretary under clause (i)
shall include--
``(I) a distribution of net prices in
the range between and including the
lowest net price and the highest net
price reported;
``(II) a delineation of the number of
barrows and gilts at each reported
price level or, at the option of the
Secretary, the number of barrows and
gilts within each of a series of
reasonable price bands within the range
of prices; and
``(III) the total number and weighted
average price of barrows and gilts
purchased through negotiated purchases
and negotiated formula purchases.'';
and
(2) in paragraph (3), by adding at the end the following new
subparagraph:
``(C) Late in the day report information.--The
Secretary shall include in the morning report and the
afternoon report for the following day any information
required to be reported under subparagraph (A) that is
obtained after the time of the reporting day specified
in such subparagraph.''.
SEC. 4. LAMB REPORTING.
Not later than 180 days after the date of the enactment of this Act,
the Secretary of Agriculture shall revise section 59.300 of title 7,
Code of Federal Regulations, so that--
(1) the definition of the term ``importer''--
(A) includes only those importers that imported an
average of 1,000 metric tons of lamb meat products per
year during the immediately preceding 4 calendar years;
and
(B) may include any person that does not meet the
requirement referred to in subparagraph (A), if the
Secretary determines that the person should be
considered an importer based on their volume of lamb
imports; and
(2) the definition of the term ``packer''--
(A) applies to any entity with 50 percent or more
ownership in a facility;
(B) includes a federally inspected lamb processing
plant which slaughtered or processed the equivalent of
an average of 35,000 head of lambs per year during the
immediately preceding 5 calendar years; and
(C) may include any other lamb processing plant that
did not meet the requirement referred to in
subparagraph (B), if the Secretary determines that the
processing plant should be considered a packer after
considering its capacity.
SEC. 5. STUDY ON LIVESTOCK MANDATORY REPORTING.
(a) In General.--The Secretary of Agriculture, acting through the
Agricultural Marketing Service in conjunction with the Office of the
Chief Economist and in consultation with cattle, swine, and lamb
producers, packers, and other market participants, shall conduct a
study on the program of information regarding the marketing of cattle,
swine, lambs, and products of such livestock under subtitle B of the
Agricultural Marketing Act of 1946 (7 U.S.C. 1635 et seq.). Such study
shall--
(1) analyze current marketing practices in the cattle, swine,
and lamb markets;
(2) identify legislative or regulatory recommendations made
by cattle, swine, and lamb producers, packers, and other market
participants to ensure that information provided under such
program--
(A) can be readily understood by producers, packers,
and other market participants;
(B) reflects current marketing practices; and
(C) is relevant and useful to producers, packers, and
other market participants;
(3) analyze the price and supply information reporting
services of the Department of Agriculture related to cattle,
swine, and lamb; and
(4) address any other issues that the Secretary considers
appropriate.
(b) Report.--Not later than January 1, 2020, the Secretary of
Agriculture shall submit to the Committee on Agriculture of the House
of Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate a report containing the findings of the study
conducted under subsection (a).
Brief Explanation
The Mandatory Price Reporting Act of 2015, H.R. 2051,
amends the Agricultural Marketing Act of 1946 to extend the
livestock mandatory price reporting requirements.
Purpose and Need for Legislation
The Livestock Mandatory Reporting Act of 1999 (Act of 1999)
expires on September 30, 2015. Stakeholders from the livestock
and meat industry are generally supportive of livestock
mandatory reporting (LMR) and have worked cooperatively to
achieve consensus toward reauthorization of the Act for a five-
year period.
The Act of 1999, which passed as an amendment to the
Agricultural Marketing Act of 1946, established a program of
information regarding the marketing of cattle, swine, lambs,
and the products of such livestock. The purpose was to provide
information that could be readily understood by producers,
improve the price and supply reporting services of USDA, and
encourage competition in the marketplace for livestock and
livestock products. The statutory authority for the program
lapsed on September 30, 2005, not because of controversy over
whether the program should continue, but because the House and
Senate passed different versions of reauthorization
legislation. Ultimately, the Senate passed the House version by
unanimous consent the following October.
When authorization lapsed, AMS sent letters to all packers
required to report under the Act of 1999 requesting that they
continue to submit information voluntarily. About 90 percent of
packers cooperated in submitting information during the lapse.
Finally, in October 2006, Congress passed the Livestock
Mandatory Reporting Reauthorization Act, re-establishing the
regulatory authority for the LMR program through September 30,
2010, and separating the reporting requirements for sows and
boars from barrows and gilts, among other changes. AMS began
re-implementing the regulations right away. The final rules
were not completed until May 2008 because AMS had to account
for changes to the program.
The 2008 Farm Bill directed the Secretary of Agriculture
(Secretary) to conduct a study to determine advantages,
drawbacks, and potential implementation issues associated with
adopting mandatory wholesale pork reporting. The study
concluded that voluntary negotiated wholesale pork price
reporting was thin and becoming thinner. It also found some
support for moving to mandatory price reporting at every
segment of the industry and that the benefits of moving from a
voluntary to a mandatory reporting program for wholesale pork
would likely exceed the cost. The 2010 Reauthorization Act
reauthorized LMR for an additional five years and added a
provision for mandatory reporting of wholesale pork cuts. It
directed the Secretary to engage in negotiated rulemaking to
make required regulatory changes for mandatory wholesale pork
reporting. AMS completed the negotiated rulemaking process and
implemented mandatory wholesale pork reporting on January 7,
2013.
The LMR program provides the market with information on
pricing; contracting for purchase; and supply and demand
conditions for livestock, livestock production, and livestock
products. Consistent with its mission to facilitate marketing,
AMS publishes this information to ensure open, transparent
price discovery and provide all market participants--large and
small--with comparable levels of market information for cattle,
swine, pork, sheep, beef, and lamb meat. AMS produces
approximately 62 daily reports and 47 weekly reports.
During the fiscal year 2014 government shutdown, AMS Market
News, including livestock mandatory reporting data, was not
available. AMS's inability to deliver the mandatory price
information for livestock, meat, and certain dairy products
caused a significant disruption to the orderly marketing of
these products and generated extensive media coverage. Many
stakeholders asked AMS to consider LMR an ``excepted activity''
that would continue in the case of another government shutdown.
In order to remain relevant with current marketing
practices, AMS regularly meets with industry and trade member
associations to discuss LMR and marketing trends. One of the
major concerns in the livestock industry is the shrinking
negotiated spot market. The number of livestock marketed on a
negotiated basis has been declining for years as more
processors, producers, and feedlots have entered into formula
marketing agreements. Industry members say that some negotiated
markets are becoming too thin to be an adequate market basis.
At the recent House Appropriations budget hearing, AMS was
asked about current reporting methodology for hogs and concerns
of price manipulation and volatility in the negotiated hog
market. To address this issue, AMS is developing a 5-day
rolling average of the daily negotiated hog prices to include
in reports. This should help normalize the reported information
and mute the volatility.
Livestock industry associations have had under
consideration other potential LMR regulatory changes. Some in
the industry would like to enhance the reporting requirements
to more accurately capture weekly basis information and near-
term negotiated formula transactions. The swine industry has
expressed an interest in amending report time requirements for
barrows and gilts while some in the lamb industry want to lower
the reporting threshold requirements, add a definition for
committed lambs, and include lamb pelts as a reported
commodity.
The legislation reflects a consensus among livestock and
meat industry participants working toward reauthorization of
the Act. A representative of AMS in attendance at a
reauthorization hearing held in the Livestock and Foreign
Agriculture Subcommittee was asked generally about
reauthorization of the LMR program and the specific requests of
industry and responded that USDA supports reauthorization of
the program and saw no issues of concern in the bill ultimately
presented for Committee consideration.
Section-by-Section Analysis of Legislation
Section 1. Short title
Section 1 of the bill designates the title of the bill as
the ``Mandatory Price Reporting Act of 2015.''
Section 2. Extension of livestock mandatory reporting
Subsection (a) of section 2 extends the authority for
continuing mandatory price reporting until September 30, 2020.
Subsection (b) requires USDA to continue to receive and
publishing the required daily reporting information during a
government shutdown scenario.
Subsection (c) is a conforming amendment for the extension
of authority.
Section 3. Swine reporting
Subsection (a) of section 3 amends the definitions section
for swine reporting to include a definition of ``negotiated
formula purchase.'' The subsection further adds ``negotiated
formula purchase'' to the definitions for ``other purchase
arrangement'' and ``type of purchase'' as an enumerated
purchase.
Subsection (b) adds ``the total number and weighted average
price of barrows and gilts purchased through negotiated
purchases and negotiated formula purchases'' to the list of
information the Secretary is required to publish in a prior day
report. The subsection also adds a requirement for the
Secretary to report information required in the afternoon
report but that occurs after the reporting deadline in both the
following day morning and afternoon reports.
Section 4. Lamb reporting
Section 4 requires the Secretary to revise the pertinent
parts of the regulations to modify the definition of the term
``importer.'' The modification requires that the Secretary
include only importers that imported an average of 1,000 metric
tons of lamb during the immediately preceding 4 calendar years.
The Secretary may include an importer that does not meet that
requirement if the Secretary determines the importer should be
considered based on the volume of lamb imports.
Section 4 further requires the Secretary to modify the term
``packer'' to include an entity with 50 percent ownership or
more in the facility as well as a federally inspected
processing plant which slaughtered or processed an average of
35,000 head per year during the immediately preceding 5
calendar years. The definition may include other processing
plants if the Secretary determines that the plant should be
considered based on its capacity.
Section 5. Study on livestock mandatory reporting
Section 5 requires the Agricultural Marketing Service along
with the Office of the Chief Economist, and in consultation
with the relevant market participants, to conduct a study on
the implementation of livestock mandatory price reporting. The
one-time report to Congress is due not later than January 1,
2020.
Hearings held by the House Agriculture Committee on April
23, 2015 concerning the reauthorization of LMR revealed
significant changes that have occurred in the lamb industry
since the inception of the program and continuing in the most
recent 5 year reauthorization period. The Committee appreciates
the desire of the lamb industry to maintain, to the maximum
extent possible, the broad discretion available to USDA that
currently exists in the underlying statute. It is evident that
many of the changes proposed by the entire livestock industry
are related to the desire to ensure robust reports while at the
same time preserving the confidentiality of the reporting
entities. As restructuring occurs in the packing industry this
becomes more challenging.
The Committee hearing on LMR reauthorization details the
long process with USDA that the lamb industry, working through
the American Sheep Industry Association (ASI), has taken in an
attempt to enact necessary changes in order for LMR to more
accurately reflect current industry conditions. The Committee
has legislatively addressed some of these proposals put forth
by ASI. For example, roughly 30% of the lambs produced in the
U.S. are done so by a producer cooperative. Currently the
definitions of ``packer'' and ``packer owned'' lamb sale
transactions prohibit reporting of these sales to be included
in MPR. The term ``packer'' is amended to apply to an entity
with 50% or more ownership in a federally inspected facility
that slaughtered or processed lambs. This should allow USDA/AMS
with the flexibility to allow reporting of transactions
resulting between producers and processors who are in business
as cooperatives or engaged in other types of non-traditional
marketing arrangements.
However, addressing certain ASI proposals legislatively
should not be interpreted to mean that the Committee does not
support other proposals included in testimony offered by ASI.
It merely reflects the Committee's intent to respect ASI's
desire to maintain as much statutory discretion as possible in
the underlying statute. Indeed, the Committee expects USDA to
continue the process with ASI and enact such of their proposals
as is appropriate to reflect current conditions in the industry
and make the LMR report as useable and relevant as possible to
the lamb industry. For instance, the Committee understands that
additional issues of particular interest to the lamb industry
are as follows:
Define the terms:
``Lambs Committed'' and require the reporting of
this category as ``lambs that are intended to be delivered to a
packer beginning on the date of an agreement to sell these
lambs'' and require weekly reporting of the quantity and
delivery period of all lambs committed.
``Packer-owned'' to be defined as lambs that a
packer owns for at least 28 days immediately prior to
slaughter. For producer-owned cooperatives who process lambs
and may or may not have them custom-killed and other non-
traditional marketing arrangements, require weekly reporting of
at least the volume, grades and base price for these
transactions.
Require USDA to:
``Collect and report pelt price and quality
information (classification and descriptors) for lambs
purchased on a negotiated, formula or forward contracted basis
under LMR.
``Review, not less frequently than every other
year, calculations to determine net carcass value of lamb
carcasses and boxed lamb.
As USDA engages in the promulgation of regulations enacting
LMR for another five year period, the Committee encourages USDA
to carefully review long developed proposals by the lamb
industry and make such appropriate changes to existing
regulations in order to ensure that LMR reports accurately
reflect current market conditions. In addition, the Committee
expects that the required USDA study and report not only
identify industry recommendations prior to the next
reauthorization, but also provide a clear indication to the
industry of USDA's position on recommendations so that any
necessary legislative changes may be addressed.
Committee Consideration
I. HEARINGS
On April 22, 2015, the Subcommittee on Livestock and
Foreign Agriculture held a public hearing to review
reauthorization of the Livestock Mandatory Reporting Act.
Members of the Subcommittee heard testimony and discussed
reauthorization of the Livestock Mandatory Reporting Act. First
enacted in 1999, the Act was developed in response to changing
markets with an increasing number of animals being sold via
marketing arrangements under which prices were not publicly
disclosed. As these structural changes continued, livestock
producers requested that the then-voluntary price reporting
mechanism be made mandatory. Thus, the resulting Act mandated
price reporting for live cattle, boxed beef, and live swine,
and it allowed USDA to establish mandatory price reporting for
lamb sales as well. During the hearing, the following witnesses
testified on matters included in H.R. 2051:
Mr. Mark Dopp, Senior Vice President, Regulatory
Affairs and Scientific Affairs/General Counsel, North America
Meat Institute, Washington, DC
Mr. James R. Heimerl, Heimerl Farms Ltd,
Johnstown, OH; on behalf of the National Pork Producers Council
Mr. Burton Pfliger, President, American Sheep
Industry Association, Centennial, CO
Mr. Ed Greiman, Chairman, Cattle Marketing and
International Trade Committee, National Cattlemen's Beef
Association, Garner, IA
Dr. Craig Morris, Deputy Administrator, Livestock
Poultry and Seed Program, Agricultural Marketing Service, USDA,
Washington, DC
II. FULL COMMITTEE
The Committee on Agriculture met, pursuant to notice, with
a quorum present, on April 30, 2015, to consider H.R. 2051, the
Mandatory Price Reporting Act of 2015.
H.R. 2051 was placed before the Committee for
consideration. Without objection, a first reading of the bill
was waived and it was open for amendment at any point.
Chairman Conaway, Mr. Peterson, Mr. Rouzer, and Mr. Costa
were recognized for statements. Chairman Conaway offered a
technical amendment, which passed by a voice vote. Mr. Peterson
was then recognized to offer a motion that the bill H.R. 2051
be reported, as amended, favorably to the House with
recommendation that it do pass. The motion was subsequently
approved by voice vote.
At the conclusion of the meeting, Chairman Conaway advised
Members that pursuant to the rules of the House of
Representatives Members had until May 4, 2015, to file any
supplemental, minority, additional, or dissenting views with
the Committee.
Without objection, staff was given permission to make any
necessary clerical, technical or conforming changes to reflect
the intent of the Committee. Chairman Conaway thanked all the
Members and adjourned the meeting.
Committee Votes
In compliance with clause 3(b) of rule XIII of the House of
Representatives, H.R. 2051 was reported by voice vote with a
majority quorum present. There was no request for a recorded
vote.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee on Agriculture's
oversight findings and recommendations are reflected in the
body of this report.
Budget Act Compliance (Sections 308, 402, and 423)
The provisions of clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives and section 308(a)(1) of the
Congressional Budget Act of 1974 (relating to estimates of new
budget authority, new spending authority, new credit authority,
or increased or decreased revenues or tax expenditures) are not
considered applicable. The estimate and comparison required to
be prepared by the Director of the Congressional Budget Office
under clause 3(c)(3) of rule XIII of the Rules of the House of
Representatives and sections 402 and 423 of the Congressional
Budget Act of 1974 submitted to the Committee prior to the
filing of this report are as follows:
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 21, 2015.
Hon. K. Michael Conaway,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2051, the
Mandatory Price Reporting Act of 2015.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jim Langley.
Sincerely,
Keith Hall.
Enclosure.
H.R. 2051--Mandatory Price Reporting Act of 2015
Summary: H.R. 2051 would reauthorize, through fiscal year
2020, reports that are produced by the U.S. Department of
Agriculture (USDA) on the marketing and prices of cattle,
swine, lambs, and products of such livestock. Current authority
to produce those reports ends on September 30, 2015. The bill
also would require the Secretary of Agriculture to begin daily
reporting of certain negotiated purchases of swine and to
conduct a study on the need to report on livestock prices to
the federal government.
CBO estimates that implementing this bill would cost $36
million over the 2016-2020 period, assuming appropriation of
the necessary amounts. Enacting the bill would not affect
direct spending or revenues; therefore, pay-as-you-go
procedures do not apply.
The bill contains an intergovernmental mandate as defined
in the Unfunded Mandates Reform Act (UMRA) because it would
preempt state and local laws. CBO estimates the cost of
complying with the mandate would be small and would fall well
below the threshold established in UMRA for intergovernmental
mandates ($77 million in 2015, adjusted annually for
inflation).
H.R. 2051 would impose private-sector mandates, as defined
in UMRA, on certain packers, processors, and importers of
livestock by extending and amending mandatory reporting
requirements related to cattle, swine, and lambs. Based on
information from USDA and industry experts, CBO estimates that
the aggregate cost of the mandates would total about $1 million
annually and fall well below the annual threshold established
in UMRA for private-sector mandates ($154 million in 2015,
adjusted annually for inflation).
Estimated cost to the Federal Government: The estimated
budgetary effect of H.R. 2051 is shown in the following table.
The costs of this legislation fall within budget function 350
(agriculture).
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------
2016 2017 2018 2019 2020 2016-2020
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level........................... 8 7 7 7 7 36
Estimated Outlays....................................... 8 7 7 7 7 36
----------------------------------------------------------------------------------------------------------------
Basis of estimate: CBO assumes that H.R. 2051 will be
enacted by October 1, 2015, and that the necessary amounts will
be appropriated over the next five years.
The legislation would extend until September 30, 2020, the
authority of the Secretary of Agriculture to require certain
livestock packers, processors, and importers, to continue
reporting prices and supply and demand information to the
government on a daily and weekly basis. USDA's Agricultural
Marketing Service (AMS) processes and provides this information
to the public. Based on information from AMS, CBO estimates
that continuing to provide these reports to the public would
cost $7 million a year.
H.R. 2051 also would require the Secretary, in consultation
with relevant producers and packers, to identify legislative or
regulatory recommendations to improve the collection and
dissemination of information under the livestock reporting
program. Based on the cost of similar work, CBO estimates that
this study would cost $1 million in 2016.
Pay-as-You-Go considerations: None.
Impact on state, local, and tribal governments: Under
current law, the Department of Agriculture's program for price
reporting preempts state and local laws that are in addition
to, or inconsistent with, any requirements of the program.
Because H.R. 2051 would reauthorize the program and thus extend
the preemption that would otherwise expire on September 30,
2015, the bill would impose an intergovernmental mandate as
defined in UMRA. While the preemption would limit the
application of state and local laws, it would impose no duty
that would result in significant additional spending.
Consequently, CBO estimates that the costs would fall well
below the threshold established in UMRA for intergovernmental
mandates ($77 million in 2015, adjusted annually for
inflation).
Estimated impact on the private sector: H.R. 2051 would
impose private-sector mandates, as defined in UMRA, on certain
packers, processors, and importers of livestock. The bill would
extend through 2020 mandatory reporting requirements related to
cattle, swine, and lamb. The bill also would add an additional
pricing category to report for packers and processors of swine
and lower the reporting threshold for importers and packers of
lamb. Based on information from USDA and industry experts, CBO
estimates that the aggregate cost of the mandates would total
about $1 million annually and fall well below the annual
threshold established in UMRA for private-sector mandates ($154
million in 2015, adjusted annually for inflation).
Estimate prepared by: Federal costs: Jim Langley; Impact on
state, local, and tribal governments: J'nell Blanco Suchy;
Impact on the private sector: Amy Petz.
Estimate approved by: H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
Performance Goals and Objectives
With respect to the requirement of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goals and objectives of this legislation are to
extend mandatory price reporting for cattle, swine, and lamb.
Committee Cost Estimate
Pursuant to clause 3(d)(2) of rule XIII of the Rules of the
House of Representatives, the Committee report incorporates the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to sections 402 and 423 of the
Congressional Budget Act of 1974.
Advisory Committee Statement
No advisory committee within the meaning of section 5(b) of
the Federal Advisory Committee Act was created by this
legislation.
Applicability to the Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act (Public Law
104-1).
Federal Mandates Statement
The Committee adopted as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act (Public Law 104-4).
Earmark Statement Required by Clause 9 of Rule XXI of the Rules of
House of Representatives
H.R. 2051 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9(e), 9(f), or 9(g) of rule XXI of the Rules of the
House Representatives.
Duplication of Federal Programs
This bill does not establish or reauthorize a program of
the Federal Government known to be duplicative of another
Federal program, a program that was included in any report from
the Government Accountability Office to Congress pursuant to
section 21 of Public Law 111-139, or a program related to a
program identified in the most recent Catalog of Federal
Domestic Assistance.
Disclosure of Directed Rule Makings
The Committee does not believe that the legislation directs
an executive branch official to conduct any specific rule
making proceedings within the meaning of 5 U.S.C. 551.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
AGRICULTURAL MARKETING ACT OF 1946
* * * * * * *
TITLE II
* * * * * * *
Subtitle B--Livestock Mandatory Reporting
* * * * * * *
CHAPTER 1--PURPOSE; DEFINITIONS
* * * * * * *
SEC. 212. DEFINITIONS.
In this subtitle:
(1) Base price.--The term ``base price'' means the
price paid for livestock, delivered at the packing
plant, before application of any premiums or discounts,
expressed in dollars per hundred pounds of carcass
weight.
(2) Basis level.--The term ``basis level'' means the
agreed-on adjustment to a future price to establish the
final price paid for livestock.
(3) Current slaughter week.--The term ``current
slaughter week'' means the period beginning Monday, and
ending Sunday, of the week in which a reporting day
occurs.
(4) F.O.B.--The term ``F.O.B.'' means free on board,
regardless of the mode of transportation, at the point
of direct shipment by the seller to the buyer.
(5) Livestock.--The term ``livestock'' means cattle,
swine, and lambs.
(6) Lot.--The term ``lot'' means a group of one or
more livestock that is identified for the purpose of a
single transaction between a buyer and a seller.
(7) Marketing.--The term ``marketing'' means the sale
or other disposition of livestock, livestock products,
or meat or meat food products in commerce.
(8) Negotiated purchase.--The term ``negotiated
purchase'' means a cash or spot market purchase by a
packer of livestock from a producer under which--
(A) the base price for the livestock is
determined by seller-buyer interaction and
agreement on a day; and
(B) the livestock are scheduled for delivery
to the packer not later than 14 days after the
date on which the livestock are committed to
the packer.
(9) Negotiated sale.--The term ``negotiated sale''
means a cash or spot market sale by a producer of
livestock to a packer under which--
(A) the base price for the livestock is
determined by seller-buyer interaction and
agreement on a day; and
(B) the livestock are scheduled for delivery
to the packer not later than 14 days after the
date on which the livestock are committed to
the packer.
(10) Prior slaughter week.--The term ``prior
slaughter week'' means the Monday through Sunday prior
to a reporting day.
(11) Producer.--The term ``producer'' means any
person engaged in the business of selling livestock to
a packer for slaughter (including the sale of livestock
from a packer to another packer).
(12) Reporting day.--The term ``reporting day'' means
a day on which--
(A) a packer conducts business regarding
livestock committed to the packer, or livestock
purchased, sold, or slaughtered by the packer;
(B) the Secretary is required to make
information concerning the business described
in subparagraph (A) available to the public;
and
(C) the Department of Agriculture is open to
conduct business, including any day on which
any Department employee is on shutdown or
emergency furlough as a result of a lapse in
appropriations.
(13) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(14) State.--The term ``State'' means each of the 50
States.
* * * * * * *
CHAPTER 3--SWINE REPORTING
SEC. 231. DEFINITIONS.
In this chapter:
(1) Affiliate.--The term ``affiliate'', with respect
to a packer, means--
(A) a person that directly or indirectly
owns, controls, or holds with power to vote, 5
percent or more of the outstanding voting
securities of the packer;
(B) a person 5 percent or more of whose
outstanding voting securities are directly or
indirectly owned, controlled, or held with
power to vote, by the packer; and
(C) a person that directly or indirectly
controls, or is controlled by or under common
control with, the packer.
(2) Applicable reporting period.--The term
``applicable reporting period'' means the period of
time prescribed by the prior day report, the morning
report, and the afternoon report, as required under
section 232(c).
(3) Barrow.--The term ``barrow'' means a neutered
male swine.
(4) Base market hog.--The term ``base market hog''
means a barrow or gilt for which no discounts are
subtracted from and no premiums are added to the base
price.
(5) Boar.--The term ``boar'' means a sexually-intact
male swine.
(6) Formula price.--The term ``formula price'' means
a price determined by a mathematical formula under
which the price established for a specified market
serves as the basis for the formula.
(7) Gilt.--The term ``gilt'' means a young female
swine that has not produced a litter.
(8) Hog class.--The term ``hog class'' means, as
applicable--
(A) barrows or gilts;
(B) sows; or
(C) boars or stags.
(9) Negotiated formula purchase.--The term
``negotiated formula purchase'' means a purchase of
swine by a packer from a producer under which--
(A) the pricing mechanism is a formula price
for which the formula is determined by
negotiation on a lot-by-lot basis; and
(B) the swine are scheduled for delivery to
the packer not later than 14 days after the
date on which the formula is negotiated and
swine are committed to the packer.
[(9)] (10) Noncarcass merit premium.--The term
``noncarcass merit premium'' means an increase in the
base price of the swine offered by an individual packer
or packing plant, based on any factor other than the
characteristics of the carcass, if the actual amount of
the premium is known before the sale and delivery of
the swine.
[(10)] (11) Other market formula purchase.--
(A) In general.--The term ``other market
formula purchase'' means a purchase of swine by
a packer in which the pricing mechanism is a
formula price based on any market other than
the market for swine, pork, or a pork product.
(B) Inclusion.--The term ``other market
formula purchase'' includes a formula purchase
in a case in which the price formula is based
on one or more futures or options contracts.
[(11)] (12) Other purchase arrangement.--The term
``other purchase arrangement'' means a purchase of
swine by a packer that--
(A) is not a negotiated purchase, swine or
pork market formula purchase, negotiated
formula purchase, or other market formula
purchase; and
(B) does not involve packer-owned swine.
[(12)] (13) Packer.--The term ``packer'' means any
person engaged in the business of buying swine in
commerce for purposes of slaughter, of manufacturing or
preparing meats or meat food products from swine for
sale or shipment in commerce, or of marketing meats or
meat food products from swine in an unmanufactured form
acting as a wholesale broker, dealer, or distributor in
commerce, except that--
(A) the term includes only a swine processing
plant that is federally inspected;
(B) for any calendar year, the term includes
only--
(i) a swine processing plant that
slaughtered an average of at least
100,000 swine per year during the
immediately preceding five calendar
years; and
(ii) a person that slaughtered an
average of at least 200,000 sows,
boars, or any combination thereof, per
year during the immediately preceding
five calendar years; and
(C) in the case of a swine processing plant
or person that did not slaughter swine during
the immediately preceding 5 calendar years, the
Secretary shall consider the plant capacity of
the processing plant or person in determining
whether the processing plant or person should
be considered a packer under this chapter.
[(13)] (14) Packer-owned swine.--The term ``packer-
owned swine'' means swine that a packer (including a
subsidiary or affiliate of the packer) owns for at
least 14 days immediately before slaughter.
[(14)] (15) Packer-sold swine.--The term ``packer-
sold swine'' means the swine that are--
(A) owned by a packer (including a subsidiary
or affiliate of the packer) for more than 14
days immediately before sale for slaughter; and
(B) sold for slaughter to another packer.
[(15)] (16) Pork.--The term ``pork'' means the meat
of a porcine animal.
[(16)] (17) Pork product.--The term ``pork product''
means a product or byproduct produced or processed in
whole or in part from pork.
[(17)] (18) Purchase data.--The term ``purchase
data'' means all of the applicable data, including
weight (if purchased live), for all swine purchased
during the applicable reporting period, regardless of
the expected delivery date of the swine, reported by--
(A) hog class;
(B) type of purchase; and
(C) packer-owned swine.
[(18)] (19) Slaughter data.--The term ``slaughter
data'' means all of the applicable data for all swine
slaughtered by a packer during the applicable reporting
period, regardless of when the price of the swine was
negotiated or otherwise determined, reported by--
(A) hog class;
(B) type of purchase; and
(C) packer-owned swine.
[(19)] (20) Sow.--The term ``sow'' means an adult
female swine that has produced one or more litters.
[(20)] (21) Swine.--The term ``swine'' means a
porcine animal raised to be a feeder pig, raised for
seedstock, or raised for slaughter.
[(21)] (22) Swine or pork market formula purchase.--
The term ``swine or pork market formula purchase''
means a purchase of swine by a packer in which the
pricing mechanism is a formula price based on a market
for swine, pork, or a pork product, other than a future
or option for swine, pork, or a pork product.
[(22)] (23) Type of purchase.--The term ``type of
purchase'', with respect to swine, means--
(A) a negotiated purchase;
(B) other market formula purchase;
(C) a swine or pork market formula purchase;
[and]
(D) a negotiated formula purchase; and
[(D)] (E) other purchase arrangement.
SEC. 232. MANDATORY REPORTING FOR SWINE.
(a) Establishment.--The Secretary shall establish a program
of swine price information reporting that will--
(1) provide timely, accurate, and reliable market
information;
(2) facilitate more informed marketing decisions; and
(3) promote competition in the swine slaughtering
industry.
(b) General Reporting Provisions Applicable to Packers and
the Secretary.--
(1) In general.--The Secretary shall establish and
implement a price reporting program in accordance with
this section that includes the reporting and
publication of information required under this section.
(2) Packer-owned swine.--Information required under
this section for packer-owned swine shall include
quantity and carcass characteristics, but not price.
(3) Packer-sold swine.--If information regarding the
type of purchase is required under this section, the
information shall be reported according to the numbers
and percentages of each type of purchase comprising--
(A) packer-sold swine; and
(B) all other swine.
(4) Additional information.--
(A) Review.--The Secretary shall review the
information required to be reported by packers
under this section at least once every 2 years.
(B) Outdated information.--After public
notice and an opportunity for comment, subject
to subparagraph (C), the Secretary shall
promulgate regulations that specify additional
information that shall be reported under this
section if the Secretary determines under the
review under subparagraph (A) that--
(i) information that is currently
required no longer accurately reflects
the methods by which swine are valued
and priced by packers; or
(ii) packers that slaughter a
significant majority of the swine
produced in the United States no longer
use backfat or lean percentage factors
as indicators of price.
(C) Limitation.--Under subparagraph (B), the
Secretary may not require packers to provide
any new or additional information that--
(i) is not generally available or
maintained by packers; or
(ii) would be otherwise unduly
burdensome to provide.
(c) Daily Reporting; Barrows and Gilts.--
(1) Prior day report.--
(A) In general.--The corporate officers or
officially designated representatives of each
packer processing plant that processes barrows
or gilts shall report to the Secretary, for
each business day of the packer, such
information as the Secretary determines
necessary and appropriate to--
(i) comply with the publication
requirements of this section; and
(ii) provide for the timely access to
the information by producers, packers,
and other market participants.
(B) Reporting deadline and plants required to
report.--A packer required to report under
subparagraph (A) shall--
(i) not later than 7:00 a.m. Central
Time on each reporting day, report
information regarding all barrows and
gilts purchased or priced, and
(ii) not later than 9:00 a.m. Central
Time on each reporting day, report
information regarding all barrows and
gilts slaughtered,
during the prior business day of the packer.
(C) Information required.--The information
from the prior business day of a packer
required under this paragraph shall include--
(i) all purchase data, including--
(I) the total number of--
(aa) barrows and
gilts purchased; and
(bb) barrows and
gilts scheduled for
delivery; and
(II) the base price and
purchase data for slaughtered
barrows and gilts for which a
price has been established;
(ii) all slaughter data for the total
number of barrows and gilts
slaughtered, including--
(I) information concerning
the net price, which shall be
equal to the total amount paid
by a packer to a producer
(including all premiums, less
all discounts) per hundred
pounds of carcass weight of
barrows and gilts delivered at
the plant--
(aa) including any
sum deducted from the
price per hundredweight
paid to a producer that
reflects the repayment
of a balance owed by
the producer to the
packer or the
accumulation of a
balance to later be
repaid by the packer to
the producer; and
(bb) excluding any
sum earlier paid to a
producer that must
later be repaid to the
packer;
(II) information concerning
the average net price, which
shall be equal to the quotient
(stated per hundred pounds of
carcass weight of barrows and
gilts) obtained by dividing--
(aa) the total amount
paid for the barrows
and gilts slaughtered
at a packing plant
during the applicable
reporting period,
including all premiums
and discounts, and
including any sum
deducted from the price
per hundredweight paid
to a producer that
reflects the repayment
of a balance owed by
the producer to the
packer, or the
accumulation of a
balance to later be
repaid by the packer to
the producer, less all
discounts; by
(bb) the total
carcass weight (in
hundred pound
increments) of the
barrows and gilts;
(III) information concerning
the lowest net price, which
shall be equal to the lowest
net price paid for a single lot
or a group of barrows or gilts
slaughtered at a packing plant
during the applicable reporting
period per hundred pounds of
carcass weight of barrows and
gilts;
(IV) information concerning
the highest net price, which
shall be equal to the highest
net price paid for a single lot
or group of barrows or gilts
slaughtered at a packing plant
during the applicable reporting
period per hundred pounds of
carcass weight of barrows and
gilts;
(V) the average carcass
weight, which shall be equal to
the quotient obtained by
dividing--
(aa) the total
carcass weight of the
barrows and gilts
slaughtered at the
packing plant during
the applicable
reporting period, by
(bb) the number of
the barrows and gilts
described in item (aa),
adjusted for special slaughter
situations (such as skinning or
foot removal), as the Secretary
determines necessary to render
comparable carcass weights;
(VI) the average sort loss,
which shall be equal to the
average discount (in dollars
per hundred pounds carcass
weight) for barrows and gilts
slaughtered during the
applicable reporting period,
resulting from the fact that
the barrows and gilts did not
fall within the individual
packer's established carcass
weight or lot variation range;
(VII) the average backfat,
which shall be equal to the
average of the backfat
thickness (in inches) measured
between the third and fourth
from the last ribs, 7
centimeters from the carcass
split (or adjusted from the
individual packer's measurement
to that reference point using
an adjustment made by the
Secretary) of the barrows and
gilts slaughtered during the
applicable reporting period;
(VIII) the average lean
percentage, which shall be
equal to the average percentage
of the carcass weight comprised
of lean meat for the barrows
and gilts slaughtered during
the applicable reporting
period, except that when a
packer is required to report
the average lean percentage
under this subclause, the
packer shall make available to
the Secretary the underlying
data, applicable methodology
and formulae, and supporting
materials used to determine the
average lean percentage, which
the Secretary may convert to
the carcass measurements or
lean percentage of the barrows
and gilts of the individual
packer to correlate to a common
percent lean measurement; and
(IX) the total slaughter
quantity, which shall be equal
to the total number of barrows
and gilts slaughtered during
the applicable reporting
period, including all types of
purchases and barrows and gilts
that qualify as packer-owned
swine; and
(iii) packer purchase commitments,
which shall be equal to the number of
barrows and gilts scheduled for
delivery to a packer for slaughter for
each of the next 14 calendar days.
(D) Publication.--
(i) In general.--The Secretary shall
publish the information obtained under
this paragraph in a prior day report--
(I) in the case of
information regarding barrows
and gilts purchased or priced,
not later than 8:00 a.m.
Central Time, and
(II) in the case of
information regarding barrows
and gilts slaughtered, not
later than 10:00 a.m. Central
Time,
on the reporting day on which the
information is received from the
packer.
[(ii) Price distributions.--The
information published by the Secretary
under clause (i) shall include a
distribution of net prices in the range
between and including the lowest net
price and the highest net price
reported. The publication shall include
a delineation of the number of barrows
and gilts at each reported price level
or, at the option of the Secretary, the
number of barrows and gilts within each
of a series of reasonable price bands
within the range of prices.]
(ii) Price distributions.--The
information published by the Secretary
under clause (i) shall include--
(I) a distribution of net
prices in the range between and
including the lowest net price
and the highest net price
reported;
(II) a delineation of the
number of barrows and gilts at
each reported price level or,
at the option of the Secretary,
the number of barrows and gilts
within each of a series of
reasonable price bands within
the range of prices; and
(III) the total number and
weighted average price of
barrows and gilts purchased
through negotiated purchases
and negotiated formula
purchases.
(2) Morning report.--
(A) In general.--The corporate officers or
officially designated representatives of each
packer processing plant that processes barrows
or gilts shall report to the Secretary not
later than 10:00 a.m. Central Time each
reporting day--
(i) the packer's best estimate of the
total number of barrows and gilts, and
barrows and gilts that qualify as
packer-owned swine, expected to be
purchased throughout the reporting day
through each type of purchase;
(ii) the total number of barrows and
gilts, and barrows and gilts that
qualify as packer-owned swine,
purchased up to that time of the
reporting day through each type of
purchase;
(iii) the base price paid for all
base market hogs purchased up to that
time of the reporting day through
negotiated purchases; and
(iv) the base price paid for all base
market hogs purchased through each type
of purchase other than negotiated
purchase up to that time of the
reporting day, unless such information
is unavailable due to pricing that is
determined on a delayed basis.
(B) Publication.--The Secretary shall publish
the information obtained under this paragraph
in the morning report as soon as practicable,
but not later than 11:00 a.m. Central Time, on
each reporting day.
(3) Afternoon report.--
(A) In general.--The corporate officers or
officially designated representatives of each
packer processing plant that processes barrows
or gilts shall report to the Secretary not
later than 2:00 p.m. Central Time each
reporting day--
(i) the packer's best estimate of the
total number of barrows and gilts, and
barrows and gilts that qualify as
packer-owned swine, expected to be
purchased throughout the reporting day
through each type of purchase;
(ii) the total number of barrows and
gilts, and barrows and gilts that
qualify as packer-owned swine,
purchased up to that time of the
reporting day through each type of
purchase;
(iii) the base price paid for all
base market hogs purchased up to that
time of the reporting day through
negotiated purchases; and
(iv) the base price paid for all base
market hogs purchased up to that time
of the reporting day through each type
of purchase other than negotiated
purchase, unless such information is
unavailable due to pricing that is
determined on a delayed basis.
(B) Publication.--The Secretary shall publish
the information obtained under this paragraph
in the afternoon report as soon as practicable,
but not later than 3:00 p.m. Central Time, on
each reporting day.
(C) Late in the day report information.--The
Secretary shall include in the morning report
and the afternoon report for the following day
any information required to be reported under
subparagraph (A) that is obtained after the
time of the reporting day specified in such
subparagraph.
(d) Daily Reporting; Sows and Boars.--
(1) Prior day report.--The corporate officers or
officially designated representatives of each packer of
sows and boars shall report to the Secretary, for each
business day of the packer, such information reported
by hog class as the Secretary determines necessary and
appropriate to--
(A) comply with the publication requirements
of this section; and
(B) provide for the timely access to the
information by producers, packers, and other
market participants.
(2) Reporting.--Not later than 9:30 a.m. Central
Time, or such other time as the Secretary considers
appropriate, on each reporting day, a packer required
to report under paragraph (1) shall report information
regarding all sows and boars purchased or priced during
the prior business day of the packer.
(3) Information required.--The information from the
prior business day of a packer required under this
subsection shall include all purchase data, including--
(A) the total number of sows purchased and
the total number of boars purchased, each
divided into at least three reasonable and
meaningful weight classes specified by the
Secretary;
(B) the number of sows that qualify as
packer-owned swine;
(C) the number of boars that qualify as
packer-owned swine;
(D) the average price paid for all sows;
(E) the average price paid for all boars;
(F) the average price paid for sows in each
weight class specified by the Secretary under
subparagraph (A);
(G) the average price paid for boars in each
weight class specified by the Secretary under
subparagraph (A);
(H) the number of sows and the number of
boars for which prices are determined, by each
type of purchase;
(I) the average prices for sows and the
average prices for boars for which prices are
determined, by each type of purchase; and
(J) such other information as the Secretary
considers appropriate to carry out this
subsection.
(4) Price calculations without packer-owned swine.--A
packer shall omit the prices of sows and boars that
qualify as packer-owned swine from all average price
calculations, price range calculations, and reports
required by this subsection.
(5) Reporting exception: public auction purchases.--
The information required to be reported under this
subsection shall not include purchases of sows or boars
made by agents of the reporting packer at a public
auction at which the title of the sows and boars is
transferred directly from the producer to such packer.
(6) Publication.--The Secretary shall publish the
information obtained under this paragraph in a prior
day report not later than 11:00 a.m. Central Time on
the reporting day on which the information is received
from the packer.
(7) Electronic submission of information.--The
Secretary of Agriculture shall provide for the
electronic submission of any information required to be
reported under this subsection through an Internet
website or equivalent electronic means maintained by
the Department of Agriculture.
(e) Weekly Noncarcass Merit Premium Report.--
(1) In general.--Not later than 4:00 p.m. Central
Time on the first reporting day of each week, the
corporate officers or officially designated
representatives of each packer processing plant shall
report to the Secretary a noncarcass merit premium
report that lists--
(A) each category of standard noncarcass
merit premiums used by the packer in the prior
slaughter week; and
(B) the amount (in dollars per hundred pounds
of carcass weight) paid to producers by the
packer, by category.
(2) Premium list.--A packer shall maintain and make
available to a producer, on request, a current listing
of the dollar values (per hundred pounds of carcass
weight) of each noncarcass merit premium used by the
packer during the current or the prior slaughter week.
(3) Availability.--A packer shall not be required to
pay a listed noncarcass merit premium to a producer
that meets the requirements for the premium if the need
for swine in a given category is filled at a particular
point in time.
(4) Publication.--The Secretary shall publish the
information obtained under this subsection as soon as
practicable, but not later than 5:00 p.m. Central Time,
on the first reporting day of each week.
* * * * * * *
CHAPTER 5--ADMINISTRATION
* * * * * * *
SEC. 260. TERMINATION OF AUTHORITY.
The authority provided by this subtitle terminates on
[September 30, 2015] September 30, 2020.
* * * * * * *
----------
SECTION 942 OF THE LIVESTOCK MANDATORY REPORTING ACT OF 1999
SEC. 942. TERMINATION OF AUTHORITY
The authority provided by this title and the amendments made
by this title (other than section 911 of subtitle A and the
amendments made by that section) terminate on [September 30,
2015] September 30, 2020.
