Tag Archives: Nebraska Farm Bureau

Nebraska Farm Bureau has offered the United States Department of Agriculture (USDA) a series of recommendations to reform the way beef cattle are marketed. The underlying concept of Farm Bureau’s suggestions are to create a more transparent and value-based system that would more closely link the prices farmers and ranchers receive for their cattle to the value of beef products sold at the wholesale and retail levels. Nebraska Farm Bureau President Steve Nelson shared the recommendations with U.S. Secretary of Agriculture Sonny Perdue in an October 2 letter.

“With only four major meatpackers, many Nebraska cattle producers have expressed concerns about the level of control that exists within the consolidated meat packing industry, specifically in the way of packer captive supplies of cattle and the diminishing cash market for live cattle. We believe reexamining the cattle pricing system and moving toward one where cattle prices and cattle contract prices are discovered under a more transparent and value-based system would be beneficial in addressing producer concerns and allow the cattle market to better respond to actual supply and demand conditions,” said Steve Nelson, Nebraska Farm Bureau president.

Beef producers’ concerns about the potential for anti-competitive actions in cattle markets heightened after a July fire at a Tyson meat processing facility in Holcomb, Kan. with producers seeing prices paid for cattle drop while meatpackers made significant profits. Nebraska Farm Bureau had urged, and USDA stepped forward, in investigating the situation under the powers given to the agency under the federal Packers and Stockyards Act; the long-standing legislation targeted to eliminating anti-competitive measures in livestock markets.

“We have no preconceived outcome in mind for the Packers and Stockyards investigation and our state’s cattle producers are grateful USDA is doing its due diligence. However, we believe the best way to address real or perceived manipulation concerns is to move to a value discovery system that more closely links what cattle producers receive for the beef they produce and the value of that product as it nears the end consumer,” said Nelson.

Nebraska Farm Bureau’s recommendations to USDA for changes under the Packers and Stockyards Act include:

  • Create regulatory standards requiring that cattle marketing contracts have a set, negotiated base price before cattle are committed for delivery.

  • Assure that cattle marketing contracts utilize reference or base prices that are more broad-based and publicly available rather than the shrinking cash markets.

  • Consideration of requiring contract standards that have reference prices or base prices that are more value-based such as using wholesale price cuts, retail meat values, or beef cut-out values. Requiring base or reference prices for cattle contracts that are more value-based up the beef supply chain would reduce, by market forces, any real or perceived incentives for packers to manipulate captive supplies in order to drive down local cash markets.

  • Consideration to developing a live cattle value index which would be required to be used as a reference or base price standard for cattle marketing contracts.  The index could use a combination of average spot cash prices, average weekly close of nearby live cattle futures, weekly average of beef cutout value, and weekly average of retail meat values.  Using this live cattle value index would help ensure that cattle are marketed on a value discovery system rather than a price discovery system.

“This has been a challenging year for Nebraska beef producers as weather, trade disputes, rising debt issues, increased input costs, and now difficult marketing conditions have created great stress on the largest sector of Nebraska’s agriculture-based economy. We appreciate the work USDA has done on many fronts for farmers and ranchers. It’s our hope Secretary Perdue and USDA will consider these ideas for reforms to move our beef industry forward toward a value-based cattle marketing system that would offer true reform,” said Nelson.

WOOD RIVER, NEB. – It’s time for Congress to pass legislation to enact the United States – Mexico – Canada Agreement (USMCA) and bring home a “win” for Nebraska agriculture. That’s the message relayed by Nebraska leaders who gathered to call for USMCA passage at Husker Harvest Days, Wed., Sept. 11. The Trump administration has negotiated a trade deal with the two countries, but Congress must act for the provisions of the agreement to go into effect.

The USMCA deal is critical to Nebraska agriculture as purchases by Mexico and Canada account for more than 21 percent of Nebraska’s total agriculture exports. The trade relationship with the two countries is also vital to the state’s economy as agriculture trade with the two nations supports nearly 54,000 Nebraska jobs.

The USMCA would replace the more than 20-year-old, North American Free Trade Agreement between the countries, making a good relationship even better. The new deal would maintain market access for Nebraska commodities like corn, soybeans, beef, and pork, while improving access for Nebraska wheat and dairy products. The deal also updates the former agreement to address agriculture biotechnology to support innovation and reduce trade-distorting policies. In addition, USMCA creates a more rigorous process for establishing trade distorting geological indicators for agriculture products and strengthens science-based measures to protect human, animal, and plant health while improving the flow of trade.

With members of Congress returning from the August recess, the Nebraska leaders urged swift action to secure the USMCA deal.

Quotes

“A combination of flooding, low commodity prices, and trade negotiations have made for a very tough time for agriculture recently. The U.S.-Mexico-Canada Agreement is critical for our country and growing key trade relationships. Now it’s time for Congress to step up and do their part by approving the USMCA.”

  • Governor Pete Ricketts

 

“USMCA passage is not only important because of the immediate and direct benefits it will bring to our state’s farmers and ranchers, but with the climate we’re operating in today, we need to show the rest of the world that the United States is open for business and we’re serious about getting deals done with our trade partners. The success of Nebraska agriculture relies heavily on our ability to reach the international customers who want to buy Nebraska agriculture products; and there are plenty of them around the world.”

  • Steve Nelson, Nebraska Farm Bureau president

 

 

“Mexico and Canada are key partners with Nebraska’s corn industry. Mexico is our top customer of Nebraska corn and Canada is our second largest export market for ethanol. Once distillers grains, livestock and other agricultural commodities start getting added into the mix, it’s easy to see why USMCA is so important to Nebraska’s farmers and ranchers.”

  • Dan Nerud, Nebraska Corn Growers Association president

“USMCA is poised to bring improvements to the North American dairy trade by expanding exports and bringing down trade barriers, benefiting America’s dairy farmers and processors. Mexico and Canada are the dairy industry’s number one and number two largest volume international exporters, with Mexico taking 25 percent of all of the United States dairy exports.  USMCA enables the Nebraska dairy industry to continue to export ice cream and butter into those markets, generating more demand and higher pay price for our milk here at home.”

  • Bob Larson, Nebraska State Dairy Association, board of directors

“Mexico is one of the largest purchasers of both US and Nebraska wheat. A fully implemented USMCA would greatly benefit our state’s wheat farmers.”

  • Von Johnson, Nebraska Wheat Board, board of directors

“In today’s trade environment the passage of the USMCA is of great importance. With trade equalization moving forward with Japan and other booming markets around the world the passage of USMCA would increase the momentum to trade with other countries and boost all sectors of our agricultural economy.”

  • Tim Chancellor, Nebraska Pork Producers Association

 

 

“USMCA will benefit U.S. and Nebraska soybean growers as well as the larger U.S. agriculture and food industry.  Over the last 25 years, U.S. food and ag exports to Canada and Mexico have more than quadrupled under NAFTA.  Mexico is the number two buyer of Nebraska soybeans and soybean products.”

  • Robert Johnston, Nebraska Soybean Association, president

“Nebraska’s cattle producers have weathered their fair share of storms this past year. Now is NOT the time to pull the rug from under the feet of our state’s largest industry. If access to these top markets were suddenly shut off, our red meat exports would drastically decline. This would pose serious consequences for Nebraska’s economy. We urge Congress to act quickly and get USMCA across the finish line.”

  • Mike Drinnin, Nebraska Cattlemen president

“USMCA reinvigorates and modernizes the trade relationships with our neighbors in Canada and Mexico. The agreement also provides critical updates that benefit growers all across the agricultural spectrum. The Nebraska Sorghum Producers Association urges congress to move swiftly forward in passing the USMCA.”

  • Nate Blum, Nebraska Grain Sorghum

“Nebraska’s own Clayton Yeutter was instrumental in opening up trade with our neighbor Canada when he served as U.S. Trade Representative in the 1980s. I’m proud that our Clayton Yeutter Institute of International Trade and Finance at UNL helps educate students and the public about the importance of trade. In 2017, Nebraska ag exports totaled $6.4 billion and translated into $8.14 billion in additional economic activity. Opening up access to our agricultural products is vital to Nebraska’s future.”

  • Ronnie Green, University of Nebraska-Lincoln Chancellor