February 24, 2006 -- The American Sheep Industry Association (ASI), the National Pork Producers Council, the National Cattlemen?s Beef Association and the American Farm Bureau Federation signed a joint letter this week requesting that Secretary of Agriculture Mike Johanns immediately implement the recommendations contained in the recently released Government Accountability Office (GAO) report entitled, Livestock Market Reporting: USDA Has Taken Some Steps to Ensure Quality, but Additional Efforts Are Needed.
?The GAO report, released on Dec. 9, 2005, contained a series of six administrative recommendations that we strongly support and firmly believe would enhance the transparency of the price reporting system for sheep, cattle and swine,? the four groups stated.
The Mandatory Price Reporting (MPR) law expired on Sept. 30, 2005. The current reporting system is voluntary and the meat packers are voluntarily reporting pricing data for most cattle and nearly all swine. However, voluntary compliance in the lamb industry has meant that importing companies immediately stopped reporting imported lamb cuts. This represents more than 40 percent of the total lamb in the U.S. market. The retail price for lamb has not been available for months and most recently, lamb-carcass reports were not available for a two-week period. The lack of carcass-price reports placed lamb producers who market their lambs ?on the rail? at a serious disadvantage. U.S. slaughter-lamb prices declined 19 percent from the first of November through the end of January 2006.
While lamb companies have resumed lamb-carcass price reporting this month, MPR would increase the reliability of national carcass reporting for the industry. Therefore, the lamb industry is seeking prompt resolution of the serious market-reporting situation.
All of the producer groups impacted by the expiration of this authorization see the lamb situation a foreshadowing of what might be to come for the cattle and swine markets. This will prove disastrous for all livestock producers and for the U.S. economy.
In addition, the signatories also have concerns regarding the continuation of the retail price scanner data collection aspect of livestock MPR. Scanner-price data collection was part of the original legislation. The law was intended to procure and publish detailed information about the retail prices of lamb, beef, pork and selected other meats. This information is critical to compiling accurate and meaningful analysis of consumer demand for meat. It is important to know how demand and price affect the price the producer receives for their product. The department?s attorneys, however, communicated that this project should not be part of the reauthorization.
?Nothing in the authorizing language supports this point of view, and we are asking for your assurance that this program will continue as intended by Congress. One month of data collection has already been missed and it will be difficult to replace at a reasonable cost. Please resolve this situation to prevent further valuable historical data from being lost,? as stated in the letter.
Staff contact: Peter Orwick, ext. 33