A project of the
Organization for Competitive Markets
 
Date: May 16, 2003
FOR IMMEDIATE RELEASE
 
Contact: Steve Cady: 402.792.0041

CCMP Supports Captive Supply Reform Act

Lincoln, NE ~ The Organization For Competitive Market’s (OCM) Cattlemen’s Competitive Market Project (CCMP) praised a bill introduced in the U.S. Senate on May 13 that seeks to restore open, fair market competition in the livestock industry.  Titled “The Captive Supply Reform Act (S.1044),” the measure was sponsored by Senator Mike Enzi (R-WY) with co-sponsorships from Senators Byron Dorgan (D-ND), Kent Conrad (D-ND), Tim Johnson (D-SD), Tom Daschle (D-SD) and Craig Thomas (R-WY).
 
“CCMP applauds Senator Enzi and the bill’s co-sponsors for introducing a measure that takes a big step towards correcting the illnesses in today’s cattle markets,” said Randy Stevenson, CCMP Steering Committee member, Wheatland, WY.  “Healthy markets require competition, access and transparency, all of which the measure addresses.  Now that the bill has been introduced the debate will begin.  Cattlemen must be prepared to make their case in Washington and at home where they can begin by encouraging their congressional delegations to sign on as co-sponsors of the legislation,” said Stevenson.
 
Four meat packers control 59% of U.S. hog slaughter and 81% of U.S. fed cattle slaughter, according to USDA data.  “Packers use their concentration power to manipulate prices, particularly through the use of secret contracts on captive supply cattle,” said Tom Spencer, CCMP Steering Committee member, Pueblo, CO.  “An increasing percentage of slaughter cattle and hogs are obtained by the packers through captive methods that are literally ‘chickenizing’ the cattle industry.  In the State of Nebraska alone, 64% of the farms and ranches that produce cattle have gone out of business because the markets no longer function and producers cannot make a profit.  I support Senator Enzi’s measure and I’ll be doing groundwork to elicit the support of more congressional delegations.”
 
The Captive Supply Reform Act requires that livestock contracts be traded in open, public markets to which all buyers and sellers of livestock will have access.  The bill also requires that contracts and agreements between buyers and sellers of livestock state a fixed base price.  Currently most contract arrangements for cattle and hogs base the amount livestock producers receive on prices determined after the deal is struck. 

CCMP is not a membership organization. Funding comes from livestock auction markets and independent feeders on a per-head basis at the point of sale. All contributions are tax deductible under OCM’s non-profit status. For more information, contact Steve Cady at 402.792.0041 or visit the web site at www.competitivemarkets.com. 

The Organization For Competitive Markets is a multidisciplinary, nonprofit group of farmers, ranchers, academics, attorneys, and policy makers dedicated to reclaiming the agricultural marketplace for independent farmers, ranchers and rural communities.