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Statement on Final Mandatory Price Reporting Rule

Thursday, November 30, 2000

USDA's final mandatory price reporting rule will create an enormous burden on meat packers and provide few off-setting benefits to anyone in the livestock or meat industry. AMI has long opposed mandatory price reporting and continues to believe that voluntary price reporting programs have provided adequate information without being unduly burdensome.

The mandatory price reporting law was passed by Congress in response to fluctuations in the livestock price cycle - fluctuations that AMI and most economists attribute to fundamental laws of supply and demand. These fluctuations are the result of classic, economic cycles and cannot be remedied simply by reporting more data.

Although the Agricultural Marketing Service (AMS) modified the rule in response to some of industry’s concerns stated in comments, problems remain. Those problems include extremely tight reporting and information turnaround times, the fact that packers may not always have complete information at the reporting deadline and the overly broad reporting provisions for some categories, which exceed the intent of Congress.

Only time will tell what the precise impact of the law will be. AMI speculates that a year from now, AMS will have amassed massive quantities of data that are of little benefit to anyone in the livestock sector, while imposing significant costs on the packing sector, and potentially upon the consumer. None of this will serve to increase demand – the real key to economic success for everyone involved in meat production and distribution.

AMI represents the interests of packers and processors of beef, pork, lamb, veal and turkey products and their suppliers throughout North America. Headquartered in Washington, DC, the Institute provides legislative, regulatory and public relations services, conducts scientific and economic research, offers marketing and technical assistance and sponsors education programs.

For more information contact:
Janet Riley
Vice President, Public Affairs
Josee Daoust
Manager, Public Affairs

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