COLUMBIA, MISSOURI (September 24, 2020) - The Missouri Cattlemen's Association September 24, 2020, threw its support behind U.S. Senator Deb Fischer's (R-Neb.) Cattle Market Transparency Act of 2020 introduced on Tuesday, September 22, 2020. MCA President Marvin Dieckman said the association has dedicated this year to directing its focus on long-term structural changes in the cattle markets.
"After the fire over a year ago in Holcomb, Kansas, and then the economic destruction to the cattle industry that occurred during the COVID-19 pandemic, this association directed full attention to bringing resolve to the extreme volatility in the markets," said Dieckman. "We remain laser focused on ensuring the cattle markets are not suppressed and are allowed to function in such a way that all segments of the industry have the opportunity to be profitable."
MCA Executive Vice President Mike Deering said the legislation focuses on robust price discovery and market transparency using reasonable mechanisms to achieve both and does not treat all regions of the country the same.
"Senator Fischer's legislation gets us closer to where we need to be to achieve robust price discovery and to ensure market transparency," said Deering. "This legislation does so in a methodical way without a one-size fits all, heavy handed approach. The thoughtfulness of this legislation is no surprise given the Senator is a cattle rancher herself."
Items in the legislation include the cattle contract library, 14-day packer purchase commitment outlook, and clarification of Livestock Mandatory Price Reporting confidentiality guidelines to ensure data collected regionally and nationally is public while also maintaining producer confidentiality. Additionally, directing USDA to establish regionally negotiated cash plus negotiated grid marketing volume minimum thresholds will enhance price discovery.
Deering said MCA formed a working group to develop policy that allowed the association to engage in these discussions. The policy adopted by MCA supports voluntary and mandatory solutions that would compel the regular participation of all major packers in the negotiated market with cash trade minimums that reflect the volumes needed in different geographical regions to achieve robust price discovery. MCA also supports amending the confidentiality guidelines for LMPR and increasing transparency in formula transactions by publicly reporting the details of the transactions including, but not limited to, the net price, base price, and any premium.
Click here to read the legislation. Click here for a summary of the provisions.