Meat&Poultry - January 2012 - 18

Washington
BY BERNARD SHIRE
meatpoultry@sosland.com

Regulatory hurdles ahead
The US Dept. of Agriculture has released a new, somewhat strippeddown anti-trust rule regulating meat and poultry companies that is far less sweeping than initial changes that were strongly opposed by both the industry and Congress, but supported by the Obama Administration. USDA November took action to limit the effects of the rule in the industry. As it passed the fiscal year 2012 agriculture appropriations bill, it placed limitations on the rule. Congress’ appropriations conference report limits only finalizing various provisions contained in the 2008 Farm Bill, such as giving farmers the right to not be held to mandatory arbitration clauses. The new rule is a victory for processors who rely on a steady and uninterrupted supply of protein supplies to keep their establishments running. In recent years, processors have developed tightly coordinated relationships with chicken growers and hog and beef raisers to ensure they have an unending supply. If the original rule had been adopted, the power would have been shifted back toward the farmers and producers. But the original GIPSA rule is not dead, and these competition issues will resurface during the next Farm Bill debate, which will take place this year. There had been concern in the agricultural community and in Congress about the GIPSA rule all last year, including the long-overdue economic impact analysis of the rule, which has been described as one of the most onerous and controversial proposals USDA has ever published. Members of Congress urged Agriculture Secretary Tom Vilsack to withdraw the proposal and introduce a new one when the economic study is completed. The rule, first proposed in June 2010, would basically change the relationships between processing companies, and their livestock and poultry suppliers. The cost of implementing the rule is estimated at $14 billion, far above the level requiring an economic study to be done.

Making labeling easier
For years, USDA’s Food Safety and Inspection Service has been talking about ways to make labeling easier for meat and poultry processing companies to do, especially what’s called “generic labeling.” While some products can be labeled generically, without first having to submit the labels to USDA for approval, others have to go through a lengthy and sometimes tricky approval process. Some of the label officials at USDA are very helpful, and processors can go to outsiders who can help them with submitting their label applications. So FSIS is proposing a new rule that would allow processing establishments to label a broader range of products without fi rst submitting the label to the agency for review. There are two benefits to this proposed change in rules if it goes through. It would enable products to get to consumers much faster, and it would make the label approval process more convenient and cost-effective for smaller processors, in particular. The President’s Food Safety Working Group issued a progress report in December, which includes FSIS performance standards for Salmonella and Campylobacter in meat and poultry, and efforts to declare six non O157:H7 toxin producing E. coli pathogens as adulterants in meat. But a large number of organizations representing meat producers and processors in the US, Canada, New Zealand and several

“Competition issues will resurface during the next Farm Bill debate, which will take place this year.”
will publish a fi nal version of the rule this year after more than a year of debate pitting the nation’s biggest meat companies against many farmers and ranchers. Congress voted last month to stop USDA from approving most parts of the original rule. Processors claimed the rule could increase costs and drive up meat and poultry prices. With all the frustration expressed in the agriculture industry over the proposed Grain Inspection and Packers and Stockyards (GIPSA) livestock marketing rule, Congress in

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