Iowa General Assembly Banner

PUBLIC HEARING SUMMARY

LIVESTOCK PRODUCTION STUDY COMMITTEE

February 26, 1996
Third of Three Public Hearings

MEMBERS PRESENT

PUBLIC HEARING IN BRIEF

Minutes prepared by Doug Adkisson, Legal Counsel,
Organizational staffing by Doug Adkisson, Legal Counsel

  1. Procedural Business.
  2. Sites Participating.
  3. Public Comments and Discussion.

SUBCOMMITTEE BUSINESS

1. Procedural Business.
a. The Livestock Production Study Committee held a public hearing conducted on the Iowa Communication Network from the STARC Armory in Johnston, Iowa.
Senator Priebe and Representative Meyer chaired the public hearing. The public hearing was called to order at 7:00 p.m. and was adjourned at 8:40 p.m.
b. Co-chairperson Meyer invited persons to provide testimony regarding the charge of the Committee. The charge requires the Committee to consider the increasing degree of vertical integration of the livestock market by packers and processors, including threats to economic competition, independent production, and consumer protection; and market practices engaged in by packers, processors, or buyers which increasingly threaten open and fair markets by establishing arbitrary and inconsistent pricing without public disclosure or price discovery mechanisms, including price differences based on the time of delivery, and transaction.
2. Sites Participating.
Remote sites participating in the public hearing included the following:
CITYSITE
Council BluffsNational Guard Armory
CrestonGreenvalley AEA
EmmetsburgIowa Lakes Community College
Ida GroveWestern Iowa Tech Community College
MarionMarion High School
SigourneySigourney High School
WaverlyWartburg College
Webster CityIowa Central Community College
3. Public Comments and Discussion.
The subcommittee heard testimony and engaged in discussion with persons attending the public hearing regarding a number of issues, including vertical integration, marketing practices, the importance of the livestock industry to the state, livestock production, and legal restrictions affecting the livestock industry. The following written and oral comments were presented:
a. Price discrimination threatens to destroy independent producers.
b. Pricing structures do not favor smaller producers.
c. Obtaining reliable pricing information is critical to the success of independent producers.
d. Packers should encourage producers to raise diversified swine. There is a market for pork products with a higher fat content.
e. Packers are increasingly demanding that producers deliver lean hogs because consumers demand less fat in meat products. There is no market remaining for lard because consumers demand a leaner product.
f. Packers should report all prices offered for the purchase of livestock.
g. The Department of Agriculture and Land Stewardship should be appropriated more moneys in order to support additional reporting.
h. The state should enact Senate File 2105 prohibiting price discrimination.
i. Packers should provide the same premiums to producers who deliver the same quality of hogs to market.
j. Packers are suspected of paying a premium to larger producers. Larger producers are suspected of having favorable contracts with packers.
k. Packers would prefer dealing with a limited number of producers.
l. Purebred producers of hogs are increasingly losing market share.
m. Iowa legislators should contact legislators in neighboring states in order to act in conjunction when regulating the industry.
n. Murphy's Farms is suspected of engaging in unfair marketing practices.
o. There is no example of contracts in which packers pay a premium to large producers based on the quantity of hogs delivered to the packer.
p. There are legitimate reasons why a packer may discriminate in prices offered to producers, including different transportation rates, delivery times, and carcass merit.
q. Senate File 2117, sponsored by Senator Bennett and Senator Bartz, requires reports by packers relating to marketing contracts for livestock and poultry.
r. Hogs sold by large corporate facilities are pale and stressed.
s. Independent producers have made this state first in the production of hogs. The state should act to support its independent producers.
t. Market access is critical to the success of independent producers. Independent producers must become more efficient in order to effectively compete.
u. Independent producers can compete against large corporate producers, if all producers are operating on a level playing field.
v. Senate File 2135 and House File 2257, providing for the organization of cooperative corporations, promises a method to allow farmers to network in order to compete against larger operations.
w. Senate File 2135 and House File 2257 allow large producers and packers to establish corporate entities which threaten small independent producers. Concern was expressed about the number of acres of farmland that a cooperative corporation could own.
x. Senate File 2135 and House File 2257 should incorporate provisions which require that each member of the cooperative corporation have not more than one vote.
y. It is difficult to obtain contracts from packers or producers in order to determine the terms of those contracts (whether premiums are paid based on volume). The Committee should see examples of contracts and may have subpoena authority in order to obtain contracts.
z. The public hearing conducted over the Iowa Telecommunications Network is a convenient method to allow members of the public to communicate with legislators. Bad weather prevented other persons from visiting sites in order to participate in the public hearings.

OTHER INFORMATION FOR THIS COMMITTEE:

| Charge | Members | Staff | Final Report |

Back to top of Interim Information

Return To Home Iowa General Assembly

index Search: 1995 Interim (76th General Assembly)

© 1996 Cornell College and League of Women Voters of Iowa

Comments? webmaster@legis.iowa.gov.

Last update: Mon Apr 29 10:10:03 CDT 1996
URL: /DOCS/GA/76GA/Interim/1995/comminfo/liveprod/ph960226.htm
sw