(WASHINGTON) – On Wednesday, Ranking Member of the Livestock & Foreign Agriculture Subcommittee Dusty Johnson (R-S.D) and Representative Henry Cuellar (D-TX-28) introduced the bipartisan Cattle Contract Library Act of 2021 (H.R. 5609), which would create a library for cattle contracts within the U.S. Department of Agriculture’s (USDA’s) Agriculture Marketing Service Department.

The bill instructs USDA to regularly update the library in a user-friendly format and provide weekly or monthly reports as applicable. The Cattle Contract Library will publish information related to the type and duration of a contract, the total number of committed cattle solely to the packer each week, and more. 

United States Cattlemen’s Association (USCA) Vice President and South Dakotan Justin Tupper issued the following statement: 

“USCA would like to thank Reps. Johnson, Cuellar, and the many others involved in continuing to push forward with meaningful changes to the Livestock Mandatory Reporting (LMR) program that will increase transparency in the cattle marketplace. A cattle contract library is sorely needed, and this bill is one step closer to bringing that concept to fruition.”  

The Cattle Contract Library Act is cosponsored by Reps. Tracey Mann (R-KS-01), Frank Lucas (R-OK-03), Rick Allen (R-GA-12), Ashley Hinson (R-IA-01), Kelly Armstrong (N.D.-AL), Jason Smith (R-MO-08), Trent Kelly (R-MS-01), Michelle Fischbach (R-MN-07), Angie Craig (D-MN-02), Mariannette Miller-Meeks (R-IA-02)Jim Hagedorn (R-MN-01), David Rouzer (R-NC-07), Vicky Hartzler (R-MO-04), Adrian Smith (R-NE-3), Abigail Spanberger (D-VA-07), and Darren Soto (R-FL-09).

Below is the proposed bill…

Cattle Contract Library Act of 2021
Sponsored by: Rep. Dusty Johnson (R-SD)


Background: Market data published by the U.S. Department of Agriculture (USDA) helps provide price discovery
and market transparency as producers look to make marketing decisions and gain leverage while negotiating the
price of cattle. Unfortunately, USDA is not currently equipped to report on the contract terms utilized in sales
transactions categorized as “alternative marketing arrangements” (AMAs). As AMAs continue to grow in
popularity, cattlemen are increasingly left in the dark as to the contract terms being offered by packers through
these agreements. A cattle contract library could help address this problem.


The concept of a contract library is not new as USDA currently maintains a pork contract library. The idea of
creating a contract library for cattle has been supported through extensive research and producer engagement.
Last year, USDA released the “Box Beef & Fed Cattle Price Spread Investigation Report”, recommending the
creation of a library. The idea was proposed by expert witnesses in two recent hearings before the House
Committee on Agriculture: A Hearing to Review the State of the Livestock Industry and State of the Beef Supply
Chain: Shocks, Recovery, and Rebuilding. In a Joint Statement of Livestock Organizations, the Livestock
Marketing Association, the National Cattlemen’s Beef Association, U.S. Cattlemen, R-CALF USA, American Farm
Bureau Federation, and National Farmers Union all endorsed the creation of a cattle contract library.


Summary:
The Cattle Contract Library Act of 2021 would direct USDA’s Agriculture Marketing Service to
establish a contract library for cattle contracts. The bill amends the Agricultural Marketing Act of 1946 (Livestock
Mandatory Reporting) to ensure this information is reported and published along with other ongoing reports
authorized by the Act.


The bill instructs USDA to regularly update the library in a user-friendly format and provide weekly or monthly
reports as applicable. Additionally, the bill authorizes USDA to issue grants to universities, associations, or other
institutions who can work directly with producers to disseminate and analyze data to drive marketing decisions.
The Cattle Contract Library will publish information pertaining to:


 Type of contract, defined as the classification of contracts for the purchase of fed cattle based on the
mechanism used to determine the base price for the fed cattle committed to a packer under the
contract, including formula purchases, negotiated grid purchases, forward contracts, and other purchase
agreements, as determined by the Secretary


 Duration of the contract, provisions in the contract that may affect the base price of cattle covered by
the contract, schedules of premiums or discounts associated with the contract, and transportation
arrangements


 The total number of cattle solely committed to the packer each week within the 6-month and 12-month
periods following the date of the contract, by reporting region


 In the case of a contract in which a specific number of cattle are not solely committed to the packer, an
indication that the contract is an open commitment and any weekly, monthly, annual, or other
limitations on the number of cattle that may be delivered to the packer under the contract


 A description of the provisions in the contract that provide for expansion in the committed cattle to be
delivered under the contract for the 6- and 12-month periods.


The Cattle Contract Library Act of 2021 is supported by: American Farm Bureau Federation, National
Cattlemen’s Beef Association, U.S. Cattlemen’s Association, National Farmers Union and the Livestock Marketing
Association.


To cosponsor, please contact John Weber with Rep. Dusty Johnson, john.weber@mail.house.gov

By Brian Allmer - The BARN

Tucker Allmer & the BARN are members of the National Association of Farm Broadcasting (NAFB), the Colorado FFA Foundation, the Colorado 4H Foundation, the Colorado Farm Show Marketing Committee, 1867 Club Board Member, Denver Ag & Livestock Club Member, the Weld County Fair Board, the Briggsdale FFA Advisory Council, Briggsdale 4H Club Beef Leader & Founder / Coordinator of the Briggsdale Classic Open Jackpot Show.