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USDA unveils initiatives to lower food costs

Key actions include improving transparency in seed germplasm access, tackling anti-competitive pricing in the beef industry.

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The U.S. Department of Agriculture (USDA) announced a series of initiatives aimed at fostering fairer competition in agricultural markets and lowering food costs for American families. Unveiled during a “Farmers and Ranchers in Action” event hosted by the White House, the actions are part of the USDA’s response to President Biden’s Executive Order on Promoting Competition in the American Economy.

Key actions announced

  1. Enhanced seed competition: The USDA is launching a multipart strategy to increase transparency and researcher access to seed germplasm, a critical material needed for breeding diverse and resilient seed varieties. This move follows recommendations from USDA’s 2023 report, “More and Better Choices for Farmers: Promoting Fair Competition and Innovation in Seeds and Other Agricultural Inputs.” The framework aims to clarify patent rights, improve breeding history disclosures, and promote the sharing of federally-funded germplasm for public and private research.

  2. Interim report on meat market competition: USDA released an interim report assessing competitive conditions in the meat retail industry. The report, based on 1,600 public comments and input from various stakeholders, highlights hidden fees and anti-competitive pricing practices in the beef market. The USDA plans to continue its investigation into the meat market, using subpoenas as needed to promote transparency and fairness.

  3. New rulemaking effort in cattle markets: The USDA is taking the first steps toward rulemaking under the Packers & Stockyards Act of 1921 to address price discovery and fairness issues in cattle markets. An Advanced Notice of Proposed Rulemaking (ANPR) will solicit public comments on how to enhance transparency and fairness in fed cattle purchasing agreements, known as Alternative Marketing Arrangements (AMAs). This initiative seeks to address complaints from cattle producers that AMAs are distorting spot market prices and undermining competition.

“These actions represent a significant step toward ensuring that small businesses and family farms have a fair shot in the marketplace,” said Agriculture Secretary Tom Vilsack. “By addressing unfair practices and increasing transparency, we’re helping American farmers and ranchers compete on a level playing field and delivering lower prices for American consumers.”

Addressing market concentration

The USDA’s efforts come amid growing concerns over the consolidation in agricultural markets, which has limited options for farmers and increased costs for consumers. USDA’s National Economic Advisor, Lael Brainard, emphasized that consolidation in the agriculture industry has been detrimental to family farms, lowering incomes and raising grocery prices.

“Today’s announcements build on our work to restore fair competition in farming and food markets,” said Brainard.

Next steps

The USDA’s actions aim to foster a more competitive and transparent agricultural marketplace, with an emphasis on providing better choices and fairer prices for both producers and consumers. The USDA is also engaging in ongoing rulemaking to address longstanding concerns in cattle and seed markets.

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