By Jamie Martin
The USDA has introduced a significant update to the Packers and Stockyards Act, aiming to protect poultry growers from unfair practices and bring transparency to the payment system. The rule seeks to address concerns over forced capital investments and unstable income for growers.
This reform mandates that poultry companies disclose a clear base pay rate in grower contracts, with no deductions allowed.
Companies can still offer performance bonuses above the base rate but must ensure fairness in comparisons. Additionally, the rule limits payment variability, providing growers with financial stability.
Steve Etka, Policy Director for the Campaign for Contract Agriculture Reform (CCAR), shared, “This rule establishes some important guardrails around the ‘tournament’ payment system to end deceptive aspects of the system and require the use of commonsense fair business practices.”
The rule also requires poultry companies to fully disclose the financial risks and rewards of capital improvements to growers, ensuring informed decision-making. It builds on earlier regulations introduced by the USDA, including those mandating transparency in contracts and payment calculations.
These changes follow a 2022 U.S. Department of Justice Consent Decree addressing abusive practices by major poultry integrators. The USDA aims to ensure a more equitable system that supports farmers while maintaining industry integrity.
For detailed information, visit the USDA official site.
Photo Credit: usda
Categories: National