A new law requiring meat packers to report prices paid to producers for food animals will become effective in mid-July, following the final regulations publication by the Agriculture Department revising and implementing the Livestock Mandatory Price Reporting (LMPR) law.
"The implementation of LMPR will allow for more accurate and timely reporting of most wholesale and retail meat prices and increase transparency in the reporting of livestock sales," said American Farm Bureau Federation (AFBF) president Bob Stallman.
Under the LMPR law, packers are required to report all transactions involving the purchase of livestock, as well as details of domestic and export sales of boxed beef and lamb cuts.
Packers that annually slaughter 125,000 cattle or 100,000 swine are required to report under LMPR. Packers or processors of 75,000 lambs annually are required to report under the law, as well as importers of 5,000 metric tons of lamb meat.
The LMPR will provide the basis for newly published market news reports, including reports that cover the prior day swine market, forward contract and formula marketing arrangement cattle purchases, packer-owned cattle and sheep information, sales of imported boxed lamb cuts and live lamb premiums and discounts.
LMPR will take effect July 15, 2008, according to the rules published in the Federal Register.
"We had a voluntary system set up years ago that effectively initiated the LMPR," said Jon Johnson, Texas Farm Bureau’s livestock specialist. "It is primarily an issue for the stockers and feeders—those closest to the packer—who want to know what cash markets were doing and how packers were paying in different markets."
By tracking such numbers, stockers and feeders can better manage their inputs by having a clearer picture of the sale price for a fatted calf. They can then adjust inputs and have a clearer picture of what the market will bring once they sell their cattle on up the system.
"This really isn’t a big issue to your average cow/calf producer out there," Johnson said. "They’re pretty much going to get whatever the going market rate is on the day they take their cattle to sale."
AFBF said implementing the rule now comes at a time of special importance to the nation’s pork producers, who are facing particularly difficult financial times. Live market hog prices recently plunged to levels not seen in nearly a decade, and wholesale pork prices recently hit their lowest point in four years.
"We are optimistic that LMPR will help the pork industry with prices at this critical time," Stallman said.