Fair and Competitive Markets

Fair and competitive markets have long been the cornerstone of the American economy. Competition ensures that American farmers, ranchers, and those who grow our nation’s food to have the freedom to choose among different suppliers, employers, and retailers to buy and sell their product and the products they need. It spurs many businesses to innovate, improves opportunities for producers and workers, and increases resiliency in the nation’s food supply.

Over a century ago, Congress authorized the U.S. Department of Agriculture (USDA) and other agencies to police against illegal market structures and conduct that harm farmers, ranchers, and agricultural producers. The Packers and Stockyards Act (P&S) of 1921 authorizes USDA to “assure fair competition and fair trade practices, to safeguard farmers and ranchers... to protect consumers... and to protect members of the livestock, meat, and poultry industries from unfair, deceptive, unjustly discriminatory and monopolistic practices...."

In 2021, President Biden issued an Executive Order on Promoting Competition in America’s Economy that directed USDA and other agencies to robustly police U.S. markets, including in agriculture, where “consolidation... is making it hard for small family farms to survive.” In January 2022, the Biden-Harris Administration also announced an Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain, and updates on USDA’s on-going efforts are available at our Meat and Poultry Supply Chain page.  In June 2022, USDA announced it’s Framework for Food System Transformation as well featuring a presentation by Secretary Vilsack.

USDA’s work includes investments, regulation, and market research.  Below, USDA outlines some ways that you can assist USDA in understanding developments in the agricultural markets, recommend actions, report a complaint or find grants and programs to promote fair and competitive markets in your town or county.

  • USDA has published the report, “Agricultural Competition: A Plan In Support Of Fair And Competitive Markets” that sets out USDA’s strategies to increase competition through investing in new competitors to address major bottlenecks in the food and agricultural supply chains, in particular meat and poultry processing and domestic fertilizer capacity. It also highlights USDA’s comprehensive efforts to reinvigorate competition and fair market regulation and oversight, and USDA’s efforts to enhance value-added competitive opportunities for producers, including the already-announced top-to-bottom review of the “Product of USA” label for beef and a newly announced review of animal-raising claims, among many other strategies and efforts.

  • The Inclusive Competition and Market Integrity proposed rule would revise regulations under the P&S Act by prohibiting certain prejudices and disadvantages against covered producers in the livestock, meat, and poultry markets. The regulations would identify retaliatory practices that interfere with lawful communications, assertion of rights, and participation in associations, among other protected activities. The regulations would also identify unlawfully deceptive practices that violate the P&S Act with respect to contract formation, contract performance, contract termination and contract refusal. The purpose of the rule is to promote inclusive competition and market integrity in the livestock, meat, and poultry markets. 

    USDA has extended the comment period deadline for this rule by 45 days to Jan. 17, 2023. The department issued the proposed rule in the Federal Register on Oct. 3, 2022. The original deadline for comments was Dec. 2, 2022. All comments submitted will be considered as USDA develops a final rule.   

  • The Agricultural Marketing Service is seeking comments on proposed revisions to the regulations under the Packers and Stockyards Act, 1921 that would revise the list of disclosures and information live poultry dealers must provide to poultry growers and sellers as part of poultry growing arrangements and would establish additional disclosure requirements to determine settlement payments for poultry growers in connection with the use of poultry grower ranking, or tournament, systems by live poultry dealers.  The proposals are intended to promote transparency in poultry production contracting and to give poultry growers and prospective poultry growers relevant information with which to make business decisions.   

  • USDA published the final rule to secure the contract information needed to populate a Cattle Contracts Library in the Federal Register on Dec. 7, 2022. The final rule requires packers who slaughtered an average of not less than five percent of the number of fed cattle slaughtered nationally during the immediately preceding five calendar years to submit contractual information for the purchase of cattle. The final rule goes into effect Jan. 6, 2023.

    The Consolidated Appropriations Act of 2022 directed the USDA’s Agricultural Marketing Service (AMS) to create a Cattle Contracts Library Pilot Program to increase market transparency for cattle producers. The publication of the library will ensure complete reporting of contractual information and volumes purchased against the contracts, including: supplemental information on cattle requirements; associated schedules of premiums and discounts; delivery and transportation terms and payments; appendices and agreements of financing, risk-sharing, or profit sharing; or other financial arrangements associated with such contracts, whenever new contracts are offered, or existing contracts are updated.

    Feedback gleaned from an April 2022 listening session and the months following, including comments related to content, frequency of reporting, and usability, helped the agency develop the pilot library. From this process, AMS developed a working library model which was primarily populated with inactive contracts. The model was presented to a wide range of stakeholders and end users, with a focus on content and usage. AMS expects to have a working library for public consumption in early 2023 with plans to hold an industry briefing session prior to release.

    AMS is continuing to work with the industry to ensure entities required to report understand what type of information is required, and how and when it must be provided, and will engage in producer education through webinars, meetings, and other opportunities.

    All information related to the library pilot is posted on the AMS Cattle Contract Library webpage.

  • USDA is issuing an Advance Notice of Proposed Rulemaking to gather comments and information to help USDA develop policy and future rulemaking proposals regarding the use of poultry grower ranking systems commonly known as tournaments in contract poultry production.  AMS seeks this input in response to numerous complaints from poultry growers about the use of tournament systems.  Comments in response to this request would help AMS tailor further rulemaking in addition to that already planned and under way to address specific industry practices in relation to tournament systems. 

  • If you are a farmer, rancher, or agricultural producer, and have a problem or would like to report a possible violation of the law, please file your complaint at the Farmer Fairness Portal.

  • Building on the Biden-Harris Executive Order’s “Whole-of-Government” approach, USDA is also taking action to ramp up enforcement of the competition laws by challenging the state attorneys general (AG) to partner with USDA on competition issues in the food and agriculture space, using up to $15 million in funds from the Consolidated Appropriations Act (CAA) for a combination of renewable cooperative agreements and memorandums of understanding that will improve state AG capacity to conduct on-the-ground investigations of competition issues, enhance coordination between Federal and state agriculture and competition enforcement authorities, create new and more independent research programs, and ultimately result in more rigorous enforcement of the competition laws.

    View the USDA’s Agricultural Competition Challenge to the State Attorneys General (pdf) 

  • Congress recognized that agricultural input and packing industries in some regions could be the only choices for farmers, and could thereby exercise their market power to increase costs or reduce payment for farmers. In response to farmers’ concerns over a century ago, Congress passed antitrust laws that prohibited monopolization, including by railroad and meatpacker trusts that combined production factories, stockyards, refrigerated rail cars, and other business lines. Recognizing (pdf) that farmers’ coordination of market activities could violate the antitrust laws, Congress through the Capper-Volstead Act permitted a limited antitrust exemption to farmer-owned and democratically elected cooperatives to possess and coordinate production, processing, and distribution activities. If you are interested in starting up or learning more about farmer-owned cooperatives, please see USDA Rural Development’s Cooperative Services webpage.

  • Congress also authorized USDA programs to enhance market competitiveness for U.S. farmers and ranchers, protect domestic food security, and promote the orderly production and distribution of agricultural products. Programs span all business lines in the food supply chain, including breeding new plant varieties that grow optimally in your region, conservation assistance, to grants and loans to build a feed mill. If you are interested in making use of the programs, which include grant funding, loans, and technical assistance, please see USDA’s Local and Regional Food Sector webpage.

  • USDA monitors markets and analyzes for anticompetitive practices that may affect agricultural and food systems. USDA regularly engages with the Department of Justice (DOJ) and the Federal Trade Commission (FTC) and state attorneys general on competition-related matters, and may provide comments on USDA’s behalf to other agencies as well—for example, the Surface Transportation Board in the case of transportation-related competition issues. 

  • As one of several federal agencies authorized by Congress’ laws to protect farmers, ranchers, agricultural producers and the general public from anticompetitive structures and conduct, we take seriously all complaints and enforcement or remediation actions. For more information on problems reported by the public and how we may engage applicable agencies to enforce laws, see the table below. In some cases, state laws and enforcement authorities may be able to help you. Please contact the applicable state agencies for assistance.

    Does your problem have to do with the following?

    Submit a complaint or tip

    Relevant agency

    • Monopolization, attempts to monopolize, or combinations or conspiracies to monopolize
    • Acquisitions that may lessen competition or tend to create a monopoly
    • Anticompetitive practices
    • Unfair, unjustly discriminatory, and deceptive practices
    • Market manipulation

    For more information on the above examples, please see web pages from USDA, DOJ, and FTC.

    usda.gov/farmerfairness

    DOJ, FTC, USDA

    • Commodity trading
    • Futures trading
    cftc.gov/complaint Commodity Futures Trading Commission (CFTC)
    • Credit score
    • Loans, debt collection, fees
    • Fair lending
    consumerfinance.gov/complaint Consumer Financial Protection Bureau (CFPB)
    • Data collection, privacy, and security
    • Identify theft, fraud, scams, bad business practices
    • Repair restrictions
    ReportFraud.ftc.gov FTC
    • Environmental violations
    epa.gov/report-violation Environmental Protection Agency (EPA)