Siding with farm activists, President Biden said “Big Ag is putting a squeeze on farmers” and signed an executive order telling the USDA to rejuvenate the livestock, seed, fertilizer and retail food markets. The executive order on competition, reaching from the FDA to the Pentagon, called on the FTC to enact right-to-repair rules so farmers can fix their own tractors.
Biden said the order on competition was part of his drive for long-term economic growth after the pandemic recession. “What we’ve seen over the past few decades is less competition and more concentration that holds our economy back,” he said on Friday. “So we know we’ve got a problem – a major problem. But we also have an incredible opportunity. We can bring back more competition to more of the country.”
The USDA will be responsible for one-fifth of the 72 specific points for action in the executive order. Some were already under consideration; for example, fair-play rules that give producers more leverage in dealing with meat processors and a rule that may limit Product of USA labels to meat from animals that were raised in the United States. At present, it includes meat processed at U.S. plants, even if the animal was raised abroad.
Other recommendations call for more transparency in livestock prices; steps to “bolster competition within highly concentrated agricultural markets;” a study with the FTC on “the effect of retail concentration and retailers’ practices on the conditions of competition in the food industries” with an eye to helping farmers and small producers reach consumers; and a report to the White House on any needed stops, such as changes in law, “to ensure that the intellectual property system, while incentivizing innovation, does not also unnecessarily reduce competition in the seed and other input markets beyond that reasonably contemplated by the Patent Act.”
Just as four companies dominate the meatpacking industry, a small number of companies are the major producers of farm equipment, seeds, fertilizers and pesticides.
“It’s no coincidence that this has coincided with a slew of problems for farmers: Low prices, little bargaining power, few choices, misleading labels, and the inability to repair their own equipment, among other headaches,” said the National Farmers Union, which said the executive order would level the playing field. The American Farm Bureau Federation said farmers rely on increasing high tech equipment, from robotic milkers to high-tech combines. “Ensuring farmers have the ability to perform cost-effective repairs on their own equipment will keep America’s farms running and financially sustainable.”
The meat industry, which objected to Obama-era proposals to rewrite livestock marketing rules, said “government intervention in the market will increase the cost of food for consumers.” Farm equipment makers block changes to the software that controls tractors on that grounds that it prevents damage to the machinery. Less than 2 percent of tractor repairs require a software update, Deere told Reuters.
“This is a big day for the right to repair our stuff,” said consumer group U.S. PIRG. “More choices help save money and cut down-time waiting for the manufacturer’s technician, which is especially important for farmers on tight planting or harvesting schedules.” The New York state Senate passed a right-to-repair bill, 51-12, covering agricultural equipment and consumer technology a month ago; the first successful vote at the state level. Right-to-repair bills were filed in 27 state legislatures this year and a right-to-repair bill was filed in the U.S. House.
Agriculture Secretary Tom Vilsack announced “a minimum of $500 million” in USDA grants, loans and technical assistance was available to expand meat and poultry processing capacity. The money was part of $4 billion the administration earmarked a month ago to strengthen the U.S. food system.
“I believe it (the $500 million) is going to leverage literally billions of dollars in investment from investors and state and local governments,” Vilsack said at a meat locker plant in Council Bluffs, Iowa. “It’s going to create a more competitive market.”
Vilsack announced the initiative after visiting the site of a planned $325 million cattle slaughter plant near Council Bluffs and a tour of the combination butcher shop and meat storage plant. The announcement was timed to coincide with Biden’s signature of the executive order.
The National Cattlemen’s Beef Association applauded administration action “on some of the top issues impacting our producers, including Product of the USA labeling and grants to expand regional, independent processing capacity.” The National Pork Producers Council, with members from all parts of the pork industry, said it “supports expanding the number of pork harvest facilities as long as they operate under federal inspection standards.”
A White House fact sheet on the executive order is available here.
Biden’s remarks on the executive order are available here.
The text of the executive order is available here.
A video of Vilsack’s news conference in Council Bluffs is available here.