The Campaign for Contract Agriculture Reform is a national alliance of organizations working to provide a voice for farmers and ranchers involved in contract agriculture, as well as the communities in which they live. The goal of the campaign is to assure that the processor-producer relationship serves as a fair partnership, rather than a dictatorship.
According to the 2012 USDA Census of Agriculture, 43% of hogs and 96% of chickens in the US were grown under production contracts where the farmer never owns the animal. The Census data also shows that over $56.7 billion of products are produced under production contracts. While contract agriculture reform has been heavily focused on the poultry industry, the model that was pioneered in poultry is being exported to many other areas of agricultural production.
Unfortunately, these agricultural production contracts are developed in an environment in which the corporate processors, handlers, packers or buyers have monopoly-like market power and farmers have almost no legal protection. According to a 2014 USDA report, the top four poultry companies control 56 percent of all chickens raised, and a producer who is located in an area where there is only one company receives 8% less income than a producer in an area where there are four companies.
The result is a growing imbalance in market power between the family farmer and agribusiness corporations, which is depressing farm income and threatening the economic viability and environmental health of our rural communities. Fairness in contracts is impossible when individual producers have no power to negotiate terms or to protect themselves against fraud, retaliation or discrimination.
What CCAR Works on Now:
Finalize and Enforce the GIPSA Rules – Protections for Poultry and Livestock Farmers
The USDA is responsible for implementing and enforcing farmer protections within the poultry industry under the Grain Inspectors Packers and Stockyards Administration, or GIPSA.
To do this, USDA has drafted rules, which were put up for public comment in 2010. Thousands of farmers, consumers, and organizations all over the country submitted their comments.
But for the past four years, Congress has blocked the USDA’s action by inserting a “rider” in the federal appropriations budget that effectively prevented the USDA from protecting farmers.
In 2015, frustrated farmers and consumers came together and told their representatives to remove the “GIPSA rider.” The USDA now has the green light to follow through on their commitment.
The rules included:
- Prohibiting companies from retaliating against farmers for speaking against abusive contracting practices or for joining together in producer associations,
- Requiring companies to give farmers information about how their pay is calculated, if they ask for that information,
- Prohibiting companies from using contracts to block farmers’ legal rights to a jury trial; and,
- Clarifying that the law does NOT require farmers to prove “competitive injury” to the entire industry when they file a complaint or take legal action to prove that they have been personally harmed by an abusive practice by their poultry company.