Congress set to cut money for meat industry reform (AP)

ST. LOUIS ? The U.S. Department of Agriculture said Tuesday it will abandon portions of a sweeping antitrust rule proposed for meat companies if Congress does not provide money for enforcement.

The USDA proposed the reforms in response to an order in the 2008 farm bill that it beef up its antitrust rules. But it went much further than Congress had asked.

Congress is scheduled to vote this week on an agricultural spending bill that would prevent the USDA from enforcing parts of the new rule governing how chicken companies pay their farmers, USDA spokeswoman Courtney Lowe said. The bill also strips funding for a reform making it easier for farmers to sue companies for antitrust violations.

Lowe told The Associated Press that if the bill passes, the USDA will abandon those reforms.

The meat industry has been lobbying heavily against the overhaul proposed last June. The companies claim the new regulations would hinder their operations and raise meat prices.

But many small farmers say the changes would give them more bargaining power when selling their animals.

The antitrust overhaul has been a cornerstone of the Obama administration's efforts to curb the power of the nation's biggest meat companies. A key part of the rule would have made it easier for farmers to sue meat companies under a 1921 law called the Packers and Stockyards Act.

Farmers must currently prove that a meat company has harmed competition in the entire meat industry to win a case under the law. The new rule would have lowered that bar, requiring only that farmers prove a company's actions harmed them personally. Meat companies and their lobbyists said the provision would have opened the door to a flood of unwarranted lawsuits.

Congress also barred the USDA from changing the so-called "tournament system" that chicken companies use to pay their farmers. Companies like Tyson Foods rank chicken farmers against each other based on how efficiently they can raise birds using the feed that Tyson provides them. The companies penalize less efficient farmers by paying them less money.

The USDA rule would have banned that practice by forcing companies to offer a base price for chickens with incentives for better performers.

Money for enforcement of those changes was cut from the final version of a spending bill for farming programs passed late Monday by a joint committee.

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Source: http://us.rd.yahoo.com/dailynews/rss/obama/*http%3A//news.yahoo.com/s/ap/20111115/ap_on_re_us/us_agriculture_antitrust

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