Sec. 2. Cattle contract library
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Title II of the Packers and Stockyards Act, 1921, is amended by inserting after section 223 ( 7 U.S.C. 198b ) the following: In this subtitle: The term base price means the price paid for cattle delivered to a packer, before application of any premiums or discounts, expressed in dollars per hundred pounds of carcass weight. Subject to subparagraph (B), the term contract means any agreement, written or oral, between a packer and a producer for the purchase of fed cattle for slaughter.
The term contract does not include a contract for a negotiated purchase. The term fed cattle means a steer or heifer that has been finished on a ration of roughage and feed concentrates, such as grains, protein meal, grass (forage), and other nutrient-rich feeds, prior to slaughter. The term formula marketing arrangement means the advance commitment of cattle for slaughter— by any means other than through a negotiated purchase, negotiated grid purchase, or forward contract; and using a method for calculating price— under which the price is determined at a future date; the basis of which is a price established for a specified market, which may be based on any publicly reported price, including plant average price, regional price, downstream price, or some other mutually agreeable price source; and that may include a grid or nongrid price.
The term forward contract means— an agreement for the purchase of fed cattle, executed in advance of slaughter, under which the base price is established by reference to— prices quoted on the Chicago Mercantile Exchange; or other comparable publicly available prices; or any other contract for the purchase of fed cattle, executed in advance of slaughter, as determined by the Secretary. The term heifer means a bovine female that has not given birth to a calf. The term negotiated grid purchase means a purchase of fed cattle by a packer from a producer under which— the buyer-seller interaction results in a negotiated base price, which may be adjusted by premiums and discounts; and the cattle are scheduled for delivery to the packer not more than 14 days after the date on which the agreement for purchase is made.
The term negotiated purchase means a purchase of fed cattle (commonly known as a cash or spot market purchase) by a packer from a producer under which— the buyer-seller interaction that results in the purchase and the agreement on the actual base price for the purchase occur on the same day; and the cattle are scheduled for delivery to the packer not more than 30 days after the date on which the agreement for purchase is made. The term packer , with respect to a contract, means a packer that slaughters cattle at 1 or more federally inspected processing plants, each of which— slaughters an average of not less than 125,000 head of cattle per year during the 5 calendar years immediately preceding the date on which the contract is executed; or has not slaughtered cattle during those immediately preceding 5 calendar years but has the capacity to slaughter not less than 125,000 head of cattle per year, as determined by the Secretary.
The term producer means a person engaged, directly or through an intermediary, in the business of selling cattle to a packer for slaughter. The term steer means a bovine male castrated before reaching sexual maturity. The term type of contract means the classification of a contract for the purchase of cattle— into 1 of the categories described in subparagraph (B); and by determining the base price of the cattle. The categories for classification of a type of contract are the following:
Formula marketing arrangement. Forward contract. Negotiated grid purchase contract. Subject to the availability of appropriations to carry out this section, the Secretary shall establish and maintain a library or catalog of each type of contract offered by packers to producers for the purchase of all or part of the production of the producers of fed cattle (including cattle that are purchased or committed for delivery), including any schedules of premiums or discounts associated with the contract.
To maintain the library or catalog established under subsection (a), the Secretary shall obtain information from each packer on each type of existing contract of the packer by requiring a filing or other form of information submission from each packer. Information that shall be submitted to the Secretary by a packer under paragraph
(1)shall include, with respect to each existing contract of a packer— the type of contract; and a description of the provisions in the contract that provide for expansion in the numbers of fed cattle to be delivered under the contract for the 6-month and 12-month periods following the date of the contract. The Secretary shall make available to producers and other interested persons information on the types of contracts in the library or catalog established under subsection (a), including notice (on a real-time basis, if practicable) of the types of contracts that are being offered by packers to, and are open to acceptance by, producers for the purchase of fed cattle. Beginning 30 days after the library or catalog is established under subsection (a), the Secretary shall make the information obtained each month in the library or catalog available in a monthly report to producers and other interested persons. The monthly report described in subparagraph
(A)shall include— an estimate by the Secretary of the total number of fed cattle committed under contracts for delivery to packers within the 6-month and 12-month periods following the date of the report, organized by reporting region and type of contract; and an estimate by the Secretary of the total maximum number of fed cattle that may be delivered within the 6-month and 12-month periods following the date of the report, based on the provisions described in subsection (c)(2)(B) in existing contracts, organized by reporting region and type of contract. Information in the library or catalog established under subsection
(a)about types of contracts that are no longer offered or in use shall be removed from the library or catalog. The reporting requirements for packers under this section shall be subject to the confidentiality protections provided under section 251 of the Agricultural Marketing Act of 1946 ( 7 U.S.C. 1636 ). It shall be unlawful and a violation of this Act for any packer to willfully fail or refuse— to provide to the Secretary accurate information required under this section; or to comply with any other requirement of this section. There are authorized to be appropriated to the Secretary such sums as are necessary to carry out this section. .
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