HCS HB 4 -- LIVESTOCK MARKETING

SPONSOR:  Liese (Shoemyer)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Price
Discrimination by a vote of 9 to 2.

This substitute repeals the right of sellers of livestock who
are discriminated against by packers to receive treble damages,
costs, and reasonable attorney fees. It also repeals the right
of any person injured by a violation of the livestock marketing
law to bring suit under Chapter 407, RSMo.

Provisions requiring a packer purchasing livestock for slaughter
not to discriminate in prices paid to sellers of that livestock
are replaced with provisions that make it unlawful for a packer
to:

(1)  Engage in any unfair, unjustly discriminatory, or deceptive
practice;

(2)  Give any undue or unreasonable preference or advantage to
any person or location in any respect whatsoever;

(3)  Sell or transfer to, for, or from any other packer with the
effect of apportioning the supply between the packers,
restraining trade, or creating a monopoly;

(4)  Sell or transfer any article with the effect of
manipulating or controlling prices;

(5)  Engage in any business practice for the purpose of
manipulating or controlling prices, creating a monopoly, or
restraining commerce; or

(6)  Conspire with any other person to apportion territory for
carrying on business, apportion purchases, or control prices.

Packers purchasing livestock in Missouri for slaughter are to
enter into a written contract with the seller.  The contract
form is to be approved by the Department of Agriculture in
conjunction with the office of the Attorney General.  A packer
is to provide a copy of a written contract to the Attorney
General within one week of the Attorney General's request.

Any seller of livestock who believes that he or she has been
injured by a violation of the provisions of the substitute may
refer his or her complaint to the Attorney General for
investigation.

The provisions of the substitute are to be enforced by the
Attorney General in a manner consistent with the purposes and
intent of the Packers and Stockyards Act (7 U.S.C.A. section 9).

The current expiration date of December 31, 2002, is extended to
December 31, 2006.

The substitute has an emergency clause.

FISCAL NOTE:  Total Cost to General Revenue Fund of $0 to
$61,702 in FY 2002, $0 to $87,040 in FY 2003, and $0 to $89,303
in FY 2004.

PROPONENTS:  Supporters say that the price discrimination law,
while well intended, has had the effect of eliminating "cash
sales," thereby, limiting the seller to "grade and yield
sales."  Grade and yield sales create uncertainty as to the
actual sale price and delayed payment to the producer.  Missouri
producers are forced to sell their animals at a competitive
disadvantage as opposed to producers in other states.

Testifying for the bill were Representative Shoemyer;
Representative Merideth, Rural Democratic Caucus; Representative
Legan, House Republicans; Winston Simpson; Brent Sandidge,
Missouri Pork Producers; Dennis Germann, Missouri Cattlemen's
Association, Missouri Farm Bureau, Citizen; John Perm, Hampton
Feedlot; Stan Falke; Kenneth Mavsey, Mavsey Soil, Inc; Dan
Dedrick, Chillicothe Livestock Market, Inc.; Kult Hamilton,
Missouri Livestock Marketing Association; Arlen Schwinke,
Missouri Dairy Association; Therese Sander; W. D. Richards;
James Daniels; George Perry, Missouri Cattlemen's Association;
Wayne Seider, Missouri Cattlemen's Association; Glenn Cox;
Richard Fordyce; Paul Thomas; Charles Jones; Bryan Cox; Ron
Hardecke, Missouri Farm Bureau; Joe Kagay; Missouri Department
of Agriculture; Stephen Gastler; David Welschmeyer; Ralph
Glosemeyer; Mike Scherer; Kim Rickets; Randy Britt; Boyd Arthur,
Camelot Farms; Dan Dedrick, Chillicothe Livestock Market, Inc.;
Ralph Hardecke; Rhett Hunziker; Steve Hobbs; Charles Jones; Tom
and Janet Mershon; Charles Shouu; Elza Winter, Winter Farms;
Denis Stuart; Mike Dethron; Ron Plain, Missouri Farm Bureau;
Bruce Bullock, Missouri Agricultural Industries; Gary Mahnken,
Missouri Cattlemen's Association; and Robert Mouuow, Missouri
Bankers Association.

OPPONENTS:  Those who oppose the bill say that the price
discrimination law has been in effect for 3 months and should be
allowed to remain as is.  New cattle buyers are showing up at
markets to take the place of those intentionally misinterpreting
the law.  Other states need time to enact similar legislation,
thereby eliminating any perceived disadvantage to Missouri
producers.

Testifying against the bill were Michael Stume, Organization for
Competitive Markets; Keith Mudd, Organization for Competitive
Markets; Barbra Ross, Catholic Rural Life, Diocese of Jefferson
City; Rev. S. W. Barret, Catholic Rural Life, Diocese of
Springfield and Cape Girardeau; Lowell Schocktsiek; Jim Foster;
David Kitsenbury, Missouri Farm Union; Jay McCullie; Lew
Shorburg; and Robert Thornsberry, Missouri Stock Growers
Association.

Roland Tackett, Legislative Analyst

Missouri House of Representatives
Last Updated October 19, 2001 at 4:30 pm