Livestock Mandatory Price Reporting

NPPC’s Position

NPPC supports the reauthorization of the Livestock Mandatory Reporting Act (LMR) with industry-supported changes that enhance price discovery before it expires on Sept. 30, 2022.

  • Because timely and accurate information is important for a competitive market to function effectively, an amendment to LMR that NPPC supports is making the United States Department of Agriculture (USDA) LMR program administrators “essential” in a government shutdown.
  • It would also require new meatpackers to begin LMR reporting within six months of starting operations. 
  • Requiring price discounts in addition to premiums – and wholesale cuts to be reported. 

NPPC opposes legislation or regulations that restrict marketing opportunities and interventions in hog markets unless such actions address a clear, unequivocal instance of market failure or abuse of market power.

Background

The Livestock Mandatory Reporting (LMR) Act of 1999 established a program that requires meatpackers to report to USDA the prices they pay for cattle, hogs, lambs, and other information. USDA uses the data to publish twice-daily reports with pricing information, contracting for purchase, supply and demand conditions for livestock, livestock production, and livestock product values.

LMR is important to producers because the number of hogs sold under marketing contracts continues to increase while the number sold on the spot market – currently less than 3% – is declining. The spot market had been used to set hog prices, but the small number of sales does not allow for the most accurate information.

The statute, which last received a five-year reauthorization on Sept. 30, 2015, then got a series of short-term extensions, was authorized through fiscal 2022 in an omnibus spending bill approved by Congress in March 2022.

Fast Facts

Pork producers

need a transparent, accurate and timely national market reporting system to make knowledgeable business decisions about selling their hogs.

Mandatory Price Reporting

offers market information on pricing, contracting for purchase and supply-and-demand conditions for hogs, all of which enhance market transparency.

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