Farm Bureau delegates from Iowa successfully added policy to advocate for more negotiated sales and market transparency in livestock markets during last week’s 2021 American Farm Bureau Federation (AFBF) annual policy session.
The AFBF delegates participating in the virtual policy session also backed several other key Iowa Farm Bureau priorities, including:
• A push for utilizing higher blends of biofuels and the adoption of uniform nationwide labeling for ethanol and biodiesel at service stations.
• The creation of a harvest price option for farmers forced by adverse weather to take the federal crop insurance program’s prevent planting option.
“We are fighting a lot of price discovery issues in the beef industry now, so we need to find ways to have more price transparency,” said Ben Albright, a Calhoun County Farm Bureau member who was one of nine Iowa delegates participating in the AFBF policy session. “We believe in free markets, but the packers seem to be operating in markets that are far from free.”
Cattle marketing issues were a major focus for Iowa Farm Bureau voting delegates at the Iowa Farm Bureau (IFBF) Summer Policy Conference in September.
Record price spreads
Packing plant shutdowns caused by a fire at a Kansas packing plant in 2019 and the COVID-19 pandemic in 2020 led to record price spreads between live cattle prices and retail beef prices over the past 18 months.
Many independent Iowa cattle feeders said the disruptions made it difficult to market cattle in a timely fashion because major meat packers often gave preference to livestock raised under contracts.
The AFBF delegates adopted policy that called for increasing the share of negotiated sales in fed cattle markets with a focus on increased price transparency. AFBF’s new policy also states that any governmental effort to increase the amount of negotiated livestock sales should be respectful of regional differences and that any government marketing requirements be regularly reviewed.
Iowa grassroots effort
The grassroots effort of Iowa Farm Bureau delegates was a big factor in the AFBF’s adoption of the livestock marketing policy, said Craig Hill, IFBF president.
“Iowa had a big hand in merging the interests of the cattle industry from various parts of the country into one concise amendment that can help lead to remedies,” Hill said.
The more than 300 AFBF delegates also adopted Iowa’s recommendation that the national organization study regional mandatory minimum cash trade in cattle markets and determine what levels are needed to achieve robust price discovery.
“We know there are regional differences, and we need to know what they look like as we pursue more open market trading and price discovery,” said Albright, who offered the market study motion.
Higher biofuel blends
Iowa delegates at AFBF policy session also backed policy to set the stage for increased sales of higher blends of ethanol and biodiesel.
Those higher levels, Hill said, will be critical to expand biofuel demand as Congress works to reauthorize the Renewable Fuel Standard in 2022.
The creation of the harvest price option for prevent plant will aid farmers' ability to use the risk management tools in the federal crop insurance program even if they are prevented from growing a crop, Hill said.
“With the volatile markets that we have today, we want to able to have the confidence in our ability to use forward pricing for the risk management," he said.
Debating, voting virtually
Farm Bureau members debated and voted on policy virtually from their home states because of the COVID-19 pandemic.
“Our Farm Bureau delegates showed that no challenge, not even a pandemic, will keep them from working to improve the lives of America’s farmers and ranchers,” said AFBF President Zippy Duvall following the Jan. 14 session.
“Their work not only sets policy for 2021, it will also serve as a guide for AFBF as we prepare to work with a new president and a new Congress to ensure we continue to lead the world in producing healthy and safe food, fiber and fuel.”
Hill applauded the Iowa delegates and the IFBF staff for working with the technology required to develop policy remotely. “We were able to participate in a way that was both safe and very productive,” he said.