To Help the Little Guy, the Government Proposes New Rules for Big Meatpackers

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By WILLIAM NEUMAN, New York Times

The Obama administration proposed new rules on Friday seeking to increase competition and rein in potentially unfair practices by large meatpackers and poultry processors. The move is aimed at helping small livestock and poultry farmers survive in an industry dominated by corporate giants.

The rules could give farmers and ranchers new leverage in suing meat companies that they believe have treated them unfairly. They would end practices among cattle and hog buyers that may lower prices paid to farmers and feedlot owners. And they would set new protections for poultry farmers, who often must go deeply into debt to build the chicken houses needed to win contracts from processors.

“As this market has become more consolidated and vertically integrated for efficiency’s sake it lends itself to unfair practices and practices that are not particularly transparent,” the agriculture secretary, Tom Vilsack, said in an interview.

The goal, he said, is to promote “a fair and more transparent relationship between the folks on the farm and the businesses that are packing and processing what’s raised on the farm.”

Mr. Vilsack said the rules could increase the payments farmers receive for their livestock or poultry, but added that those higher costs would not necessarily be passed on to consumers, who might benefit from increased competition.

The regulatory move comes as the Agriculture and Justice Departments have been holding a series of public workshops to discuss allegations of anticompetitive behavior in agriculture.

The rules apply largely to how the Agriculture Department enforces the Packers and Stockyards Act, a 1921 law governing the livestock and poultry industry. The U.S.D.A. will evaluate public comment before issuing a final set of rules, which could take many months.

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