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USDA launched its pilot Cattle Contracts Library Jan. 31.
March 8, 2023
On Jan. 31, USDA launched the pilot Cattle Contracts Library, as directed by the Consolidated Appropriations Act of 2022. The goal — provide increased market transparency for cattle producers around the contract portion of the cattle market.
Getting to this working pilot library, though, wasn’t as easy as it sounds. Brittany Koop, Livestock Mandatory Reporting Compliance Program manager, explained the steps it took.
Cattle producers are used to looking up cattle markets that the USDA Agricultural Marketing Service provides online. USDA AMS has market coverage along every segment of the cattle life cycle, Koop explained. Typically, market news reporters collected data at auction barns and at retail outlets, and from livestock mandatory reporting by processors. Data collection methodology and accuracy are the key to everything that USDA AMS does.
In the case of livestock mandatory reporting, packers that meet a certain threshold are required to report their livestock purchases and meat sales daily, Koop said. USDA AMS has a log file that shows how many lines of data are processed in a day from these mandatory reports. In just one day, she said, that log showed 58,000 lines of data, each one with a lot of individual data points that must be reviewed by market reporters. There are also compliance auditors who will audit packers — reviewing kill sheets, scale sheets, payment checks, invoices and more, to ensure that the data collected are verified.
It’s no simple task to roll out another market report product, and even more so when you’re dealing with sales contracts that are unique between sellers and buyers. An auction report is simple — report the final price at the last hammer of the gavel. But a cattle contract can have multiple different elements that trigger price premiums and discounts, and that’s much more complicated to report.
The pilot Cattle Contracts Library looked to the 20-year Swine Contract Library for some guidance. Market News also held a listening session with cattle stakeholders to get their input on what information they needed to increase market transparency and support competition.
A team of market reporters also had access to 300 old, inactive cattle contracts to see what elements were common to each, to get an idea of the data points that could and should be collected. All of this is to not only provide that transparency, but also ensure confidentiality of the parties reporting, Koop said.
Those data points included:
How was the base price established for the contract?
Were there any base price adjustments prior to premium discount applied? And how were those applied?
Were there any premiums and discounts applied to the base price?
What specifications are included in the contract for quality, yield, breed, weight, delivery, financing, profit or risk-sharing and more?
To collect these data points, packers don’t have to submit actual contracts; rather they fill out a form asking for the data points on those contracts. Then, those data points are compiled into a format that ensures confidentiality. The plan is to publish once a week on Mondays.
According to the USDA, the Cattle Contracts Library will soon also share the number of cattle moving through current contracts by contract base price source — both the actual numbers from the previous month and the estimates for the current month.
For more information, or to see a demonstration, visit the online recording of the Feb. 8 listening session USDA conducted.
Editor, Kansas Farmer
Through all her travels, Jennifer M. Latzke knows that there is no place like Kansas.
Jennifer grew up on her family’s multigenerational registered Angus seedstock ranch and diversified farm just north of Woodbine, Kan., about 30 minutes south of Junction City on the edge of the Kansas Flint Hills. Rock Springs Ranch State 4-H Center was in her family’s backyard.
While at Kansas State University, Jennifer was a member of the Sigma Kappa Sorority and a national officer for the Agricultural Communicators of Tomorrow. She graduated in May 2000 with a bachelor’s degree in agricultural communications and a minor in animal science. In August 2000 Jennifer started her 20-year agricultural writing career in Dodge City, Kan., on the far southwest corner of the state.
She’s traveled across the U.S. writing on wheat, sorghum, corn, cotton, dairy and beef stories as well as breaking news and policy at the local, state and national levels. Latzke has traveled across Mexico and South America with the U.S. Wheat Associates and toured Vietnam as a member of KARL Class X. She’s traveled to Argentina as one of 10 IFAJ-Alltech Young Leaders in Agricultural Journalism. And she was part of a delegation of AAEA: The Ag Communicators Network members invited to Cuba.
Jennifer’s an award-winning writer, columnist, and podcaster, recognized by the Kansas Professional Communicators, Kansas Press Association, the National Federation of Presswomen, Livestock Publications Council, and AAEA. In 2019, Jennifer reached the pinnacle of achievements, earning the title of “Writer of Merit” from AAEA.
Trips and accolades are lovely, but Jennifer says she is happiest on the road talking to farmers and ranchers and gathering stories and photos to share with readers.
“It’s an honor and a great responsibility to be able to tell someone’s story and bring them recognition for their work on the land,” Jennifer says. “But my role is also evolving to help our more urban neighbors understand the issues our Kansas farmers face in bringing the food and fiber to their store shelves.”
She spends her time gardening, crafting, watching K-State football, and cheering on her nephews and niece in their 4-H projects. She can be found on Twitter at @Latzke.
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