Mandatory price reporting allows for transparency in the marketplace without unnecessary government intrusion and privacy invasion, Woodall said.
"Along with transparency, mandatory price reporting encourages competition in the marketplace without violating producers’ privacy by substantially increasing the volume of industry sales transactions reported by the U.S. Department of Agriculture [U.S.D.A.],” he added. “This mandatory reporting provides U.S. producers with readily understandable and timely information regarding pricing, contracting for purchase, and supply and demand conditions for all segments of the beef industry.”
The Mandatory Price Reporting Act of 2010 will reauthorize mandatory price reporting programs run by U.S.D.A. for five years. The act requires livestock sales information to be reported and published in a timely fashion, allowing buyers and sellers to make more informed decisions.
“Producers have come to rely on the information provided by mandatory price reporting to aid in their negotiation of sales prices for cattle and meat products,” Woodall said.
Prior to 2001, information was collected by observing public auction markets and via voluntary submission by market participants. However, by 1999 many producers had come to notice fundamental changes in the market structure.
Approximately 35% of fed cattle sales in 1999 occurred via contract agreements that were not covered by U.S.D.A. reports. Bruce Hafenfeld, California cattle producer and N.C.B.A.’s policy division chair, said these unreported transactions hampered producers' ability to accurately assess livestock prices, negotiate with packers or obtain a fair price when selling their livestock. Requiring price reporting augments producers’ knowledge base when making marketing decisions by providing them with pricing and sales information from transactions around the country, he added.
“By reauthorizing mandatory price reporting, cattle producers will continue to have access to daily price and volume information on purchases of cattle and boxed beef sales as well as export and import data. This effort to enhance transparency in the marketplace is a definite win for every aspect of the industry,” Hafenfeld concluded.