RESTON, Va. – On Feb. 7, the US Department of Agriculture’s Grain Inspection, Packers & Stockyards Administration’s (GIPSA) final rule involving contracts for poultry and swine went into effect, relays the Feb. 10 edition of the National Chicken Council’s Washington Report. Implementing parts of the 2008 Farm Bill, the rule was proposed in June 2010 with the final rule issued in December 2011. The new rule applies to production contracts and arrangements entered into, amended, altered, modified, renewed or extended after Feb. 7, 2012.

Regarding poultry, the rule includes provisions affecting suspending delivery of birds, additional capital investment criteria, breach of contract between grower and dealer plus arbitration. However, the rule does not address other issues the proposed rule would have covered, such as tournament systems, competitive injury or undue or unreasonable preferences or advantages. The rule applies to all live poultry dealers for all types of live production in addition to meat-type chickens, such as broilers, pullets, breeders and laying hens.

NCC relays the final rule has improved much since it did not include the most objectionable provisions as a result of congressional action, but ambiguous provisions potentially subject to misinterpretation or application still remain. As a result, NCC submitted a letter to GIPSA identifying and requesting clarifying these provisions.