Study: USDA rule could cost U.S. Broiler Industry $1 Billion

November 25, 2010 – The livestock marketing rule proposed by USDA’s Grain Inspection,
Packers and Stockyards Administration (GIPSA) will cost the U.S. broiler
chicken industry more than $1 billion over five years in reduced
efficiency, higher costs for feed and housing and increased
administrative expenses, according to a study released by the
National Chicken Council.

November 25, 2010 – The livestock marketing rule proposed by USDA’s Grain Inspection,
Packers and Stockyards Administration (GIPSA) will cost the U.S. broiler
chicken industry more than $1 billion over five years in reduced
efficiency, higher costs for feed and housing and increased
administrative expenses, according to a study released by the
National Chicken Council.

This estimate does not include potential costs of litigation, lost
export sales and increased consumer prices, according to the study by
FarmEcon LLC, an agricultural economics consulting firm. 

“This study confirms what AMI’s economic impact analysis concluded
recently: that this rule’s impact would be significant and that
USDA erred in concluding that its impact was below the $100 million
threshold that triggers additional government economic impact
assessments,” said AMI Senior Vice President of Regulatory Affairs and
General Counsel Mark D. Dopp.  “Couple the studies’ findings with
the recent letter from 115 members of the U.S. House who noted the
absence of a thorough economic analysis and asked Agriculture
Secretary Tom Vilsack to conduct such a study and it seems to me that
the Department’s marching orders are clear.” 

The cost burden from all identified sources increases over time,
Elam wrote, reaching about $337 million per year in 2015.  The
total identified cost over the first five years is about $1.03
billion.  

To view the FarmEcon study, click here: http://www.meatami.com/ht/a/GetDocumentAction/i/64286