Bill aims to regulate poultry contracts

Associate Editor

ANNAPOLIS, Md. (March 8, 2016) — Poultry industry representatives and supporters heavily criticized last week a bill that seeks to regulate contracts between growers and integrators, calling the legislation just another example of the environmental lobby’s extensive effort to pinch poultry production on the Eastern Shore.
“Why shouldn’t I view this as one more assault in a long list of assaults on the poultry industry in the state of Maryland?” said Del. Anthony J. O’Donnell, R-Calvert. “Because it feels like it, and when it feels like a chicken and squawks like a chicken and flaps its legs like a chicken, it’s probably a chicken.”
O’Donnell was one of several delegates, farmers and poultry industry reps to testify in a hearing on a bill, known as the Farmers’ Rights Act, in the House Environment & Transportation Committee on March 2.
The bill seeks to expand rights for growers, including protections against retaliation from poultry integrators, and it regulates when and how production contracts can be terminated.
Bill supporters — including the bill’s sponsor, Del. Mary L. Washington, D-Baltimore — said the relationship between integrators and growers is sometimes abusive with poultry companies arbitrarily terminating contracts and changing flock delivery schedules and retaliating against growers who publicly criticize them. A grower with four chicken houses, for instance, would have about $1.2 million in debt with annual payments of $140,000 over 15 years — supported typically by only a five-year contract, said Patrick Woodall, research director at Food & Water Watch, a national food and water quality advocacy organization.
“Because there are few firms, there is tremendous leverage these (companies) have against (growers), and farmers are often forced into take-it-or-leave-it contracts,” Washington said.
Mike Weaver, a West Virginia poultry farmer and president of a contract growers association in Virginia, said integrators can retaliate by giving growers poor chicks and feed, which makes them perform worse in the tournament system.
They make less money, and the money they don’t make, he said, goes to neighboring growers.
“It’s a rob-Peter-to-pay-Paul system,” he said.
But industry officials, including Maryland Farm Bureau Executive Director Valerie Connelly, said there are no calls from Shore farmers to create legislation like the Farmers’ Rights Act. At the Farm Bureau, Connelly said farmers can anonymously voice complaints through the bureau’s policy development process, and they often do.
“Our members have said to us that they do not see a need for this bill, and they hope the committee will reject it,” she said.
Contracts between farmers and integrators are already regulated by the USDA’s Grain Inspection, Packers and Stockyards Administration, said Bill Satterfield, executive director of the Delmarva Poultry Industry Inc. Washington’s bill would eliminate the competitive pay system and remove incentives for farmers to do a better job, he said, while creating another layer of regulation against the poultry industry.
Bobbi Reed, a Greensboro, Md., poultry farmer, said integrators aren’t her problem.
“Funny, I wasn’t aware I needed protection from my business partner,” she said. “I do, however, need some from these government regulations that keep popping up.”
But whistleblowers and growers upset with their integrators do exist, said Amanda Hitt, who oversees the Food Integrity Campaign at the Government Accountability Project, a national organization dedicated to whistleblower protection.
“The decision not to come forward should not suggest that there isn’t a problem. It is often quite the opposite,” she said.
But industry officials and supporters said they believed farmers were savvy enough to understand the contracts they sign and wouldn’t get into such a debt-heavy business that would mistreat them.
“I feel a great contempt for the intelligence of my farmers in your line of testimony,” said Del. Charles J. Otto, R-Somerset, another committee member. “Isn’t that what you’re saying here? That my poor, ignorant farmers don’t know what business they can enter into?”
Washington and Woodall said the bill merely intends to protect growers who find themselves mistreated and want to speak out. Washington started her testimony by saying her grandparents were farmers. She said she was not discrediting farmers.
“I don’t disparage the food deserts of Baltimore City either, thank you,” Otto said.