Acknowledging that their ability to protect America's chicken farmers is weak, U.S. Department of Agriculture officials asked a congressional panel yesterday to give them new authority and money to improve investigations of the business tactics of the nation's powerful poultry companies.
In a budget hearing before an agricultural subcommittee of the House Appropriations Committee, the officials said they had been largely hamstrung by laws and low manpower in probing the increasingly concentrated industry, in which five large companies account for half the nation's poultry production.
Citing a three-part series in The Sun this week that outlined the modern chicken farmer's plight, Michael V. Dunn, USDA's undersecretary of marketing and regulatory programs, said: "We desperately need those additional funds, and we need some more teeth [in the law] to do something to assist these producers out there."
The Sun series described an industry in which farmers borrow hundreds of thousands of dollars to build farms that often yield incomes below the poverty level until the loans are paid off. They work under contracts that can be canceled at virtually any point. The large processors control their fortunes to the last detail, often demanding costly equipment upgrades that can force a farmer to go under.
That's a vastly different hierarchy than the pioneers of the poultry industry faced on the Delmarva shore 75 years ago, when chicken was a delicacy and a slew of companies competed for farmers' business.
USDA's Grain Inspection, Packers and Stockyards Administration, charged with overseeing the chicken industry's relationship with the nation's 30,000 contract growers, has been largely powerless to keep up with the changes.
The newspaper also reported that Packers and Stockyards has overlooked evidence of overt cheating by large companies such as ConAgra, the fifth-biggest U.S. processor, even as growers unearthed proof through their lawsuits.
Even after a recent expansion of the agency's poultry division -- and the concentration of investigators at a regional office in Atlanta -- Packers and Stockyards has only about seven full-time investigators to examine farmers' complaints.
And even if those investigators can document wrongdoing, their chances of punishing companies are slim. They must ask the Justice Department to take action on their behalf, a decision-making process that can take years.
In the beef, pork and lamb industries, by contrast, Packers and Stockyards can take action on its own to halt misconduct.
USDA's request for expanded authority is not new. The department, spurred by the recommendation of its Advisory Committee on Agricultural Concentration, has tried for several years to get administrative authority over poultry processors. But Congress has not granted it.
"We've asked for the last four years for additional money to do poultry investigations, and we're asking again," said James R. Baker, administrator of Packers and Stockyards. "I'm most concerned about it."
The $750,000 increase Baker requested to improve poultry investigations is small compared with his overall Packers and Stockyards budget request of $15 million, but he said it would be a start.
Rep. Jo Ann Emerson, a Republican who represents southeastern Missouri, was concerned as well. She told Baker that growers in her district had left grain farming and row cropping in hopes of making more money with chickens.
"Needless to say, it's not turning out that way," Emerson said, noting that only one company -- Tyson Foods Inc. -- offers contracts to growers in that region. "They've [the growers] made huge investments, and they're in big trouble right now."
Baker acknowledged that there were other aspects of the industry that his agency did not fully understand.
For example, investigators have found wide discrepancies in the weights of trailers used to weigh the birds, which in turn determines a farmer's pay. In one lawsuit, employees at ConAgra's Dalton, Ga., plant said they manipulated those weights to cheat farmers -- a fact that Packers and Stockyards agents had missed.
"There is a lot of room for discrepancy," Baker said. "We need the money to get in the middle of that."
A `glaring omission'
Despite Baker's words, Rep. Marcy Kaptur of Ohio -- the ranking Democrat on the subcommittee whose 1997 legislation to give growers the right to bargain with their companies died -- noted the absence of the word "farmers" in the agency's priorities for the coming year.
Instead, the farmers are called "producers."
"Sometimes words really do tell us where people's minds are," Kaptur said. "I just point that glaring omission out to you."
Replied Dunn: "We sometimes fail to realize why we're here. The family farmers throughout this nation -- that's the primary reason why we have to be here."
Pub Date: 3/04/99