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Proposed Rule to Address Undue Preference in Livestock and Poultry Processing

USDA Agricultural Marketing Service (AMS) published a new proposed rule in the Federal Register, specifying four criteria the Agency would consider when determining whether an undue or unreasonable preference or advantage has occurred in violation of the Packers and Stockyards (P&S) Act. According to the rule, USDA would test for undue preference using these four criteria: cannot be justified on the basis of a cost savings related to dealing with different producers, sellers, or growers; cannot be justified on the basis of meeting a competitor’s prices; cannot be justified on the basis of meeting other terms offered by a competitor; and, cannot be justified as a reasonable business decision that would be customary in the industry. AMS invites public comment on the proposed criteria until March 13, 2020.