Trust ensures cattle sellers receive payment should a livestock dealer become insolvent.
USDA’s Agricultural Marketing Service announced a new Dealer Statutory Trust to protect livestock sellers. The Consolidated Appropriations Act, signed on December 27, 2020, amended the Packers and Stockyards (P&S) Act by adding Section 318 to establish a “Dealer Statutory Trust” for the benefit of unpaid cash sellers of livestock.
The bill ensures that livestock producers are paid for their animals by requiring dealer trusts. In the current system, dealers frequently buy and resell livestock, often grouping them to meet the volume and type needs of their customers. Dealers are allowed to take possession of livestock and pay for them later, and dealers do not maintain a trust account to guarantee payment.
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arsenisspyros/iStock/Thinkstock A look at a Dealer Statutory Trust, help for small meat processors, Livestock Mandatory Reporting extension and animal health funds.
In the over 5,500 pages of the recent approved appropriations and COVID-relief, there are several nuggets important to those in the livestock sector including certainty that producers can recoup payment losses by establishing a dealer trust, funding for agriculture quarantine inspection services and an extension of Livestock Mandatory Reporting.
Small meat processors
The bill offers expanded resources for state-inspected meat processors through inclusion of the Requiring Assistance to Meat Processors for Upgrading Plants Act, which assists meat and poultry slaughtering and processing facilities with making improvements to allow for interstate shipment.