Taylor, Justin; Cates, Sheryl C; Karns, Shawn A; Lawrence, John D.; Koontz, Stephen R.; Muth, Mary K.

ISU Extension: Livestock Marketing Information Center, No. LM-2 (November 2007)

During the 2002 Farm Bill debate, several pieces of legislation were aimed at
restricting packers' livestock purchasing practices. A specific concern focused on marketing arrangements that gave packers control over livestock more than 14 days prior to slaughter, commonly known as "captive supply." As a compromise, in 2003 Congress requested a study of alternative marketing arrangements (AMAs) that are used as alternatives to the cash market. The resulting Grain Inspection, Packers and Stockyards Administration (GIPSA) Livestock and Meat Marketing Study was completed in early 2007 (Muth et al., 2007; Cates et al., 2007). However, during the time of the study, much of the proposed legislation has been reintroduced, and several are currently being discussed along with the 2007 Farm Bill. The purpose of this discussion is to illustrate perceived benefits of using AMAs to producers and packers.

Keywords: alternative marketing arrangements, hogs