Optimizing the Cattle Market Act of 2021
This bill directs the Department of Agriculture (USDA) to establish and maintain a library or catalog of each type of contract offered by packers to producers for the purchase of all or part of the production of fed cattle (including cattle that are purchased or committed for delivery). Fed cattle means a steer or heifer that has been feeding on a ration of roughage and feed concentrates prior to slaughter, including grains, protein meal, grass, and other nutrient-rich feeds.
USDA must create and maintain a publicly available library or catalog of the types of contracts that are being offered by packers to, and are open to acceptance by, producers for the purchase of fed cattle. It must also conduct educational outreach activities for producers on how best to use the library or catalog.
Additionally, USDA must also establish (1) regional mandatory minimum thresholds to enhance price discovery and transparency for cattle market participants; and (2) methods for establishing such thresholds, which shall be publicly available.
Further, the bill revises daily reporting requirements for packer processing plants by requiring them to include the number of cattle scheduled to be delivered for slaughter each day for the subsequent 14 days.
To amend the Packers and Stockyards Act, 1921, to establish a cattle 
               contract library, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Optimizing the Cattle Market Act of 
2021''.

SEC. 2. SENSE OF CONGRESS.

    It is the sense of the Congress that there is a need for expedited 
reauthorization of the Livestock Mandatory Reporting program of the 
Department of Agriculture, including formula base prices subject to the 
same reporting requirements as negotiated cash and the creation of a 
contract library.

SEC. 3. CATTLE CONTRACT LIBRARY.

    (a) In General.--Title II of the Packers and Stockyards Act, 1921, 
is amended by inserting after section 223 (7 U.S.C. 198b) the 
following:

                     ``Subtitle C--Cattle Contracts

``SEC. 231. DEFINITIONS.

    ``In this subtitle:
            ``(1) Base price.--The term `base price' means the price 
        paid for cattle delivered to a packer, before application of 
        any premiums or discounts, expressed in dollars per hundred 
        pounds of carcass weight.
            ``(2) Contract.--
                    ``(A) In general.--Subject to subparagraph (B), the 
                term `contract' means any agreement, written or oral, 
                between a packer and a producer for the purchase of fed 
                cattle for slaughter.
                    ``(B) Exclusion.--The term `contract' does not 
                include a contract for a negotiated purchase.
            ``(3) Fed cattle.--The term `fed cattle' means a steer or 
        heifer that has been finished on a ration of roughage and feed 
        concentrates, such as grains, protein meal, grass (forage), and 
        other nutrient-rich feeds, prior to slaughter.
            ``(4) Formula marketing arrangement.--The term `formula 
        marketing arrangement' means the advance commitment of cattle 
        for slaughter--
                    ``(A) by any means other than through a negotiated 
                purchase, negotiated grid purchase, or forward 
                contract; and
                    ``(B) using a method for calculating price--
                            ``(i) under which the price is determined 
                        at a future date;
                            ``(ii) the basis of which is a price 
                        established for a specified market, which may 
                        be based on any publicly reported price, 
                        including plant average price, regional price, 
                        downstream price, or some other mutually 
                        agreeable price source; and
                            ``(iii) that may include a grid or nongrid 
                        price.
            ``(5) Forward contract.--The term `forward contract' 
        means--
                    ``(A) an agreement for the purchase of fed cattle, 
                executed in advance of slaughter, under which the base 
                price is established by reference to--
                            ``(i) prices quoted on the Chicago 
                        Mercantile Exchange; or
                            ``(ii) other comparable publicly available 
                        prices; or
                    ``(B) any other contract for the purchase of fed 
                cattle, executed in advance of slaughter, as determined 
                by the Secretary.
            ``(6) Heifer.--The term `heifer' means a bovine female that 
        has not given birth to a calf.
            ``(7) Negotiated grid purchase.--The term `negotiated grid 
        purchase' means a purchase of fed cattle by a packer from a 
        producer under which--
                    ``(A) the buyer-seller interaction results in a 
                negotiated base price, which may be adjusted by 
                premiums and discounts; and
                    ``(B) the cattle are scheduled for delivery to the 
                packer not more than 14 days after the date on which 
                the agreement for purchase is made.
            ``(8) Negotiated purchase.--The term `negotiated purchase' 
        means a purchase of fed cattle (commonly known as a `cash' or 
        `spot market' purchase) by a packer from a producer under 
        which--
                    ``(A) the buyer-seller interaction that results in 
                the purchase and the agreement on the actual base price 
                for the purchase occur on the same day; and
                    ``(B) the cattle are scheduled for delivery to the 
                packer not more than 30 days after the date on which 
                the agreement for purchase is made.
            ``(9) Packer.--The term `packer' has the meaning given the 
        term in section 221 of the Agricultural Marketing Act of 1946 
        (7 U.S.C. 1635d).
            ``(10) Producer.--The term `producer' means a person 
        engaged in the business of selling cattle to a packer for 
        slaughter.
            ``(11) Steer.--The term `steer' means a bovine male 
        castrated before reaching sexual maturity.
            ``(12) Type of contract.--
                    ``(A) In general.--The term `type of contract' 
                means the classification of a contract for the purchase 
                of cattle--
                            ``(i) into 1 of the categories described in 
                        subparagraph (B); and
                            ``(ii) by determining the base price of the 
                        cattle.
                    ``(B) Categories.--The categories for 
                classification of a type of contract are the following:
                            ``(i) Formula marketing arrangement.
                            ``(ii) Forward contract.
                            ``(iii) Negotiated grid purchase contract.

``SEC. 232. CATTLE CONTRACT LIBRARY.

    ``(a) In General.--Subject to the availability of appropriations to 
carry out this section, the Secretary shall establish and maintain a 
library or catalog of each type of contract offered by packers to 
producers for the purchase of all or part of the production of the 
producers of fed cattle (including cattle that are purchased or 
committed for delivery), including any schedules of premiums or 
discounts associated with the contract.
    ``(b) Information Collection.--
            ``(1) In general.--To maintain the library or catalog 
        established under subsection (a), the Secretary shall obtain 
        information from each packer on each type of existing contract 
        of the packer by requiring a filing or other form of 
        information submission from each packer.
            ``(2) Contracted cattle numbers.--Information that shall be 
        submitted to the Secretary by a packer under paragraph (1) 
        shall include, with respect to each existing contract of a 
        packer--
                    ``(A) the type of contract; and
                    ``(B) a description of the provisions in the 
                contract that provide for expansion in the numbers of 
                fed cattle to be delivered under the contract for the 
                6-month and 12-month periods following the date of the 
                contract.
    ``(c) Availability of Information.--
            ``(1) In general.--The Secretary shall make available to 
        producers and other interested persons information on the types 
        of contracts in the library or catalog established under 
        subsection (a), including notice (on a real-time basis, if 
        practicable) of the types of contracts that are being offered 
        by packers to, and are open to acceptance by, producers for the 
        purchase of fed cattle.
            ``(2) Monthly report.--
                    ``(A) In general.--Beginning 30 days after the 
                library or catalog is established under subsection (a), 
                the Secretary shall make the information obtained each 
                month in the library or catalog available in a monthly 
                report to producers and other interested persons.
                    ``(B) Contents.--The monthly report described in 
                subparagraph (A) shall include--
                            ``(i) an estimate by the Secretary of the 
                        total number of fed cattle committed under 
                        contracts for delivery to packers within the 6-
                        month and 12-month periods following the date 
                        of the report, organized by reporting region 
                        and type of contract; and
                            ``(ii) an estimate by the Secretary of the 
                        total maximum number of fed cattle that may be 
                        delivered within the 6-month and 12-month 
                        periods following the date of the report, based 
                        on the provisions described in subsection 
                        (c)(2)(B) in existing contracts, organized by 
                        reporting region and type of contract.
    ``(d) Maintenance of Library or Catalog.--Information in the 
library or catalog established under subsection (a) about types of 
contracts that are no longer offered or in use shall be removed from 
the library or catalog.
    ``(e) Educational Outreach Activities.--The Secretary shall conduct 
educational outreach activities for producers on how best to use the 
cattle contract library or catalog established under subsection (a).
    ``(f) Confidentiality.--The reporting requirements for packers 
under this section shall be subject to the confidentiality protections 
provided under section 251 of the Agricultural Marketing Act of 1946 (7 
U.S.C. 1636).
    ``(g) Violations.--It shall be unlawful and a violation of this Act 
for any packer to willfully fail or refuse--
            ``(1) to provide to the Secretary accurate information 
        required under this section; or
            ``(2) to comply with any other requirement of this section.
    ``(h) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary such sums as are necessary to carry out 
this section.''.
    (b) Conforming Amendment.--Section 201 of the Packers and 
Stockyards Act, 1921 (7 U.S.C. 191), is amended by striking ``When used 
in this Act'' and inserting ``Unless specified otherwise, in this 
Act,''.

SEC. 4. CASH MARKET ACQUISITION OF CATTLE.

    Title II of the Packers and Stockyards Act, 1921 (7 U.S.C. 191 et 
seq.) (as amended by section 2), is amended by adding at the end the 
following:

            ``Subtitle D--Cash Market Acquisition of Cattle

``SEC. 241. DEFINITIONS.

    ``In this subtitle:
            ``(1) Negotiated grid purchase.--The term `negotiated grid 
        purchase' means a purchase of cattle by a packer from a 
        producer under which--
                    ``(A) the buyer-seller interaction results in a 
                negotiated base price, which may be adjusted by 
                premiums and discounts; and
                    ``(B) the cattle are scheduled for delivery to the 
                packer not more than 14 days after the date on which 
                the agreement for purchase is made.
            ``(2) Negotiated purchase.--The term `negotiated purchase' 
        means a purchase of cattle (commonly known as a `cash' or `spot 
        market' purchase) by a packer from a producer under which--
                    ``(A) the buyer-seller interaction that results in 
                the purchase and the agreement on the actual base price 
                for the purchase occur on the same day; and
                    ``(B) the cattle are scheduled for delivery to the 
                packer not more than 30 days after the date on which 
                the agreement for purchase is made.
            ``(3) Packer.--The term `packer'--
                    ``(A) has the meaning given the term in section 221 
                of the Agricultural Marketing Act of 1946 (7 U.S.C. 
                1635d); and
                    ``(B) for calendar years beginning on or after 
                January 1, 2022, includes only a federally-inspected 
                cattle processing plant that slaughtered an average of 
                125,000 head of cattle per year during the immediately 
                preceding 5 calendar years.
            ``(4) Producer.--The term `producer' means a person engaged 
        in the business of selling cattle to a packer for slaughter.
            ``(5) Regional mandatory minimum.--The term `regional 
        mandatory minimum' means, for each reporting region (as 
        designated by the Agricultural Marketing Service), of the 
        number of transactions and quantity of cattle purchased for 
        slaughter by a packer in that region each slaughter week, the 
        minimum number of such transactions and the minimum percentage 
        of such cattle, respectively, that are required to be purchased 
        through negotiated purchases or negotiated grid purchases from 
        producers.
            ``(6) Slaughter week.--The term `slaughter week' has the 
        meaning given the term `current slaughter week' in section 212 
        of the Agricultural Marketing Act of 1946 (7 U.S.C. 1635a).

``SEC. 242. REGIONAL MANDATORY MINIMUMS.

    ``(a) In General.--Not later than 2 years after the date of 
enactment of this subtitle, the Secretary, in consultation with the 
Chief Economist, shall establish--
            ``(1) regional mandatory minimums for the purpose of 
        enhancing price discovery and transparency for cattle market 
        participants; and
            ``(2) methods for establishing those regional mandatory 
        minimums, which shall be publicly available.
    ``(b) Duration.--Regional mandatory minimums established for each 
reporting region under subsection (a)(1)--
            ``(1) may be weekly or on another periodic basis, as 
        determined by the Secretary;
            ``(2) shall account for improbable events with profound 
        consequences (commonly referred to as `black swan events'); and
            ``(3) shall be applicable for not more than a 24-month 
        period.
    ``(c) Public Input.--In carrying out subsection (a), the Secretary 
shall make all proposed regional mandatory minimums and proposed 
methods for establishing those minimums subject to a notice and comment 
period.
    ``(d) Considerations.--In carrying out subsection (a) for each 
reporting region, the Secretary, in consultation with the Chief 
Economist, shall consider the following factors:
            ``(1) The number of packers in the reporting region.
            ``(2) The availability of cattle in the reporting region.
            ``(3) Pre-existing contractual arrangements of packers in 
        the reporting region.
            ``(4) The number of pricing transactions (pens of cattle 
        sold) in the reporting region.
    ``(e) Land-Grant Research.--In carrying out subsection (a), the 
Secretary, in consultation with the Chief Economist, shall take into 
account relevant research conducted by land-grant colleges and 
universities (as defined in section 1404 of the National Agricultural 
Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)).
    ``(f) Biannual Review.--On establishing regional mandatory minimums 
under subsection (a)(1), the Secretary--
            ``(1) shall review the regional mandatory minimums not less 
        frequently than once every 2 years; and
            ``(2) may, in consultation with the Chief Economist, modify 
        the regional mandatory minimums after--
                    ``(A) making the proposed modification subject to a 
                notice and comment period; and
                    ``(B) consulting with representatives of the United 
                States cattle and beef industry.
    ``(g) Enforcement.--On establishing regional mandatory minimums 
under subsection (a)(1), the Secretary shall--
            ``(1) regularly monitor compliance by packers with those 
        regional mandatory minimums; and
            ``(2) enforce this section in accordance with section 203.
    ``(h) Cost-Benefit Analysis.--Not later than 3 years after 
establishing regional mandatory minimums under subsection (a)(1), the 
Secretary, in consultation with the Chief Economist, shall conduct a 
quantifiable, data-driven cost-benefit analysis regarding the operation 
and effect of those regional mandatory minimums.''.

SEC. 5. 14-DAY CATTLE SLAUGHTER.

    (a) Definition of Cattle Committed.--Section 221(1) of the 
Agricultural Marketing Act of 1946 (7 U.S.C. 1635d(1)) is amended by 
striking ``7-day'' and inserting ``14-day''.
    (b) Mandatory Reporting for Live Cattle.--Section 222(c) of the 
Agricultural Marketing Act of 1946 (7 U.S.C. 1635e(c)) is amended--
            (1) in paragraph (1)--
                    (A) by striking subparagraphs (B) and (C); and
                    (B) by redesignating subparagraph (D) as 
                subparagraph (B);
            (2) by redesignating paragraph (2) as paragraph (3); and
            (3) by inserting after paragraph (1) the following:
            ``(2) Prior day reporting.--
                    ``(A) In general.--The corporate officers or 
                officially designated representatives of each packer 
                processing plant shall report to the Secretary, for 
                each business day of the packer processing plant, not 
                later than 10:00 a.m. Central Time on each reporting 
                day, the information from the prior business day 
                described in subparagraph (B).
                    ``(B) Information required.--The information 
                required under subparagraph (A) shall be, with respect 
                to the prior business day, the number of cattle, 
                organized by cattle type, scheduled for delivery to a 
                packer processing plant for slaughter for each of the 
                next 14 calendar days.''.
                                 <all>
Optimizing the Cattle Market Act of 2021
To amend the Packers and Stockyards Act, 1921, to establish a cattle contract library, and for other purposes.
Optimizing the Cattle Market Act of 2021
Rep. Hartzler, Vicky