Agriculture in the United States is experiencing a significant transformation.  This evolution can be attributed to rapidly improving technologies, developments in biotechnology, changes in worldwide consumption, and concentration in production agriculture and  agribusiness.  These developments create opportunities, but raise questions about concentration and antitrust.  The developments also raise new challenges in the regulation of unfair and deceptive business practices, and identifying the best policies to address these issues.

 This Committee has examined concentration issues in previous hearings.  The competitive implications of consolidation and concentration in production agriculture and agribusiness are numerous.  Situations of monopoly or monopsony can result from reduction in the number of market participants or an increase in the market share of the participants.  Unique among Federal statutes that are within the purview of the Department of Agriculture, the Packers and Stockyards Act provides the Secretary with legal authorities to take actions against activities by packers in interstate commerce that have the effect of restraining commerce or creating a monopoly in commerce.

 The USDA has restructured the Grain Inspection, Packers and Stockyards Administration to strengthen enforcement of anti-competitive practices and improve the agency’s ability to enforce the provisions of the Packers and Stockyards Act.  Today the Committee will examine the present structure and functions of the Grain Inspection, Packers and Stockyards Administration.  This marriage of two previously independent agencies occurred in 1994, intended to secure a productive and competitive global marketplace for U.S. agricultural products.

 I welcome Mr. Michael Dunn, Under Secretary for Marketing and Regulatory Programs, and Mr. James Baker, Administrator of the Grain Inspection, Packers and Stockyards Administration.  I have asked Mr. Baker to provide testimony addressing the challenges facing GIPSA.  Under Secretary Dunn may offer additional remarks.  I take this opportunity to thank Mr. Baker for coming to my home state of Indiana, in order to receive input from Hoosiers farmers regarding concentration and consolidation.   I also welcome Mr. David Shipman, Deputy Administrator of the Federal Grain Inspection Program, who is present to respond to questions the Committee may have regarding his program.

 I am pleased that Dr. Philip Paarlberg and Dr. Kenneth Foster from Purdue University are with us today.  They will review the findings in their recent paper titled “Structural Change and Market Performance in Agriculture: Critical Issues and Concerns about Concentration in the Pork Industry.”

 Today’s third panel contains producer representatives who will provide commentary on the functions performed by the Packers and Stockyards Administration. Finally, the last panel consists of members from producer groups and the business community who will discuss the functions assigned to the Federal Grain Inspection Program.