In many states, higher prices are offered for large shipments of cattle or hogs, effectively discriminating against smaller producers providing identical products. In the absence of any federal initiatives, South Dakota, Nebraska, Minnesota, and Missouri have all passed price discrimination laws. Efforts in Kansas are currently underway.

However, the laws have encountered resistance from meatpackers. South Dakota's 1999 law (SB 95) was overturned in a case brought by the American Meat Institute (AMI), an industry trade group, in 1999. The law was interpreted as extending uniform pricing to other states "for livestock purchased for slaughter in this state", thereby interfering with interstate commerce.

Missouri passed a similar law in 1999, avoiding the language overturned in South Dakota. Nonetheless, AMI has challenged the law. In March 2000 the Missouri law was overruled by a federal district court. In May 2001, the 8th Circuit Court of Appeals reinstated the law.

RULES

• Anti-Price Discrimination - Missouri
  The Missouri Livestock Price Discrimination Law enacted in 1999 requires meatpackers to pay the same price for animals of the same quality, regardless of who the sellers are. Despite the fact that the Court "has little doubt that discrimination exists between the price that packers are willing to pay to a large producer and the price paid to a small producer", the Federal District Court ruled in March 2000 that the law violated the Commerce Clause of the US Constitution. In May 2001, the 8th Circuit Court of Appeals overturned the Federal District Court's decision. More...
• Anti-Price Discrimination - South Dakota
  A proposal introduced in the SD Legislature was directed at the failure of the federal Packers and Stockyards Act. The failure to enforce the federal Packers and Stockyards Act has resulted in the vast majority of beef in the United States being concentrated in the hands of a small number of packing firms and has restricted fair competition for livestock producers. The only recourse for the State of South Dakota is to enact appropriate provisions for the regulation of packers as provided in section 2 of this Act to protect South Dakota citizens who are directly or indirectly associated with the state's agricultural economy. More...