The Perishable Agricultural Commodities Act (PACA) was enacted in the 1930s at the request of fruit and vegetable growers to promote fair trade in the industry. It’s designed to protect business dealings in fresh and frozen products by establishing and enforcing fair business practices and helping resolve disputes. Some examples include interpretation of inspection certificates, advice on contract disputes, and bankruptcy payments. The Act established a trust provision to compensate farmers in the event of loss of payment and many believe the trust entrance requirements do not reflect current purchase practices. Significant concern is the expansion in the types of purchases allowed in the trust provision.
Some farmers have raised concerns about the effectiveness of PACA in regard to recovery of payments from processors when there is a bankruptcy, as well as in modernizing the protections to address current “future payment” terms having very limited protection under PACA.
Contact: Audrey Sebolt | 517-391-5055
Is PACA meeting the needs of fruit and vegetable farmers?
What, if any, updates are needed to PACA to reflect today’s market needs and address any concerns farmers are currently experiencing?
Should PACA coverage be extended to cover pooled pricing practices?
Trust rights are preserved from grower to wholesaler; should the need for the grower to preserve the trust rights of suppliers or buyer agents be removed?
Is the current trust provision and claims process adequate?
Should delayed term purchase agreements be eligible for trust protection?
MFB Policy #28 Payment Protection and Security for Growers
AFBF Policy #224 Marketing Philosophy
AFBF Policy #416 Bonding and Bankruptcy
AFBF Policy #460 Perishable Products
USDA PACA web site