Agricultural Economics Department


Date of this Version



Published in Cornhusker Economics. January 31, 2001. Produced by the Cooperative Extension, Institute of Agriculture and Natural Resources, Department of Agricultural Economics, University of Nebraska-Lincoln .


Agricultural production contracts are becoming more widespread in Nebraska. (Contract production should be distinguished from custom farming, which is not at issue here). Under ag production contracts, farmers may contract to produce crops or livestock typically for processors. Contracting is widespread in the broiler industry, and is becoming more common in the swine and beef industry, and for some crops. The Producer Protection Act of 2000 (PPA) is a proposed model state statute prepared by the National Association of Attorneys General to deal with legal issues associated with agricultural contracting. The PPA was developed in order to avoid some problems that have arisen with contracting in the broiler industry. The Unicameral’s Agriculture Committee has introduced LB592, based on the PPA and dealing with swine and cattle production contracts. Sen. Dierks has introduced a companion bill, LB587. LBs 592 and 587 will be heard by the Agriculture Committee on February 13, 2001 at 1:30 p.m. in Room 1524, State Capital Building. The bills apply only to swine and cattle production contracts between producers and processors, and do not apply to crop production contracts, do not apply to production contracts for other livestock species, and do not apply to cattle or swine production contracts not involving processors.