What is a Wisconsin Livestock Packers and Stockyards Bond?
The State of Wisconsin requires those in the meatpacking industry, mainly livestock packers and stockyard owners, to furnish a surety bond.
The Livestock Packers and Stockyards Bond is required before livestock packers and stockyards can obtain a state license and operate in compliance with the Packers and Stockyards Act of 1921 as amended.
The PSA is administered by the Packers and Stockyards Programs of the Grain Inspection, Packers and Stockyards Administration (GIPSA), a US Department of Agriculture agency, and the Packers and Stockyards Program (P&SP), a division within GIPSA.
The bond guarantees that livestock packers and stockyards (Principal) conduct fair business practices related to marketing livestock, meat, and poultry. The bond provides financial protection to the State of Wisconsin, consumers, and sellers of livestock, meat, and poultry against fraudulent or deceptive trade activities and unfair competition. Furthermore, the bond ensures that the Principal pays the gross amount for which all livestock is sold.
What is the role of a livestock packer?
According to 7 U.S.C. § 191, a “packer” is defined as any person engaged in the business:
- of buying livestock in commerce for purposes of slaughter;
- of manufacturing or preparing meats or meat food products for sale or shipment in commerce;
- or of marketing meats, meat food products, or livestock products in an unmanufactured form acting as a wholesale broker, dealer, or distributor in commerce.
What is a stockyard?
A stockyard means any facility, establishment or location that is managed or operated as a public market for livestock feeders, producers, and buyers, where live cattle, swine, horses, sheep or goats are received or kept for sale or delivery for commercial purposes.
The stockyard owner is the person that owns, manages or operates the stockyard.
What is the bond amount?
Livestock packers and dealers (whose average annual purchases of livestock exceed $500,000) must maintain a surety bond amounting to at least $10,000. The bonds are determined from annual livestock reports conducted through self-reporting as mandated by and submitted to the Central Reporting Unit of the P&SP.
The cost of the bond is a percentage of the bond amount (bond premium), which you can get between 1% and 5%. The cost varies and may depend on your financial position.
For a thorough overview of how your bond cost is determined, get your FREE HERE!
How do I obtain a Livestock Packers and Stockyards Bond?
Find a reliable surety bond company that is authorized to conduct business in the State of Wisconsin.
STEP 1: Apply for the bond
You need to submit a bond application to us. If you’re ready to apply now, you may do so HERE!
STEP 2: Underwriting
We will ask you a couple of important information needed for the bond. This will include your financial history, business performance history, and your credit score.
Also, you need to submit a copy of the BOND FORM, which can be obtained from USDA GIPSA.
A certified surety underwriter will carefully evaluate all those.
STEP 3: Bond execution
Once the underwriter is done with the underwriting process, we will immediately issue the bond and send it to you!
Call us at 800-333-7800 today!