Keep large meatpackers from owning and processing cattle
By BILL BULLARD**
The Bismarck Tribune - North Dakota
Feb 11, 2008
An intense conflict is being waged in Congress. At stake is the security of U.S. consumers' meat supply. Security is dependent on the structure of our production system. A system where control is distributed among hundreds of thousands of independent livestock producers, geographically dispersed, is more secure than a system concentrated in a few geographic locations and controlled by only a few large multinational meatpackers.
Our meat supply, secured by a widely dispersed production structure, is now in jeopardy. By the 1990s, our poultry industry, once characterized by tens of thousands of independent businesses, was reduced to about 50 integrated firms. U.S. hog operations, which numbered 667,000 just 25 years ago, were reduced 90 percent to only 67,000 operations by 2005.
Livestock production is now nearly completely controlled by only a handful of meatpackers that have virtually decimated the widely dispersed, family-farm structure of U.S. livestock production - with one notable exception. While the number of cattle operations shrank nearly 40 percent from 1980 to 2005, the cattle industry remains the last frontier that large meatpackers hope to dominate - it is the only major livestock sector not already corporately controlled from birth to plate. With about 900,000 cattle operations remaining, independent cattle producers still have the critical mass necessary to maintain a viable industry - provided Congress takes steps to restore their industry's competitiveness.
Farmers and ranchers, who raise and feed cattle, are reaching out to consumers and Congress for help to overcome the large meatpackers' efforts to capture control over the entire cattle industry. Meatpackers are employing the same anti-competitive practices to take control of the cattle industry as they used to decimate the independent structure of the other livestock industries: restrictions on market access that lead to price control and manipulation - anti-competitive practices that disrupt the free-market system.
Congress now realizes that America has been harmed by the alarming contraction of its livestock industries, causing the security of our meat supply to be more vulnerable than ever. In the 2007 farm bill, Congress is attempting to prohibit the largest meatpackers from owning and feeding cattle prior to slaughter.
The largest meatpackers are the only buyer for cattle producers' slaughter-ready cattle. Anti-competitive practice enables meatpackers to manipulate prices paid to all independent cattle producers. They restrict producer access to their plants by refusing to buy cattle from cattle producers and fill their plants' needs with millions of their own cattle. This drives producers' cattle prices downward, making independent businesses unprofitable.
The large meatpackers are formidable adversaries highly skilled at pulling the wool over consumers' eyes. They erroneously suggest that Congress' measure would eliminate beneficial marketing agreements, despite the measure's protection of such agreements when producers maintain ownership of, and participate in, the production of livestock. The multinational meatpackers are attempting to enlist consumers' help to derail congressional efforts to prohibit their anti-competitive practices by waving an altruistic banner, claiming that such control is justified by the consumers' desire for a consistent quality product. Empirical evidence, however, shows just how disingenuous they are.
Although poll after poll shows that consumers overwhelmingly want a label informing them of the country-of-origin of their meat purchases, these meatpackers are fighting to prevent consumers from having this information. Although polls show that consumers support voluntary testing for bovine spongiform encephalopathy, these meatpackers are fighting voluntary testing. Although both cattle groups and consumer groups requested that the Canadian border remain closed to older Canadian cattle and beef that are at higher risk for BSE, these meatpackers are fighting the request.
Congress and consumers must not fall for the multinational meatpackers' attempts at deception. The meatpackers are not fighting for the best interests of consumers. Instead, they are fighting for their own self-interests: more power, more control, and more money. Working together, cattle producers and consumers can protect the security of our meat supply by supporting Congress' efforts to prohibit meatpacker ownership of livestock, helping restore the competitiveness of the U.S. cattle industry.
**Bill Bullard, of Billings, is the CEO of R-CALF USA., representing the interests of thousands of U.S. farmers and ranchers who raise and feed cattle.
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