We’re Seeing Movement
For some time, the Department of Justice (DOJ) has been investigating the large meatpackers for a number of reasons. One of the main reasons for the investigation was unfair practices by the meatpackers. I always figured the meatpackers used these unfair practices because they could – knowing they could get away with it – and this has harmed all on the lower chain of the meat supply.
As we have heard from Sen. Cynthia Lummis and Rep. Liz Cheney during interviews at the Roundup, the DOJ announced the reasons behind the investigation at the beginning, but has been silent until the investigation is finished to provide results. This is just the way this process works, and it takes time.
Before the DOJ investigation was announced, national livestock organizations kept asking for information and more investigations, especially the National Cattleman’s Beef Association. But, not hearing anything, we all hoped something was happening.
Then this spring, consumers realized beef prices were on the rise and some were hearing about a meat shortage again. This got the attention of members of Congress and they started to get vocal about it. Between the organizations, consumers and Congress, there was a lot of talk going on and finally some action.
Everyone realized the high price of beef only helped the meatpackers. We also realized there was an abundance of live cattle waiting to be processed and wondered why more cattle were not processed every week. The packers were making a profit of $900 to $1,200 per head, but ranchers and feeders were getting low prices. Was this something more than supply and demand, and did this action place our food supply at risk?
As we know, the national livestock organizations got together and wrote some common goals. This united front pleased Congress and everyone involved. The Senate and House Agriculture Committees, along with the White House, started doing something.
About 100 years ago, Congress passed the Packers and Stockyards Act to protect the poultry raisers, hog farmers and cattle ranchers from unfair, deceptive and anti-competitive practices in the meat markets. Now, the U.S. Department of Agriculture (USDA) will begin work on three proposed rules to support enforcement of the Packers and Stockyards Act.
First, USDA wants to clarify and strengthen enforcement of unfair and deceptive practices, undue preferences and unjust prejudices. Second, USDA will propose a new poultry grower tournament system rule, with the current inactive proposal to be withdrawn. Remember, some poultry processers have assessed large fines. And third, USDA will re-propose a rule to clarify that parties do not need to demonstrate harm to competition in order to bring an action under section 202(a) and 202(b) of the Packers and Stockyards Act.
These rules hopefully will strengthen the sustainability of ranchers, farmers and growers. USDA will spend $4 billion to support the new proposed rules and guarantee the need for greater transparency and competition in the livestock markets and the meat processing sector, including unfair treatment of some farmers, ranchers and small processors.
Some in Congress have introduced bills to help the process such as Sen. Tester (D-MT). This bill would create a team of investigators within the packers and stockyard division of the USDA that will have the power of subpoena, allowing them to obtain information to keep meatpackers accountable.
We will know hell has frozen over when we see the meatpackers accountable, but we have faith it will happen.