In a year when the term “unprecedented” has been tossed around more times than you can count, a first-time gathering of members from different producer organizations requires the use of the term at least one more time.
Members of the American Farm Bureau Federation, National Cattlemen’s Beef Association (NCBA), National Farmers Union, R-CALF USA, and United States Cattlemen’s Association met in Phoenix, AZ, May 10 at the request of the Livestock Marketing Association (LMA) to discuss industry issues.
Cheslea Good, LMA vice president of government and industry affairs, told WLJ that LMA members have been growing increasingly frustrated about the spread between boxed beef prices and live cattle. In addition, there have been concerns about market competition and the fed cattle market in general.
Good said LMA has been having internal discussions on those issues and other cattle groups have as well. The purpose of the meeting was to come together and try to find common ground between the producer organizations on cattle marketing.
“It was a unique meeting because participants were designated by their respective organizations, but didn’t have the authority to set policy in that room,” Good said. “In that room, they were just individuals.”
Each organization sent several member leaders to the meeting to speak candidly about issues such as packer concentration, price transparency and discovery, packer oversight, Packers and Stockyards Act enforcement, level of captive supply and packer capacity.
Participants left the day-long meeting with the goal of bringing several actions back to their respective groups for consideration. This included expediting the renewal of the Livestock Mandatory Reporting program, adding formula base prices subject to the same reporting requirements as negotiated cash, and creating a contract library. In addition, members emphasized developing new, independent local and regional packers.
Finally, participants will bring back to their organizations the consideration to demand the Department of Justice (DOJ) to issue a public investigation status report on packer activity and conduct oversight with USDA over packer activity moving forward.
“We stand ready to come together on issues, but that first step is going back to our respective organizations,” Good said.
She also added: “I’m proud that LMA leaders really showed great vision in bringing together a pretty diverse set of producer organizations. And maybe these are groups that don’t always work together or see eye to eye on every issue, but I think it says a lot that they’re willing to work together on this topic.”
Bicameral letter
A week after the organizations met, Sen. John Thune (R-SD) and Rep. Dusty Johnson (R-SD-At large) submitted a letter to U.S. Attorney General Merrick Garland, urging the DOJ to move forward with their investigation into the meatpacking industry.
Good said although there have been discussions with lawmakers about concerns with the DOJ, the timing of the letter was purely coincidental—however she said it couldn’t have been more perfect timing.
After the fire at a Tyson Fresh Meats processing plant in Holcomb, KS, in 2019 and the impacts of the COVID pandemic last spring, USDA conducted a market investigation to see if packers took advantage of the crises. Last summer, USDA released a report analyzing the market conditions before and after each event and did not actually evaluate whether there were violations of the Packers and Stockyards Act.
Since then, USDA has been working with the DOJ regarding allegations of anticompetitive practices. The DOJ also said it was launching its own investigation, but no details have been reported since their initial announcement last summer.
In their letter, the lawmakers voiced concerns over not having seen any public results from the investigation. “In fact, there is no information to even suggest whether the investigation has concluded or is still ongoing,” the letter read.
The correspondence was ended by the lawmakers urging the DOJ antitrust division to continue its vigilance and provide updates when possible. The letter was also signed by 14 other Republican congresspeople.
NCBA applauded the letter. “We have a high supply of cattle at one end of this equation and a high demand for U.S. beef at the other, but the middle is being absolutely choked by the lack of processing capacity,” said NCBA Vice President of Government Affairs Ethan Lane in a released statement.
He added that it was in the best interest of both consumers and producers for the DOJ to “get to the bottom of the current market dynamics, and assess why they seemingly always result in producers getting the short end of the deal.” — Anna Miller, WLJ managing editor
