by John Haughey
There are more than 95,000 farms in Missouri with the Show Me State placing among the nation’s top 10 in terms of beef, chicken and pork production, according to the U.S. Department of Agriculture.
But consolidation within the meatpacking industry – four firms (JBS, Tyson, Cargill, National Beef) control more than 80% of all the beef slaughtered in the United States – has long frustrated Missouri producers.
The Missouri Farm Bureau (MOFB) has for years called for federal action to promote competition, protect consumers and address market manipulation that includes allegations of widespread price-fixing and collusion.
Last year, Missouri Attorney General Eric Schmitt joined 10 other state attorneys general in calling on the US Department of Justice (DOJ) to investigate alleged unfair and illegal trade practices in the meatpacking industry.
In May 2020, Missouri’s junior US Senator Josh Hawley requested then-U.S. Attorney William Barr to initiate an antitrust investigation into “the highly concentrated beef packing sector.”
Hawley has also asked for the Federal Trade Commission (FTC) to open an antitrust investigation into the meatpacking industry. Then-President Donald Trump followed through with the request and the DOJ opened an investigation into the matter.
That investigation is bearing fruit. On June 3, the DOJ’s Antitrust Division announced indictments of four senior executives for price fixing in the chicken market. Two days later, the DOJ said it launched an investigation into the nation’s s four largest meat processors.
Earlier in August, Hawley also asked US Department of Agriculture (USDA) Secretary Tom Vilsack to investigate alleged fraud and “anti-competitive behavior” from large meatpacking companies, including Tyson Foods, JBS and WH Group.
“The biggest firms will not curb their anticompetitive practices unless they face a penalty that impacts their bottom line. Big companies require big penalties,” Hawley said in an Aug. 4 letter to Vilsack. “Federal statute provides you with robust authority to revoke inspection services following convictions for fraudulent behavior in the marketplace.”
Hawley urged Vilsack to probe corporate meatpackers and revoke inspection services for violators to “restore competition, safeguard farmers and ranchers, and ensure food security for all Americans.”
Meanwhile, Missouri’s congressional delegation is addressing MOFB’s concerns legislatively.
US Representative Jason Smith, R-Salem, is among co-sponsors of the proposed FAIR Meat Packing Act, which would establish two tax incentives to create small- and mid-sized meat processing businesses to “ensure a level playing field for our nation’s cattlemen and to return to fair prices for both cattlemen and consumers.”
Missouri cattle producers “deserve access to fair markets,” Smith said, “Unfortunately, if the mega meat packers continue their strangle-hold on the market, our hardworking producers don’t stand a chance.”
U.S. Representatives Emanuel Cleaver, D-Kansas City and Vicky Hartzler, R-Columbia, in June co-introduced the Optimizing the Cattle Market Act of 2021, which seeks to erect regional regulatory minimums for negotiated cash trades in cattle markets that are based on “peer-reviewed research from land-grant universities.”
The bill would also require the USDA to catalog beef contracts between producers and marketers while keeping them confidential and order packers to report the number of cattle scheduled to be delivered the next two weeks, allowing producers to plan marketing strategies.
The House bill, yet to be assigned hearings, is similar to a Senate proposal sponsored by US Senator Debbie Fischer, R-Nebraska.
“America’s producers continue to face challenges in the cattle market, particularly in terms of external market disruptions and the fading COVID-19 pandemic,” Hartzler said. “This legislation aims to usher in transparency improvements and restores accountability in the industry to lift up these struggling sectors and embark on a new chapter of progress for our cattlemen and women.”
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