From the Farm: Meat prices and White House intervention


WASHINGTON, D.C. (WCIA) — Over the weekend, the White House announced a major initiative that targets the nation’s handful of meat packers.

The nation’s cattle, pork and poultry producers have been in turmoil over low prices they are paid for live cattle, hogs and poultry, compared to the high prices that consumers have to pay at the meat counter. The grocery chains are not to blame – they say – because of the prices they have to pay the meat packers.

The so-called Big Four – Tyson Foods, Cargill, JBS USA and National Beef – control about 80% of the beef market, giving them substantial market power. They also control 55% to 85% of the marketplace when it comes to pork and poultry.

Several members of Congress have asked for hearings, but nothing happened until late Sunday night when the White House sent a news release to farm broadcasters about a two-pronged approach to quell the turmoil.

White House officials said the meat and poultry processing sector is a textbook example of a lack of competition that is hurting consumers, producers and the economy.

The administration plan is for USDA to issue stronger rules in the Packers and Stockyards Act designed to combat abuses that will enhance competition for establishing pricing for livestock and poultry.

Additionally, the Justice Department will investigate farmer complaints about the meat packers in relation to anti-competitive violations of the Sherman Antitrust Act. Additionally, the Administration will work with a bipartisan group of senators and representatives who have reached out for help to increase the transparency of livestock price contracts and negotiated deals with feed lots.

The other major initiative is designed to strengthen the market share of small local slaughter plants and meat packers so they will have a great opportunity to compete for space in the meat counter.

These include funding to make capital improvements in their facilities and get better training for their employees with opportunities for higher wages.

We’ll have more as this initiative is rolled out.

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