In late June, the Senate Agriculture Committee held an historic hearing to examine the state of the U.S. meatpacking industry.
Titled “Examining Markets, Transparency, and Prices from Cattle Producer to Consumer,” the hearing was the first of its kind in decades and yielded evidence of harm to American cattle producers, consumers, and rural communities as a direct result of concentration in the food system, the Family Farm Action group said.
Sen. Deb Fischer of Nebraska urged Senate Agriculture Chairman Debbie Stabenow (D-Mich.) and Ranking Member John Boozman (R-Ark.) to hold the hearing.
Fischer is an advocate for increased cash sales and more transparency in the cattle market.
The witness list included Dr. Mary Hendrickson, a rural sociologist and author at the University of Missouri.
Hendrickson expressed grave concern over the unequal distribution of power in the food system. She said currently, everyone must abide by decisions handed down by the boards of directors of a few transnational agri-food companies.
With their questions, committee members displayed a clear interest in the lack of resiliency and transparency of the U.S. agricultural system and a sense of urgency to do something as soon as possible about unprecedented levels of concentration: for example, the “Big Four” meatpacking companies control 85% of the market, Family Farm Action said.
“The hearing leaves no doubt that meatpacking monopolies are stealing fair market opportunities from cattle producers, gouging consumers, and putting profit over people. The time for action is now,” said Emily Miller, Research and Policy Manager of Family Farm Action and co-author of a report on the food system by Hendrickson.
Earlier this year, Fischer and Sen. Ron Wyden (D-Ore.) introduced a bipartisan Cattle Market Transparency Act of 2021.
The legislation will:
- Establish a mandatory minimum number of negotiated cash and negotiated grid trades, which will enable discovery of fair prices. It will require the Secretary of Agriculture in consultation with the Chief Economist, to establish regionally sufficient levels of negotiated cash and negotiated grid trade, seek public comment on those levels, then implement.
- Require USDA to create and maintain a publicly available library of marketing contracts between packers and producers in a manner that ensures confidentiality.
- Prohibit the USDA from using confidentiality as a justification for not reporting marketing deals.
- Mandate that a packer report to USDA the number of cattle scheduled to be delivered for slaughter each day and require USDA to report this information daily.
Reauthorization for Livestock Mandatory Reporting (LMR), the rule established in 1999 mandating price reporting for livestock including cattle, expires on Sept. 30, and is an opportunity to address these issues in the cattle industry, Fischer said.
Committee members and witnesses alike suggested several possible reforms of the financial structures that underpin the U.S. agricultural system.
Among those suggested were checkoff program reforms, introduction of mandatory Country of Origin Labeling, programs to support young and disadvantaged farmers, investment in local and regional food systems, funds for small and local meat processors, the Farm System Reform Act, the Meat Packing Special Investigator Act, the Food and Agribusiness Merger Moratorium and Antitrust Review Act, and meaningful reforms to the Packers and Stockyards Act, such as removing the competitive injury requirement and defining “undue preference” to end preferential treatment and sweetheart marketing deals.
The Family Farm Action group says all of these programs and policies should be advanced without delay.
Family Farm Action Family Farm Action is a coalition of farmers, workers, and businesses building the “political muscle” to take on abusive corporate monopoly power, the group says.
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