Senators Promise Hearing On Cattle Markets
The disparity of prices in today’s cattle and beef markets has the attention of Senate Agriculture Committee members who promised a hearing on the issue.
During the ag committee’s nomination hearing on Thursday for USDA General Counsel nominee Janie Simms Hipp, both committee leaders noted they were receiving messages from constituents related to livestock markets.
Noting the “livestock industry is in a very difficult situation right now,” Sen. John Boozman (R-AR), said during opening remarks he was urging that a Ag Committee hearing be scheduled during the next work period. “We need to understand exactly what’s going on in that regard and begin to offer solutions,” he said.
Ag Committee Chairwoman Debbie Stabenow (D-Mich.) called on members to work together to address the concerns with livestock industry supply chains. “We need to work together and with members of the committee to understand and look for solutions,” Stabenow said.
Earlier this spring, Senators Deb Fischer (R-NE) and Ron Wyden (D-OR) introduced the Cattle Market Transparency Act that would mandate increased cash sales and bring more transparency to the cattle market. Since that bill was introduced, the spread between cattle prices and wholesale beef prices has widened.
The first week of May, members from six livestock organizations issued a statement calling on the Department of Justice to expedite the renewal of USDA’s Livestock Mandatory Reporting and for DOJ to issue an update on its investigation into packer activity and encouraging investment in new independent, local and regional packers.
Thursday’s Ag Committee meeting was held to consider Hipp’s nomination as USDA’s top legal counsel, and she was asked about current cattle market issues. Hipp said she has heard concerns about livestock market concentration for 35 years.
“I believe I’m seeing a bipartisan approach to this issue that has risen to a level I haven’t seen before,” Hipp told Fischer in response to a question. Hipp pledged to be a “strong voice” in discussions with DOJ and said USDA will need to play a role during any antitrust investigation.
“I commit to you that I will get on this [cattle price transparency] as one of my very, very top priorities,” Hipp said.
Senator Fischer announced during her remarks that she is working on new legislation to better enable the Justice Department and the U.S. Department of Agriculture to address competition problems and potential beef market manipulation.
The North American Meat Institute distributed a memo to Senators outlining myths and facts about cattle markets. For instance, NAMI countered the claim that there is no growth in the packing industry, stating since last year companies have announced expansion or new capacity that would increase packer capacity 4%.
“Meat and poultry companies are utilizing capacity to the best of their abilities with COVID protocol constraints still in place and despite significant labor challenges that existed prior to – and have been exacerbated by – COVID. In fact, Saturday slaughter for the year was 51% above last year and 65% over 2019,” Sarah Little, Meat Institute vice president of communications, said.
“Those calling for government intervention in the market never address labor. Labor is, and is likely to remain, a significant factor that affects utilization of production; and is also a factor that will challenge new small and medium sized facilities entering the market,” Little said.
Labor is likely to remain a significant factor that affects utilization of production capacity; and is also a factor that will challenge new small and medium sized facilities entering the market, the Meat Institute notes.
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