R-CALF Asks FTC and DOJ to Investigate Vertical Integration of Feedlots
In a statement issued Monday, R-CALF USA said it has submitted formal comments to the Federal Trade Commission and the Department of Justice regarding concentration and integration of cattle feedlots in the U.S. Specifically, the group said the “oligopolistic structure of the beef packing industry is now being pushed upstream into the live cattle supply chain.”
R-CALF said nearly 85,000 feedlots have exited the feeding industry over the past 25 years, with 1,000 small farmer/feeder lots exiting just last year. The group said that loss represents75% of the nation’s cattle feeders. Conversely, the group said, the number of the largest feedlots has increased from 45 to 77 over the same period, and those 77 lots fed 35% of the nation’s cattle last year.
The 2017 Census of Agriculture estimated 26,586 feedlots in the U.S., and of those about 61% have fewer than 100 cattle. USDA says 77% of fed cattle are produced in feedlots with capacity greater than 1,000 head.
R-CALF said it is concerned about the rapid consolidation of the feeding industry and it urged the FTC and DOJ to investigate the degree of buyer power the concentrated beef packers exercise over those feedlots – in particular, the 77 largest feedlots.
The agencies had called for public comments to help them improve enforcement of U.S. antitrust laws regarding both horizontal and vertical mergers.