Delta County (Colo.) Independent – Wednesday – Aug. 11, 2010
(quotes R-CALF USA CEO Bill Bullard)
By Kami Collins
Bill Bullard, CEO of the Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America (R-CALF USA), was in Delta on Aug. 2 to inform and generate support for the independent cattle ranching market before a meeting on Aug. 27 will determine how livestock market concentration is handled in the U.S.
Later this month, in an historic act, representatives from the Department of Justice and U.S. Department of Agriculture will meet in Ft. Collins to discuss livestock market concentration.
This will be the ﬁrst meeting between the two agencies since the inception of the USDA.
The decisions that stem from the meeting will affect wholesale and retail beef prices and will affect the way independent cattle ranchers operate for years to come.
DoJ and USDA ofﬁcials will address how market conditions of livestock affect the national meat market, the impact on beef producers, prices and consumers, the concentration of market control and the need for enforcement or enhancement of the 1921 Packers and Stockyards Act.
Bullard, who is also a rancher from Montana, spoke at Bill Heddles Recreation Center to a full room, outlining the problem of market concentration and offering solutions to the issue. His visit was co-sponsored by Rocky Mountain Farmers Union, the Colorado Independent CattleGrowers Association and the Independent Cattlemen of Wyoming. He noted that these three organizations typically compete for members and ﬁnancial resources, and it spoke to the severity of the issue that they would come together to provide the forum.
According to Bullard, about 83 percent of the beef in America is controlled by only four companies; one of those companies, JBS, has said they plan to buy out one of the remaining three companies. Additionally, poultry, pork and lamb are also controlled by a handful of companies.
This market concentration, Bullard explained, is bad news for independent ranchers and for consumers. “The U.S. cattle industry is under siege,” he said. “We are in a state of crisis.”
Since 1996, the national cattle market lost 30,000 independent ranchers, and he said the U.S. is losing an additional 11,000 producers every year. The competition in the cattle market is being pulled geographically to the center of the country where the majority of meat packers are, and packers are moving away from a cash market, forcing the hand of producers to sell in unfavorable conditions. In 2009, for every $1 a consumer spent on beef at the grocery store, 43 cents was returned to the producer, compared to about 60 cents in 1990. During that same time frame, consumers at the grocery store saw record beef prices. Beef proﬁts are going back to the packers, Bullard said. Additionally, the U.S. beef market is “slowly but surely” being replaced with imported beef.
All this stems from the control over the industry by the four companies. They have vertical control, Bullard said. They control price, production and supply. As a result of buying power, packers are exploiting producers and consumers in an abuse of power, he said.
At the DoJ/USDA meeting, ofﬁcials will look at enforcing an act that was passed in 1921, the Packers and Stockyards Act, which was created to assure fair competition and fair trade practices and to limit monopolistic control over the market. They’ll also look at enhancing the 1921 act with the new GIPSA Rule (Grain Inspection, Packers and Stockyards Administration). That rule will clarify the act, provide producers with the ability to show harm done to themselves in lawsuits (instead of harm to the entire industry), improve transparency in the industry, prohibit packers from trading cattle amongst themselves, halt the practice of one buyer purchasing beef for several packers, and will end packers’ practices of granting preferred feedlots special preferences and practices.
Bullard requests that letters in support of enforcing the 1921 act be sent to Tess Butler, GIPSA, USDA, 1400 Independence Ave., SW, Room #1643-S, Washington, D.C., 20250-3604. He’s also looking for 25,000 people in support of the effort to attend the Aug. 27 meeting in Ft. Collins, which will be held at Colorado State University. More information on the issue and the meeting can be found at www.r-calfusa.com.
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