Sen. Fischer sees momentum for increased competition in cattle markets | Agriculture

As client beef costs proceed to shoot up and the nation’s producers get an ever-shrinking share of these {dollars}, Nebraska U.S. Sen. Deb Fischer mentioned she sees rising bipartisan assist for her invoice searching for to convey extra competition to the nation’s cattle markets.

The Senate’s agriculture committee is about to carry a listening to in Washington on Tuesday on a Fischer invoice that might require beef packers to purchase extra of their cattle in open, aggressive markets.

Fischer and plenty of in the cattle trade imagine an absence of competition as a result of heavy focus in the meatpacking trade is giving packers an excessive amount of market energy, to the detriment of each shoppers and farmers and ranchers. Some 85% of the greater than 30 million head of cattle raised for slaughter annually in the United States are processed by simply 4 main meatpackers.

“I’m really pleased to see the forward momentum for our cattle market reform bill,” Fischer mentioned of the measure, which now has a complete of 19 co-sponsors in the Senate, together with 9 Republicans and 10 Democrats.

Cattle producers’ shrinking share of the meat greenback in comparison with packers was the topic of a sequence of tales in The World-Herald final yr. An up to date World-Herald evaluation of year-end figures for 2021 from the U.S. Department of Agriculture exhibits the pattern has not abated.

Producers in 2021 did see a ten% improve in the worth they obtained for their cattle, ending three straight years of declining costs. But producers’ share of the meat greenback continued to fall, as retail beef costs went up 11% and the packers’ share went up one other 31%.

Over the final 4 years, the worth of beef is up $1.34 per pound. But farmers have obtained lower than 2 cents of that improve, with the packers netting $1 of it. The relaxation went to retailers.

Packers argue there’s nothing inherently fallacious with cattle markets, attributing the worth modifications to pure provide and demand forces and market disruptions just like the pandemic.

But Fischer mentioned the persistence of the traits makes that onerous to just accept.

“You can’t blame the pandemic for everything,” she mentioned. “It’s a result of 85% of meat going to four packers. It’s the result of continued consolidation.”

Today, meatpackers purchase nearly all of their cattle by contracting with particular person producers. Fischer’s Cattle Market Transparency Act would require extra public disclosure of what packers are paying for their cattle and likewise require the packers to purchase extra cattle by way of aggressive money markets.

Sen. Chuck Grassley of Iowa had a competing proposal with the identical goal however has now joined forces with Fischer, a fellow Republican. Democrats Jon Tester of Montana and Ron Wyden of Oregon are the opposite most important sponsors of the invoice.

Fischer mentioned she and different co-sponsors not too long ago met with U.S. Agriculture Secretary Tom Vilsack. He and President Joe Biden have been supportive of the idea of the invoice, and he or she’s hopeful they may formally endorse it.

While the Senate has beforehand held hearings on circumstances in the nation’s cattle markets, this would be the first on Fischer’s invoice, which she believes has the votes to emerge from the agriculture committee.

Fischer mentioned she has made lodging to the packing trade in the most recent model of the invoice. That contains increasing the forms of money gross sales that might depend as aggressive, together with on-line gross sales.

But packers proceed to combat the measure. The North American Meat Institute has pointed to the latest improve in cattle costs, which they are saying have reached a seven-year excessive. And they are saying Fischer’s invoice would restrict the pliability of cattlemen who need to promote their cattle by contract.

“Supply and demand has already driven the cattle markets back into balance without the radical government interference and convoluted mandates called for in the latest draft of the Grassley-Fischer bill,” mentioned NAMI president and CEO Julie Anna Potts. “Make no mistake, the bill still contains government mandates directing how producers market their cattle.”