Nebraska Farm Bureau Suggests Cattle Market Reforms to USDA
BY Craig Head, KTIC (NE)
October 3, 2019
Nebraska Farm Bureau has offered the United States Department of Agriculture (USDA) a series of recommendations to reform the way beef cattle are marketed. The underlying concept of Farm Bureau’s suggestions are to create a more transparent and value-based system that would more closely link the prices farmers and ranchers receive for their cattle to the value of beef products sold at the wholesale and retail levels. Nebraska Farm Bureau President Steve Nelson shared the recommendations with U.S. Secretary of Agriculture Sonny Perdue in an October 2 letter.
“With only four major meatpackers, many Nebraska cattle producers have expressed concerns about the level of control that exists within the consolidated meat packing industry, specifically in the way of packer captive supplies of cattle and the diminishing cash market for live cattle. We believe reexamining the cattle pricing system and moving toward one where cattle prices and cattle contract prices are discovered under a more transparent and value-based system would be beneficial in addressing producer concerns and allow the cattle market to better respond to actual supply and demand conditions,” said Steve Nelson, Nebraska Farm Bureau president.
Beef producers’ concerns about the potential for anti-competitive actions in cattle markets heightened after a July fire at a Tyson meat processing facility in Holcomb, Kan. with producers seeing prices paid for cattle drop while meatpackers made significant profits. Nebraska Farm Bureau had urged, and USDA stepped forward, in investigating the situation under the powers given to the agency under the federal Packers and Stockyards Act; the long-standing legislation targeted to eliminating anti-competitive measures in livestock markets.
“We have no preconceived outcome in mind for the Packers and Stockyards investigation and our state’s cattle producers are grateful USDA is doing its due diligence. However, we believe the best way to address real or perceived manipulation concerns is to move to a value discovery system that more closely links what cattle producers receive for the beef they produce and the value of that product as it nears the end consumer,” said Nelson.
Nebraska Farm Bureau’s recommendations to USDA for changes under the Packers and Stockyards Act include: