Coronavirus in South Dakota: Despite demand for meat, state beef farmers are losing money


Patrick Anderson, Argus Leader and Bart Pfankuch, South Dakota News Watch

March 24, 2020


Walt Bones and his family just wanted a little more value per cow before locking in a price with beef packers.


Then the market dropped.


The global COVID-19 pandemic sent prices tumbling for what Bones and other South Dakota farmers get on the open market.


The fourth-generation farmer in Parker blames himself for mistiming the market, but he’s still frustrated by what he sees happening elsewhere, as consumers across the United States respond to the worsening crisis.


Beef coolers are picked over. Shoppers are hoarding groceries and home goods, including meat.


Yet somehow, South Dakota farmers such as Bones are losing hundreds of dollars per cow at auction.


His cows have to go by May as they continue to approach market weight, Bones said.


“Now we’ve got to look at a different strategy,” Bones said. “I can’t keep feeding them day after day after day and wait for the market to get better.”


Representatives for South Dakota farmers raised an alarm this month after a market report from the Fort Pierre Livestock Auction described exceptionally low bids and accused the nation’s four beef packers of conspiring to fix prices and “using this coronavirus ordeal as an excuse to suck the lifeblood out of the cattle industry.”


'If there’s that much demand ... Why is our price so low?'


Tyson, JBS, National Beef and Cargill control 81 percent of the nation’s beef packing market, according to a federal antitrust lawsuit filed by industry representatives last year against the companies.


A Tyson representative sent an email in response to an interview request for this story, linking to a post on the company’s official website.


Tyson Fresh Meats is planning to provide a one-time premium for cattle harvested this week as a show of support for beef producers, president Steve Stouffer said in the post. The post includes no information about how the premium will work and who will benefit, and Tyson did not respond to follow-up questions.


JBS, National Beef and Cargill did not respond to requests for comment.


South Dakota is home to more than 13,000 beef farms, and the state’s industry has an economic impact of $2.2 billion, according to Ag United for South Dakota.


The auction report from Fort Pierre was enough for Doug Sombke to pen a letter to the state’s congressional delegation, including Sen. Mike Rounds.


The four major beef packers have worked together to control the market, at the expense of South Dakota farmers and consumers, said Sombke, president of the South Dakota Farmers Union.


“If there’s that much demand, if we can’t meet the domestic needs, why is our price so low?” Sombke said.


Rounds asks feds to investigate ...