Source: Law360
Cattle ranchers in Nebraska were too afraid of retribution to appear before Congress to testify about the increasing consolidation in the industry, Sen. Deb Fischer, R-Neb., said Tuesday at a committee hearing examining a pair of bills aimed at addressing market power imbalance in the meatpacking space.
Even though the Cornhusker State is known for its beef production — its citizens boasted license plates that read "The Beef State" in the 1950s and 1960s — industry group Nebraska Cattlemen told the senator in a letter that none of its members were willing to risk being punished for anything they might tell the U.S. Senate Agriculture, Nutrition and Forestry Committee.
While the excerpt of the letter read by Fischer called it "an unfortunate reality of today's cattle industry," others on the committee had stronger words regarding the situation.
One such lawmaker was Sen. Cory Booker, D-N.J., who railed against the consolidation in the industry and the purported inaction of Congress that led to it, calling the news delivered by Fischer "stunning" but admitting that the ranchers "have reason to be afraid."
"The fact that they are afraid to come here to testify because of the outrageous power of these meatpacking companies is a testimony to the unacceptable inaction of Congress over the last decade or two to allow these meatpacking companies to continue to consolidate," Booker said.
Like many senators on the panel, Booker shared the Biden administration's upset at the market power wielded by the so-called Big Four meatpacking companies, which that control 85% of the beef slaughter in the United States: Tyson Foods Inc., Cargill Inc., JBS and National Beef Packing Co.
"Four meatpacking companies have corrupted the marketplace using unfair and unlawful practices," Booker said. "This has got to stop."
The senators were gathered Tuesday to hear from two panels of witnesses — one made up of industry players and another made up of two U.S. Department of Agriculture officials — on a pair of bipartisan bills.
The first, the Cattle Price Discovery and Transparency Act of 2022, would divvy the country up into five to seven regions and require that a minimum number of fed cattle in each region be sold using "approved pricing mechanisms." It would also raise the penalty for violations of the Packers and Stockyards Act to $90,000, up from the $10,000 established in 1946.
The second bill, the Meat and Poultry Special Investigator Act of 2022, would create a new USDA office aimed at investigating competition issues in the meat and poultry industry.
Though addressing consolidation in the industry seemed to be a largely bipartisan issue, Republicans on the committee expressed the most concern with the latter bill, making it clear they didn't think the solution involved expanding the federal government.
Sen. Roger Marshall, R-Kan., said it's worrisome when "this government starts throwing around more money and forming more committees." Likewise, ranking committee member Sen. John Boozman, R-Ark., questioned whether "we really think that creating yet another government entity is a solution."
Another issue that several senators took issue with is the ability for large meatpackers to label their meat a "product of the USA" when the cattle were brought in from another country and only processed inside the United States. Booker called the practice "outrageous."
"That is lying to consumers, that is a deceptive practice and it should end," he said.
