Iowa Senator Chuck Grassley is reintroducing legislation that would ban packer ownership of livestock. Grassley, a Republican, says he’s seeing more consolidation and “vertical integration” in the livestock industry which will ultimately hurt farmers and consumers.
“When four companies control 76% of all the slaughter, there’s not much competition,” Grassley says, “and particularly that competition is even lessened when farmers are up against these packers that own livestock and can butcher their own.” In the past few decades, large poultry and pork packers have concentrated operations and Grassley says the beef industry is also showing signs of going the same direction.
“I want farmers to have as much competition as they can to get the highest price for the cattle,” Grassley says. “I think it’s compromised when cattle are owned by packers. They can manipulate the market easier. It shows up in lower prices for farmers.”
A report from the U.S.D.A. says the amount of cattle traded on the cash market dropped from 52 percent in 2005 to 21 percent in 2015. Grassley says that trend shows how packers are gaining far too much power to control the marketplace.
Grassley says, “You’ve heard me say, quoting some president of some company, ‘Why do we own livestock? Well, when prices are high, we kill our own. When prices are low, we buy from the farmer.'” Grassley has offered packer ownership bans at least twice before in recent years and he’s hoping this Congress will be more receptive to his concerns.