Commentary

Hold Biden administration to its promises for fairer ag markets

January 15, 2022 11:00 am

Workers in a pork processing plant, 2016. (Stock photo by USGAO/Wikipedia)

Family farmers like me have been calling for years for aggressive federal action to break up monopolies and make markets more fair.

We know what happens when a handful of companies control livestock and meatpacking markets: farmers earn a shrinking share of the food dollar, farm income declines, and meatpackers earn huge profits. Meatpacking corporations then use those profits to gain more control over livestock production, either through direct ownership or through subcontractors, in a never-ending cycle of corporate concentration and consolidation.

Last week, I was pleasantly surprised to see President Biden announce a new initiative to address this problem, one of the biggest facing rural America today. The “Administration’s Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain” includes commitments to strengthen antitrust enforcement, provide more resources for legal actions when meatpackers break the law, and financial resources for new independent meat processing capacity.

If these policies are implemented effectively, the outcome would be increased competition in the marketplace for farmers and protections for consumers from soaring meat prices.

The statistics that back up this experience nationally are both confirming and alarming. According to the White House, four corporations control 85% of the beef market, four packers control around 70% of pork processing, and four firms control 54% of the poultry market. The farmers’ share of the consumer dollar for cattle producers has declined from 60 cents of every dollar 50 years ago to about 39 cents today. During the same time period, hog farmers’ share has declined from between 40 and 60 cents down to about 19 cents.

On my family’s farm in Adair County, we have directly experienced that change in livestock industry structure. When my husband and I got married nearly 50 years ago, we raised cattle and hogs, as well as hay and pasture and oats. Today, we no longer produce livestock since it has become unprofitable, and we focus on corn and soybeans. This story is the same for hundreds of farm families here in Adair County, and for thousands of former livestock farmers throughout Iowa.

Rather than the diversified, more decentralized livestock production and processing system of the past, multinational corporate power is on full display here in Iowa. JBS, Smithfield, Tyson, Cargill, Marfrig (National Beef), and others operate both giant meat processing plants and livestock production factories in many parts of our state. It’s no surprise that concentrated production controlled by meatpacking corporations has also resulted in concentrated pollution to air and water from livestock and poultry manure.

In addition to squeezing family farmers to drive down their operating costs, corporate meatpackers are also currently ripping off consumers, attempting to blame “rising costs and inflation” for rising meat prices. The same White House report, however, states that the latest corporate profit reports document a 120% increase in gross profits and a 500% increase in net income by meatpacking corporations since before the COVID-19 pandemic.

I agree with President Biden’s analysis of the situation: “We’ve seen too many industries become dominated by a handful of large companies that control most of the business and most of the opportunities — raising prices and decreasing options for American families, while also squeezing out small businesses and entrepreneurs… When dominant middlemen control so much of the supply chain, they can increase their own profits at the expense of both farmers — who make less — and consumers, who pay more.”

I also agree that this initiative addresses some key needs, including a commitment to issue new, stronger rules under the Packers and Stockyards Act, investing millions in federal funding for new independent meat processing operations in small towns, and instituting additional transparency in livestock markets.

President Biden’s recent focus on corporate power in the livestock and meatpacking industry is one of those moments when a large group of organized people can make meaningful change. The truth is, we have a lot of work to do. We have to hold the president, Secretary of Agriculture Tom Vilsack and Attorney General Merrick Garland accountable for their promises.

We also need to push them to address factory farm pollution, as well as better pay and protections for meatpacking workers. We need to make sure that the meat processing funding truly goes to local, independent operations instead of becoming yet another corporate agribusiness slush fund.

What’s needed now is a strong push from farmers, consumer advocates, people concerned about corporate influence over our democracy, and citizens who want a more fair economy to pull together and make sure that the White House rhetoric is matched with administrative and congressional action.

The time is now for us to weigh in together and demand a government and an economy that works for people instead of multinational corporations. Let’s get to work!

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Barb Kalbach
Barb Kalbach

Barb Kalbach is a fourth-generation family farmer registered Nurse, and board member of Iowa Citizens for Community Improvement.

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