Ranchers Divided Over USDA Reversal on Pricing Rules for Meatpackers

Tom Lutey reported yesterday at The Billings Gazette Online that, “Bill Bullard was hopeful President Donald Trump’s rhetoric about draining the political swamp would mean cracking down on powerful meat packing companies, too.

“Bullard, the CEO of the Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America, has for years preached against the federal farm policies he said benefited the nation’s big meatpackers to the detriment of ranchers.

“He thought he saw a kindred spirit in Trump, when the president pledged a rewrite of the North American Free Trade Agreement. But the R-CALF USA leader from Billings parted philosophical ways with Trump on Tuesday as the U.S. Department of Agriculture abandoned Obama-era plans to further regulate cattle sales for fairness.”

The article noted that, “In cattle country, the decision by Agriculture Secretary Sonny Perdue was hailed by ranchers comfortable with private contracts for their sold cattle.”

Mr. Lutey explained that, “It’s the middlemen who feel the pinch of the meat packer monopoly, said Jess Peterson, of the United Cattlemen’s Association. Calves like the ones Peterson was loading into stock trucks Tuesday near Custer are sold into feedlots, where they will be fattened up from 450 pounds to 900-plus.

“‘Fat cattle’ are then sold to meat packers. It’s the final sale to the packer where GIPSA is needed, Peterson said. Although there are four meat packers, each works a different region of the United States, rarely competing against the others.

“When a packer calls a feedlot to offer a price, it’s pretty much take it or leave it, Peterson said. GIPSA would have required meat packers to disclose the prices offered, which would have given feedlot owners a glimpse at prices outside their region and a good idea about whether they were being sold short.”

Yesterday’s article pointed out that, “It’s the fat cattle sales from feedlot to meat packer that present common ground for folks like Peterson and private sales advocates like Miles City rancher Fred Wacker.

At the ranch level, Wacker has more than one buyer for his cattle. He doesn’t see the need to disclose his prices to the federal government for the sake of transparency. There are small sales of 30 cattle or fewer, sometimes between neighbors or family, that don’t need to be reported. Sales between feedlots and large meat packers are a different story.”


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