Q: What do you feel are the major issues standing in the way of fair cattle markets?
The biggest issue is the dominant position the packers have. If there were more marketing options, packers wouldn’t be in the position to oppress producers and depress prices. Market concentration is the real problem; all the other issues in the industry are symptomatic of that.
Q: What solutions could be implemented to solve this issue of market concentration?
In the short-term, MCOOL would at least give producers the opportunity to compete at the retail level with imported beef, such as Brazilian beef.
Long-term, anti-trust laws need be enforced with the packers so they aren’t able to have such a dominant market position.
Q: You recently gave a presentation regarding the Global Roundtable for Sustainable Beef. Can you elaborate on what GRSB is?
GRSB is a corporation with members that are the biggest players in the beef business. The important players in this corporation are Wal-Mart, Tyson foods, Cargill, JBS, National Beef, Marfrig, other global meatpackers, World Wildlife Fund, most of the pharmaceutical companies, The Nature Conservancy, the United Nations and NCBA. No producer driven organizations are involved with the GRSB.
Q: What are the goals the GRSB?
The goals are to reduce demand for beef and increase the cost of beef production so consumers eventually quit eating meat, specifically beef. The packers and the big retail outfits that are involved don’t have any particular allegiance to beef; they’re involved with other integrated proteins such as pork, poultry, and fake meat substitutes. There is pressure up the supply chain to transition to these more efficient proteins and essentially put beef producers out of business. The GRSB is making consumers believe that beef is harmful to the environment and bad for their health. They would like to see the industry vertically integrated by 2030.
Q: How does the cattle industry avoid vertical integration?
Vertical integration slowly works its way into a system by having a choke point in the supply chain. Right now, the choke point is at the packer level. The packers are in a position to dictate the terms and conditions not only to the producers, but also to the retailers.
Q: What are your thoughts on cattle and beef imports?
We don’t need imports. The packers like imports because they are able to import cheap meat from Brazil and then label it product of the USA by just repackaging the product. This is a terrible fraud to the American consumers and also a disservice to domestic cattle producers. Furthermore, we’re importing beef from countries that are endemic with Foot and Mouth Disease. If FMD finds its way into our country, it will decimate our cattle industry and completely wipe out consumer confidence.
Q: What are your thoughts on the beef checkoff?
The NCBA controls the vast majority of beef checkoff dollars. They have dual loyalty to both beef packers and cattle producers, and since packers hold a much more powerful position, they’ve been able to highjack the checkoff.
Producers need to be informed with what is truly going on with their beef checkoff dollars and they need to have the chance to vote on the program.
Q: Any closing statements?
The biggest threat facing the cattle industry today is Foot and Mouth Disease. If the disease finds its way into the U.S., American beef will become undifferentiated.