Current Cattle Market Daily Headlines for December 15, 2020

by | Dec 15, 2020 | 0 comments

Biden agricultural secretary pick made $1 million a year off of struggling farmers

  • Tom Vilsack, soon to be agricultural secretary for the Biden administration, spent the last four years working as a dairy industry lobbyist with the trade group U.S. Dairy Export Council.
    • In this position he received a salary of $1 million annually, which came from the Dairy checkoff, a program meant to promote milk goods, collected through mandatory fees paid by dairy farmers.
  • In 2018, Vilsack was the highest paid executive at Dairy Management Inc. He was receiving this sizable salary during a time when many dairy farmers were on the brink of financial ruin because of a downturn in milk prices.
  • The dairy checkoff program is much like the beef checkoff program; dairy farmers are required to pay 15 cents for each 100 pounds of milk they sell. This money is supposed to go towards promotion and advertisement of their dairy products.
    • Ten cents of this goes to local and regional programs and 5 cents go to fund national programs, such as Dairy Management, where Vilsack is executive vice president.
      • Dairy farmers expect their checkoff fees to work for them, but instead they are seeing them pad the pockets of people like Vilsack. Many are enraged by this considering how tight money is within the dairy industry.
    • Despite the dairy checkoff program being in place to help dairy farmers sell their product, in 2017, 1,600 dairy farms shutdown, according to the Milwaukee Journal Sentinel.
    • The dairy industry has been so bad that Dean Foods, America’s largest dairy producer, filed for bankruptcy in November of this year.


USDA issues final rule to define undue or unreasonable preferences or advantages under the Packers and Stockyards Act

  • Last week, the USDA issued a final rule to ensure fair trade and competitive marketing of livestock and poultry.
    • This rule clarifies the types of conduct prohibited by the Packers and Stockyards (P&S) Act.
    • It also implements various criteria which the Secretary of Agriculture will consider when determining if conduct by packers, swine contractors or live poultry dealers represents an undue or unreasonable preference or advantage.
  • According to USDA Under Secretary for Marketing and Regulatory Programs, Greg Ibach, this criteria demonstrates USDA’s commitment to equity in the livestock, meat and poultry industries.
    • The establishment of this final rule will ultimately work to benefit everyone in the supply chain, Ibach stated.
  • The four criteria include whether the preference or advantage:
    • Cannot be justified on the basis of a cost savings related to dealing with different producers, sellers, or growers;
    • Cannot be justified on the basis of meeting a competitor’s prices;
    • Cannot be justified on the basis of meeting other terms offered by a competitor; and
    • Cannot be justified as a reasonable business decision.
  • The final rule provides the Secretary will consider these criteria and permits additional criteria to be considered in determining if an undue or unreasonable preference or advantage has occurred and enforcement action should be taken.


Boxed beef prices

  • Choice boxed beef: $209.69 (-4.19)
  • Select boxed beef: $192.30 (-3.41)



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How did we get here?

From the Holcomb Tyson fire to COVID-19;
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