Beef Contract Library Bill Introduced in House
In May 2021, NCBA met with American Farm Bureau Federation, Livestock Marketing Association, National Farmers Union, R-CALF and U.S. Cattlemen’s Association to discuss urgent concerns and the need for a cattle contract library was one of three priorities agreed upon.
According to Drovers, on Wednesday, Ranking Member of the Livestock & Foreign Agriculture Subcommittee Dusty Johnson (R-S.D) and Representative Henry Cuellar (D-TX-28) introduced the bipartisan Cattle Contract Library Act of 2021, which would create a library for cattle contracts within the U.S. Department of Agriculture’s (USDA’s) Agriculture Marketing Service Department.
The bill is designed to provide cattlemen with the market data needed to make more informed marketing decisions and exert greater leverage in negotiations with major meatpackers.
The bill instructs USDA to regularly update the library in a user-friendly format and provide weekly or monthly reports as applicable. The Cattle Contract Library will publish information related to the type and duration of a contract, the total number of committed cattle solely to the packer each week, and more.
With a similar library currently in place for the pork sector, the House Agriculture Committee will vote on House Bill 5609 Thursday.
Swift to Acquire Sunnyvalley Smoked Meats for $90M
According to Food Dive, Swift Prepared Foods, a subsidiary of JBS USA, is acquiring Sunnyvalley Smoked Meats for $90 million. The purchase, which is subject to closing, includes Sunnyvalley’s Manteca, California, production facility, and gives Swift an expanded geographic footprint in the smoked segment, as demand for bacon and other pork products continues to rises throughout the pandemic.
Sunnyvalley, which produces smoked bacon, turkey and ham for retail and wholesale customers, has gross annual revenues of $150 million, employs over 300 people, and will continue to be lead by Bill Andreetta, president and founder of the more than 30-year-old business.
After JBS’s second quarter pork revenue hit $10.7 billion, over 25% higher than the same quarter a year prior, JBS S.A. CEO Gilberto Tomazoni said the company was looking to diversify its protein lineup, specifically pork products.
The acquisition of Sunnyvalley gives JBS an opportunity to gain share in a bacon segment dominated in the U.S. by Kraft Heinz’s Oscar Mayer, Smithfield, Hormel and Tyson.
Record High Cattle Sales in Rugby
While selling off a few head here and there is not unheard of, across the region many have been forced to sell more than half or even their entire their cow herds this year due to severe drought conditions.
West Dakota Fox News reported, as a consequence, sale barns like the Rugby Livestock Auction in Rugby, ND have been busier than ever; typically selling anywhere from 60,000-65,000 cattle annually – a number they hit this summer alone with calving season on the horizon.
Rugby Livestock Auction owner, Cliff Mattson commented that a during a typical summer they will sell 200-300 head every other week, but this year demanded weekly sales where anywhere from 2,500 to 4,000 head were sold.
Thanks to recent moisture in the state, sales have slowed down a bit, alleviating a small bit of stress for both local ranchers and sale barn workers but all continue to wait anxiously to see what this winter will bring.
Supply Chain Workers Warn of Worldwide ‘System Collapse’
According to the Epoch Times, The International Chamber of Shipping, a coalition of truck drivers, seafarers, and airline workers, has warned in a letter to heads of state attending the United Nations General Assembly that governments need to restore freedom of movement to transportation workers amid persistent COVID-19 restrictions and quarantines.
If nothing is done, they warned of a “global transport system collapse” and suggested that “global supply chains are beginning to buckle as two years’ worth of strain on transport workers take their toll” according the letter signed by the International Air Transport Association (IATA), the International Road Transport Union (IRU), and the International Transport Workers’ Federation (ITF), which represent some 65 million transport workers around the world.
Gene Seroka, executive director of the Port of Los Angeles, attempted to shed some light on the problem during a recent ABC News interview, noting that there’s a significant backup of container ships off the coast of major ports of entry. “We’re witnessing a pandemic-induced buying surge by the American consumer, the likes of which we’ve never seen,” Seroka said.
Drovers reported that the Ports of Los Angeles and Long Beach account for 40% of all shipping containers entering the U.S., which is a main source of the bottleneck dilemma. And it’s not just ships waiting to unload. The challenge is further fueled by an insufficient number of truck drivers to get the goods out of the Port and dispersed across the U.S.
Last week, the issue was discussed and debated at the White House. As a result, President Biden announced one solution: expanding operating hours at a key West Coast port. The Biden administration announced a brokered agreement that would turn the Port of Los Angeles into a 24-hour operation, seven days a week. The White House said the expanded hours would nearly double the time that cargo will be able to move in and out of port.
USDA Chief Economist Seth Meyer is currently exploring ways the agency could help facilitate fixes, and what role USDA could play as the Biden administration works through one of its largest challenges. As the situation becomes more dire, economists across the globe are also mixed on just how long it will take to get the supply chain back in standard operating order.
A Wall Street Journal survey found labor shortages and supply constraints to be bigger risks to the economy than Covid-19. While the majority of economists surveyed (more than 30%) say they think supply chain disruptions will recede by Q2 of 2022, more than 10% see the issues lasting into 2023 or later.
Meyer is in the camp it will take months, not years but commented, “It’s not just things like tractor parts, but it’s hauling food products, it’s hauling cattle, it’s all these transportation issues. It’s getting those truck parts back, it’s delivery of food products to the institutions. I think we’ve got a while to sort these things out. When I look at the USDA,” Meyer said, “you’ve got short-run port resolutions as in opening for 24 hours, and then medium-term things where you try to improve the throughput by getting more truck drivers.”
Groups like the International Dairy Foods Association (IDFA) say there are quick fixes that could help get more drivers on the road, including pilot programs which would allow drivers who are below the age of 21 to drive interstate, but the other barrier the White House could help remove is the maximum weights truck drivers are allowed to carry.
Matt Herrick, Vice President of Communications for the IDFA commented, “We’ve got increased demand in our sector, increased demand for our products. Can we keep those truck weights up in a safe way, but keep them elevated? Can we continue to raise the hours of operation and keep those elevated? And can we do that so truck drivers can stay on the road and make those deliveries in a safe manner?”
As shippers try to raise wages in order to attract more drivers to get on the road, the action not coming without other costs