Daily headlines for November 24, 2021

by | Nov 24, 2021 | 0 comments

Cattle groups disagree on new legislation that would reshape U.S. cattle markets

According to Brownfield Ag News legislation is expected to be introduced in Congress next week that would significantly reform the structure of U.S. cattle markets

RCalf CEO Bill Bullard told Brownfield the legislation introduced Monday by Senator Cory Booker and Representative Ro Khanna would make comprehensive changes to all aspects of the market, starting with prohibiting packers from entering into formula contracts.

The Act accomplishes this by requiring any contract that requires delivery of cattle more than 7 days before slaughter to contain a base price that can be equated to a fixed dollar amount.

The new Act also:
• Bans the nation’s largest packers from owning and feeding cattle more than 7 days before slaughter.
• Requires each plant owned by the largest packers to purchase at least 50% of their cattle needs from the competitive cash market each day and to slaughter those cattle within 7 days.
• Prohibits any conduct by the packers that adversely affects competition regardless of any business justification claimed by the packers.
• Clarifies that a showing of harm to competition is not necessary for producers to protect themselves from anticompetitive conduct by the packers.
• Restores mandatory country of origin labeling (MCOOL) for beef and pork and adds dairy products.
• Empowers producers to defend the competitiveness of their industry by authorizing the recovery of attorney fees in successful cases filed under the Packers and Stockyards Act.

The comprehensive new Act contains three titles: the first addresses reforms to protect meat and poultry processing workers; the second addresses the above stated cattle market reforms; and the third addresses reports required by the Government Accountability Office, including a report on the fragility of and national security concerns in meat and poultry food systems.

While R-CALF announced their endorsement of the reforms, Ethan Lane with the National Cattlemen’s Beef Association told Brownfield “To craft something like this with vegan members of Congress that don’t even agree that cattle production should exist and slap it together and put it out the door as some kind of silver bullet solution is not something we can take seriously at this point as an industry.”


USDA invests $32 million to strengthen U.S. food supply chain; solidifies commitment to helping the meat and poultry sector recover from the pandemic

The U.S. Department of Agriculture (USDA) reported Monday that Secretary Tom Vilsack announced the investment of $32 million in grants awarded to 167 meat and poultry slaughter and processing facilities to support expanded capacity and efficiency through the Meat and Poultry Inspection Readiness Grant (MPIRG) program.

With this grant funding, meat and poultry processing businesses can cover the costs for improvements such as expanding existing facilities, modernizing processing equipment, and meeting packaging, labeling, and food safety requirements needed to achieve a Federal Grant of Inspection, or to operate under a state’s Cooperative Interstate Shipment program. These changes will allow these facilities to serve more customers in more markets.

The Meat and Poultry Inspection Readiness Grant, a new program authorized by the Consolidated Appropriations Act of 2021, is jointly administered by USDA’s Agricultural Marketing Service (AMS) and Food Safety and Inspection Service (FSIS). The program was part of USDA’s comprehensive funding package to help small and very small processing facilities weather the pandemic, compete in the marketplace, and get the support they need to reach more customers.

In June 2021, USDA announced the availability of $55.2 million in program funding, accepting applications for a competitive grant award process which resulted in this week’s awards. Remaining funds will be made available through a forthcoming Request for Applications.


Prairie ranchers brace for potential strike at Cargill plant in Alberta as deadline looms

According to CBC News, in the last two years Prairie ranchers have been dealing with drought, soaring feed costs and pandemic disruptions that led to massive cattle backlogs. Now they are watching — and hoping — for progress on labor negotiations at the Cargill meat-packing plant in High River, Alberta after the union representing workers at the plant issued a strike notice to the company earlier this month.

While the facility is one of the largest in Canada, and has been estimated to processes about one third of Canada’s beef, Cargill spokesperson Daniel Sullivan said Thursday that an agreement has yet to be reached.

A spokesperson for UFCW Local 401 could not be reached for comment, but a strike notice issued on behalf of workers said employees at the plant have raised health and safety concerns related to COVID-19 after a 2020 outbreak saw at least 950 staff at the facility — nearly half its workforce — test positive, with two worker deaths linked to the outbreak.

The union has said workers also want improved benefits, for the company to move workers who are awarded new jobs to those jobs quickly, and reasonable wage increases.

Alberta ranchers hope the two sides can find common ground soon, concerned that a strike at the Cargill plant will lead to another backlog of cattle as they continue trying to manage the fallout of this summer’s drought that hit pasture land and helped drive up feed costs.

As experts have suggested up to 20% of the Canadian cattle herd could be sold off this fall and winter as producers are forced to decrease the size of their herds or go out of business, President of the Manitoba Beef Producers, Tyler Fulton, said he has no doubt that if there’s a long-term stoppage at Cargill that ranchers in his province would see declines of 10-20% in the prices paid for their calves.

Cargill said while they are optimistic an agreement will be reached before there is any impact to producers, they “are in communication with cattle suppliers about contingency plans should they be necessary.”

Professor and food economist, Mike Von Massow said if a strike closed the Cargill plant it would put more upward pressure on retail beef prices, that the stakeholder most significantly hurt by a long-term closure would be the producers and feedlot operators that lead up to the processor, and that if a dispute were to close the plant for a long period of time there would be the potential for significant farm failures in the beef industry.


U.S. senator introduces bill to block Brazilian beef imports after ‘mad cow’ reports

According to Reuters, U.S. Senator Jon Tester introduced legislation last Thursday to halt the import of Brazilian beef into the United States and called for experts to review “the commodity’s safety” after Brazil delayed reporting two cases of mad cow disease.

The bill follows political pressure from U.S. cattle producers who have been calling for a halt to imports of Brazilian fresh beef due to questions about what processes Brazil uses to detect animal disease and other potential foodborne threats to consumers.

Brazil, the world’s largest beef exporter, suspended beef exports to top customer China after the South American country confirmed two cases of “atypical” mad cow disease in two separate domestic meat plants in early September – 3 months after the cases were originally detected in June.

Political pressure on USDA has mounted in recent days, after two cases of a neurodegenerative disorder in patients in Rio de Janeiro were reported earlier this month, despite Brazil’s Agriculture Ministry claiming the cases were not related to beef consumption.


JBS enters cultivated protein market with BioTech Foods takeover

New Food Magazine reported food manufacturing giant, JBS Foods, has entered into an agreement to acquire control of the Spanish company BioTech Foods as it looks to enter the cultivated protein market.

The deal signals the company’s entry into the cultivated protein market, and includes investment in building a new plant in Spain to scale up production. Along with the acquisition, JBS is also announcing the setting up of Brazil’s first cultivated protein research & development center, channeling $100 million (US) into the two projects.

Founded in 2017 and supported by the Spanish Government and European Union, BioTech Foods operates a pilot plant in the city of San Sebastián and expects to reach commercial production in mid-2024 with the building of this new production facility.

JBS will become the majority shareholder, and have access to BioTech Foods technology and protein production capability while providing the industrial processing capacity, marketing structure, and sales channels to bring the new product to market.

When commercial operations begin, the cultivated protein will reach consumers in the form of prepared foods, such as hamburgers, steaks, sausage meats, and meatballs. The technology has the potential not only for the production of beef protein, but also chicken, pork and fish.

Through their investment in the R&D center, JBS says it intends to develop new techniques that accelerate the economies of scale and reduce the costs of producing cultivated protein, bringing forward its commercialization on the market.


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How did we get here?

From the Holcomb Tyson fire to COVID-19;
Click to see a timeline of events that have brought to light the profit and pricing disparity in cattle markets.


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