WASHINGTON – Senator Chuck Grassley has introduced legislation to ban packer ownership of livestock after seeing continued consolidation within the livestock industry.
“An effective and efficient marketplace is one where packers that control all harvest capacity of the industry do not also own a majority of the animals to be processed,” Grassley said. “The fact of the matter is that the market continues to become less competitive. It’s time to see if ending packer ownership of livestock will reverse that trend.”
Over the last several years, we’ve seen large companies joining forces to create new business giants in every sector of the economy, including agriculture. Tyson has purchased Hillshire Brands and JBS purchased Cargill pork. Smithfield, by far the largest pork producer in the world, was sold to the Chinese. And, in the beef industry, packing plants have closed in West Texas and Denison, Iowa which further concentrated power in that industry.
This means independent producers are seeing fewer choices of who to buy from and who to sell to. More and more family farmers and independent producers are feeling the pressure and impact of concentration in agriculture.
Grassley’s bill contains four exceptions to the ban for:
1. an arrangement entered into within seven days (excluding any Saturday or Sunday) before slaughter of the livestock by a packer, a person acting through the packer, or a person that directly or indirectly controls, or is controlled by or under common control with, the packer;
2. a cooperative or entity owned by a cooperative, if a majority of the ownership interest in the cooperative is held by active cooperative members that own, feed, or control livestock; and provide the livestock to the cooperative for slaughter;
3. a packer that is not subject to mandatory price reporting laws; or
4. a packer that owns one livestock processing plant.
Grassley introduced similar versions of the packer ban in previous Congresses. He has long-standing concerns about concentration in agriculture and the impact on the family farmer.
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