Big Sky Connection

 

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Eric Tegethoff

August 30, 2018

BILLINGS, Montana - Ranchers and cattle producers are throwing their weight behind a U.S. Senate bill that would temporarily stop mega-mergers in the agriculture sector. 

The bill, introduced by Sen. Cory Booker of New Jersey, would put a moratorium on farm and food business mergers until the U.S. Department of Justice more actively enforces anti-trust laws. 

Bill Bullard, CEO of R-CALF USA, which represents independent cattle producers and is headquartered in Billings, says a small number of meatpackers have so much control over the market that they are exploiting both producers and consumers.

"They're paying producers for less than what the competitive market would dictate and charging consumers whatever the market will bear," he points out. "We need to restore competition, and this bill is absolutely essential."

Four meatpackers control 85 percent of the beef market, 74 percent of pork and 54 percent of poultry, according to the Institute for Agriculture and Trade Policy

Bullard says as meatpackers have consolidated, they've moved their operations to the Southwest, hurting cattle producers in Montana.

For the first time in decades, the Justice Department halted a merger in 2008 in the meatpacking industry, but hasn't stopped any mergers since. 

Bullard says two of the four meatpackers that control the vast majority of the market are Brazilian companies. He says these companies have been known to cut corners on food safety.

"This is just another example of how dominant meatpackers, when given the tremendous market control that they now possess, can use that control to maximize their profits, but on the backs of independent cattle producers and consumers," he states.

The Senate bill also would create the Food and Agriculture Concentration and Market Power Review Commission to review mergers and acquisitions.