WASHINGTON — American Farmers & Ranchers (AFR) Cooperative President Scott Blubaugh, Tonkawa, Okla., detailed the negative impact industry consolidation has on family farmers and ranchers and consumers during a U.S. House Agriculture Committee hearing titled “State of the Livestock Industry” Oct. 7. Blubaugh represented National Farmers Union (NFU) in the hearing.
“Over the past 50 years, our food system has come under the control of fewer and fewer multinational corporations,” testified Blubaugh. “Unchecked consolidation and vertical integration have created a dramatic imbalance of power between producers and corporations, allowing corporations to manipulate the marketplace, push down prices paid to farmers and ranchers, and ultimately drive us out of business.”
Since 1980, the retailer percentage of the beef dollar has grown by 65% and the packer share of the beef dollar has increased by more than 70%. During this same time, the farmer and rancher share as fallen by more than 40%.
Blubaugh questioned the fairness of the shift in the U.S. beef dollar, stating the “[meat]packers maximize their profits, overcharge consumers, and limit farmers like me to razor thin profit margins.”
“It doesn’t have to be this way,” said Blubaugh. “Corporate consolidation of the food system, especially the livestock sector, isn’t inevitable.”
Blubaugh called for strong action by the Committee, other lawmakers and the Biden Administration to address consolidation issues in the livestock sector and encourage “robust competition” at all links of the livestock supply chain. Specifically, Blubaugh called for:
- Stronger rules to reinvigorate the Packers and Stockyards Act (PSA);
- More reliable and robust information for ranchers through improved mandatory price reporting;
- More accurate information for consumers through truth-in-labeling; and
- Improved price discovery through reform and reauthorization of the Livestock Mandatory Reporting Act.
Blubaugh also called for federal and state governments to invest in supporting more competition in marketing and processing, citing the success of a small meat processor grant initiative in Oklahoma.
“This is just one example in one state, but it’s clear the interest and the need is there to decentralize processing,” said Blubaugh. “It reduces supply chain risk, puts more funds in producers’ pockets, and creates jobs in rural America.”
Other panel witnesses included: U.S. Agriculture Secretary Tom Vilsack, Iowa Senator Chuck Grassley and representatives of the National Cattlemen’s Beef Association, North American Meat Institute, National Pork Producers Council and the American Sheep Industry Association.
AFR Cooperative is a membership services organization established in 1905 as Oklahoma Farmers Union. AFR provides educational, legislative and cooperative programs across the state and serves as a watchdog for Oklahoma’s family farmers and ranchers and rural communities. The organization is actively supportive of the state’s agricultural industry and rural population with membership consisting of farmers actively involved in production agriculture and non-farmers adding their voice in support of AFR principles.
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