Here is the best insight you will get into what really needs to happen with the beef industry after the President’s latest action, from one of the smartest, most honorable people I know, Ammon Blair, Senior Fellow with the Texas Public Policy Foundation:
I agree with President Trump that we have to break the stranglehold a handful of large processors have on the cattle market and give American ranchers a real opportunity to process and sell their own beef. 🥩
But processing is only one part of the problem.
We need Mandatory Country of Origin Labeling.
If an American rancher raises cattle here, that rancher should be able to distinguish that product in the marketplace, and American consumers should be able to look at a package of beef and know whether the animal was born, raised, and processed in the United States.
We also need real enforcement of the Packers and Stockyards Act.
Competition means very little if independent producers are still dealing with market concentration, unfair practices, retaliation, weak price discovery, and limited access to buyers.
We have to restore an actual competitive cattle market too.
When dominant packers can secure large portions of their cattle through formula contracts and other captive supply arrangements, they do not have the same incentive to compete aggressively in the open market. At the same time, the shrinking cash market can still help establish the price used in those contracts.
That is backwards.
We need enough negotiated trade to establish meaningful price discovery, and we need to address procurement practices that allow dominant packers to control cattle supplies without truly competing for them.
We also cannot allow the cattle industry to go the way of poultry and hogs.
One of the reasons independent cattlemen have remained independent is that the packer generally does not control the animal from birth to slaughter.
We should be very cautious about further vertical integration that allows a handful of companies to control genetics, production contracts, feeding, slaughter, processing, distribution, and access to the consumer.
We need more independent cattlemen, more independent processors, and more competing buyers—not a system in which the same handful of companies increasingly control the animal, the processing, the distribution, and access to the consumer.
If we are serious about helping ranchers process their own beef, then we also have to fix the regulatory side.
A rancher can spend enormous amounts of money building a small processing facility and still get buried trying to obtain and maintain inspection.
USDA should recognize that a family scale processor is not the same operation as a plant slaughtering thousands of animals a day.
Small processors need clear and predictable rules, timely inspection, due process, and people inside USDA whose job includes helping legitimate small businesses comply and stay open.
We should also expand state inspection and interstate shipment opportunities.
A safe, properly inspected local processor should not be trapped inside one state's borders simply because of the inspection program under which it operates.
If the plant meets the required food-safety standards, government should be helping that business reach more customers rather than creating unnecessary barriers to market entry.
Then there is market access itself.
Ranchers and independent processors need a realistic way to sell to consumers, grocery stores, restaurants, schools, hospitals, military installations, correctional facilities, and other institutional buyers.
Giving somebody the ability to process beef does not solve much if the same concentrated distribution and retail system keeps them from reaching the customer.
Government procurement is part of that too.
Federal, state, and local agencies purchase enormous amounts of food. Those contracts should not automatically be written at a scale that only the largest corporations can fulfill.
@NoAgendaLara