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Montana Ag Network: Ranchers disturbed by meat packer settlement

Posted at 8:08 AM, Feb 07, 2022
and last updated 2022-02-07 15:36:26-05

Cattle producers in Montana and across the nation were alarmed last week when the news that the court case against JBS USA for alleged price-fixing and constraining the supply of the fed cattle had been settled for $52.5 million.

The information came as the nation's cattle producers gathered in Houston, Texas for the 2022 Cattle Industry Convenient and NCBA Trade Show.

The National Cattlemen’s Beef Association (NCBA) said there were disturbed by the announcement. The group wants to know what has happened to the cattle industry’s demands for a federal investigation into the beef markets going back to 2019.

“It's an active case,” said NCBA CEO Colin Woodall. “The fact that JBS came out and settled before anything was even heard is extremely disappointing to us. It's making us as cattle producers ask the question, ‘What do they know that we don't know? What are they sharing? What are they hiding from us?’ Because when you look at the packers, at these cases, when you look at the Department of Justice investigation, they must understand this is our livelihood. We need to know what's going on. We need to have some transparency. We don't have the luxury as cattle producers to wait for two, three, four, five, six years or more for the DOJ to complete a process as having an impact on our very existence today.”

The Department of Justice began investigating the meatpackers in 2020 as JBS, Tyson and others acknowledged in spring 2020 being issued subpoenas for information. USDA, under the Trump administration, also launched an investigation into cattle-market practices after a major spread in live cattle and boxed beef prices followed the August 2019 fire at the Tyson plant in Holcomb, Kansas.

Oregon rancher Skye Krebs is the Region V Vice President for NBCA. He represents Montana and five other states in his position. He said the NBCA is continuing to address transparency in the cattle markets.

“The Black Swan events and the pandemic kind of highlighted that we have problems in the supply chain,” said Krebs. “We came into the pandemic and the packers couldn't get cattle processed and their operations backlogged. We were all trying to market our cattle. Everybody was frustrated, plus the drought and $200/ton hay.”

“Something needs to be done,” said Krebs. “The pandemic, I think, it highlighted the problem. We're having good conversations about it. I think the solution is out there someplace. I'm not sure we're there yet. But that's why we're here this week to work on issues like that.”

NCBA said they will continue to push the Department of Justice to continue its investigation into the packers.

“So, the fact that JBS settled, I think, does a disservice to the entire industry,” said Colin Woodall. “But more importantly, it's an opportunity for us to go back to the Department of Justice and to Congress and say we need the investigation complete. We need to complete it now. And we as cattle producers need to know what's in it.”

At the beginning of January, President Joe Biden laid out plans to address what are seen as unfair market practices by the big four meatpackers.

The president said the price spread between what packers receive and what cattle producers receive "reflects a market being distorted by lack of competition.