BILLINGS — The Montana Stockgrowers Association (MSGA) and 22 other state cattlemen’s associations signed a letter requesting an investigation of beef pricing margins by the U.S. Department of Justice (DOJ) which resulted from two recent extreme market shifts due to a packing plant fire in Holcomb, Kansas, in August 2019, and more recently due to COVID-19.
Fred Wacker is the MSGA president from Miles City and says they believe determining evidence of any fraudulent business practices within the meatpacking industry is vital to our producer’s continuity of business and needs to be identified quickly and rectified immediately.
“Montana Stockgrowers feels that we did the right thing,” said Wacker. “This is needed, done for a good while. We're very interested in seeing that there is fairness in the markets. It's very hard to watch the prices paid for fat cattle to fall in slumber along and we see the cutout values holding steady; and in some instances rising. We believe that we need to take a look at how cattle are priced. And as long as we're going to do that, we think it's time that Department of Justice did an investigation and we find out exactly what the profits are and exactly what the packers are doing when they buy cattle.”
U.S. Senator Jon Tester (D-MT) agrees and says that price irregularities in the beef market have been present for some time but have been made worse by COVID-19. “For some time now, we've had a situation in this country where large packers are taking advantage of the feeders, the small and medium sized feeders and the cow/calf operators,” said Tester. “We've seen record profit at the packer end of things and we've seen the feeders and the cow/calf operators lose money. So, I've asked Attorney General Barr to do an investigation to find out what's exactly going on, because quite frankly, with covered 19, this is only getting worse. And in a state where cattle outnumber people. This is a huge problem.”
U.S. Senator Steve Daines (R-MT) said in a news release: “At a time when cattle producers are seeing record losses and bankruptcies, now exacerbated by the COVID-19, compared to the shelf price of meat at record highs – these margins fail to make sense. We ask that the Department of Justice Antitrust Division evaluate these dual concerns thoroughly and expeditiously in order to protect the integrity of America’s failing beef industry.”
The Montana Stockgrowers Association believes the Department of Justice is the appropriate agency to open an investigation and can also support the USDA in its investigation – allowing this process to be concluded in a timely manner.
If people would like to read the full letter to the Department of Justice, they can visit the Montana Stockgrowers Association’s website at www.mtbeef.org.