President Biden is to meet with farmers, ranchers and independent meat processors today to discuss the Biden-Harris Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain. The Action Plan includes four core strategies for creating a more competitive, fair, resilient meat and poultry sector, with better earnings for producers and more choices and affordable prices for consumers.

The Biden Administration has been critical of the meat industry in the past. In a fact sheet released today, the White House said that a lack of competition hurts consumers, producers, and the economy.

“Four large meat-packing companies control 85 percent of the beef market. In poultry, the top four processing firms control 54 percent of the market. And in pork, the top four processing firms control about 70 percent of the market. The meatpackers and processors buy from farmers and sell to retailers like grocery stores, making them a key bottleneck in the food supply chain,” the release states.

The Action Plan will do the following:

• Dedicate $1 billion in American Rescue Plan funds for expansion of independent processing capacity.
• Strengthen the rules that protect farmers, ranchers, and consumers.
• Work to increase transparency in cattle markets so that ranchers can get a fair price for their work.

As part of its work in the meat industry, the Biden-Harris Administration has announced plans to issue new, stronger rules under the Packers and Stockyards Act. The USDA has already begun work on three proposed rules to provide greater clarity and strengthen enforcement under the Act. It will also Issue new “Product of USA” labeling rules so that consumers can better understand where their meat comes from.

The Biden-Harris Administration will also work with Congress to make cattle markets fairer and more transparent. “The Administration is encouraged to see bipartisan legislation in the Senate by Senators Grassley, Fischer, Tester, and Wyden, and in the House by Representatives Axne and Feenstra, that seeks to improve price discovery in the cattle markets and facilitate actual negotiation of prices between livestock producers and packers,” the White House said. “We look forward to working with Congress on these important issues, and we hope that they will also look for ways to ensure farmers and ranchers have fair access to processing capacity.”

The U.S. Cattlemen’s Association praised the Action Plan. “Today's announcement puts into motion what our members have, for years, urged action on - empowering the independent producer and processor to create a more robust and resilient food system,” said USCA President Brooke Miller.
 
 “USCA commends the Biden-Harris Administration for its persistence in working to restore competition throughout the U.S. economy. We are hopeful that the Action Plan unveiled today will help bring transparency and true price discovery to the cattle marketplace, bring back truth in labeling through the closure of the Product of the U.S.A. loophole, and invest in a stronger - and more American - meat industry. We look forward to working with the Administration to implement the provisions outlined in this Action Plan.”

The North American Meat Institute said that increased government intervention will not help consumers or produceers. “For the third time in six months, President Joe Biden and his Administration announced the same plans to spend $1 billion to fund government intervention in the market in an attempt to increase prices livestock producers receive while blaming inflation on private industry,” said Julie Anna Potts, President and CEO of the North American Meat Institute. “The Biden Administration continues to ignore the number one challenge to meat and poultry production: labor shortages. This tired approach is not surprising because they have refused to engage with the packing and processing sector they attack, going so far as to hold a roundtable on meat packing without a single beef or pork packer present.

“Press conferences and using taxpayer dollars to establish government-sponsored packing and processing plants will not do anything to address the lack of labor at meat and poultry plants and spiking inflation across the economy,” said Potts. “The Administration wants the American people to believe that the meat and poultry industry is unique and not experiencing the same problems causing inflation across the economy, like increased input costs, increased energy costs, labor shortages and transportation challenges. Consumers know better.

“As economists predicted, producers are seeing higher prices for their cattle because packers have processed the backlog of animals in the system.”

Source: The White House, U.S. Cattlemen's Association, North American Meat Institute