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Legislation intended to the address increasing consolidation of the cattle market by a few big companies is facing opposition from some Republicans who fear the effort will lead to government overreach.
At a Senate Agriculture, Nutrition, and Forestry Committee hearing Tuesday, a number of senators expressed concern over whether two bills intended to help cattle producers compete would actually harm them.
One bill, S. 4030, would establish a cattle contract library and require the Agriculture secretary to set a minimum threshold for negotiated trade volumes. The other, S. 3870, would establish an Office of the Special Investigator for Competition Matters within Agriculture Department.
Meatpacking is dominated by four large companies — Tyson Foods Inc., Cargill Inc., JBS SA, and National Beef Packing Co. — raising longstanding concerns about consolidation in the industry. The sponsors of the negotiated trade volumes measure, including Sen. Deb Fischer(R-Neb.), say it would help bring market and price transparency to keep small producers from getting edged out of the industry.
But the committee’s ranking member, Sen. John Boozman (R-Ark.), whose state is home to Tyson Foods’ headquarters, said after the hearing that he can’t support the bill, citing problems with the mandatory cash minimums proposed.
Boozman cited studies indicating that the Cattle Price Discovery and Transparency Act could impose costs on producers, the very people its supporters say it aims to help. One analysis he brought up cited burdens on producers in the Southern Plains region.
Boozman said he had spoken to lawmakers from states that could be affected, including Oklahoma and Texas. “I think there’s real concern that this bill picks winners and losers and certainly that part of the country would be dramatically affected,” he said.
Much of the discussion at the hearing focused on alternative marketing agreements, or AMAs, which involve negotiated prices outside the cash market. Those opposed to the bill contend that the cattle transparency bill would hurt producers by limiting the benefits they can reap from such arrangements.
Sen. Roger Marshall (R-Kan.) said the committee agrees on the problem but disagrees on how to solve it. Marshall, who said fewer regulations, not more, are the solution, also opposed the second bill that would establish the investigative office in the USDA.
“It scares me when this government starts throwing more money and forming more committees and what the unintended consequences of that’s going to be,” Marshall said, questioning the necessity of a new office.
The bills enjoy support, however, from key farm state Republicans such as Fischer and Sen. Charles Grassley (R-Iowa). “I don’t intend to stop until these bills become law, and I would like to have my colleagues join us in this effort,” Grassley said at the hearing.
While divisions between Republicans could be troublesome for the bills if they get to the floor, Grassley said last week on a call with reporters that he’s confident in bipartisan votes to get the cattle transparency bill through the Senate.
Democrats have championed the bills, citing them as necessary to improve the supply chain and tamp down on rising prices. Committee Chair Debbie Stabenow(D-Mich.) said the four large multinational meat processors control 85% of the supply.
“The big guys are muscling out the new smaller meat processors who simply can’t compete,” Stabenow said at a leaders’ press conference after the Democrats’ weekly policy lunch. Stabenow, who supports both bills, said the food supply chain is efficient but vulnerable, referencing the effects of Covid-19 and Russia’s war on Ukraine.
She said the legislation was evidence Democrats were attacking price gouging as inflation runs rampant.
“Republicans talk and talk and talk, and we act and act and act,” Stabenow said.
The House passed a bipartisan cattle library bill (H.R. 5609) in December by a 411-13 vote.
Nancy Ognanovich in Washington also contributed to this story.
To contact the reporter on this story: Maeve Sheehey in Washington at firstname.lastname@example.org