White House aims to increase meat processing options

Sep 10, 2021  | 3 min  | Ep4704

The cost of food, one of the volatile elements in the producer and consumer price indexes, has been on the rise. According to the White House, over the past 10 months, half the increase in the cost of food can be attributed to higher prices for beef, pork and poultry. For months, the Biden Administration has been pursuing complaints about consolidation and price-fixing in the beef industry. This week, USDA laid out their plan to even the playing field.

Peter Tubbs has more.

Sec. Tom Vilsack, USDA: “but what I do know is that our job is to make sure that that farmer gets a fair price and that the producer and that when I go to the grocery store and I'm in the checkout line, I'm paying a fair price. I'm not paying more than I should.”
The White House and the USDA, this week, were decidedly more pointed in their initiative to address consolidation in the meat processing industry. 
Brian Deese, White House National Economic Council: “I want to be very clear that the president's executive order directs the Department of Justice and the FTC to train their enforcement on potential illegal activities, including price fixing and price gouging. We're going to leave that to the enforcement agencies. That's their appropriate role.” 
While the Department of Justice considers their next move where it pertains to the nation’s four largest meat processing companies, the USDA will focus on increasing the number of meat processors in the country.
Sec. Tom Vilsack, USDA: “I remember talking to a producer the other day in Council Bluffs and he said, ‘I don't get this, Mr. Secretary,’ he said, ‘I just sold my cattle and I lost a $150.00 a head, but the processor made $1,800 a head. How can that be?’ ” 
As part of President Biden’s COVID-19 relief package, $500 million dollars has been allocated towards support of new meat processors or those that are planning on expansion. 
The USDA also announced more stringent enforcement mechanisms through the Packers and Stockyards Act to limit meatpackers ability to use their market power to lower prices for market animals.
The White House also hopes that by increasing the number of processing options available to meat producers, a larger share of the profits from meat production will find their way to the farm. 
Sec. Tom Vilsack, USDA: “I think the fact that we are putting $500 million on the table, and basically have begun a process of reaching out to states, to farm organizations, to philanthropic organizations, and asking the question, what could you do with this resource that would allow us to significantly increase the processing capacity in this country in places where we know there Is a need for this, where there are not competitive markets and the reaction to this has been quite favorable.”
For Market to Market, I’m Peter Tubbs
Grinnell Mutual Insurance