August 31, 2020

Cattle Market Letter Sent to USDA

Letter Relating to Cattle Market Sent to USDA

House Agriculture Committee Chairman Collin C. Peterson (D., MN) and Ranking Member K. Michael Conaway (R., TX) sent a letter to United States Department of Agriculture (USDA) Secretary Sonny Perdue, recommending he works with university policy research centers to investigate matters related to the cattle industry, particularly because of the recent and ongoing stress related to COVID-19.

The Congressmen encourage the USDA’s Office of the Chief Economist to evaluate cattle market structure, price discovery, price reporting, purchasing mandates, and barriers to entry in the packing sector, and asks for the analysis to address the following questions:

·      How did the sector get to its current structure and what are its advantages and disadvantages for producers as well as consumers?

·      Is the current capacity sufficient for the industry to thrive and grow?

·      What are the impediments to expansion for both new and existing firms of varied sizes?

·      Are there policy options to expand capacity or increase price discovery regionally or nationally, and would those options address current concentration and supply chain vulnerability concerns?

·      What common success factors for small to medium packing plants, including producer-owned processing can be documented, and is there a set of generalizable strategies for success?

The letter states that the congressmen would like “the policy research centers to engage other experts from across the country, including critical private industry members and industry associations, to ensure this research has appropriate regional representation.” Additionally, they would like “the policy centers to provide quarterly briefings for the Committee staff to provide timely updates on findings and progress”, and they “see this as an opportunity to fully examine and bolster the beef sector, ameliorating current concerns and ensuring food security for America’s future.”

Read the letter here.