The U.S. is the highest and best consuming market in the world for beef, so why have half of America’s ranchers gone out of business? Why have 10 million cows been liquidated, leaving Americans with such a short supply of beef? Why has America become an overall net food importer, dependent on foreign food to eat?
The failure to enforce antitrust laws has put control of our food system into the hands of a few multinational corporations. These same multinational corporations control politics and the policy, keeping the wealth from agriculture flowing into their pockets. Two of our big four beef packers, JBS and Marfrig, are from Brazil. The other two, Cargill and Tyson, do business globally, all searching the world for the cheapest of everything to sell into the highest consuming market – the United States.
All the fuss about opening up Argentina for more imported beef ignores the power of the big food/beef cartel to profit even more, with no relief for struggling ranchers or consumers, both in the U.S. and in Argentina. History proves, increasing the beef supply in the current highly concentrated market will not translate to lower consumer prices, but will lower cattle producer income, when for the first time in decades, cattle producers are nearing break evens.
Why are ranchers going broke with the highest retail prices in history?
Argentina raises some of the very best cattle in the world. From cattle genetics to healthy soils, and ideal growing conditions, Argentina has fed their citizens well from over 60 domestic meatpackers, compared to producers in the U.S. being crushed by four corrupt and cooperating meatpackers controlling 85% of the market. Additionally, Argentina’s ban on performance enhancing drugs elevates their beef quality above the industrially produced beef elsewhere in the world. They love their beef, and have not supported exporting at the expense of their own citizens.
The fingerprints of Tyson/Cactus, the largest Argentine exporter, are all over the idea of exporting more beef to the U.S. Additionally, think about the new opportunities to transship (previously through Uruguay and Mexico) via the newly favored country to the profitable U.S. market?
So, asking the question, why are cattle producers going broke while consumers pay record high prices for beef? It’s the abusive market power of powerful middlemen – the big meatpacker, big retailers, and big food service cartel. Until the government breaks up this concentrated power, we will continue to lose more and more food producers and will become less and less able to feed ourselves.
