Mike Callicrate | No-Bull Food News

America needs a new food system, free of the market predators that have forced producers and workers into lives of perpetual fear and bankruptcy.

The most ideal organic dairy farms will be history if the Biden administration doesn’t act.

As of September 29th, 2021, one-hundred and seventy-eight of the best organic dairy farmers in the nation have been given a notice – a death notice. French dairy giant, Danone, is cancelling their contracts. This means certain death in today’s highly concentrated, monopoly-controlled marketplace, which Danone rules over.

Photo by Nick Levendofsky – 2021 Dairy Expo

Why isn’t the consumer of dairy products being informed of the loss of their local/regional food supply, instead of being fed the lie of how regenerative and forward-thinking Danone is? Currently, as our nation is recognizing the importance of a more local, decentralized, and resilient economy, why aren’t we jumping at the opportunity to build a new local/regional food system in the Northeast, keeping the ideal independent dairies and farms like Danone claims to support in business, while providing consumers the ability to eat better food from their own communities?

Rather than importing from Danone’s aquifer depleting, hyper-industrial factory-farm mega-dairies in the west, consumers of the New England states should have the choice to support the multi-generational family farm dairies close to home.

It’s Danone that should receive notice

It’s well past time for the monopoly power in our critical industries to be broken up, especially foreign market predators like Danone. It’s past time to expose the massive lies of efficiencies and economies of scale that have misled lawmakers and enforcers, enabling big corporations to capture the food system, leaving Americans with bare grocery shelves. How efficient is it to transport Danone’s dairy products from arid faraway places, like Texas, Western Kansas, and New Mexico, to the fertile and forage rich climate of the Northeast – a region fully capable of sustainably feeding itself? How smart is it to destroy local wealth creating enterprises, like family dairies, in favor of below-cost-of-production imports, produced with the extraction of precious and depleting resources, the exploitation of workers, mistreatment of animals, and the disastrous and on-going environmental degradation of industrial style agriculture?

The pandemic has raised awareness among both producers and consumers of the importance of a dependable and safe food system.

The Biden administration is talking local/regional food system development with “Build Back Better,” a plan to address the national security risk of a few corporations controlling farming and food and destroying our ability to feed ourselves. What will “Build Back Better” look like? How will the money be spent? How can the investment in infrastructure be sustainable and resilient? Will Big Food capture, control, and kill the efforts to rebuild, or will new antitrust actions stop these market predators?

Big Food corporations block fair market access to farmers, ranchers, and small food companies.

The safest pathway to consumers is going around the Big Food cartel.

Any new local/regional infrastructure should guarantee a safe pathway for family farmers, ranchers, and small processors to reach consumers, feeding people and communities instead of corporations.

Question: “Is the Ranch Foods Direct model scalable?” Answer: “No, it’s replicable. It’s not meant to be scalable.”

At Ranch Foods Direct our motto is “building community around local food.” To make that happen, we left the industrial food model to sell as directly as possible to the end consumer, seeking to avoid the Big Food monopoly and their predatory practices, which have eliminated many independent food producers attempting to compete.

Northeast dairy farmers are pleading for a fair, open, and competitive market for their milk, but one doesn’t currently exist. Like our nation’s desperate independent farmers and ranchers, they had no alternative but to be part of the abusive Big Food (Danone) below cost of production supply chain – a forced transfer of their work, health, and wealth, until all is lost, including the community. Why have we continued to allow unchecked corporate greed to destroy those who feed us?

Mid-sized regional food producers like Ranch Foods Direct are a more efficient, humane, and safe alternative than the big meatpacker, retailer, and food service cartel, allowing animals to be processed where they are raised and the carcasses transported to the whole animal butcher shop like we have in Colorado Springs. Fresh milk (raw) cheese, and other dairy products direct from the farm should have a major presence in any new market development, setting a new standard and acceptable price level for both producers and consumers.

What kind of alternative market infrastructure?

Globalized corporate supply chains aren’t the solution. The local food movement, along with the local farmer and food story, has been captured and falsely promoted by large multinational food companies like Danone. Producers lack places to process, prepare, and market food, and deceived and misled consumers are struggling to find ways to support authentic local/regional food production.

The pandemic has raised awareness among both producers and consumers of the importance of a dependable and safe food system. It has also left empty spaces in and around urban centers that could be ideal locations for new local/regional food infrastructure.

Local food related businesses have long been at the mercy of rent-seeking developers and property owners. Other options should be considered for new infrastructure that provide more direct connections between the producer and consumer, with more of the food dollar remaining in the community and region, building healthier, fairer, and more resilient economies.

One alternative would be publicly owned infrastructure like the historic Queen Victoria public market in Melbourne, Australia:

Another option is a private vendor-owned multi-establishment food hub and retail market connecting local/regional food producers to consumers using a cooperative-condo ownership model.

A new co-op designed ownership model could offer a better option in which a diversity of member/owners could own and control the food-hub/market real estate, earning appreciation in land and facilities, while benefiting from the synergy of co-locating. Consumers and local restaurants would have access to local food from the whole animal butcher and baker to the produce vendor, cheese maker, brewery, grain miller, coffee roaster, etc., in a lively community space within either existing or new purpose-built facilities. The food-hub/market could also offer opportunities for education and job skill development, as well as indoor and outdoor space to incubate new food related businesses. Fair market access would restore producer and worker share of the consumer food dollar and provide consumers with an affordable, healthy, safe, and dependable food supply.

Perhaps the place to begin building something better is in the Northeast where there are many appropriately sized, sustainable, but very worried dairy farmers.

What if a producer could avoid the big food cartel and sell direct?

Rather than scaling up, and playing the fools game of “Get big or get out,” is it possible to scale back, improve meat quality, and sell more direct to the end consumer? With improved returns to the farm and ranch gate, investments can once again be made in livestock operations and in rural communities. Consistent returns, without the constant “Black Swan” events threatening our livelihoods, will also improve mental and physical heath, and perhaps, hopefully, the kids will want to take over some day.

Today, many bigger cattle operations, trapped in the extractive industrial supply chain, are unable to scale back. Building more local/regional food system infrastructure, along with aggressive antitrust enforcement, that profitably connects producers more directly with consumers, should provide pressure for a more competitive marketplace with improved price levels for all cattle operations nationally.

CHAINFEEDING – Typical chain store feeding operation, north of Denver, handles an estimated 20,000 head per year for National Food Stores. Others nearby handle up to 40,000 head per year. Feeders are purchased direct, bypassing marketplace, and go from feedlot to chainstore’s packing plant. This chain slaughters 1,500 head per week for Denver-area market alone.

By Roscoe Fleming

Publication Date:  June 1958

U.S. Senate votes to Close FTC-USDA loophole that let chain stores evade trust charges.

The U.S. Senate has voted to wrench the great supermarket chains – which sell one-third of the nation’s food – from the kindly, non-regulating arms of Ezra Benson, and put them under the Federal Trade Commission.

This meant no regulation at all, since USDA has not enforced the packers’ section of the Packer and Stockyards Act of 1920.

For years the chains have managed to escape from FTC regulation by qualifying as “packers,” which put them under the Department of Agriculture.  This meant no regulation at all, since USDA has not enforced the packers’ section of the Packer and Stockyards Act of 1920.

One effect if the bill becomes law may be to check the rush toward “vertical integration,” which has hurt livestock producers, since food companies would no longer be able to escape regulation by becoming “packers.”

The senate passed a version of S. 1356 by Senators Watkins (R-Utah) and O’Mahoney (D-Wyo.). The final version was worked out by Senators Carroll (D-Colo.) and Young (R-N.D.).  It would be effective for three years.  The House still must pass the bill.

Regulation of livestock and poultry marketing would remain with the Department of Agriculture, through the packing houses.  Agriculture would actually get wider powers over marketing of all livestock in interstate commerce.  Now it is restricted to regulating the larger “posted” and terminal markets.

But “packers” would be specifically subject to FTC regulation of their unfair business practices – which is what they have escaped by fleeing to the arms of Agriculture.

The House still must pass the bill, and Farm Bureau and other forces that oppose it are expected to weaken it there.  Some farm observers feel that it is too weak already.

USDA’s failure to enforce the packer section of the Packers and Stockyards Act has had two effects:

1. The huge supermarket chains, when charged by the FTC with unfair or monopolistic practices, have successfully slipped out of FTC control by claiming they were “packers.” (See accompanying list.)
2. Both to qualify as packers and because it is cheaper and thus increases meat-handling profits, many have gone to “vertical integration” in the livestock country, buying lean animals at the farm or ranch, fattening them in their own huge feedlots, and slaughtering them in their own plants.

 HIGHER PROFITS AT BOTH ENDS

This in turn enabled them to make higher profits from meat than those retailers who bought from the traditional packers, who in turn bought from the traditional “stockyards” or terminal markets.

The result was to depress livestock prices clear back to the farm or ranch, according to Senators Watkins, O’Mahoney, Carroll and Young.

But housewives got no benefit.  Meat prices at the city counter are nearly at an all-time high, housewives are blaming the livestock growers …

But housewives got no benefit.  Meat prices at the city counter are nearly at an all-time high, housewives are blaming the livestock growers– and the Department of Agriculture is bragging of higher farm prices based mostly on this peaking of meat prices.

The massive change in marketing practices is shown by a recent Department of Agriculture report that– even in 1955– more than half of all “animal units” sold for slaughter in the U.S. were bought elsewhere than at the terminal markets.

This tendency has since steepened fast.  In 1953, 96.8 percent of all cattle bought for slaughter in the Denver area, for example, were bought through the Denver Union Stockyards, a typical terminal market.  By 1957, this figure had slid to 74.8 percent.  The terminals have become desperate at so much loss of business and tried to check it.

Denver Union Stockyards Co., for example, made a rule in 1955 that, within about nine-tenths of the area of Colorado, traders had to bring all their livestock to it for market, or be shut out of using its facilities altogether.

YARDS GET SLAPPED

This oppressive rule was approved by the Department of Agriculture.  When a farmers’ cooperative fought it all the way to the Supreme Court, Department of Agriculture lawyers defended it.  In a ringing decision written by Justice W. O. Douglas, the Supreme Court recently knocked it out, declaring:

“…The (company’s) argument is promised on the theory that stockyard owners, like feudal barons of old, can divide up the country, set the bounds of their domain, establish ‘no trespassing’ signs, and make market agencies registering with them, their exclusive agents.”

The stockyards have tried other expedients.  For example, they are supposed to be auction markets, but, at some of them, buyers sought to get around making the purchase an actual auction by using the “turn system.”

Only one buyer would make an offer at a time – and, if this were rejected, the owner of the livestock would be left to stew, with stockyard expenses running up …

Only one buyer would make an offer at a time – and, if this were rejected, the owner of the livestock would be left to stew, with stockyard expenses running up, until the next day when maybe someone else would bid.  This practice has supposedly been abandoned also.

DIRECT BUYING KILLS MARKET

But the many of the nation’s 66 “terminal markets” have become virtually sideshows. Particularly in the West, the bigger business is now back at the feedlots.  Whether independently or retailer-owned, many feedlots each fatten thousands of animals yearly, doing an annual business that runs in to the millions of dollars.  They buy direct from the range and sell for slaughter– and usually directly to the packer.

In turn, some of the largest packing houses outside the “big four,” are now run by retail chains.  Two such in Colorado each year slaughter, respectively, about 100,000 and 75,000 cattle.  In other words, the era of “big business” has now fully come to the livestock industry, with resulting massive effects all up and down the line—most of them depressing for the actual livestock farmers in the back country.

One odd angle is that the packers, who “consented” back in the early 20’s to stay out of retailing – under threat of anti-trust prosecution—now find themselves facing stiff competition right in their own backyards from the big food chains.

So, they are pleading with the Department of Justice for escape from the consent decree.  If they get it, we may see Swift and Armour retail markets blossoming all over the country.

‘Big 7’ Chains Claim Packer Protection

Among the supermarket claims that have qualified as “packers” and thus under present law escape Federal Trade Commission anti-trust jurisdiction, are:

The Great Atlantic and Pacific Tea Co., with 4,650 supermarkets and doing $4.5 billion worth of business yearly –or 10 percent of all American retail food sales.

Safeway, doing $2 billion annual business in 2,000 supermarkets.

Kroger, doing $1.5 billion in 1,500 supermarkets.

American Stores, doing $650 million in 1,000 markets.

National Tea, doing $620 million in 760 supermarkets.

First National, doing $500 million in 660 supermarkets.

Food Fair, doing $500 million in 240 supermarkets.

Scores of smaller chains have also qualified as “packers,” and together these “packers” do almost one-third of the nation’s retail food business.

The big food processors, too, have joined the procession.  Among those qualifying as “packers” and thus under the benevolent jurisdiction of the Department of Agriculture, are:

Proctor and Gamble, Campbell Soup Co., Carnation Co., Quaker Oats, Seabrook Farms, General Foods Corp., Beatrice Foods, Stokely-Van Camp, and scores more.

Approximately 2,000 companies are registered with the Department of Agriculture as “packers.”

Thanks to NFU Historian, Tom Giessel

The powerful meatpacking cartel has made sure nothing is done to stop their stealing. Last weeks packer margin was over $1,300 per head, representing nearly $2 billion dollars per year on an annual basis in stolen profits for just the one Tyson plant at Holcomb, Kansas.

Cow-calf producers and independent feeders are dying, and consumers are losing their food system. USDA should file for an immediate injunction to stop the stealing. It’s a top national security issue.

Listen to R-CALF’s Bill Bullard to understand what’s currently happening to America’s cattle industry:

August 25, 2021 – This week’s segment describes how USDA appears to be working to end undue and unreasonable preferences, otherwise known as sweetheart deals.

How can an industrial livestock operation transition from feeding corporations to feeding people?

Downsize, diversify, and sell direct.

Just east of the Colorado-Kansas border in the Republican River Valley watershed, annual precipitation is around 17 inches per year. Winters can be cold and snowy, and summers hot and very dry. Farm and grasslands make up the landscape in somewhat equal parts. Cattle harvest the grass, consume nearly all of the hay and other forages, and much of the grain, providing a dependable year-around supply of high quality meat to consumers.

In December of 1998, Callicrate Cattle Co. was shut out of the market by the meatpacker cartel, which was forcing smaller independent feedlots like ours into non-negotiated packer-aligned marketing arrangements at the expense of traditional family farm agriculture. Fifteen employees soon lost their jobs and many local farmers and cattle producers lost an important market for feed, calves, and feeder cattle.

After much worry and considerable thought, and following years of failed attempts at litigation and legislation to restore open and competitive markets, Callicrate Cattle Co. decided to seek an alternative – build a separate and more direct pathway to the consumer. A path that would avoid market predators – specifically, the big meatpacking, retail, and food service cartel. The well-organized, and government-enabled multinational monopoly had long been mining valuable resources from the land and rural communities, including precious water, soil, and equity, while impoverishing our most essential citizens: farmers, ranchers, and the workers who support these critical agricultural operations. We hoped to build a more accountable, equitable and humane connection to the consumer by selling meat instead of livestock. In June of 2000, we shipped our first cattle to G&C Packing in Colorado Springs for processing, and Ranch Foods Direct was born.

Today, twenty-one years later, we are still in business providing a better market for ourselves and many other producers of healthy foods in the region. Our program focuses on healthy food, regenerative practices, product quality and eating satisfaction.

Cattle graze across our pastures and cover crops, and are finished on high quality local forages and grains, using our pre-existing feedlot pens. By avoiding the growing competitive pressures to use growth-promoting drugs, we improved animal welfare, health, and meat quality. Pigs are raised in open pens with plenty of room to roam. A modern and efficient on-site slaughter facility saves thousands of miles of high-stress transport, and provides processing for other producers seeking to sell direct. Carcasses and select parts such as organ meats, along with pastured eggs, are shipped to our food-hub and meat processing facility in the urban center of Colorado Springs. Highly skilled butchers cut the properly aged carcasses directly into primals and retail cuts, eliminating the less safe and inefficient step of “boxing,” before sending them to our two retail stores and several restaurant and wholesale accounts.

We believe our model is exemplary of a dependable, sustainable, safe, and resilient food system that serves the whole community, making the lives of producers, workers, and consumers better, while conserving resources, healing the environment, building soil heath, and improving animal welfare and meat quality.

The following short video shows Callicrate Cattle Co. today after transitioning from a 12,000 head capacity industrial style feedyard to a regenerative, soil building, multi-species operation producing year around, high quality, and healthy food for the region: