R-CALF Fights to Stop Chinese-Controlled Industrial Hog Farms in Nebraska

Group Fights to Stop Chinese-Controlled Industrial Hog Farms in Nebraska

Billings, Mont. – In a letter hand-delivered yesterday to Nebraska Unicameral Legislature’s Agriculture Committee, R-CALF USA urged the rejection of Nebraska Legislative Bill 176 (LB 176). Introduced by Nebraska Senator Ken Schilz, LB 176 would amend the state’s Competitive Livestock Markets Act (Act) passed in 1999, an anti-corporate farming law that prohibits meatpackers from owning, controlling or feeding livestock for more than five days prior to slaughter.

Schilz’s bill proposes to amend the Act to allow packers such as Chinese-owned Smithfield Farms to begin owning, controlling and feeding hogs in corporate-controlled contract swine operations in Nebraska. R-CALF USA wrote that LB 176 would result in a loss of marketing outlets for independent livestock producers that would force them to "either produce livestock under the command-and-control regime of the meatpackers or exit their industry."

R-CALF USA contends that the proposed amendments would drastically reduce livestock market competition in Nebraska because when meatpackers are allowed to own and control all the livestock they need from birth to plate, the meatpackers will no longer need to compete with one another for available supplies offered by independent livestock producers. This, the group states, limits the marketing outlets available to independent producers.

Additionally, R-CALF USA described LB 176 as a means to allow meatpackers to capture the livestock supply chain away from independent farmers and ranchers.

The group attributes Nebraska’s Act as enabling Nebraska to maintain among the most competitive price-discovery markets in the nation by preventing meatpackers from shrinking the competitive cash market through corporate ownership or control of livestock. R-CALF USA explained that the cattle industry’s price-discovery cash market has been reduced nationally from 52 percent in 2005 to only 23 percent in 2014.

"In sharp contrast, and as a direct result of Nebraska’s Competitive Livestock Markets Act that limits the packers ability to shrink the price-discovery market by capturing the livestock supply chain away from independent producers, the volume of fed cattle comprising the competitive cash market in the Nebraska fed cattle procurement region is at 38 percent, which is much higher than the national average.

"Nebraska should fight to defend its Competitive Livestock Markets Act against LB 176, which is designed to help the meatpackers chickenize Nebraska’s hog industry by helping the meatpackers to capture the hog supply chain from Nebraska’s independent hog producers. And, where Nebraska’s hog industry goes, the state’s cattle industry is certain to follow."

R-CALF USA CEO Bill Bullard explained that the reason the cattle industry will likely follow the path of the hog industry is because the same meatpackers that slaughter and control the lion’s share of all the hogs in the U.S. also slaughter and control the lion’s share of fed cattle.

"The U.S. cattle industry is the meatpackers’ Last Frontier and cattle producers need to aggressively fight against any and all efforts by the meatpackers to capture any more livestock supply chains away from independent farmers and ranchers, regardless of whether those supply chains involve sheep, hogs or cattle," Bullard said.

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R-CALF USA (Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America) is the largest producer-only cattle trade association in the United States. It is a national, nonprofit organization dedicated to ensuring the continued profitability and viability of the U.S. cattle industry. For more information, visit www.r-calfusa.com or, call 406-252-2516.