House Agriculture Committee leaders Collin Peterson and K. Michael Conaway sent a letter to Agriculture Secretary Sonny Perdue, asking him to address a variety of issues surrounding the beef industry.
In the letter, House Agriculture Committee Chairman Collin C. Peterson, D-Minnesota, and Ranking Member K. Michael Conaway, R-Texas, call on 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.
The letter also specifically 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?
In July, USDA released an update on its investigation into beef prices following the fire at the Holcomb processing plant. In the report, USDA outlines what has happened in cattle markets since the Holcomb fire in August 2019 and the volatilities due to COVID-19.