Good morning! This is Bob Bragg with the April 30th edition of farm news and views
Last week, two class action lawsuits were filed in Federal Courts that will be of interest to both cattle producers and beef consumers.
On April 23, R-Calf USA filed suit alleging that meat packing companies Tyson, Cargill, National Beef and JBS, violated U.S. antitrust laws, the Packers and Stockyards Act, and the Commodity Exchange Act by unlawfully depressing the prices paid to American ranchers, and thereby inflating their own margins and profits. These four companies slaughter over 80% of all of the cattle raised in the U.S. This lawsuit seeks to recover the losses suffered by both cattle producers and traders who transacted live cattle futures or options contracts on the Chicago Mercantile Exchange from January 2015 to the present.
On April 26th another suit was filed in the U.S District Court for the District of Minnesota against the same big four beef packers and the industry forecasting service Agri Stats. The suit, filed by the consumer-rights class-action law firm of Hagens Berman Sobol Shapiro LLP, alleges that the meat packing firms reaped billions of dollars in extra profits while consumers paid far more for beef than they should have since 2015. The suit claims that the firms artificially limited the amount of beef they purchased, processed and sold to retail operations. These actions don’t surprise many ranchers who have commented for years about the wide gap between the retail price of beef and prices paid to producers and cattle feeders.
While Alaska is best known for its forests, frozen tundra, and fishing , a nugget of interest came out in the 2017 Census of Agriculture. The report points out that the state saw a 30 percent increase in farms between 2012 and 2017. Alaska also has the nation’s highest percentage of beginning farmers, with 46 percent of its producers having fewer than 10 years of experience, and many farmers are are selling what they produce at farmers markets, which have grown in numbers from 13 in 2006, to more than 50 today. While the growing season is short, the high-latitude, constant sunlight results in fruits and vegetables that are high in sugar content and large in size.
Colorado has also bucked the trend of fewer farms, according to Bill Meyer at the National Agricultural Statistics Service in Lakewood. He pointed out that there are now 38,900 farms in 2017, compared to 36,200 in 2012, with the increase coming in small farms producing local food such as produce and small scale livestock production.
I’ve had several questions about whether the the March Midwest floods have resulted in higher prices for crops and livestock in the U.S. When I look at futures prices for April and May contracts and cash prices paid to farmers and livestock producers for corn, soybeans, wheat, beef and hogs, there’s not been a spike in prices. Rather, the price for grains have been close to or below the cost of production for the past several months as a result of the large carryover of crop inventories. While at the same time, the number of cattle and hogs lost to the floods are not significant considering the total number of animals that are raised in the U.S.
Today’s report brings to mind a quote from Theodore Roosevelt. He said “A man who has never gone to school may steal a freight car; but if he has a university education, he may steal the whole railroad.”
Until Next week, I’m Bob Bragg