Cattlemen Ask for Marketing Study to be Completed

Story courtesy of Texas Cattle Feeders Association

Cattle industry organizations in a recent meeting with U.S. House Agriculture Committee Chairman Bob Goodlatte emphasized the need to complete the Livestock & Meat Marketing Study.  Congress appropriated $4.5 million last year for the study that is to be an independent analysis of the beef marketing complex by prestigious business schools to ensure unquestionable credibility in the results.

Representatives from NCBA, Texas Cattle Feeders Association, Texas and Southwestern Cattle Raisers Association, Oklahoma Cattlemen’s Association, New Mexico Cattle Growers Association and Kansas Livestock Association attended the meeting during the Texas Cattle Feeders Convention in Amarillo.  Industry leaders told Chairman Goodlatte they were concerned that producers need accurate and independent information to adjust to the future.  Through the Livestock & Meat Marketing Study analysis, industry leaders are seeking answers to key market questions, including:

1.  Are there points in the beef production and marketing system where price discovery and/or proper market signals fail to function?  If so, what are the solutions?

2.  Are there points in the beef production and marketing system where the potential exists for price manipulation?  If so, what are the solutions?

In answering these questions, cattlemen asked for analysis of:

a.  The economic factors affecting the cattle cycle, and how this can be modified to address periodic high and low prices to producers;

b.  The futures market and its impact on the cash market and whether the futures market is manipulated to the benefit of packers;

c.  Methods used by packers to manage supply;

d.  Effects of retail market concentration and purchasing arrangements on the farm to retail price spread;

e.  Effects of international trade arrangements on the price of beef in the United States.

The organizations represented at the meeting have been debating these issues for several years.  Last year, a special Four-State Working Group was organized to address challenges and arrive at solutions to improve fed cattle marketing.  This group included leaders from five different organizations with very diverse opinions.  They discussed the industry’s many controversial issues, including captive supply, retail concentration and mandatory price reporting.

Chairman Goodlatte promised to continue his efforts to assure that the study be completed by the appropriate economic experts and the analysis be completed in a thorough and unbiased manner.