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Iversen: Concentration in the marketplace

I am not sure if our urban readers understand or are aware of what has been transpiring in the agricultural industry in recent decades. Specifically the beef industry, where up to 85% of our cattle are processed and controlled by only 4 beef processing companies. This affects everyone, not just the rural communities and businesses that depend on local agriculture.

Look at the mergers and acquisitions that are occurring in other industries such as your local feed/grain coops, implement dealers, banks, health insurance companies, utility companies, gas/petroleum companies, cell phone companies, car dealerships, grocery stores, insurance companies, etc.

How important is it to have healthy competition in these industries? What if only one gas company, grocery store or cell phone company was supplying all the service to your area? No more price checking or negotiating power.



Think about it from this perspective, if a disruption like a cyber-hack or transportation bottleneck were to occur, which industry would be most impacted; a highly concentrated and efficient large scale corporate or globally owned company, or a smaller product specific company or family owned business? Which one could adapt more swiftly to meet the immediate needs of consumers? Did you know that two of our four major beef/pork processing facilities are foreign-owned?

Whether you realize it or not this affects everyone. Look at the beef prices in the grocery store and the record profits the 4 beef processors are making while at the same time, the take home pay continues to decline for our independent cattle ranchers and feeders. Especially when you factor in inflation. Most are operating at or below break even margins. Producers are going to continue to exit the industry if things don’t change soon.



Get involved before it’s too late and we have no recourse. South Dakota and other agriculture states depend on the success of independent cattle producers and feeders. Don’t let these profits be captured by the corporate shareholders in other states and even worse…other countries!

Currently there is a bill being discussed in Congress that would require that only beef that is from cattle that are born, raised and processed in the United States can bear the “Made in the USA” label. Sounds logical right? As a consumer, don’t you already expect this when you buy beef at your grocery stores and see the “Product of USA” label? Currently, so long as imported beef is “further processed” in the USA it can bear this mark!

When consumers choose American beef they are not only getting the safest, highest quality, most environmentally sustainable beef raised from producers whose animal husbandry practices are second to none, they are also supporting with their consumer dollars other American businesses that rely on farmers and ranchers to remain viable. It’s a win all the way around! The only loser in this scenario is the companies that are mislabeling product and reaping huge dividends by diluting the American brand!!

Producers, please call your Congressmen and stress your support for independent American cattle producers and feeders before we become serfs of our own land or just cattle hotels to feed corporation owned cattle. Thank you. Also, please educate your urban friends and relatives.

Eric Iversen

Iversen Angus Ranch

White River, SD

 


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