Despite Heavy Lobbying, the Senate Approves a Ban on Meat Packer Ownership of Livestock.

December 17, 2001

Although the meat sector vigorously opposed an amendment to the farm bill to force beef and pork packers to divest themselves of cattle and hog ownership, within six and 18 months respectively, the amendment was approved by a vote of 51 to 46.

The American Meat Institute (AMI), the National Cattlemen's Beef Association, and other meat and agribusiness organizations were unable to defeat the amendment cosponsored by Sen. Tim Johnson (D-SD), Sen. Chuck Grassley (R-IA), and Sen. Paul Wellstone (D-MN).

The prohibition on packer ownership of livestock exempts cooperatives from its divestiture provisions and applies only to red meat packers, which means poultry packers would be allowed to continue their livestock ownership. The same amendment was defeated in the Senate Agriculture Committee on November 13, 2001, by a vote of 12 to 9.

In a press release issued last Friday, AMI President Patrick Boyle said "we are appalled at the lack of knowledge 51 Senators demonstrated...with respect to the economics of the meat and livestock sectors. This bill would force massive ‘fire-sale' liquidation of hog and cattle assets, further accelerating consolidation. It also disadvantages the beef and pork sectors by making them less competitive than their poultry competitors. It is an unprecedented government intrusion into the business community, and we will fight vigorously to remove this amendment during the farm bill conference."

Meanwhile, the National Farmers Union (NFU) also issued a press release the same day, proclaiming a victory for family farmers and ranchers. NFU President Leland Swenson said his organization has tirelessly fought in a "David versus Goliath battle" against packer ownership of livestock. He said that the amendment "is a triumph for family agriculture producers in the campaign to end the market concentration trend."