A project of the
Organization for Competitive Markets
 
Date: June 13, 2003
FOR IMMEDIATE RELEASE
 
Contact: Steve Cady: 402.792.0041

OCM's Cattlemen's Competitive Market Project
Calls For Hearings on Packer Price Gouging

Lincoln, NE ~ The Cattlemen's Competitive Market Project (CCMP) is calling for a congressional hearing on meatpacker price gouging, pointing to the week of June 9, 2003 as a clear example of how the packing industry uses captive supplies to unlawfully depress cattle prices at the ranch and feedlot gate while retail price spreads widen and packer profits soar.

"The market price for fed cattle today should be $87 to $90," said Tom Spencer of Pueblo, Colorado, a CCMP Steering Committee member. "Packers have been receiving record high cutout prices while using captive supplies to depress live prices for near record profits."

According to USDA figures on June 11, the Choice cutout value was $1.4580 and Select cutout value was $1.2950. Using a 70% Choice/30% Select grading basis (an accepted formula used by market analysts) the value of a pen of cattle should translate to $1.41 in the meat or $87.73 live. However, packer bids throughout the cornbelt fell from $1.24 to $1.20 in the meat and ranged from $73 to $75 live.
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The raping and pillaging of American cattle producers by the packing and retail sector has got to stop," said Fred Stokes, OCM President. "Using USDAss figures, cattlemen lost $150 per head in equity this week alone and the futures market took a terrible hit. It's obvious that USDA has its head buried in the sand and is flaunting their blatant disregard for their constituents in the cattle production business. There is a hemorrhage going on in agriculture while the packers and retailers are reaping millions of dollars in profits each week this allowed to continue. Therefore, OCM is calling for a full-blown congressional hearing of what's happening," stated Stokes.

OCM member and cattle feeder Randy Stevenson, Double S Feeders, Wheatland, WY, agreed saying, "This is nothing more than the packers using their captive supply cattle to drive prices down during a season when beef demand is at its peak. Here at Double S Feeders we were bid $73-$75. At what point does excessive profiteering become criminal? At what point does USDA inaction become complicit to this profiteering? We will be contacting our congressional delegation to request immediate hearings."said Stevenson.

CCMP is not a membership organization. Funding comes from livestock auction markets and independent feeders on a per-head basis at the point of sale. All contributions are tax deductible under OCM’s non-profit status. For more information, contact Steve Cady at 402.792.0041 or visit the web site at www.competitivemarkets.com. 

The Organization For Competitive Markets is a multidisciplinary, nonprofit group of farmers, ranchers, academics, attorneys, and policy makers dedicated to reclaiming the agricultural marketplace for independent farmers, ranchers and rural communities.