Is The Meatpacking Industry Running Family Farmers Out Of Business?

Iowa produces more factory-farmed hogs than any other state and ranks fourth in large-scale cattle feedlots. While the state rankings may not seem like a big deal, the proliferation of factory farms has been largely driven by the rise of meatpacker monopolies that make it nearly impossible for farmers to get a fair price.

Some farmers get big to deal with persistently low hog and cattle prices, some get out. In 1992, less than a third of hogs were raised on factory farms, but by 2007, the latest figures available, 95 percent of the 18 million hogs produced in Iowa were raised on factory farms. Over the same period, Iowa has lost around three-fourths of its hog farms, falling from 31,700 in 1992 to 8,300 in 2007.

The story is similar for cattle production in Iowa. From 2002 to 2007, the number of industrial-scale cattle feedlots in Iowa almost doubled to 1.2 million head. Despite the growth in giant feedlots, Iowa's cattle operations and production has been shrinking during this time. We've lost 15,000 cattle operations since the mid-1990s and produce 80,000 fewer head annually. So while the number of farmers and total number of cattle steadily decreases, factory farms get bigger and bigger.

The negative impacts of this extreme concentration of animal meat production and factory farms have been well documented — from the manure spills and runoff leading to water pollution, to hydrogen sulfide and ammonia air pollution, to the plight of rural communities, to the increase of food borne diseases such as E. coli in our meat. What has not been well addressed is that the concentration and proliferation of factory farms is not the result of economic efficiency but rather is the result of market abuses by the large meatpackers.

The top four companies slaughter more than four out of five cattle and two out of three hogs. This market control by a handful of corporations over the vast majority of meat production has lead to monopolistic practices and market abuses.

One of the worst market abuses by these large packers has been giving sweetheart deals to favored factory farms and feedlots — better prices for the same number and quality of hogs or cattle. Medium-sized and smaller farmers often get lower prices and worse contract terms from the packers. For example, when a few independent hog producers join together to fill a tractor-trailer full of hogs, they typically get a lower price than an identical trailer full of hogs from a single factory farm.

These types of special deals were supposed to be outlawed by the antitrust Packers and Stockyards Act of 1921, but 80 years later it still lacks the teeth to be properly enforced. Fortunately, one year ago today (June 22, 2010), the U.S. Department of Agriculture proposed rules that would address some of these market abuses by the meatpacking industry. Unfortunately for farmers and consumers, these fair farm rules have yet to be implemented.

Also fortunate is that President Obama, who ultimately is the boss on whether these rules are implemented, campaigned specifically on this issue. Food and Water Watch is spearheading a national call-in day with thousands of people and dozens of organizations around the country to the White House to demand these rules are finalized and implemented. I hope you can take a minute today to join us and call the White House to demand these rules be implemented immediately.

Preventing the meatpacking industry from abusing their economic power to run family farmers out of business is long overdue. And it is time for Obama to follow through on a campaign promise.

Matt Ohloff is the Iowa-based organizer for Food and Water Watch.