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AMI Guest Opinion: Ban on Packer Ownership of Livestock Would “Set America’s Meat Industry Back Decades”

Thursday, February 14, 2008

(American Meat Institute)

“Driving through the American south, it’s easy to see, firsthand, the law of unintended consequence,” says AMI President and CEO J. Patrick Boyle in a guest editorial in the Sioux City Journal as he compares the unintended consequence of Kudzu, a vine native to south Asia that now covers 7 million acres in the Southeast, to a packer ownership ban contained in the 2007 Farm Bill.  Boyle notes, “Oftentimes, the actions that lead to unintended and dramatic consequences occur because of decisions made outside the realm of public scrutiny, careful study and thorough discourse.”

Boyle states that a measure contained in the 2007 Farm Bill would ban the ability of a company to own livestock and then process them.  “Banning the ability of a company or an individual to both own and process an animal would set America’s meat industry back decades and forever handicap the market-driven, progressive steps the industry has embraced over the last 100 years. Agreements between producers and processors allow U.S. meatpackers to deliver products of consistent value and unequaled quality to consumers in the U.S. and across the globe.”

Boyle points to a 2007 study by the Grain Inspection Packers and Stockyards Administration (GIPSA) which found that "both [producers and packers] agreed that if packers could not own cattle, higher returns would be needed to attract other investors and that beef quality would suffer in an all-commodity market place."  Boyle argues that packer ownership of cattle is a response to market driven signals from consumers, and the ban “places our meat sector - but not the poultry sector - at a competitive disadvantage by forbidding companies to own the raw materials they use to make their finished products.”

“If Congress insists on undoing this progress by banning a company’s ability to both own and process animals for meat, it should know in advance that it will imperil the long-term health of our farm and meat sectors and potentially reduce the quality and consistency of the
products we offer consumers,” Boyle concluded.

To see a copy of the editorial in its entirety, click here:  http://meatinstitute.org/storylinks/2008/kudzusiouxcityjournal2-14-08.pdf

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