Beef Buzz News
Cong. Lucas Waiting For All Government Investigations to be Completed Before Saying Anything More About Increasing The Number of Packing Plants
Mon, 27 Jul 2020 09:04:49 CDT
On Today's Beef Buzz U.S. Rep. Frank Lucas (R-OK) continues his conversation with Radio Oklahoma Ag Network Farm Director Ron Hays about the USDA report on boxed beef and fed cattle price spread investigation. Specifically, starting with the fire at the southwest Kansas packing plant last year and moving forward into the current pandemic issues.
Ron Hays Beef Buzzes Cong. Frank Lucas
It would appear to me in the Holcombe fire that we had five packers processing 84 percent of the meat and most of these were super large and efficient, Lucas said. When one goes down you had the inelasticity of the supply and demand market forcing large price spreads, he said.
The price spread peaked at $67 per hundredweight for a short time.
Step forward to the COVID-19 problem we saw the spread jump dramatically to $270.
The underlying issue when you have so much of the beef supply going through these mega plants, if there is a hiccup it sets off these sort of market gyrations, Lucas said.
That's why in the recommendations we talk about how to expand processing and give producers more options, he said.
The efficient large plants will still be there but how do you make sure there is a place for animals to be processed promptly and that's the goal, Lucas said.
Cong. Lucas earlier had suggested during a Farm Bureau webinar, increasing the number of packing plants. Today he delayed saying anything more about that concept except to mention that he and a number of his colleagues are ready to move on this but wanted to wait until
the USDA and Department of Justice finished their investigations.
The kind of change we're talking about is substantial and long term, Lucas said.
The Oklahoma Congressman added these are serious penalties the government is looking at could lead to actual jail sentences.
Click on the LISTEN BAR below to hear more of Ron's interview with Cong. Frank Lucas.
The Beef buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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