Two Iowa senators have rolled out legislation to challenge the meatpacking industries, offering a bill to ban those companies raising or pre-purchasing livestock. The new "packer ban" bill resembles a similar initiative presented but deafeated in 2002.
If passed, the bill would make it illegal for meatpackers to "own, feed, or control livestock, either through a subsidiary or an arrangement that gives the packer operational, managerial, or supervisory control prior to seven days before slaughter."
Sens. Charles Grassley (R-Iowa) and Tom Harkin (D-Iowa), and the new agriculture committee chair, contend that the large meatpacking companies use their buying power to obtain livestock. They argue that practice lets the companies keep prices low and undercut farmers and ranchers trying to sell livestock on the open market.
Packer/processours contend that use of "forward contracts," or pre-arranged agreements to buy livestock is similar to practices in other industries, and that it helps maintain a steady supply of cattle.
"Our business practices line up exactly with what the retailers, restaurateurs and consumers demand," Mike Brown, senior vice president of legislative affairs for the American Meat Institute, told the Chicago Tribune. "Can you imagine Detroit or Maytag or Whirlpool if they couldn't secure the necessary component for their cars or washing machines on demand?"
Brown adds the idea that packers use those contracts to control livestock prices is "just a wives' tale from the countryside and I don't think that's true at all."
Grassley believes the bill has a chance this time because "the House is philosophically different because of the Democrats. In the Senate, the agriculture committee already supports it."
Brown says that if passed, the bill would dramatically disrupt the way meatpackers-- and many producers-- run their businesses. This could be a second hit to an already battered industry that's facing higher feed costs and dramatically tighter margins.