WASHINGTON — President Joe Biden met with farmers, ranchers and independent meat processors on Monday to discuss his plans to create a more competitive supply chain in hopes of boosting profits for family farms and lowering prices for consumers.
The Biden administration is aiming to provide $1 billion in American Rescue Plan funds to help expand independent processing capacity, and provide funding that would give independent meat producers access to cold storage and other equipment to improve distribution of their products. It will also work with lenders to provide independent processors with credit and devote money to workforce training and safety, the White House said.
The administration has blamed the drop in revenue for farmers, as well as the increase in consumer prices, on a small number of companies controlling a majority of the meat, pork and poultry markets.
“Capitalism without competition isn't capitalism — it's exploitation,” Biden said during Monday's virtual meeting. “That’s what we're seeing in meat and poultry and those industries now. Small independent farmers and ranchers are being driven out of business, sometimes businesses that have been around for generations."
The increased cost of meat is one of the inflation issues the administration is trying to get under control as consumer costs weigh on Biden's approval numbers when it comes to his handling of the economy. Overall consumer prices rose in November at the fastest pace since 1982.
Biden said Monday that even with consumers paying higher prices, farmers are getting a smaller share of those profits, with cattle farmers bringing in just 39 cents for every dollar Americans spend on beef compared to 60 cents about 50 years ago.
"The big companies are making massive profits, all their profits go up, the prices you see the grocery stores go up commensurate. The prices farmers receive for the products they are bringing to market go down," Biden said. "This reflects the market being distorted by lack of competition."
The White House said it plans to work with Congress on legislation aimed at making cattle markets more transparent and encouraging price negotiations. Another component of the administration's plan is the issuance of new rules designed to combat anti-competitive practices by meatpackers and processors and clarify “Product of USA” labeling so that consumers know the sources of their meat.
The Justice Department and the Department of Agriculture also announced an initiative Monday that they said will make it easier for farmers and ranchers to report potentially illegal practices in their industry.
“Anti-competitive practices in agriculture, as in any industry, hurt the American people, producers, consumers and workers alike. And they hurt the American economy," Attorney General Merrick Garland said at Monday's meeting. "Too many industries have become too consolidated over time. Too many companies have pursued corporate conduct and more aggressive mergers that have made all of us vulnerable."