Letter to the Editor of Hutchinson News:

Lack of competition hurting farm prices

A Hutchinson News article Jan. 4, “Farm prices losing ground,” was good, but why not tell us the rest of the story?

Tell us how many packing plants operated in the United States in 1990, but that four packers slaughter more than 80 percent of the cattle in the United States Today.

Tell us how many grain companies operated in the United States in 1990, but that there are basically two operating today.

The real problem in the farm economy is lack of competition in the marketplace. The Organization of Competitive Markets reports that Cargill increased profits by 67 percent last quarter; Hormel, 57 percent; Smithfield Foods, 28 percent; and Tyson’s profits tripled since the acquisition of IBP to almost 24 percent

Tell us why, after four years of historically low grain prices, Cargill’s profits are up 67 percent while farm income is down 46 percent.

Tell us why our congressmen are not demanding enforcement of the Packers and Stockyards Act, antitrust laws and unfair-trade-practices laws against these monopolies.

The Kansas Livestock Association’s explanation for lower-fed-cattle prices (lower exports and a devalued dollar) are laughable when you consider the facts: Since the 1950’s, the United States has not produced enough beef to meet domestic consumption. According to the Kansas Cattlemen’s Association, “As of Nov. 30, the average retail beef price was 9 percent above last year’s price - an increase of over $140 per head in retail value. By the second week in December, fed-cattle prices were $14 per cwt. Below a year ago-a loss to producers of $175 per hear.” That amounts to more than $300 per head sucked out of beef producers’ pockets by beef-industry segments.

And then you could tie it all together by telling us what this means to every Kansan. Assuming that 5 million cattle were slaughtered last year at $200 loss per head, that amounts to $1 billion sent out of state. Figure the number of times those dollars would turn in the retail sector, and the other sales and income taxes generated, it would help the state’s budget problems immensely.

Meanwhile, Sens. Sam Brownback and Pat Roberts hand the monopolies a knife to hold against our throats by voting against legislation to ban packer ownership of animals and force packers to bid competitively on supplies to run their factories.

While reader digest all this information, you could remind us of some of December headlines: “Tyson executives indicted for smuggling illegal aliens,” “Class status granted by Alabama judge in suit against IBP for trying to corner the beef market,” “Former Archer Daniels Midland CEO released from federal prison.”

If the governor and the Legislature decide to cut school budgets and raise taxes to cover the state’s budget shortfall, then maybe Kansans will demand that this rape of our state resources be stopped.

Brad Frisbie

Kingman, KS