Of all the things that you would expect to see trending on social media, Beef and the Prime Act weren’t on my list. Yet here we are. Watching people have a mini war of words about beef. Let’s see what both sides are saying before I dive in,
Does anyone have a problem with this Prime Act? It seems sensible.
However, prices for beef are crazy high right now. How long would this Prime Act take to kick in? Cattle take time to mature. What can we do now? That’s where the President steps in.
Now of course, people are fighting about the President’s solution and the Prime Act.
This leads me to my first question: How do you mess up beef? What happened? Americans love to eat meat. That hasn’t changed. Beef sells. It always has. So, that isn’t the issue. Maybe it’s lack of free markets? Huh? Whatever happened to supply and demand?
This is one of the issues we asked AI about. Four large packers control roughly 85% of processing. Some analyses point to concentration as a factor in how prices transmit through the chain (and the DOJ has looked into antitrust issues), though the dominant consensus is that low cattle numbers are the core supply problem. Heavier carcass weights have partially offset fewer animals, but not enough.
Let’s all put on our thinking caps for a second. Ranchers need to get more cattle to market to satisfy the demand for beef. Competition drives down prices.
The four large packers that control roughly 80–85% of U.S. beef processing (often called the “Big Four”) are:
- Tyson Foods (U.S.-based, publicly traded)
- JBS USA (subsidiary of Brazilian company JBS S.A.)
- Cargill (U.S.-based, privately held)
- National Beef Packing Company (majority-owned by Brazilian company Marfrig Global Foods)
These companies dominate fed-cattle slaughter and processing capacity. While there are hundreds of smaller independent and regional plants, the Big Four handle the large majority of volume through a relatively small number of very large facilities.
The other big factor according to Ranchers is drought. Okay. That might be a thing. And this is certainly the first time in the history of ranching that water has been an issue. Certainly, that’s never been a factor before now.
But when it comes to choosing sides in today’ beef war, let’s find out what the Ranchers want. The people who are actually doing the job. I don’t want to hear from lobbyists or bankers. Let’s hear from the family-owned ranchers. I bet they know a thing or two about the real issue and real solutions. Long term solutions. And call me old-fashioned but let’s follow the money. Who is benefiting from these prices? I doubt very much it’s the ranchers. Who is making the money? Whose long term position is getting better?
