Frustrated with persistently low prices, ranchers and others in the beef industry are moving to reverse a long trend of consolidation and planning to open new slaughterhouses.
FILE - In this June 10, 2020 file photo, cattle occupy a feedlot in Columbus, Neb. Frustrated with persistently low prices, ranchers and others in the beef industry are moving to reverse decades of consolidation and planning to open new slaughterhouses. The plants will be smaller than those owned by the four beef company giants that now slaughter over 80% of the nation's cattle. That has led to some skepticism about whether the new plants will succeed.
“We’ve been complaining about it for 30 years,” Kemp said. “It’s probably time somebody does something about it.” David Briggs, the CEO of Sustainable Beef, acknowledged the difficulty but said his company's investors remain confident.Consolidation of meatpacking started in the mid-1970s, with buyouts of smaller companies, mergers and a shift to much larger plants. Census data cited by the USDA shows that the number of livestock slaughter plants declined from 2,590 in 1977 to 1,387 in 1992. And big processors gradually dominated, going from handling only 12% of cattle in 1977 to 65% by 1997.
However, they say they will have important advantages, including more modern equipment and, they hope, less employee turnover thanks to slightly higher pay of more than $50,000 annually plus benefits along with more favorable work schedules. The new Midwest plants are also counting on closer relationships with ranchers, encouraging them to invest in the plants, to share in the profits.
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