Decentralize the U.S. meat industry
Whether it’s coronavirus or a computer virus, the meat industry just can’t seem to get a break from infections.
Just a year after a massive shortage brought on by the pandemic butchered meat markets across the United States, supply chains of America’s favorite food are taking another hit. This past week, Brazil-based JBS, the world’s largest meat producer, shut down its U.S.-based beef plants in response to a cyberattack — a move that disrupted the food chain and jacked prices in an already inflated market. JBS CEO Andre Nogueira says his company paid an $11 million ransom to the attackers last week.
The reason that Americans’ favorite dishes are constantly under threat by pandemics or cyberattacks is not due to lack of security measures or safety precautions; it’s the monopolies of the large meat processing companies that are made possible by the USDA and powerful interests in K Street. The centralized market system makes the supply chain more vulnerable to threats. Just a tiny breach into the database of one of these companies has catastrophically impacted our food supply chain.
JBS is one of the four major meat companies, known as the “Big Four,” which dominate the American meat market alongside National Beef, Tyson Foods and Cargill. JBS and Tyson Foods control about 40% of the poultry market. And JBS and the three other companies control roughly 70% of the pork market, leaving very little room for domestic competitors.
The United States is home to 9.35% of the world’s cattle. The idea that we could get caught in a meat shortage ought to be ridiculous. We’ve got the cows. Now, all we need is a federal government that gets out of the way. Currently, federal red tape prevents small meat producers from processing their meat in-house. They aren’t allowed to sell to grocery stores unless they have an in-house inspector. Some cattle farmers usually have to ship their meat supply thousands of miles away for the process at a plant like JBL and ship them back to their state for distribution. Therefore, as soon as there is an issue with JBL and other giant processing plants, it disrupts the supply chain nationally. The meat market will take a massive blow, trickling down the price jumps to the consumers.
If the Biden administration wants to end once and for all the cyber threats facing our food supply chain, he should let states seek solutions that work for their local farmers without jeopardizing the safety of the products and consumers’ well-being.
The coronavirus pandemic has highlighted these defects in the meat market. To address those, Rep. Thomas Massie, himself a cattle farmer in Kentucky, re-introduced the PRIME Act in the previous Congress. The farmers would be subject to unannounced USDA inspections, but they wouldn’t have to have a federal agent on their payroll anymore. The bill would allow farmers to utilize local butchers and processors to sell their products directly to consumers without having to contend with burdensome federal regulations. The PRIME Act would give the power back to the states to regulate their local meat production and lifting the barriers that small meat producers face that are currently restricted from supplying restaurants, schools, grocery stores, etc.
The PRIME Act is one of the many solutions that could have prevented supply chain disruptions. The recent cyberattacks and exploits are just another piece of evidence of the vulnerabilities of monopolies. Shortages threaten the well-being of American families as long as these monopolies continue with the blessing of the federal government.