House Select Subcommittee Report on COVID Unfairly Critical of the Meat Industry


On Thursday May 12th the Select Subcommittee on the Coronavirus Crisis issued a staff report highly critical of the red meat industry.  The Committee chaired by Rep. James E. Clyburn (D-SC) reviewed and reported on the interaction between the red meat industry and the Administration leading to the Presidential Executive Order of April 28th This mandated plants to remain in operation subject to complying with recommendations on prevention of COVID among line workers. The report documented action by USDA administrators including Dr. Mindy Brashears, the Undersecretary For Food Safety as facilitating action by the Department for the benefit of packers.


In retrospect commentary and perceptions relating to the entire sad period of the COVID epidemic and its impact on the red meat industry and agriculture in general can be compared to Rashomon the Japanese play.  The plot involves the murder of a samurai by a brigand and the assault on his wife, as recounted by each of the three participants in addition to a disinterested observer.  The characters recount the event from their individual perspectives suggesting that what could be regarded as a simple event may on analysis emerge as a series of complicated issues and what might appear as fact is subject to interpretation based on personal perception and bias. 


Beginning in March and extending through May, COVID demonstrated a high incidence rate in the U.S. population.  Little was known about the mechanism of transmission and epidemiologists made recommendations based on experience with influenza using previous pandemics including the 1918 outbreak as their model.  It is also evident in retrospect that the infection was politicized initially with a strong but misplaced message of denial followed by a response to the reality of an widespread and highly infectious disease.  The situation was complicated by lack of leadership and the culture within the CDC that failed to evaluate the situation and provide clear directives to guide the public and industry.  Many of the criticisms of the meat industry raised by the Select Committee could also be applied to schools, public transport and other essential activities involving close contact among people.


Chick-NewsIt must also be recognized that Canada and nations in Europe experienced similar high incidence rates of COVID in packing plants due to common factors that existed in U.S. facilities.  Low temperature, high humidity, suboptimal ventilation with infrequent air exchange and close proximity of line workers all facilitated transmission of the virus.  The infection also spread among plant employees in their communities and especially during shared transport to their work place. 


Decisions made by the Administration leading up to the Presidential Executive Order should be considered in the light of the impact of COVID especially on red meat plants.  Volume was reduced in both hog and beef operations to the point that it was necessary to euthanize animals awaiting shipment that could not be processed.  In contrast, the chicken industry that was fully integrated, with a short production cycle and a higher level of mechanization in plants was able to adapt with far less disruption in processing and with minimal impact on supply.


A valid criticism of the Select Subcommittee Report is that it failed to recognize the actions by industry that addressed the problem of COVID in the absence of either treatment or a vaccine and with minimal diagnostic modalities during the first two months of the outbreak.


It s a matter of record that Perdue Farms invited representatives of the CDC and other agencies to visit their plants and to make recommendation to limit spread of infection.  Many companies encouraged workers to stay at home with pay if they experienced symptoms. At an early stage in the outbreak, health screenings were introduced to identify symptomatic workers before they entered plants.  Most companies attempted as far as possible to reconfigure production lines and they installed barriers between work-stations.  Many of the allegations concerning interaction between the Administration and producers could be interpreted as responding to an unprecedented crisis the proportions of which were evident but appropriate responses were not clearly understood.


Industry responded vigorously to the Select Subcommittee Report.  National Chicken Council president, Mike Brown emphasized “We must remember the importance of how uncertain and chaotic the early days of the pandemic were.”  He is justified in stating, “The Committee failed to shine a light on the momentous efforts between industry, government and state and local health officials to keep employees safe and to keep Americans fed.”


Julie Ann Potts, president and CEO of the North American Meat Institute stated, “The Committee could have tried to learn what the industry did to stop the spread of COVID among meat and poultry workers, reducing positive cases associated with the industry while cases were surging across the country.”


The unfortunate event resulted in as many as 60,000 cases of COVID among workers in the meat industry with over 250 fatalities but with proportions approximating infection in the general U.S. population.  The Select Subcommittee characterized Administration actions as favoring the meat industry at the expense of workers.  Applying the Rashomon parallel they could also have considered the necessity of maintaining a supply of protein to the public.  The motivation, actions and decisions of the participants will be debated going forwarded but if a study of the pandemic is to provide practical and beneficial recommendations, interpretation of actions and imputing motives should not be viewed through a partisan political prism.



Grassley-Fischer Bill Criticized By Both Packers And Producers


Egg-NewsThe Cattle Price Discovery and Transparency Act (S.4030) motivated by Senator Chuck Grassley (R-IA) was intended to protect producers by achieving greater transparency in marketing live cattle.


In hearings on April 27th, the proposed legislation was criticized by both representatives of the meat packers and by livestock producers.  Ethan Lane, Vice President for Government Affairs for the National Cattlemen’s Beef Association (NCBA), stated, “A one-size-fits-all solution such as the government mandate on cattle sales included in S.4030 is not the solution the industry is looking for.”  He added, “What is being proposed right now concentrates on what works for one region and simply doesn’t work for the rest of the country.”  The NCBA is advocating a cattle contract library, 14-day delivery, expedited weighing of carcasses with reporting and incentives to increase regional processing.


SEgg-Newshawn Tiffany of the Kansas Livestock Association is opposed to any government mandate since this would result in less incentive for producers to invest in innovative production techniques and genetics that would contribute to meat of higher quality.  He stated, “I do not support a government mandate of any kind, regardless of how well-intentioned the concept of helping producers obtain fair-market value for their animals.”  


The North American Meat Institute (NAMI) is opposed to mandates. For the record the hearing received a study conducted by Texas A&M University that the proposed S.4030 would impose an estimate of at least $112 million in additional cost over five years. Projections show that S.4030 would severely impact ranchers in Kansas, Texas and Oklahoma.


 Julie Anna Potts, President of NAMI, the attributed high cost of meat at retail to a disparity caused by an increase in demand coinciding with a lower herd. 


In a prepared statement and testimony, Donnie King, President and CEO of Tyson Foods attributed the rise in the price of beef to basic supply and demand economics that cannot be “rectified” by mandates and government intervention. These measures in the opinion of the packing sector would only exacerbate existing problems and create new difficulties for both sides of the transaction. King avowed that, “Tyson does not set the prices for either the cattle we buy or the beef our customers purchase.”  Following the advent of COVID, the packing industry was confronted with a major labor shortage.  Plants could not operate at an effective level reducing volume of throughput contributing to an oversupply of live cattle that drove down prices.  Cost inflation, especially in corn and soybeans, has increased the cost of producing cattle, hogs and chickens.  King stressed that there is no evidence that businesses are to blame for escalation in the price of beef.  He quoted Dr. Lawrence Summers, former Treasury Secretary, as noting, “Rising demand with capacity and labor constraints are fully sufficient to account for what we observe in meat packing.”


King stressed that industry consolidation with four major producers responsible for 80 percent of cattle processed was not a factor in high prices at the checkout counter. Over the past 30 years with the same level of concentration, there has been considerable fluctuation in profit among both ranchers and packers.


Quoting the policies and business practices that are typical in the packing industry, King noted the progressive increase in salaries, health programs, improved educational opportunities and potential for promotion of line workers.  Packers currently directly support more than 11,000 independent farmers and feed-lot operators.


So it should be back to the drawing board for Sen. Grassley with the gentle admonition that if it’s not broken don’t try to fix it! Obtaining input from both sides of the issue and studying the economic factors involved before drafting legislation would have been more productive. The ongoing fear is that once legislators have “resolved” the problems in the beef and pork they would roll right on over to fix the chicken industry.

Copyright © 2022 Simon M. Shane