Independent cattle and hog producers say they can't compete with giant packing firms that grow their own herds for slaughter.
THURSDAY March 2, 2000 / By Steve Painter / The Wichita Eagle
TOPEKA -- Alan Hess, a Flint Hills cattle rancher, says he doesn't want the government messing with the free market, telling him how he can or can't do business.
Mike Callicrate, a western Kansas feedlot owner, says the free market will cease to exist in the cattle business unless the government steps in.
Lawmakers at the state Capitol aren't sure what to make of it all, as a divided industry tries to pull them in opposite directions.
At issue Wednesday was a proposed law to prohibit the nation's biggest meat packing companies from owning cattle or hogs, or controlling the market destination of animals through contracts. The bill is a key element of a package of policy changes sought by lawmakers who contend that independent farmers are powerless in negotiating with huge agribusiness companies.
If adopted, the bill would force packing companies such as IBP, Monfort and Wichita-based Excel Corp. -- all of which have packing plants in Kansas -- to sell off any livestock they own by Jan. 1, 2003.
The bill also could have an effect on hog company Seaboard Farms, which is considering Great Bend as the site of its next packing plant. Seaboard has several large-scale hog farms in southwest Kansas but would not be banned from owning hogs under the bill because its slaughter plant is out of state, in Guymon, Okla.
Many cattle and hog producers say a handful of packers control so many animals destined for slaughter that they can manipulate prices.
"The packers are financing the takeover of agriculture through low prices," Callicrate told a Senate committee. The St. Francis feedlot owner has campaigned for years against what he considers packer dominance of the cattle market.
Several other feedlot operators declined to testify before the Legislature for fear of retaliation from packers, said Rep. Dennis McKinney, D-Greensburg, one of the sponsors of the legislation.
The state's largest cattle and hog groups, the Kansas Livestock Association and the Kansas Pork Producers Council, oppose the legislation.
They say the bill would keep packers and producers from negotiating business terms with each other.
Hess, the president of the livestock association, said the bill would limit the opportunities he has to choose how to sell his cattle.
"I like to have the individual freedoms that the free market has always given us," he said.
Mark Klein, a spokesman for Excel, said his company uses contracts to reward producers who raise high-quality cattle. Many contracts include premiums for high quality and require the packer to give sellers detailed data about the quality of their cattle.
The law would apply to companies that slaughter 1 million or more cattle a year.:
