SIOUX CITY, Iowa (KCAU) – The closures of packing plants are causing a series of challenges for Iowa farmers.
“We are losing three, four hundred dollars a head on these live cattle,” said John Hansen a cattle farmer in Sioux County.
He said typically the price on his live cattle is determined by the price of boxed meat, like hamburger, in grocery stores. Hansen said 60% of that price determines how much his live cattle is worth but because the price for boxed meat has skyrocketed, he’s said he’s losing out.
“The packer said we can raise our prices because we have no beef, which is untrue. We have plenty of beef, we just don’t have slaughter capacity as of right now due to COVID-19 and people not going to work in these packing houses,” Hansen added.
Katie Olthoff is the Senior Director of Communications and Membership for the Iowa Cattlemen’s Association.
“Boxed beef prices have continued to rise but at the same time cattle prices has declined and there is a huge disparity between the two prices,” Olthoff said.
She said the association has asked for the Department of Justice to investigate the pricing disparity in the Iowa cattle market.
“We’re really concerned about the prices they’re receiving for their cattle. We don’t think it adds up in a way that makes sense and it really puts them at a disadvantage,” Olthoff added.
Ryan Schroeder, who produces hog and cattle in Plymouth County, said producers are left with an ultimatum.
“We have no control, you know. If I don’t sell it to a packer when he can take it, then the animal gets too big, and I can’t sell it anyway,” Schroeder said.
He said packers are making more off his product than what he’s paying to feed them. He said the losses farmers are facing could force producers to leave the industry.