Beef is expensive. Shoppers see it every time they walk past the meat counter. Washington has responded with a band-aid solution by opening the door to more imported beef. While that may provide some short-term appeal to consumers, it does nothing to address the underlying domestic supply problem that has led to high prices in the first place.
In fact, allowing more imported beef actually makes the problem worse in the long run because it artificially manipulates the supply and demand signals that would improve the domestic supply and drive down prices for consumers.
America’s beef herd is still shrinking. The USDA counted 28.5 million beef cows in July, 1 percent fewer than a year ago. With drought and high costs still squeezing ranchers, rebuilding will take time. And they can only invest in raising more cattle if it makes economic sense to do so—which is why Washington favoring foreign beef sends such a mixed signal to the market.
It’s clear America also needs to raise more of its own beef. To encourage growth in the American cattle herd Washington should instead focus on lowering avoidable production costs and helping independent processors grow.
Processing is the obvious place to start. More independent and regional processors would give ranchers more options for getting cattle to market and create additional paths for locally raised beef to reach consumers. Additional buyers can also strengthen a rancher’s hand when negotiating cattle prices.
The USDA’s $500 million Strengthening Processing for U.S. Ranchers (SPUR) program already offers temporary support to eligible small and midsize slaughter facilities. Public support should favor projects with enough cattle and customers to sustain them once the aid ends.
Ranchers can also benefit when consumers who prefer American beef can identify it. USDA now restricts voluntary “Product of USA” claims to meat from animals born, raised, slaughtered and processed here. American beef is the healthiest and most rigidly controlled for quality in the world. Foreign-raised meat is less regulated with fewer controls on the use of antibiotics and growth hormones. Consistent enforcement of the law would help ensure domestic producers receive the benefit of that distinction.
Repair bills and delays are another expense ranchers have reason to watch. Many equipment companies force them to get their machinery fixed at a dealership, which costs farmers as a collective $4.2 billion annually. During these tough economic times, sky-high dealership repair bills can sometimes mean life or death for struggling family farms and ranches in this state.
But it’s not all bad news on that front. John Deere recently petitioned regulators to ensure that farmers would not be at risk of a suit or accruing penalties from the federal environmental regulators if they repair their own equipment. The company then enacted comprehensive right-to-repair reform months after obtaining this clarification. With the EPA now providing regulatory certainty, hopefully other farm equipment manufacturers start offering the right to repair soon, which will relieve some pressure on our beef producers.
Consumers have every reason to want relief from high beef prices. Ranchers have every reason to worry about weakening cattle prices while their own costs remain high. Lower production costs give ranchers more room to expand, which can increase the supply available to shoppers over time.
Imports may provide short-term relief at the meat counter, but a stronger domestic industry would give Americans a more dependable supply beyond the life of a temporary tariff measure. If America wants a larger, more affordable beef supply, producing it has to make economic sense for the people raising the cattle.
Republican Rep. Eric Albus represents House District 28 in northeastern Montana. He ranches near Glasgow.