Alabama Department of Agriculture and Industries Commissioner Rick Pate (R) thanked President Donald J. Trump (R) for asking the Department of Justice to investigate the Big Four meatpackers for possible market manipulation of the price that farmers and ranchers get for their beef cattle.
“I want to thank President Trump for asking the U.S. Department of Justice (DOJ) to expand its investigation into allegations that large U.S. meat packing companies manipulated beef prices farmers received for their cattle at market. USDA has been investigating meatpacker pricing activity since last fall, after live cattle prices plummeted following the Holcomb, Kansas, meat plant fire,” Pate said. “On April 6th, I sent a letter to U.S. Senators Richard Shelby and Doug Jones requesting they join fellow U.S. senators calling on DOJ to investigate meat packing companies’ influence on the cattle market.”
U.S. Senator Doug Jones (D-Alabama) was part of a bipartisan group of 19 Senators who sent a letter to the DOJ urging the AG William Barr and the Department of Justice to investigate possible unfair manipulation of the live cattle markets to fix prices in favor of the packers and against farmers and ranchers.
“Cattlemen across America seriously question the ability for their children to take over what are frequently multi-generational, family-owned operations that have served as the engines for their communities and our country’s food supply,” Jones and the Senators wrote. “The precarious market situation for feeders and producers could lead to a widespread collapse of this entire industry, making it susceptible to the forces of vertical integration, which may beset the industry far more quickly than once anticipated. It is critical for the DOJ to act expediently to investigate these concerning circumstances and evaluate potential competitive harms.”
“Four meat packing companies in the U.S. control more than 80 percent of the beef supply and there continues to be a tremendous gap between the cash cattle price farmers receive and the price consumers pay at the store,” Commissioner Pate wrote. “Since the coronavirus outbreak, boxed beef prices have more than doubled, while live cattle prices have dropped about 20 percent.”
Pate is optimistic that cattle farmers will benefit from the DOJ investigation.
“I am encouraged that the investigation seems to be moving forward,” Pate said. “It’s important that cattle farmers who work hard to produce the beef we all enjoy receive a fair price for their cattle.”
The Senators were joined in urging for a DOJ investigation by 11 State Attorney Generals.
Missouri Governor Mike Parson (R) said, “As a third-generation cattleman myself, I understand the stress many in the cattle business have faced for years. Cattlemen and cattlewomen across the United States are simply asking for transparency and accountability from our meatpackers in the beef business. I applaud Attorney General Eric Schmitt for showing leadership on this issue. It is important our farmers and ranchers understand that Missouri supports them.”
The Big Four meatpackers are: Tyson Foods, Cargill/Excel, JBS Swift, and National Beef.
R-CALF USA (Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America), a ranchers’ group, filed suit against the Big Four last year alleging illegal market manipulation and monopolistic behavior. R-CALF is urging Congress to bust up the large food processing companies.
Mike Callicrate is one of the co-founders of R-CALF USA and is a farmer-rancher and entrepreneur who owns a boxed beef company in Colorado Springs.
“National security is impossible without food security,” Callicrate told the Alabama Political Reporter. “The security of the State is impossible without food security. Globalization and multinational corporate control of our food systems has left us unable to feed ourselves.”
R-CALF USA believes that the Southeast region should have its own locally owned packing industry rather than being dependent on giant meatpackers located hundreds or even thousands of miles away owned by multi-national corporations.
“Job one should be for Alabama to build local/regional food infrastructure that connects Alabama farmers directly to Alabama consumers,” Callicrate told APR. “This will eventually eliminate the industrial model that is exploiting Alabama citizens and mining the State’s valuable resources. We must make future efforts bomb-proof . . . with a new commitment to antitrust law enforcement, and through support of our food dollars.”
Bill Bullard is the CEO of R-CALF USA.
“Covid19 has magnified a problem that has plagued the industry for years,” Bullard told APR. “We can not go back to where we came from. Restructuring is a necessity! “
COVID-19 exposed the danger of reliance on increasing larger and larger meatpacking plants that slaughter thousands of cattle each day with thousands of workers, many of them immigrants, working literally shoulder to shoulder disassembling animals often at breakneck speeds.
Sunday afternoon, the Alabama Political Reporter interviewed Callahan Parrish, a 4th generation Cattle Farmer. Callahan also owns the Cullman Stockyard and is emerging as an Industry Advocate.
“The pandemic has unmasked many fundamental problems associated with the current beef production model. Industry infrastructure, competitive market access for our producers and food security issues top this list,” stated Parrish.
“The skeletonization of the downstream segments of our industry is the result of the packers’ efforts to vertically integrate the cattle industry as they have already accomplished in the hog and poultry industries,” Bullard said. “In a very short time, we’ve lost hundreds of thousands of cattle producers, tens of thousands of farmer-feeders (smaller feedlots), and hundreds of packers, not to mention the loss of local livestock auction yards.”
70 percent of the cattle processed by the big meatpackers is contracted in advance. Prices are determined in the cash or spot market. By hedging against the cash market in livestock auctions the packers are more easily able to manipulate that cash market R-CALF USA contends.
“Without robust competition, the hollowing out of our rural communities will continue,” Bullard said. “It is time we reversed the negative trajectory of our industry by rebuilding our industry’s competitive marketing channels. It is time for Alabama to take a lead in infrastructure overall.”
There are impediments to siting a new regional meatpacker in Alabama. Since John Morrell closed its packing plant in Montgomery in 1992 thousands of Alabama farms and ranches have gone out of business and the state has far fewer cattle than it did a generation ago. Most of the remaining farms and ranches in the state produce 450 to 650 pound feeder calves, not the 1100 to 1500 finished or “fat” cattle that the industry butchers. Order buyers purchase southern calves and ship them out west to Texas, Missouri, or the plains states for growing out and finishing.
That would need to change to support a meatpacker here. While an increasing segment prefers grass finished cattle, most American cattle since the 1950s are finished in feedlots on grain. In 1915 Alabama had 4.5 million crop acres in cotton alone. Today all the crops acres combined in the state are less than 1.5 million acres. Some industry experts say that it is easier to export Alabama calves to the grain than import western gran to Alabama cattle; however Alabama’s poultry farmers grow over a billion chickens a year. Most of the 150 million bushels of corn and 63 million bushels of soybean meal that the chickens eat is imported from out of state. There is also enormous potential for grass finishing in Alabama given the moderate winters and plenty of rainfall.
“In the midst of hardship, Alabama’s Cattle Producers and stakeholders are talking solutions . . . and that is real progress,“ Parrish stated.
(Original writing and research by Montgomery area writer Amy McGhee contributed to this report. McGhee’s parents own and operate an Angus beef cattle farm in Tennessee.)
Alabama’s immigrants pay more than $1 billion in annual taxes, study says
Immigrants in Alabama are responsible for more than $900 million in federal taxes and more than $350 million in state and local taxes, according to a study.
Immigrants in Alabama are responsible for more than $900 million in federal taxes and more than $350 million in state and local taxes, according to a study published Monday that assessed the economic impacts of immigrants in each state.
Of Alabama’s 4.9 million residents, 162,567 of them, or 3 percent, were foreign-born as of 2018, according to statistics compiled by the American Immigration Council, which advocates for immigration reform.
Alabama residents in immigrant-led households had $3.7 billion in spendable income, the study states.
Of the state’s immigrant population, 34 percent was undocumented in 2016. That is equal to 1 percent of the state’s total population. Undocumented immigrants represented 2 percent of the state’s workforce that year. They paid an estimated $54.1 million in federal taxes and $37.6 million in state and local taxes in 2018.
Roughly 67,000 of the state’s immigrants, or 41 percent, were naturalized citizens as of 2018. Three-quarters reported speaking English “well” or “very well,” according to the study.
A third had a college degree or higher. By comparison, 25 percent of native-born residents of Alabama have that level of education. Twenty-seven percent of immigrants had less than a high school diploma compared to 13 percent of native-born Alabamians.
Mexico is the most common country of origin at 27 percent of immigrants. China and India each account for 6 percent, followed by Guatemala and Germany with 5 percent each.
The industries employing the largest shares of the immigrant population are construction, services other than public administration, accommodation and food services, agriculture and manufacturing.
There were 4,000 active recipients of Deferred Action for Childhood Arrivals, known as DACA, as of 2019. Of those eligible for DACA, 58 percent had applied. These groups combined were responsible for $11.4 million in state and local taxes, or 3.2 percent of the total amount paid by foreign-born residents.
Immigrants represented 6 percent of the state’s business owners and generated $319.8 million in business income in 2018, the study said.
Extra $600 in COVID-19 unemployment benefits ends July 26
The extra weekly unemployment payment of $600 ends later this month.
Despite surging COVID-19 cases and hospitalizations across Alabama and in many other states, an extra $600-per-week in unemployment compensation through the Federal Pandemic Unemployment Compensation program is expected to expire July 26.
That extra money, meant to help those whose jobs were displaced by coronavirus and through no fault of their own, was made possible through the CARES Act, the federal aid program that is to continue through Dec. 31, 2020, but the extra weekly payment of $600 ends later this month.
“At this time, the federal government has not changed or extended the FPUC program. States do not have the ability to extend FPUC,” the Alabama Department of Labor said in a press release on Monday.
The end of the extra assistance will impact more than 25 million Americans, during a time when COVID-19 continues to spread actively through communities.
More than $1 billion has been pumped into Alabama’s economy through the extra $600-a-week payments to Alabamians, according to the New York City-based think tank The Century Foundation.
The Federal Pandemic Unemployment Compensation payments make up 60 percent of total unemployment benefits paid during the pandemic.
In Alabama, 35,760 people are receiving the extra $600 a week, which totals approximately $91.7 million weekly into the state, according to The Century Foundation, which estimates that benefits to Alabamians receiving unemployment assistance will decrease by 70 percent once the extra $600 a week dries up.
The average current combined unemployment benefits in Alabama is $854.95 and after the end of the Federal Pandemic Unemployment Compensation payments, the remaining unemployment benefit will be roughly $254.95.
There are also racial justice implications in the end to the extra $600 a week in aid, according to the think tank.
“Alabama, Delaware, Georgia, Louisiana, Mississippi, and South Carolina all have average unemployment benefits below $300 per week, as a result of both low wages and unemployment insurance rules that simply offered less protection to predominantly black workforces,” The Century Foundation’s report notes.
In Alabama, 57 percent of those receiving unemployment benefits during the COVID-19 pandemic from March to April were women and 50 percent were white, while 43 percent were Black, while Black people make up only 27 percent of the state’s population.
The report states that the Federal Pandemic Unemployment Compensation benefit was intended to be a public health measure, helping workers while they stay home until it is safe to go back to work.
“Just as rushed reopenings put families at risk, eliminating FPUC now will force people to rush back to work before it is safe,” the report reads.
Job seekers can visit their local Career Center or search jobs online without cost at alabamaworks.alabama.gov.
Alabama Innovation Fund, Auburn support development of saliva COVID testing device
The Alabama Department of Commerce and the City of Auburn’s Industrial Development Board have teamed to award $250,000 in funding to accelerate the development of OraSecure LLC’s breakthrough patent-pending saliva collection device intended to help in the ongoing battle against the novel coronavirus.
Support from the Alabama Innovation Fund and the City of Auburn will help OraSecure finalize the initial manufacturing run needed to begin mass producing its devices and complete validation with the FDA. Production of the devices will take place in Auburn.
“The Alabama Innovation Fund is a key component in our efforts to spark the creation of high-impact ’Made in Alabama’ products by stimulating breakthrough research,” said Greg Canfield, secretary of the Alabama Department of Commerce. “With this support, we are helping OraSecure speed the development of a specimen collection device that can make a difference in the pandemic response while simultaneously raising the state’s profile in the bioscience industry.”
For more information, see the attachment or click this link: https://www.madeinalabama.com/2020/07/orasecure_saliva_collection_device/
New unemployment claims held steady in June, state says
The number of Alabamians filing for unemployment insurance held more or less steady over the course of June, with 18,340 new claims added during the last week of the month, according to the Alabama Department of Labor.
There were 19,950 new claims in the first week of June and 18,367 in the second week, then a slight jump to 18,671 in the third week.
The month’s total of 75,328 new claims comes after Gov. Kay Ivey relaxed some restrictions meant to slow the spread of COVID-19 and allowed more businesses to open. The numbers vary by industry and county, but generally represent some stabilization, according to department spokesperson Tara Hutchison.
“They remain significantly down from a high in excess of 100,000 in April, which is good news. I don’t know if we can really expect anything one way or another in this unprecedented situation, but the decline from early in the pandemic is of course welcome news,” Hutchison said.
About 60 percent of last week’s new claims were attributed to COVID-19.
The state’s unemployment rate dropped from 13.8 percent in April to 9.9 percent in May. That compares to a rate of 3 percent in May 2019.
Jefferson County had the highest share of new claims last week at 2,626, followed by Mobile and Montgomery counties at 1,900 and 1,400, respectively.
The worst-hit industries that are categorized were administrative and support services, food service and bars, transportation equipment manufacturing, general merchandise stores, nursing and residential care facilities and educational services.
As of May, counties with the lowest unemployment rates are Clay County at 5.6 percent, Geneva County at 6.3 percent and Shelby County at 6.5 percent.
Counties with the highest unemployment rates are Wilcox County at 19.3 percent, Lowndes County at 18.3 percent and Greene County at 16.4 percent.
Major cities with the lowest unemployment rates are Vestavia Hills at 5.2 percent, Homewood at 5.4 percent and Madison at 6.2 percent.
Major cities with the highest unemployment rates are Prichard at 18.6 percent, Selma at 17.1 percent and Gadsden at 15.7 percent.
Wage and salary employment increased in May by 42,500, according to the department.
Average weekly earnings increased to a record high in May, rising to $905.25 per week, representing an increase of $66.43 over the year.