“There’s no competition,” said Ty Thompson, an auctioneer at the public auction yards in Billings, Mont., who also operates his own feed lots. Given the market dominance of the four largest packers in their regions, feed lots lack alternative places to sell their animals once they reach slaughtering weight. In exchange, the feed lots must lock into a price structure that tracks those in public auctions, where buyers are scarce.Īccording to industry experts, this system allows packers to lock up the overwhelming supply of cattle at prices they impose, under terms hidden from public view. Those contracts provide the feed lots with certainty that the packers will buy their animals.

Instead, the packers now overwhelmingly rely on private contracts with feed lots. His organization is a plaintiff in a class-action lawsuit that accuses meatpackers of manipulating prices by sharply reducing their purchases of cattle at so-called sale barns - open marketplaces where animals are inspected and purchased on the spot, with the prices disclosed publicly. “The meatpackers are making all-time record profits.” “You’re having consumers exploited on one end of the supply chain, cattle producers exploited on the other,” said Bill Bullard, a former rancher who now heads an advocacy group, the Ranchers-Cattlemen Action Legal Fund. Last year, cattle ranchers received only 37 cents on every dollar spent on beef, according to federal data. But that relationship began to break down in 2015. In past decades, when beef prices rose, so would payments to cattle ranchers, who claimed over half of what consumers paid for meat. While ranchers have been tallying losses, JBS has been celebrating gains - revenues of $18 billion between July and September, which represented an increase of 32 percent compared with the same quarter in 2020. (They have since been released.) A $20 billion international acquisition spree put JBS in control of one-fourth of the American capacity for slaughtering beef.

Four years ago, they went to prison after pleading guilty to participation in a Brazilian bribery ring that secured loans from government-owned banks. The two brothers who control the enterprise, Wesley and Joesley Batista, possess a fortune estimated by Bloomberg News at $5.8 billion. Many of the cattle raised in Montana are eventually hauled to slaughterhouses run by JBS, the world’s largest meat processor.

Raising bulls for profit