ARLINGTON, VA – Meat and Poultry Industry experts and economists universally pan U.S. Senator Chuck Schumer’s (D-NY) bill, the so-called “Family Grocery and Farmer Relief Act”:

• Hyrum Egbert: You can’t legislate the cattle cycle

  Beef supply chain economic expert Hyrum Egbert says, “This bill is being marketed as consumer relief and rancher fairness. But the assumptions underneath it, about how prices form, how retail behaves, and what happens when you force structural breakups in a capital-intensive chain, don’t line up with the actual mechanics.

  You can’t legislate the cattle cycle. You can only decide whether policy helps the system move through it with less friction, or whether it adds friction, raises costs, and then acts surprised when the rancher, the packer, and the consumer all feel more pain.”

  On prices for consumers and livestock and poultry producers: “Don’t confuse high prices with manipulation when the cattle cycle is doing exactly what it always does. High beef prices are real. Grocery bills hurt. That’s not up for debate. The question is whether the pain is coming from a cartel story or from the cattle cycle and capacity reality working through the system. Here’s the sober test: if packers set prices, you’d expect durable economic fingerprints: persistent supernormal profits, spreads that blow out and never normalize, loss years disappearing. Instead, what shows up historically is something less exciting, but accurate: Prices and spreads react to shocks and utilization.

  Margins fluctuate between profits and losses. Retail behaves differently because it’s category-managed and sticky. That is not a moral defense of every behavior in the chain. It is an economic description of how a tight cattle cycle transmits. Breaking up the packing sector doesn’t change the cycle. It changes the industry’s ability to absorb it.”

• Drovers: What is Sen. Schumer’s Family Grocery and Farmer Relief Act?

  Drovers reports, “John Nalivka, Sterling Marketing Inc. president, echoes his concern regarding the proposed legislation.

  “Packers break carcasses — politicians break companies,” Nalivka summarizes. “It should not surprise anyone, but the politicians have produced an answer to lower food prices and that is to break up companies into smaller entities. Though he did not ask for my opinion, I would tell Senator Schumer, ‘That plan goes against the one thing that allows a company to compete, including meatpackers, and that is economies of scale.’”

  Nalivka adds the Sterling estimates for margins across the red meat industry would not support any contention that packers are taking advantage of producers or consumers for that matter.

  “For 2025, my Sterling margin estimates indicated that beefpackers had an average loss of $138/head. Feedlots realized an average profit of $498/head last year while cow-calf producers made $897/head on cattle sales during 2025,” Nalivka says. “Record-high cattle prices certainly benefited feedlots and cow-calf producers over the last year. However, those same record-high fed cattle prices more than offset the record-high wholesale beef prices paid to packers last year, thus leading to significant packer losses.”

  The argument for “too big” might begin with packers, but where does it go from there? Does it extend further to the government needing to regulate the size of feedlots and cow-calf ranches in the U.S.? That might sound unlikely, but what might seem like an appealing argument can often spiral further.

  “Initiating an investigation is only the beginning,” Nalivka adds. “I have seen this with federal lands grazing in the western U.S.”

  The meat industry competes in a global market. The U.S. meat industry has an advantage in many aspects of producing and marketing beef, pork and poultry with part of that advantage being the structure of the industry. As a result, U.S. consumers have access to a wide variety of safe and wholesome red meat and poultry meat products.

  “Is beef affordable? I would answer yes, and consumer demand would support that,” Nalivka summarizes. “If consumers were unwilling to purchase beef at record-high prices, prices would fall.”

• Agri-Pulse: “Schumer, Senate Dems go after meat industry concentration”

  Glynn Tonsor, an economist at Kansas State University, told Agri-Pulse: “that larger cattle plants generally can harvest an animal more cheaply than smaller ones, often as a result of different procedures and labor distributions. He said if restrictions are set on size and ownership, it would limit some of the ‘economies of scale’ benefits that larger beef processors have been able to provide.”

  In the same story, Agri-Pulse also reported: Derrell Peel, a professor of agricultural economics at Oklahoma State University, said consolidation has occurred because it's "cost effective." If the meatpackers were broken up, "you will lose that cost efficiency," which will raise costs in the middle of the industry, above producers and below consumers. When those costs rise, he said consumers tend to pay more, and producers tend to get paid less.

  He also said beef packers specifically were currently losing "tremendous amounts of money" in the present cattle market amid a combination of low inventory and high demand.

  "This is a horrible idea," he said of the proposal. "It will make prices for consumers go higher. It will make cattle prices ... go lower, and it will infinitely extend the amount of time it would take to rebuild this industry to get to a point where there would be larger supplies."

  He added: "There will be no winners in this, other than a bunch of lawyers. That's the bottom line."

• Beef Magazine: “Schumer’s Pretense of Knowledge”

  Industry expert Nevil Speers says "higher beef prices are largely the result of improved demand (the signal is loud and clear) – not the packer squeezing margin out of the middle (for more see here). And meanwhile, consumers continue to prove their willingness to trade up when it comes to buying beef (because they like it!)."

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