The OFF Act – What’s the big deal?

The big deal is to investigate the various livestock checkoff programs. This is needed at this time because the referendum promised when the checkoff began never happened. Why has the OFF Act has caused consternation for some so-called cattle trade associations?

It should be clear that a “cattle” trade association that disagrees with the OFF Act does NOT represent cattle producers!

The beef checkoff is a one dollar per head sold assessment paid by those selling cattle. Note, selling live cattle is not the same business as selling beef!

Producers mostly sell at cattle auction markets. Backgrounders and feed lots are the prime purchasers. The purchasers need to purchase our feeders at the best price they can get. We producers need the highest price we can get. Competition for our feeders should make for a fair market for all. In the past 25 years 82,964 feedlots have gone out of business. Most of these were small to medium sized, family-owned operations. This loss decreased competition for producers’ cattle. This caused downward pressure on prices received by producers. However, the consumers are paying record high prices at the supermarkets. The “beef industry” begins with the meat packers and culminates with the retail outlets. Some meat packers have been allowed to own feedlots in violation of the packers and stock yard Act. This ownership allows the packers to manipulate the cash market depress the prices received by independent feeders. The price depression and decreased competition at the auction houses, are reflected in the lower prices received by the producers.

The checkoff dollar has been used by subterfuge to support lobbying by the so “called” cattle trade associations which oppose the OFF Act.

Meat packers and retail outlets don’t pay the checkoff fee. Have you ever seen a commercial for live cattle? Why not?

The purpose was to increase per capita beef consumption in the USA. Theoretically, increasing cattle sales and improving the lot for our domestic producers and the entire chain and stabilizing prices to the consumer.

Let’s look at the results.

The beef-checkoff was included in the 1985 farm bill. It was instituted in 1988. The per capita beef consumption in the USA was 97pounds. In 2020 it decreased to 88 pounds. In1988 the USA beef cow herd was about 87million mother cows. In 2020 it decreased to 31 million mother cows. Domestic beef cattle operations numbered about 930,000 in 1990 and declined to 730,000 in 2017.

People are eating less beef per person. However, the domestic beef production is 20-30% less than the total amount of beef consumed. This reflects the growth in the population of the United States of America. The gap is filled with imported beef. Thus, the emphasis on beef exports as an indicator of market health is misleading if not downright dishonest. Based on domestic production beef exported as product of the USA can’t be all domestically produced. Some if not most of this exported is beef imported and repackaged as product of the USA.

The “cattle” trade association which opposes the OFF Act uses checkoff dollars to lobby against Country Origin Labeling of all beef products. This is despite the tendency of one of the” Big Four” meat packers, both past and present, to import contaminated beef.

It’s been stated by some that the checkoff is working as intended. If that’s true, then it was intended to drive the domestic producer out of business. Clearly, we were misled from the inception of the beef checkoff program. If it was simply terminated, it would save the family cattle producer.

Data above is taken from USDA Economic Research Service and or USDA National Agricultural Statistics Service reports.