WASHINGTON, D.C. – Today, the United Food and Commercial Workers International Union (UFCW), which represents 1.2 million essential workers across North America, including more than 250,000 workers in meatpacking and food processing, announced its support for state legislation to combat vertical integration in the meatpacking industry in Minnesota and Iowa. By controlling various stages of supply chains through vertical integration, companies can exert more power over suppliers and boost their bottom line at the expense of workers, producers, and customers.
Mark Lauritsen, Director of the Food Processing, Packing and Manufacturing Division and International Vice President at UFCW International, said:
“When grocery retailers vertically integrate, we all suffer – workers, farmers, ranchers, and consumers. For decades, the Federal Trade Commission, the Justice Department and the USDA have failed to enforce antitrust laws against dominant retailers. Walmart and Costco are seizing on this by investing in meatpacking production to force farmers and ranchers to accept lower prices for their livestock, lower pay for workers, and eventually raise prices on consumers.
“Retail grocery consolidation drives consolidation through the meat supply chain, which leads to job losses in both industries where hundreds of thousands of UFCW members work. With even more consolidation in meatpacking, employers will have more bargaining power to drive down wages for essential workers.
“Now, lawmakers in Iowa and Minnesota are stepping up to prevent retailers from tightening their grip. These bills would level the playing field for workers to get fairer wages, farmers to get fairer prices, consumers to get lower prices, and for regional grocers and meat processors to get market access, resulting in more wealth for local communities instead of Wall Street. Our food supply chain needs more competition, not less.”
Minnesota State Rep. Rick Hansen (DFL-53B), co-chair of the Agriculture Finance and Policy Committee, said:
“Everyone pays the price for monopolization, economically and culturally. This is one small step that we can take to keep the culture in agriculture and protect workers at the same time.”
Minnesota State Sen. Aric Putnam (D-14) said:
“Minnesota farmers are taking home a shrinking share of every dollar consumers spend on meat, and yet prices at the grocery counter keep rising. SF 4393 would prevent the largest retailers in America from locking in that broken dynamic by acquiring ownership over the very meatpackers that should be competing for farmers’ livestock — because when one company controls the supply chain, farmers get squeezed and consumers pay the bill.”
Iowa State Rep. J.D. Scholten (D-1) said:
“Since at least the pandemic, packers have squeezed farmers, suppressed workers and continue to raise costs for the American consumer. I support the retail packer ban to begin to balance the power of the American farmer, worker and consumer.”
Iowa State Rep. Josh Turek (D-20) said:
“Consolidation is hurting our meatpackers and our hog farmers at a time when they are already being crushed by tariffs and rising input prices. When large multinational companies own entire meat supply chains, it hurts workers, farmers, ranchers, consumers and local communities. I’m proud to sponsor legislation that empowers our state to crack down on this consolidation that’s leading to the loss of rural communities and higher prices in Iowa.”
Iowa State Sen. Zach Wahls (D-43) said:
“Fundamentally, this is pretty simple. If you’re a grocery chain, you shouldn’t be allowed to own the whole supply chain just so you can crush your competition and raise prices. That’s not capitalism, that’s rigging the game against hard-working Iowa families. This legislation protects both hard-working families and workers from getting squeezed by companies that put profits over people.”
BACKGROUND
- In Minnesota, Rep. Hansen (DFL-53B), co-chair of the Agriculture Finance and Policy Committee, has introduced HF 4080, which would prohibit large retailers from having an ownership interest in meatpacking companies. This legislation is being heard in the Agriculture Finance and Policy Committee today, March 18. Sen. Aric Putnam (D-14) has introduced companion legislation in the Minnesota Senate.
- In Iowa, Rep. J.D. Scholten (D-1) and Rep. Josh Turek (D-20) have introduced HF 2734, which would ban vertical integration in meatpacking and require retailers to divest any ownership stakes they have in production. Sen. Zach Wahls (D-43) has introduced companion legislation in the Iowa Senate.
- For decades, the Federal Trade Commission, the Justice Department and the USDA have failed to enforce antitrust laws against dominant retailers. Consequently, those retailers have been allowed to gain more power over the meat supply chain.
- These pro-worker vertical integration bills empower the State Attorney General to fight predatory, anticompetitive, undue preferences in grocery retail and pressure dominant retailers to divest from meatpacking facilities.
- Dominant retail grocers are rapidly moving to vertically integrate the U.S. meat supply chain, tightening their control to the detriment of workers, farmers, ranchers, and consumers. For example, Costco has opened a chicken plant in Fremont, Nebraska, and Wal-Mart has acquired a stake in beef processing plants in Kansas, Georgia and Nebraska.
- UFCW is the largest meatpacking union in the country, representing workers who process 60-70% of the beef Americans eat. Where there are unions, there are higher wages and safer workplaces for workers. The move towards vertical integration in the meat industry poses a significant threat to workers and strong labor standards for all proteins.
