Archive for Sunday, March 7, 1999


March 7, 1999


— A western Kansas feedlot owner is leading the charge to diminish the clout of agribusiness giants.

More than 75 years ago, government trustbusters went after Armour, Swift and other big meat companies.

Now, a new set of companies dominate the U.S. meat industry and Mike Callicrate and other frustrated Kansas cattle growers say it's time for the government to blow dust off the 1921 Packers and Stockyards Act.

"In 1921, the government forced the meat companies to divest themselves of all interests other than packing," said Callicrate, 47, owner of the 12,000-head Callicrate Feedyards here. "I think we have such a highly concentrated industry that it again needs to be broke up. We've got predators in the marketplace and they're preying on producers and consumers."

Callicrate has become a leading activist in the effort to push lawmakers and agriculture bureaucrats to trim the power of IBP, Excel, Monfort and National. More and more, the four major Kansas slaughterhouses buy cattle through advance or formula contracting -- not on the open market.

That puts small-scale feeders and others at a disadvantage as competitive bidding disappears.

"It's my survival," Callicrate said. "What we've got going on, in my opinion, is many violations of the act. We've lacked enforcement for many years. Now four packers control 87 percent of the beef slaughter in the whole U.S. I believe they fix the price."

The result, Callicrate said, is that some feedyards are unable to get a fair price for their cattle and go bankrupt while others receive preferential treatment and are able to expand.

"That's not fair," he said. "Many of the smaller feedyards are more efficient."

Callicrate pulls few punches and is not shy about criticizing some of the state's most powerful people and institutions.

  • His take on Farmland Industries, the giant cooperative:

"Farmland has become a greedy corporation," he said. "They exploit the farmer just like a corporation. The very people they were organized to benefit, they are putting out of business. They are competing with their very own members. They are just like Cargill, Conagra and IBP."

  • His take on USDA Secretary Dan Glickman, a former Democratic Kansas congressman:

"Dan Glickman finds it very difficult to enforce the law. The bottom line is he simply doesn't have the political will."

  • Callicrate's take on U.S. Sen. Pat Roberts, a Republican:

"At the federal level, Kansas is in big trouble. Pat Roberts doesn't think there's a problem. He listens to (Kansas State University ag economist) Barry Flinchbaugh. I think Barry Flinchbaugh should be fired. I think he's totally ignored the interests of producers and consumers.

"KSU continues to minimize the negative impacts of concentration in the industry. What is the intent of a land grant university? Not to promote big corporations."

  • His take on U.S. farm policy:

"When is USDA going to figure out the world doesn't want our grain, doesn't need our grain and can't afford our grain? When we're knee deep in corn?"

But Callicrate hasn't just been speaking out about the problems faced by small and mid-sized producers.

He played a role last December in forming a new group, the Kansas Cattleman's Assn., which broke away from the long-established Kansas Livestock Assn. The new group claims the older group does too little for members that aren't huge operations.

Callicrate also -- with nine other cattle producers -- has filed suit in federal district court in Alabama against IBP claiming the packer uses anticompetitive practices. The case goes to trial in November.

He also has been lobbying state and federal lawmakers to pass legislation that would require buyers for the packing houses to publicly report the prices they pay for cattle, require mandatory labeling of imported meat and require packers to buy all their cattle on the open market.

And he was among a group of western Kansas cattlemen who aired their complaints last week before the Senate Agriculture Committee. It is considering a bill that would require daily cattle price disclosure, prohibit discrimination in what packers pay different producers and forbid business retaliation against producers for statements they make about packers.

Agriculture officials already have the power to make happen many of the things Callicrate and his allies seek, but they have been reluctant to exercise it, USDA critics say.

"USDA has been extremely resistant to using the authority it has under the Packers and Stockyards Act," said Martha Noble of the Sustainable Agriculture Coalition in Washington, D.C. "They're studying it (concentration in the industry) and studying it and studying it. Hey, at some point you have to conclude they're going to study it till the last rancher leaves the range."

The Kansas Livestock Assn., which has lost members to the upstart Kansas Cattleman's Assn., says many of the new group's goals are unworkable or undesirable.

`Not supportive'

"We're not supportive of mandatory price reporting," said livestock association spokesman Mike Beam. "It's likely going to be after-the-fact reporting and it's not feasible to do it.

"But the biggest reason is that for mandatory reporting, the government would have to get in the business of both the buyers and the sellers. And that gets some of our people nervous."

Beam's group also opposes government strictures against packers owning cows in feedlots.

"We don't want government stepping in to say who should or should not be in the market or who should or should not be raising cattle."

The new group is more comfortably allied with the Kansas Farmers Union, a long-established group for small farmers.

"Mike is a sharp guy," Emil Mushrush of the McPherson-based Farmers Union said of Callicrate. "Sit down and talk with him, you got to be impressed. He started running into this problem of only so many buyers, so he started challenging it. He found out a lot of other people are frustrated too.

"A lot of these feedlot guys only got one buyer. If they're lucky they got two. Basically a lot of the big packers make deals with the big feedlots, give them better price, but don't report it."

Elroy Heim, a director of the new cattleman's group, has been among those crisscrossing the state recruiting members.

Last week he made stops in Parsons and Hillsboro. The group now has about 300 members, he said.

"We're traveling the state," Heim said. "Trying to get out to the grass-roots producer, let them know we intend to take their voice. I was a long-time member of KLA, but I didn't feel we were getting representation of the real issues, this packer consolidation that exists today. We're averaging 6.5 new members a day.

"KLA has been very negative," Heim said. "They've called us activists and a splinter group. I don't have any problem with that. I kind of like it. I want people to know we're active."

Heim is a manager at Callicrate Feedyards. He said his outspoken criticism of the status quo has made it even more difficult for the yard to sell cows.

"I wrote an article back in early December about why this is not working for the producer and got published in (a livestock trade journal). After that, from Dec. 16 until the first week of February, I never got a bid out of a National buyer because they thought I was slamming their company. An Excel buyer hasn't been in our yard for three years (despite) personal invitation."

-- Mike Shields' phone message number is 832-7144. His e-mail address is

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