A plan for a new large beef processing plant in southwest Iowa is bringing hope to cattle ranchers who want more bargaining leverage.
Four big meatpackers control most of the beef slaughter. Farm groups say less market competition means lower prices for cattle. But new company, Cattlemen’s Heritage, plans to build a facility on the Mills-Pottawattamie county line to process 1,500 head of cattle each day. They hope to open the plant in late 2023.
In a statement, Iowa Cattlemen’s Association said it looks forward to the facility.
“This facility will provide another market access for Iowa’s cattle producers with hopes of boosting cattle prices through competition and giving the state a needed economic boost for agriculture and the local area,” said Matt Deppe, the CEO of the Iowa Cattlemen’s Association. “We look forward to having continued conversations with the Cattlemen’s Heritage group and how they can help our state’s cattle producers.”
Iowa State University livestock economist Lee Schulz said another player in the packing industry means “tremendous opportunity” for local producers.
“Locally, that should really help competition for the cattle that are available,” Schulz said. “Cattle can only travel so far and so the largest impact is going to be to producers in that area.”
Schulz said the facility will also have ripple effects across the region.
“If that's the new demand there, the other plants are going to have to bid higher prices or go out further distances, to find cattle to supply their plants,” Schulz said.
Schulz said it’s hard to say how much the new plant will affect prices because markets and production costs are constantly changing.
Iowa Republican U.S. Sen. Chuck Grassley reintroduced a bill earlier this year to increase competition across livestock markets. The bill would require meatpackers to buy at least half of the amount of beef cattle they slaughter weekly from the market where buyers and sellers negotiate prices.
