11/19/08 Department of Justice lawsuit

I really didn't anticipate a recent news story, but I think it has some merit. I'm Jeff Keane; I'll be back in one minute to fill you in. Recently, a news article came out that I didn't think I would actually see. The Department of Justice filed a lawsuit to block JBS SA from purchasing National Beef Packing Company. I have discussed several times how the Brazilian company, JBS SA purchased Swift Meat Packing and would like to acquire National Beef Company, Smithfield Beef Group and Five Rivers Ranch Cattle feeding operation. Many cattle producers have been concerned for years about beef packers' concentration, since only a handful of packers process over 80 percent of U.S. fed cattle. There have been congressional committee investigations and university studies researching packer captive supply and lack of competition in acquiring the cattle that stock their plants. The answer has always been the same  yes, packers may have captive supplies but they are not used as leverage to set a market price. Hard work and testimony by R-CALF USA along with other cattle producers and consumers convinced the Department of Justice this merger would lower prices paid to cattle suppliers and raise prices consumers pay. Attorney General from thirteen Midwest and western states joined the DOJ in the lawsuit. I really didn't think the department would act on the acquisition. It will be interesting to see the results. I'm Jeff Keane.