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Home » News » 2024 » July

News Brief

July 1, 2024 |  By: Mark Moran - Public News Service

California 'price gouging' ripples to Iowa

By Mark Moran - Public News Service

Farm advocates claim price gouging on meat and poultry in California is spreading across the country, including in Iowa, which is the nation's largest hog producer.

California passed a law banning the use of gestation crates for raising hogs, and producers said it increased production costs which are rippling across the country to Iowa. Iowa has similar regulations on gestation crates.

The agriculture advocacy group Farm Action has issued a report which shows in addition to blaming the California law, corporate meat producers also continue to use supply chain disruptions as an excuse to price-gouge.

Joe Maxwell, chief strategy officer for Farm Action, offered as evidence a 20% hike in California pork prices.

"It's just a part of their doing business now," Maxwell pointed out. "They find excuses in the markets to gouge that consumer. And one thing we want to be very clear on is that the consumer knows it's not the farmer. The farmer's getting squeezed just as much as is the consumer."

Iowa is the nation's leading hog producer, but still lost $32 per hog in 2023, a number experts said could grow this year. They blamed increased demand but have also come under scrutiny for trying to meet demand by raising hogs in large confinements, which are known to cause environmental damage.

Farm Action is the same group which, not long after the official end of the pandemic, asked the Federal Trade Commission to investigate egg prices, which had tripled in some cases. The group researched U.S. Department of Agriculture data and said the numbers did not justify the price hike.

Producers said other factors are driving up prices, including inflation and animal illness.

Maxwell added corporate food producers have positioned themselves to have outsize control over the market.

"They've got that control over the farmer, not unlike oil companies have over oil fields," Maxwell argued. "They now have that control because there are very few buyers of farmers' commodities, so they have that control over the farmer, the producer."

Iowa produces almost 50 million hogs a year. It costs nearly $4 billion a year just to feed them.