The DOJ Leads the Way
U.S. Agriculture Secretary Tom Vilsack let the Department of Justice (DOJ) beat him to the punch on reforming the poultry processing market. The DOJ’s proposed consent decree with Cargill-Continental bans use of the tournament system for the newly-merged corporation, which represents 15% of the poultry processing market. While the merger increases concentration levels in the poultry industry, this monumental settlement should inspire the U.S. Department of Agriculture (USDA) to outlaw the tournament system for the other 85% of the market. It’s time for Vilsack to follow suit.
The Tournament System at a Glance
The tournament system is a corrupt and abusive payment scheme in which contract poultry farmers compete with each other for a price they will be paid for raising poultry. The farmers who come out on top receive a bonus, which comes out of the paycheck of the lower-performing farmers. Meanwhile, corporations control all the inputs, such as feed quality and number of chicks, behind closed doors. The system pits farmers against each other and tears rural communities apart. Watch our explainer video below to learn more about how this scheme works.
Banning the Tournament System Won’t Break the Bank
The DOJ’s settlement with Cargill-Continental shows that corporations know that they will continue raking in profits even without the tournament system. As Farm Action’s Joe Maxwell points out in Bloomberg, the company “would never agree to do it if it wasn’t going to be profitable.” We don’t buy the bellyaching from the other 85% of the market still using the tournament system to exert control over their contract growers.
Time for the USDA To Get on Board
In their first round of rulemaking, the USDA is attempting to rectify the tournament system by increasing transparency. Unfortunately, their proposal doesn’t go far enough. The tournament system can’t be fixed – it needs to be outlawed entirely. America’s farmers need contracts with a fixed base price that they will be paid: a system that works for farmers, not just the meatpacking corporations. The USDA should gain confidence from the DOJ’s monumental settlement and outlaw the tournament system for the other 85% of the market.
Written by Jessica Cusworth; edited by Dee Laninga; concept developed by Joe Maxwell and Angela Huffman
