2022 brought usual storylines, but infrastructure dominated

The meat packer started the year in the driver’s seat on packer margins. 

President Joe Biden, United States: “I've said it before, and I'll say it again: capitalism without competition isn't capitalism. It's exploitation.” 

In early January, President Joe Biden announced the allocation of $1 billion to advance expansion of small to medium-size meat packers and processors. 

The Senate Agriculture Committee held a hearing in April on a proposed bill that would require meatpackers to buy half of their cattle on the cash market and create a library of  co ntracts for all of the nation’s cattle sales.

William Ruffin, Bay Spring, MS: “And I dare say that if we don't pass this bill where we have some transparency in this and we don't make an effort to reestablish the price, the c ash price, I'm not going to have any. When that happens, I'll go the way of most other producers in this business.” 

Stephen Koontz, Colorado State University: “It's not a conclusion that there's any competitive conduct, and in fact, it's rather competitive within this industry. Likewise, there's not any research that shows that mandating cash trade is going to make it make for better cattle prices. That's that's just not part of the research that I understand.”

That same week, the House zeroed in on smaller producers affected by the tandem choices of contracts, known as alternative marketing agreements, or AMAs, and the potential of more lucrative price discovery at auction. 

Don Schiefelbein/President – National Cattlemen’s Beef Association: “They’re basically trying to cram our industry back into the bottle – the way it was 20 years ago…15 years ago.  That’s not healthy for industry.  Nothing could be more advantageous for the industry than to listen to your consumer. And especially on the impact of consumer preferences, nothing goes well when you disrupt what the consumer wants.”

By year’s end, no legislation emerged from Congress for signature by the president. 

High pathogenic avian influenza, or HPAI emerged again in 2022. Bird flu would strike millions of birds in the U.S. and in nearly every state. Even after changes were made since the last big outbreak eight years ago. 

While fall has typically brought about a resurgence as migratory birds begin their journeys to warmer climates, this summer also included what the World Organisation for Animal Health called an “unusual persistence” of the virus in wild birds.

Nearly every state has reported a positive flock where more than fifty million birds have died or been euthanized. 

In late February, Russia would invade Ukraine. The fallout locally in Europe strained supplies of energy and grain from the region and would reverberate across the globe as countries lined up in support of Ukraine. Commodity markets would respond to the flow of grain through the region. 

Late July brought major flooding in Kentucky. The eastern Appalachia region was damaged with 8 to 10 inches of rain. At least 37 people died in the early hours of the storm, more than 1,300 needed rescue and thousands more were without power for days - ending the wettest July on record in Jackson, Kentucky. 

A drought record was reached in California.  The past three years have been the driest on record in California, according to data dating back to 1896. Although the just completed 2022 water year was slightly wetter and cooler than the 2021 water year, it was still 24 percent below the historical average of precipitation

Dry conditions in the Upper Mississippi led to problems downstream.

Dredging would be used to help get traffic moving.  

Phillip VanderWeit, United States Coast Guard “It's definitely created navigational hazards along the marine transportation system. But we've been working very closely with the Army Corps of Engineers who have put in a lot of work over the past decade in preparing for a situation like this.” 

The lower Mississippi River went through a  limited barge draft restriction that is standard on the Upper Mississippi.

Paul Rhode, Waterways Council: “We're we're about 40% a little bit more than 40% right now in some cases half 50% so you know the industry is very resilient and working with the Corps to make sure that let's say the Corps is dredging 12 hours and then we'll stop for 12 hours so that two cue of barges and boats can get through. At its worst we had 2,200 barges directly impacted with 150 boats waiting.”

The river level at Memphis neared the minimum operational limit in October, but rose 16 feet the next  six weeks. Some barge operators have reduced the number of tows by half, and those tows include a reduced number of barges due to width restrictions on the river. Barges are often loaded at only 75 percent of capacity.

But the long term prognosis is for lower than average levels to be the norm until the drought is broken. 

Back in September, an initial agreement was reached between the 115,000 rail workers and their employers. This provided the biggest raises in 40 years, but it was more than money, changes in policies that allow more flexibility in taking time off from work, including the right to take unpaid medical days off without being punished.

Mike Steenhoek, Soy Transportation Coalition: “You know, there's a lot of areas of this country where your option for transportation is rail and it's rail, that's your only option. And maybe some areas of the country where you're close to the inland waterway system. You can move some freight at the margins to the river, but that's only, that's only limited.”  

Economists had estimated a shutdown of the rail system in the U.S. would have cost the economy up to $2 billion per day. Over 40 percent  of U.S. cargo shipments are moved via rail, and a strike could have caused cascading shutdowns throughout the economy. 

However, not all unions ratified the agreement and Congress stepped in with last-minute legislation in December.

Contact: Paul.Yeager@Iowapbs.org