68 Types and Market Classes of Live Stock 



in the United States is sold in the fresh state. Fresh beef is a perish- 

 able product which must be kept moving out in a continuous stream 

 from the packing plant. If the packer paid the producer enough to 

 insure a supply of animals and then attempted to charge so high a 

 price for meats as to insure a huge profit despite restricted volume of 

 business, then many local butchers would stop buying packers' meats 

 and would do their own slaughtering, and farmers' cooperative packing 

 plants and other smaller packers would at once take advantage of the 

 opportunity to capture the trade by pricing their beef below the high 

 prices demanded by the large companies. 



Suppose that packers should enter into a combination with pro- 

 ducers, agreeing to charge higher prices for beef and pay higher prices 

 for cattle. If this were attempted the market soon would be flooded 

 with cattle far beyond the capacity of the packing plants or the con- 

 suming public, and it would be impossible to maintain the higher price 

 for either beef or live cattle. 



Through very high efficiency in packing methods and business 

 administration, and small profits on sales, certain packing companies 

 were enabled to underbid their competitors and build up large plants 

 and a large volume of business. Efficiency and narrow margins are 

 today just as essential in retaining this large volume of business as 

 they were in developing it. 



By ingenuity and enterprise the huge packing business of this 

 country has been developed through continual improvement in methods 

 of slaughtering, handling, and distributing meats and in methods of 

 utilizing animal by-products, until the market for our surplus meat 

 production has been made world-wide and a constant, open, cash 

 market for live animals has been made possible. 



From the live-stock producer's viewpoint it is best that we have 

 in this country a large, highly efficient, reasonably profitable, and stable 

 packing industry. If packing companies were continually going into 

 the hands of receivers because of bad management or for other reasons, 

 it would not be beneficial to either producers or consumers. 



Large packers are continually in competition with small packers, 

 and all packers are continually in competition with retailers who do 

 their own slaughtering. If any combination of packing companies 

 fixes the prices of live animals, they have done a mighty poor job of it 

 in those years in which cattle producers have made large profits. 



Summary. — It would seem that the packer is now doing his share 

 in supplying the people with good meat at a fair price. There can be 

 no further expansion in the line of getting more product out of the 

 animal, the limit in that direction having been reached. Further im- 

 provement in the quality and cheapening of the price of beef rests 



