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Walmart takes a step toward owning the food chain – CNN

New York (CNN Business)America’s biggest retailers are pushing back against this country’s largest meat processors. The future of the nation’s food chain is on the line.

Walmart last week opened a meatpacking plant in south Georgia that will cut, package and label its own brand of steaks and roasts to deliver to meat cases at 500 stores in the region. It is Walmart’s first meatpacking plant. Costco has also developed its own farm-to-store poultry production operation in Nebraska to control some of its chicken production.
Although Walmart’s plant is a step toward a farm-to-shelf meat production, Walmart doesn’t actually operate the facility, nor does it own any cows or butcher the meat. An outside processor will operate the plant in Thomasville, Georgia, 20 miles from the Florida border and a little bigger than the size of a Walmart supercenter.

The plant’s opening is the latest move in top US retailers’ attempts to muscle into the food supply chain, an area traditionally dominated by food processors. Four companies control around 85% of the US cattle market, according to the Department of Agriculture. Walmart (WMT) buys its beef from Tyson (TSN) and Cargill, and it’s Tyson’s largest customer.”I think the broader implications are more big retailers exploring expanding into processing themselves versus buying the product from a current packer or processor,” said David Anderson, agricultural economist at Texas A&M University.

Source: Walmart takes a step toward owning the food chain – CNN

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