Another group of U.S. Senate and House lawmakers has sent a letter to the Department of Justice concerned over the market power of four large meatpackers that control more than 80% of the processing market.
The bipartisan, bicameral letter led by U.S. Sens. Mike Rounds, R-S.D., and Tina Smith, D-Minn., said those meatpackers are seemingly able to control prices at will or even defy expectations of market fundamentals.
“The time has come for the government to determine whether the stranglehold large meatpackers have over the beef processing market violate our antitrust laws and principles of fair competition,” they said in the letter to U.S. Attorney General Merrick Garland.
The lawmakers said the price of live cattle in the U.S. market has plummeted in the last several years while the price of boxed beef has increased significantly.
“Concurrently, the major packing companies realized significant profits while both the U.S. beef consumers and independent cattle producers have paid the price,” they said.
In the past decade, there have been repeated instances that demonstrate a disconnection between the price of live cattle purchased by meatpackers and the value of choice beef cutout sold by meatpackers, they said.
“These persistent irregularities reveal an unfairness in the producer-meatpacker relationship and possibly anticompetitive behavior in the beef industry,” they said.
They noted Congress intended the Packers and Stockyard Act "to assure fair competition and fair trade practices, to safeguard farmers and ranchers ... to protect consumers ... and to protect members of the livestock, meat and poultry industries from unfair, deceptive, unjustly discriminatory and monopolistic practices...."
They said it is unfortunate that exactly 100 years later, the problem is worse.
Packer concentration and foreign influence has significantly grown and until the question of whether consolidation of power in the meatpacking industry has amounted to violations is fully answered, this market will continue to suffer for both the consumer and the producer, they said.
“From our perspective, the anticompetitive practices occurring in the industry today are unambiguous, and either our antitrust laws are not being enforced or they are not capable of addressing the apparent oligopoly that so plainly exists,” they said.
“In the past 18 months, the Department of Justice has received multiple letters raising these concerns and, collectively, we urge your department to take decisive action,” they said.
JBS, National Beef, Cargill and the North American Meat Institute did not respond to Capital Press' requests for comment on Friday. Tyson directed Capital Press to the Meat Institute.
In May, a group of 16 lawmakers sent a bicameral letter to DOJ urging the agency continue and conclude its investigation into the four meatpackers’ actions after the Tyson fire in 2019 and during the pandemic in 2020.
The investigation was focused on large discrepancies between prices for fed cattle and boxed beef correlating with those events.
Last week, the National Cattlemen’s Beef Association led an industry letter to the leadership of the House and Senate agriculture committees urging them to address critical concerns, including meatpacker oversight.