The US Department of Justice has confirmed it is looking into possible breaches of anti-trust rules among meat-packing companies.
Speaking to reporters yesterday (4 May), Acting US Attorney General Todd Blanche said the “current market structure and high concentration in the industry indicate anti-competitive activity”. He pointed to four processors that “control over 85% of the beef processing market”.
Brooke Rollins, the US Secretary of Agriculture, said “consolidation” in US meatpacking around the four companies – Cargill, JBS, National Beef and Tyson Foods – has led to a “frightening landscape for cattle ranchers” and gives the processors “an unprecedented ability to wield market power and influence”.
The US, Rollins said, had around 86.2 million head of cattle and calves at the start of the year, “the lowest since the 1950s”.
She added: “Industry consolidation reduces options for our ranchers looking to sell their cattle. It weakens their negotiating power and it risks reliance upon a single buyer.”
In November, the DoJ said it would examine alleged price fixing by meatpacking companies at the behest of President Trump amid concern over consumer prices.
It emerged the same month the department had closed an anti-trust probe started during Trump’s first term before the President asked for a new investigation.
Last month, The Wall Street Journal reported the DoJ was studying whether unnamed meatpackers had taken part in criminal activity.
Asked by a WSJ reporter if the investigation was “predominantly criminal in nature”, Blanche said: “It depends. In the anti-trust space, the criminal part of the investigation is something that is done, in almost every case, in parallel with the civil investigation.
“The facts matter, intent matters, what we find, if there are bad participants, what role they have. It’s not as if ‘Oh, this is just civil’ or ‘Oh, this is just criminal.’ It’s an investigation and if we find evidence of criminal conduct and criminal intent, we’ll go from there.”
So far, the DoJ has reviewed more than three million documents, Blanche said, with “hundreds of industry participants” contacted and “many interviewed” as part of the investigation.
He called on “whistleblowers” to provide information on “anti-trust crimes about price fixing, bid rigging, market allocation or even procurement fraud”, underlining financial rewards are available.
Asked if the US government had a goal of breaking up the major meatpackers, or for National Beef’s majority owner, MBRF, to sell up, Rollins said: “I think the goal is to preserve a way of life of rural America, to ensure that our food security is absolute, that the importance of being able to feed ourselves in this country and not to rely on other countries is absolute.”
She added: “I don’t want to answer those questions specifically because that’s the importance of this investigation: to fully understand what we’re facing, what it looks like and what we need to do to ensure that our ranchers and our farmers and our agricultural community have everything they need – and that we’re also able to reverse this trajectory of smaller and smaller producers in the country.”
Just Food has approached Cargill, JBS, National Beef and Tyson for comment.
Blanche, meanwhile, indicated the DoJ plans to strike a settlement over its case against data provider Agri Stats.
The department has alleged reports produced by Agri Stats on prices and sales have enabled anti-competitive behaviour in the meat sector. Agri Stats has said the claims are baseless.
