The Department of Justice (DOJ) is investigating meatpacking companies for potential antitrust violations as producers cry foul over rising packer margins. Separately, USDA is also investigating the rise in marketing margins.
Bloomberg reported an unnamed source told the news outlet that the DOJ is in the early stages of investigation and began before the coronavirus outbreak spread across the U.S.
On May 6, the day before the report was released, President Donald Trump said he would ask the DOJ to investigate the rising packer margins. Trump’s remark came shortly after attorneys general from 11 states wrote to the DOJ requesting investigation into the meatpacking industry.
A coalition of nearly 20 senators also sent a letter May 12 to Attorney General William Barr asking for the investigation of the meat processors for suspected price manipulation and anticompetitive behavior.
“DOJ’s enforcement responsibility is key to ensure market manipulation and anticompetitive conduct do not interfere with competitive market forces within the beef supply chain,” the letter from the senators read.
In addition to the DOJ’s investigation, USDA is separately investigating the rise in packer margins, an effort that has been ongoing since the Tyson Holcomb fire last fall. The department has not yet released results regarding the investigation.
“During the current pandemic and following the fire at our Holcomb, KS, facility last August, we have taken steps to minimize the impact each situation had on our producers, production volume and our ability to cover customer needs,” Tyson had said in a statement.
An executive order from Trump ordered meatpacking plants to stay open throughout the COVID-19 pandemic, and as of May 14 only two beef plants were closed down, Cargill plants in Nebraska and Wisconsin. The Nebraska plant was temporary closed for cleaning and the Wisconsin ground beef plant was closed because of working condition concerns. “I want to thank the patriotic and heroic meatpacking facility workers who are returning to work this week so the millions of Americans who depend on them for food security can continue to do so,” USDA Agriculture Secretary Sonny Perdue said May 8. — WLJ
