The ‘big four’ beef packers, in dramatic questioning at a House Ag hearing, denied breaking antitrust laws by colluding to create record profits.
It was a dramatic moment in an hours-long hearing, as Ag Chair David Scott asked the ‘big four’ beef packer CEOs if they’d worked together to set prices, netting 15 billion in profits last year alone. Scott; “Was there ever an agreement between your four companies to cooperate together on issues impacting supply or pricing? And I need a ‘yes’ or ‘no’…and also, let me remind you that you’re testifying under oath.”
It was the same question the Justice Department’s been looking into for the last couple of years, frustrating lawmakers. And the response to Scott? “No…no…no…not that I am aware of.” Scott: “Alright, each of you have said that, no…and you all deny that you acted improperly or illegally.”
The Cargill, JBS, National Beef Packing and Tyson Foods CEOs blamed supply and demand issues during the pandemic, but Scott was doubtful, pointing to a huge runup in profits before the pandemic. Scott; “Let me tell you that this can’t possibly happen in a competitive market. I’ve studied antitrust behavior at the Wharton School of Finance at the University of Pennsylvania.”
But the debate a day after a similar Senate hearing boiled down to whether the government should mandate some negotiated cattle pricing to help offset largely packer-controlled contract pricing.
Lawmakers disagreed. Some Republicans blamed inflation, and the administration, the National Cattlemen’s witness blamed supply and demand. Missouri cow/calf producer Coy Young blamed the packers.
Young; “The American farmers and ranchers are tired…tired of being taken advantage and losing money year after year, while watching the big four post record profits every single quarter. The packers have manipulated the system with their alternative marketing agreements or arrangements, with the huge corporate-owned feed yards, that control 87-percent of the fed beef in this country.”
Young charged there’s “blood on the hands” of the packers, as more than 40 cattle farms fail every day prompting an unprecedented level of suicides.
Adding that Washington has failed to enforce the Packers and Stockyards Act written a hundred-years ago, to combat the same problem occurring again today.