Lawmakers question beef executives over soaring food prices

Lawmakers on Capitol Hill aggressively questioned the chief executives of the country’s four major beef producers, accusing them of engaging in anti-competitive practices that have financially harmed cattle ranchers and driven up the price of meat.

The four multinational corporations—National Beef, JBS, Cargill and Tyson—control 85 percent of the beef industry. Allegations that these meatpackers have abused their position in a highly concentrated market to fix prices has led to $400 million in fines and settlements in recent years. Critics of the companies’ conduct also say industry consolidation has squeezed both ends of the supply chain, with ranchers being paid unsustainable prices for their cattle and consumers overpaying at the grocery store.

Defenders of the meatpacking firms say they are being scapegoated for inflation. Tyson chief executive Donnie King defended his company’s actions Wednesday, telling the House Agriculture Committee that it doesn’t set prices for either cattle or beef.

“These prices are set by straightforward market forces, namely available supply and consumer demand. These market forces mean that there are times when the commodity business cycle favors one party over another,” he said.

But lawmakers took a sharp tone with the executives in the face of rising food prices and concerns that the companies took advantage of the coronavirus. The four companies’ collective net profits rose more than 300 percent during the pandemic.

Last year, the prices for beef, pork and poultry increased far more than other kinds of food, accounting for more than half of price inflation at grocery stores. But in the past couple months other categories, such as produce, eggs and grains, have also skyrocketed.

The hearings before the House and Senate Agriculture committees related to two bills designed to provide relief for consumers and ranchers and prevent anti-competitive practices. The Meat Packing Special Investigator Act, co-sponsored by Sens. Jon Tester, D-Mont., Chuck Grassley, R-Iowa, and Mike Rounds, R-S.D., would create a new U.S. Agriculture Department office to monitor for anti-competitive practices in the meat and poultry industries.