meat production

Call to Examine Market Concentration in the Meatpacking Industry

Brian GermanDairy & Livestock, Industry

Market Concentration in meatpacking

Concerns have been raised in recent weeks related to the market concentration of the meatpacking industry. In a letter addressed to the U.S. Attorney General William Barr, the attorneys general for nearly a dozen states are calling for more oversight in the industry.  The group notes that the recent issues that have arisen in response to the COVID-19 pandemic have highlighted the problem of too much consolidation in the industry.

“The U.S. beef processing market is highly concentrated, with the four largest beef processors controlling 80 percent of U.S. beef processing. In this highly concentrated industry, meat packers have achieved sizeable profit margins,” the letter states. “Cattle ranchers, however, who for generations have supplied our nation’s beef, are squeezed and often struggle to survive.”

The group is calling for an investigation into the level of competition within the meatpacking sector, alleging that antitrust laws may been violated.  President Donald Trump also recently told reporters that he would like the Justice Department to look into any possible anticompetitive behavior within the industry.  The comment comes after President Trump ordered meat processing plants to remain in operation after several plants closed due to coronavirus, which had a noticeable impact on the supply of meat in the U.S.

The issue of market concentration has been raised repeatedly over the past few years and the impact consolidation has had on meat supplies in the wake of COVID-19 have renewed the focus on the matter. Several lawmakers have weighed in on the need for an investigation into how meatpacking companies are operating within the sector. U.S. Senators Josh Hawley and Tammy Baldwin have asked the Federal Trade Commission to open an antitrust investigation into the meatpacking industry.  U.S. Senators Jon Tester and Chuck Grassley have also sent letters to both U.S. Secretary of Agriculture Sonny Perdue as well as the Attorney General to examine the situation in the meat industry.

About the Author

Brian German

Facebook Twitter

Ag News Director, AgNet West