The Meatpackers, Always in Trouble

The top four meatpackers always seem to have a bullseye on their backs, and most of the time I think they deserve it.

These days, large meatpackers can’t find a win except to say, “Well, we’re not losing as much money as we were.”  

I’ve always said we need meatpacking houses to meet the demand of U.S. beef consumers and U.S. beef exports. This demand is currently hard to meet with the record low number of cattle in the nation, and according to many, these low numbers are not going to change much in the next few years. 

The current drought across cattle country is not going to help to rebuild the cattle herd, which is not good news for any meat processor. 

As I’ve said a number of times, when major meatpackers get into trouble, they simply pay a large fine and go on with their business. They never seem to contest the charges against them.

Recently, a federal judge granted preliminary approval to a proposed $47 million class action settlement between Tyson Foods and commercial and institutional indirect purchaser plaintiffs in the ongoing cattle and beef antitrust litigation.

The plaintiffs in the case include restaurants, catering companies and other foodservice operators alleging anticompetitive conduct in the fed cattle and beef markets.

This is typical of some of the cases against the meatpackers. 

The approval reads, “The litigation against Tyson and other released parties will remain stayed pending final approval of the settlement. The order stated the settlement does not constitute an admission of wrongdoing or liability by Tyson.”

This approval comes at a time when the U.S. Department of Justice (DOJ) is investigating Tyson, JBS, National Beef and Cargill. DOJ and U.S. Secretary of Agriculture Brooke Rollins have accused the “Big Four” of price fixing and colluding to artificially raise beef prices.

The DOJ’s proposed settlement with Agri Stats would require the data company to overhaul how it collects, reports and distributes meat industry data as federal officials continue broader antitrust investigations into the protein sector. 

Filed in the U.S. District Court for the District of Minnesota, this lawsuit would resolve claims brought by the U.S. and six states alleging Agri Stats’ reporting practices facilitated anticompetitive behavior in chicken, turkey and pork markets. The settlement was also entered without Agri Stats admitting wrongdoing or liability.

Under the proposed judgement, Agri Stats would be prohibited from offering sales report books and barred from reporting sales data except in limited circumstances, such as providing individual companies with their own data. 

The settlement would require Agri Stats to make reports and manuals available for purchase to any person in the U.S. including buyers such as grocery stores and restaurants, under terms no less favorable than those offered to meat processors.

Again, I’m wondering why the DOJ won’t uphold the Packers and Stockyards Act of 1921. It has had numerous updates, some as recent as last year.

Everyone needs to read the 10 page overview to understand what it is all about.