Watchdog: Penalties meatpackers paid for price-fixing to blame for higher prices
The left-leaning watchdog group Accountable.US released a report this month blaming the multimillion-dollar fines that the meat processing industry has paid for the rising cost of meat.
According to a review conducted by Accountable.US, the largest meat processing companies in the U.S. have recently agreed to millions in fines to settle price-fixing allegations.
Companies like Smithfield Foods and JBS have all agreed to pay more than $80 million in fines to settle price-gauging allegations within the past year. In January of this year, Tyson Foods agreed to pay $221.5 million as part of a price-fixing settlement.
Other companies scrutinized in the organization’s review included National Beef Packing Company and Cargill.
“When meat packer CEOs are still living high on the hog after agreeing to pay $400 million in fines and settlements for manipulating prices in recent years, consumers know who to really blame for ridiculous meat prices,” Kyle Herrig, President of Accountable.US, said in a statement to NBC News.
Accountable.US also criticized the high salaries that the CEOs of the meat processing companies made within the past few years, pointing to how the average hourly wage for a meatpacker in the U.S. was $15.
When reached for comment, a representative from Smithfield Foods said the company had denied any wrongdoing when settling the litigation cited by Accountable.US. The representative pointed to factors such as the rising cost of corn and soybean as well as the heightened cost in ensuring worker safety due to the COVID-19 pandemic.
“U.S. agriculture faces a severe labor shortage on farms and in harvest facilities, causing additional cost pressures. With declining rural populations, the industry is seeking visa reform to improve access to foreign-born workers. Current visa programs are designed for seasonal agriculture and are not optimized for non-seasonal livestock ag such as pork production,” the Smithfield representative said.
Earlier this month, Biden administration officials raised concerns about the rising cost of meat. National Economic Council Director Brian Deese said during a White House briefing that the cost of meat was behind half of the food price increases being experienced by consumers.
“When you see that level of consolidation and the increase in prices, it raises a concern about pandemic profiteering, about companies that are driving price increases in a way that hurts consumers who are going to the grocery store and also isn’t benefiting the actual producers, the farmers and the ranchers that are growing the product,” said Deese.
In an accompanying statement, the White House said it planned on “taking strong actions to crack down on illegal price fixing, enforce antitrust laws, and bring more transparency to the meat-processing industry.”
“Just four large conglomerates control the majority of the market for each of these three products, and the data show that these companies have been raising prices while generating record profits during the pandemic,” the White House said.
Updated on Tuesday at 3:47 p.m.
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