White House raises concerns about packers’ “pandemic profiteering”
Senior officials in the administration of US president, Joe Biden, have announced a series of steps to address what they regard as imbalance in the beef industry.
They have accused four major beef producers of achieving high levels of revenue growth at the expense of “a disproportionate increase” in consumer prices and of “distressed farmers”.
On September 8, the US secretary of agriculture, Tom Vilsack (pictured), and the director of its National Economic Council, Brian Deese, spoke at a White House press briefing. Official press secretary, Jen Psaki, said The White House had invited Mr Vilsack and Mr Deese to speak at the briefing because Biden-Harris administration has become concerned about increases in food prices.
She said: “Beef, pork, and poultry are the real drivers of increased grocery store bills, and there’s an underlying corporate consolidation problem with meat-processing giants that we need to address so that families can pay lower prices at the grocery store and farmers and ranchers can earn more.”
Mr Deese said his organisation, which advises the president on economic policy, had figures suggesting the top four packer groups (JBS, Tyson, Cargill and National Beef) may control as much as 85% of the beef market in the US and had reported “record or near-record profits in the first and second quarter of this year”, with high gross margins as well. This “raises concern about pandemic profiteering”, Mr Deese said.
He added that the federal government has identified steps it can take “to try to drive price transparency, encourage greater competition [and] help ranchers, farmers and consumers”.
When Secretary Vilsack addressed the press briefing, he explained that this will involve four main steps, focusing on accountability “for unfair and discriminatory practices”, price transparency, product labelling, and increased support for smaller meat processing companies and livestock farmers to help them expand their capacity.
He said he had recently spoken to a livestock farmer in Iowa who had had to sell cattle at a loss of $150 per head to processors who were making a profit of $1,800 per head. He asked: “How can that be?”
One of the journalists at the briefing asked the secretary of agriculture if he intended to break up “the big four”, but he insisted this was not the case.
Tyson was the first of the four companies to react. Please see separate story.
Image: The White House
