The Biden administration is planning tougher action to curb meat prices

WASHINGTON, Sept. 8 (Reuters) – The Biden administration plans to take a tougher stance on meat-packing companies, it says, that cause collision of stickers in grocery stores.

Four companies control much of the U.S. meat processing market, and top aides to President Joe Biden blamed those companies for rising food prices in a blog post on Wednesday.

As part of a set of initiatives, the administration will channel $ 1.4 billion in COVID-19 pandemic stimulus money to small producers and meat workers, administration aides said in the publication of the block. They also promised actions to “crack down on illegal pricing,” White House aides said in the blog post.

According to the latest data from the U.S. Department of Agriculture (USDA), four companies slaughtered approximately 85% of the fattened grain cattle that become fillets, roast beef and other cuts of meat for consumers in 2018 .

The four major processors in the U.S. beef sector are: Cargill (CARG.UL), a global commodity operator based in Minnesota; Tyson Foods Inc. (TSN.N), the chicken producer that is the largest U.S. meat company for sales; JBS SA (JBSS3.SA), based in Brazil, the largest meat packer in the world; and National Beef Packing Co. (NBEEF.UL), controlled by Brazilian beef producer Marfrig Global Foods SA (MRFG3.SA).

Tyson shares fell briefly in higher-volume operations after the Reuters report.

Companies did not immediately respond to requests for comment.

“Issuing inflammatory statements that ignore the fundamentals of how supply and demand affect markets achieves nothing,” said Mark Dopp, chief operating officer of the North American Meat Institute, an industry group that represents packers. “American consumers of most goods and services see higher costs, largely due to persistent and widespread labor shortages. The meat and poultry industry is no different.”

Rising beef, pork and poultry prices have caused half the rise in prices Americans have paid for food they eat at home since December, the White House said. And the administration sees those companies making too much profit after the stimulus helped drive demand for their products.

“We have helped maintain this market and it is frustrating to see these companies turn around and raise prices,” Bharat Ramamurti, deputy director of the White House National Economic Council, said in an interview. “What we see here smells lucrative with pandemic and that’s the behavior of the administration.”

The U.S. Consumer Price Index (CPI) showed that beef and veal prices rose 6.5% in July from a year earlier, while poultry prices rose 5.3% and pork 7.8% higher. Last year’s jumps in poultry prices were the highest since 2004 and the highest since 2014 for beef and pork.

Rising inflation has posed a serious threat to Biden’s efforts to control the COVID-19 pandemic, his top priority as president, and generate an economic recovery from the recession it caused.

The Biden administration has responded to these problems in part by stepping up efforts to crack down on what it considers anti-competitive and monopolistic behavior that could drive up prices. The meeting of a new White House Competition Council created by Biden is scheduled for Friday.

The USDA and the Department of Justice have already conducted an investigation into pricing in the chicken processing industry. Read more

“The goal of this over time is to reduce those prices,” Ramamurti said.

U.S. lawmakers are seeking greater oversight of the cattle sector as concerns about anti-competitive behavior after the pandemic and a cyberattack on JBS USA increase. Read more

The administration is “encouraged” by bipartisan legislation that could help further price negotiations in the meat market, the blog said.

Reports of Trevor Hunnicutt in Washington Additional reports of Tom Polansek in Chicago and Chuck Mikolajczak in New York Edition by Matthew Lewis and Jonathan Oatis

Our standards: the principles of trust of Thomson Reuters.