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Missouri Co-Sponsors Letter Urging Federal Investigation into Meat Packing Anti-Trust Concerns

May 5, 2020, 11:56 AM by AG Schmitt
Missouri Attorney General Eric Schmitt, Colorado Attorney General Phil Weiser, and Montana Attorney General Tim Fox today announced they are co-sponsoring a letter, led by North Dakota Attorney General Wayne Stenehjem, urging the Department of Justice and Attorney General Barr to investigate antitrust concerns in the beef processing industry. Attorneys General from Arizona, Idaho, Iowa, Minnesota, Nebraska, South Dakota, and Wyoming also signed on to the letter.

“Natural market competition is essential to the health of any industry, including the beef market. We co-sponsored this letter to ensure that Missouri’s ranchers and farmers, an important component of Missouri's economy, aren't subjected to anticompetitive behavior," said Attorney General Schmitt. “We urge the Department of Justice to investigate possible instances of anticompetitive behavior in the U.S. beef markets to ensure that Missouri's farmers and ranchers aren't continually harmed, especially throughout the COVID-19 pandemic.”

“As a third-generation cattleman myself, I understand the stress many in the cattle business have faced for years,” said Governor Mike Parson. “Cattlemen and cattlewomen across the United States are simply asking for transparency and accountability from our meat packers in the beef business. I applaud Attorney General Eric Schmitt for showing leadership on this issue. It is important our farmers and ranchers understand that Missouri supports them.”  

"Our members are facing economic and financial destruction during this current crisis," said Missouri Cattlemen's Association President Marvin Dieckman. "One segment of the industry is making unprecedented profits while the rest of us are counting pennies. We appreciate Attorney General Eric Schmitt for standing up for the farm and ranch families we represent. We need DOJ to open an investigation immediately. This is essential for the cattle farmer who is struggling and the consumer who deserves access to safe, affordable and nutritious beef."

The letter, which was sent today, states, "In this highly concentrated industry, meat packers have achieved sizeable profit margins. Cattle ranchers, however, who for generations have supplied our nation’s beef, are squeezed and often struggle to survive. Consumers, moreover, do not realize the benefits from a competitive market. In short, with such high concentration and the threat of increasing consolidation, we have concerns that beef processors are well positioned to coordinate their behavior and create a bottleneck in the cattle industry—to the detriment of ranchers and consumers alike.”

The letter emphasizes that the four largest beef processors control 80 percent of all U.S. beef processing in the United States, and alleges that the concentration of the industry and the threat of increasing consolidation could create a bottleneck that hurts ranchers.

The letter also acknowledges the effect of COVID-19 on the industry, stating, "During an economic downturn, such as that caused by the current pandemic, firms’ ability to harm American consumers through market manipulation and coordinated behavior exacts a greater toll, providing an additional reason for conducting a careful inquiry into this industry.”