Jan 3 (Reuters) - The United States will issue new rules and
$1 billion in funding this year to support independent meat
processors and ranchers as part of a plan to address a lack of
meaningful competition in the meat sector, President Joe Biden
said on Monday.
The initiative comes amid rising concerns that a handful of
big beef, pork and poultry companies have too much control over
the American meat market, allowing them to dictate wholesale and
retail pricing to profit at the expense of their suppliers and
Capitalism without competition isnt capitalism. Its
exploitation," Biden said. "Thats what were seeing in meat and
poultry industries now.
A recent White House analysis found that the top four
meatpacker companies https://www.reuters.com/business/how-four-big-companies-control-us-beef-industry-2021-06-17
- Cargill, Tyson Foods Inc, JBS SA,
and National Beef Packing Co - control between 55%
and 85% of the market in the hog, cattle, and chicken sectors.
The Department of Agriculture (USDA) will spend the $1
billion from American Rescue Plan funds to expand the
independent meat processing sector, including funds for
financing grants, guaranteed loans, and worker training, said
Agriculture Secretary Tom Vilsack, who was speaking at an event
USDA will also propose rules this year to strengthen
enforcement of the Packers and Stockyards Act and to clarify the
meaning of "Product of USA" meat labels, which domestic ranchers
have said unfairly advantage multinational companies that raise
cattle abroad and only slaughter in the United States.
Attorney General Merrick Garland, also speaking at the
event, said too many industries have become too consolidated
over time, and that the antitrust division of the Department of
Justice has been chronically underfunded.
The Biden administration issued an executive order last year
that advocated a whole of government approach to antitrust
A central concern in agriculture has been meat prices, which
have risen at a time when the White House is fighting inflation.
An analysis in December by the White House economic council
found a 120% jump in the gross profits of four top meatpackers
since the pandemic began.
The meat industry has said the White House analysis was
inaccurate and criticized the new plan.
National Chicken Council President Mike Brown called the
plan a solution in search of a problem.
North American Meat Institute spokesperson Sarah Little said
staffing plants remains the biggest issue for meatpackers and
that the White House plan would not address it.
Our members of all sizes cannot operate at capacity because
they struggle to employ a long-term stable workforce, she said.
New capacity and expanded capacity created by the government
will have the same problem.
Eric Deeble, policy director at the National Sustainable
Agriculture Coalition, cheered the plan, calling it a very
positive step to ensure farmers and ranchers receive fair
The anticipated rulemaking under the Packers and Stockyards
Act could have a significant impact, said Peter Carstensen,
emeritus professor of law at University of Wisconsin-Madison and
former antitrust attorney at the Department of Justice. But he
noted that investment in independent processing itself would not
address market concentration.
Austin Frerick, deputy director of the Thurman Arnold
Project at Yale University, an antitrust research center, said
the plan does not go far enough to tackle the power of the top
"I do not believe this (plan) will meaningfully change the
concentration numbers," he said.
(Additional reporting by Diane Bartz and Trevor Hunnicutt;
Editing by Marguerita Choy)