Congressional lawmakers questioned the chief executives of some of the biggest beef producers across the United States during a House hearing on Wednesday amid allegations that they engaged in unfair practices that drove down prices for cattle producers and increased the cost of meat for consumers.
In response, bosses of the four meat producers have denied claims that they profited off the COVID-19 pandemic while blaming the drastic price increases on a variety of factors such as pandemic-related disruptions, inflation, and labor shortages, among others.
They also dismissed allegations of anti-competitive behavior or price-fixing.
However, chairman of the House Agriculture Committee David Scott (D-Ga.) questioned that explanation on Wednesday, pointing to an “abrupt” rise in meat prices that go as far back as 2015, way before the pandemic began.
“Was there ever an agreement between your four companies to cooperate together on issues impacting supply or pricing? I need a yes or no,” Scott asked the CEOs.
Appearing via video before the House, Tyson CEO Donnie King defended his company’s actions, stating that the Springdale, Arkansas-headquartered food giant does not set prices for either cattle or beef.
“Tyson does not set the prices for either cattle that we buy or beef that our customers purchase,” King told lawmakers. “These prices are set by straightforward market forces, namely available supply and consumer demand.”
The other CEOs all replied “no,” while Tim Schellpeper of JBS USA added, “Not that I am aware of.”
Wednesday’s hearing also saw emotional testimony from three cattle producers, including Coy Young, a Missouri cattle producer, who told lawmakers that suicide rates among farmers had increased in recent years, which he blamed in part on meat companies taking advantage of farmers and ranchers.
“There’s blood on the hands of the packers and leaders in Washington and no one seems to care,” Young said.
Wednesday’s hearing before the House and Senate Agriculture committees related to two bills aimed at providing relief to both consumers and ranchers amid sky-high inflation levels while also preventing anti-competitive practices.
The first, “The Meat Packing Special Investigator Act,” is co-sponsored by Sens. Jon Tester (D-Mont.), Charles Grassley (R-Iowa), and Mike Rounds (R-S.D.), and would create a new U.S. Agriculture Department office, headed by the Special Investigator for Competition Matters, to monitor competition and trade practices in the food and agricultural sector.
That bill would direct the Department of Agriculture to establish and maintain a library or catalog of each type of contract offered by packers to producers for their cattle as well as regional mandatory minimum thresholds for negotiated sales to “enhance price discovery and transparency for cattle market participants.”