With everything going on in the markets right now, it is easy to see federal authorities launching investigations into the various social media and other tech-based giants, especially considering President Trump’s recent executive order. However, the food industry still remains one of the largest industries in the entire country, and its an area that has had a history of price fixing arrangements between competitors. As it turns out, federal authorities are now planning to move ahead with potential antitrust measures against some of the largest beef companies in the U.S.
The Wall Street Journal went on to report on Friday that the U.S. Justice Department, alongside several state attorney generals, have expressed worries over the practices surrounding the big beef companies of the country. More specifically, they are worried about complaints from local, small-time farmers that claim that these large companies are engaged in price-fixing.
The department ended up issuing civil subpoenas to four of the largest beef processing companies in the country. This includes Tyson Foods (NYSE: TSN), as well as Cargill, National Beef Packing, and JBS USA Holdings. Additionally, a number of other pork producers are also falling under federal scrutiny as well, which includes Tyson Foods and JBS, who are involved in the pork market as well.
Just one day earlier, the Justice Department held a call with attorney generals to go over their concerns about the competition in the meat market and ways to promote healthy competition in the industry. All the companies named above refused to comment on this matter. Nor is this the first time that federal authorities have targeted meat industries in the past. Just recently, the department also issued separate price-fixing charges against a number of executives in the chicken industry. This includes claims that prices were being fixed by these large companies for several years.
It’s quite likely that authorities could end up pressing similar charges to the chief executives of top beef companies in the future. Despite the news, shares of Tyson weren’t really affected adversely. Instead, they rose by around 1.5% over the course of the day.
With COVID-19 having shut down a number of meatpacking plants in the U.S. and around the world, prices for meat have been surging for a while now. While not all areas of American are back to normal in this regard, with some towns and cities having little meat available of store shelves, the situation has improved for the most part across the country.
Tyson Foods Company Profile
Tyson Foods is the largest U.S. producer of processed chicken and beef. It’s also a large producer of processed pork and protein-based products under the brands Jimmy Dean, Hillshire Farm, Ball Park, Sara Lee, Aidells, and State Fair, to name a few. Tyson sells 90% of its products through various U.S. channels, including retailers, foodservice distributors, restaurants, and noncommercial foodservice establishments, such as schools, healthcare facilities, military bases, and other packaged food companies. In addition, 10% of the company’s revenue comes from exports to Canada, Mexico, Brazil, Europe, China, and Japan. – Warrior Trading News
