WASHINGTON, DC – A handful of companies dominate the cattle, hog, and poultry sectors, “and these middlemen are using their market power to increase prices and underpay farmers while taking more and more for themselves,” said a recent blog by the White House National Economic Council (NEC).
Reports from four of the large processors, Tyson Foods, JBS, Marfrig, and Seaboard, indicate that their gross profits collectively have more than doubled during the pandemic, and their net income shot up 500%, wrote NEC director Brian Deese and two assistants. Beef, pork, and poultry price increases accounted for a quarter of the overall increase in grocery prices, they said.
The meat industry dismissed the White House blog as an attempt to shift the blame for inflation. “Why the sudden inflation?” asked the North American Meat Institute. “The answer is consumer demand for meat and poultry product has never been higher.” Processors “are producing more meat than ever before under extraordinary circumstances to keep our farm economy moving and to put food on American’s [sic] tables,” said the meat industry trade group.
Grocery prices are climbing at their fastest pace since 2008, with beef, pork, and poultry leading the way — up nearly 13% since last November, said the government’s new inflation report. The White House pinned the blame for surging meat prices on meatpackers “taking advantage of their market power to raise prices while increasing their own profit margins.”
Price increases in beef, pork and poultry have driven half of the increased prices Americans have paid for food they eat at home since December, the White House said. And the administration sees those companies collecting too much profit after the stimulus helped prop up demand for their products
“We’ve helped sustain this market, and it’s frustrating to see these companies turn around and raise prices,” Bharat Ramamurti, the deputy director of the White House’s National Economic Council, said in an interview. “What we see here smacks of pandemic profiteering and that is the behavior the administration finds concerning.”
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