The publisher of a livestock industry publication is applauding President Joe Biden’s administration for criticizing meat packing companies for taking advantage of the supply chain crisis to increase their profits.
Dennis Sun, publisher of the Wyoming Livestock Roundup, told Cowboy State Daily on Wednesday that a report calling out certain meat packing companies for raising prices for no real reason was a good move because although the meat packing companies are acting within their legal rights, they are hurting customers.
“There’s no doubt meat packers have been profiting, probably, historically high,” Sun said. “A lot of it was not necessarily because of something they did, but just supply and demand.”
Earlier this month, the White House released a report that explicitly stated meat prices are the largest factor to the rising cost of living. This is partly due to just a few large corporations, including Tyson, JBS, Marfrig and Seaboard, dominating the meat processing market, the report said.
“Just four large conglomerates control approximately 55-85% of the market for pork, beef and poultry, and these middlemen were using their market power to increase prices and underpay farmers, while taking more and more for themselves,” it said.
The four aforementioned companies’ gross profits have collectively increased by more than 120% since before the pandemic and their net income has surged by 500%.
Sun said it was not a surprise that the Biden administration issued the report, as the National Cattlemen’s Beef Association has been regularly talking with White House officials about the high prices of beef. The report was issued despite the fact that there is little else the organization and the administration agree on, he said.
“The Biden administration knows that meat is part of the inflation and they need to do something about it, but it’s not an overnight fix,” Sun said. “We’ve always asked for investigations into the meat packers because they’re doing stuff that they probably shouldn’t, but the laws are such that they get away with it.”
The recent White House report said: “The meat price increases we are seeing are not just the natural consequences of supply and demand in a free market—they are also the result of corporate decisions to take advantage of their market power in an uncompetitive market, to the detriment of consumers, farmers and ranchers and our economy.”
Wyoming’s annual inflation rate of 7.7% recorded during the second quarter of the year — which ended June 30 — is the highest annual inflation rate seen since the second quarter of 2008, when it stood at 7.9%, according to Wyoming’s Economic Analysis Division’s inflation report.
Moving forward from the report, Sun said laws need to be passed that require the meat packing companies to be more transparent and honest about their pricing.
Last month, a bipartisan bill was introduced in the U.S. Senate that would require more transparency among the four major meat packing companies. The Biden administration has also announced that it intends to crack down on illegal price fixing and invest to create more competition in meat processing.