Trump accuses meatpackers of collusion and price-fixing, asks DOJ to investigate. Let's see if it gets anywhere

President Trump’s call a few days ago for an investigation into the meatpacking industry ignited some strong memories in me. 

During my years (roughly the late 1980s to the early 2000s) as a cattle futures broker, trader and producer, the most consistent theme dominating talk in the ranching industry was that meatpackers in this country were too concentrated and that price collusion among them was a regular way of doing business.  

Demands for an investigation of collusion in the meatpacking industry came from both livestock producers, who felt they weren’t getting enough money for live cattle, and consumer groups, who believed that prices for beef products were too high. Though the complaints were loud and constant, I don’t recall that any comprehensive investigations by the U.S. Justice Department ever occurred.

Given the high prices that we have to pay for beef at supermarkets these days, an examination is overdue. For context, consider that overall consumer prices are up 24% since 2020. Beef prices, up 51% during the same period, have risen at more than twice the pace of inflation.  

President Trump, sensitive as ever to complaints about inflation, accused meat packing companies of “driving up the price of Beef through Illicit Collusion, Price Fixing, and Price Manipulation.” He has asked “the DOJ to immediately begin an investigation.”

Attorney General Pam Bondi quickly confirmed that the Department of Justice is working on the case.

Politically, Trump’s move comes at a good time. He got a very angry reaction from cattle producers a few weeks back when he announced that the United States is planning to quadruple imports of Argentine beef to 80,000 tons a year. In context, mollifying ranchers with his DOJ investigation announcement seems like a politically smart decision.

For their part, ranchers seem pleased. South Dakota State Representative Liz May, who represents a rural district in western South Dakota, told Rapid City’s KOTA News that ranchers have had concerns about this for decades and that “we’ve never had an administration that would even look at us, or listen to us, or listen to the concerns of the producers, it was always about the packers.”

As to the reaction within the industry itself,  meatpackers insist that they’re losing money, largely because of high cattle prices. The Meat Institute says that “despite high consumer prices for beef, beef packers have been losing money because the price of cattle is at record highs. For more than a year, packers have been operating at a loss due to a tight cattle supply and strong demand.”

Are meatpackers as blameless as they say? I’m dubious just because there are constant reports of packers making multi-million dollar settlements over collusion claims, though settlements uniformly include a notation by the packers that they are denying any wrongdoing. I guess the principle is that they didn’t do anything wrong but are willing to shell out millions of dollars just the same.

Regardless of how anybody feels about the situation, though, the possibility that Trump’s investigation will be thorough and transparent is an encouraging turn in this decades-long skirmish between livestock producers and meat processors.  

I’ll give kudos to the administration if it is.  

John Tsitrian is a businessman and writer from the Black Hills. He was a weekly columnist for the Rapid City Journal for 20 years. His articles and commentary have also appeared in The Los Angeles Times, The Denver Post and The Omaha World-Herald. Tsitrian served in the Marines for three years (1966-69), including a 13-month tour of duty as a radioman in Vietnam. Republish with permission.

Photo: public domain, wikimedia commons

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