USDA Will Investigate Meat-Packer Margins After Beef Price Surge
(Bloomberg) -- The U.S. Department of Agriculture will investigate a surge in meatpackers’ margins for beef during the coronavirus outbreak that has stirred accusations of market manipulation from some cattle producers.
U.S. Agriculture Secretary Sonny Perdue announced the probe in a Twitter post Wednesday after demands for an inquiry by members of Congress from cattle-producing regions.
Retail prices for beef surged following the virus outbreak while prices that processors pay for cattle dropped. The margin between the two more than doubled between late February and March 21, according to an analysis by the American Farm Bureau Federation.
Beef slaughter and processing in the U.S. is highly concentrated and dominated by four companies. A surge in meatpackers’ margins after a fire last year shut down a packing plant in Holcomb, Kansas, also stirred complaints from cattle producers that the companies unfairly took advantage of the situation and is also under investigation.
U.S. Senator Deb Fischer, a Nebraska Republican, announced that the USDA had committed to an investigation in a Twitter post shortly before Perdue.
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