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U.S. Senator Warren calls for probe of soaring poultry prices

Stock MarketsNov 22, 2021 05:10PM ET
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© Reuters. FILE PHOTO: A truck laden with chicken leg quarters leaves Sanderson Farms poultry processing plant enroute to Mexico, in Palestine, Texas, U.S., January 17, 2018. REUTERS/Jason Lange/File Photo

By Tom Polansek

CHICAGO (Reuters) - U.S. Senator Elizabeth Warren on Monday called on the Justice Department to open a broad investigation on the impact of price- fixing and consolidation in the poultry sector on consumers and farmers.

The former Democratic presidential candidate also urged the department's Antitrust Division to review "with suspicion" any large mergers in the industry, after Cargill Inc and Continental Grain said in August they would buy chicken company Sanderson Farms (NASDAQ:SAFM) for $4.53 billion.

Warren said in a letter that consumers are paying higher prices because of excessive consolidation, price-fixing and "plain-old corporate greed."

Prices for chicken breasts have jumped 26% over the past year, according to U.S. Labor Department data, while turkey prices were up 24% in an annual American Farm Bureau Federation survey ahead of Thanksgiving.

The meat industry has said increased demand and the labor shortage have boosted prices. Four processors control 54% of the chicken market, up from 35% in 1986, according to the Biden administration.

"Lack of competition in the poultry industry is allowing these massive companies to squeeze both American consumers and farmers to fuel record corporate profits and payouts to shareholders," Warren said.

The Justice Department is investigating price-fixing among some chicken producers. The Biden administration is also promising a tougher stance toward four companies that control the U.S. beef market as a way to rein in prices.

In February, chicken company Pilgrim's Pride (NASDAQ:PPC) Corp pleaded guilty and settled federal charges that it conspired to fix prices and passed on the costs to consumers.

A month earlier, Tyson Foods Inc (NYSE:TSN) settled civil litigation by three groups of plaintiffs that accused it of illegally conspiring to inflate chicken prices.

Warren asked the Justice Department to report by Dec. 20 on how price-fixing and consolidation have contributed to higher poultry prices.

Republican U.S. Senator Chuck Grassley previously raised concerns about the takeover of Sanderson Farms, the third-largest U.S. chicken producer.

U.S. Senator Warren calls for probe of soaring poultry prices
 

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Comments (2)
peter neal
peter neal Nov 22, 2021 7:51PM ET
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There should be hearing on hyper inflation and she should serve time. Lock her up.
Roger Miller
Roger Miller Nov 22, 2021 5:46PM ET
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A diversion tactic to try and shift blame for high inflation caused by failed Democrat policies, just like Biden's antitrust probe into high gas prices.  How about a probe into higher home prices while your at it, or is that not politically beneficial?  Everyone knows the causes of high inflation, except their naive followers.
 
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