Markets 
The Justice Department is reportedly pursuing a criminal antitrust investigation of large meatpacking companies after President Donald Trump called for them to face a probe over the higher prices facing consumers.
The Wall Street Journal reported, citing sources familiar with the matter, that while the DOJ indicated it was investigating beef companies following the president’s request, the criminal nature of the probe hasn’t been disclosed previously.
Trump claimed in November that beef companies were manipulating the purchase price of cattle they bought from ranchers while raising prices on consumers. The report noted that criminal antitrust cases typically focus on allegations related to market collusion or price fixing.
The Journal reported that although Trump’s comments placed blame on “majority foreign owned meatpackers,” the investigation is looking at four major companies that sell beef in the U.S.
TRUMP TEAM PLEDGES TO DRIVE BEEF PRICES DOWN BY 2026 AS USDA CHIEF PUSHES BACK ON $10-PER-POUND WARNING
The report noted that Tyson Foods, Cargill, JBS and National Beef are the four leading companies operating in that portion of the U.S. market, with Tyson and Cargill both U.S.-headquartered firms, while JBS and National Beef are from Brazil.
Antitrust regulators have looked into the contracts used by beef companies to acquire cattle from ranchers which reference a pricing benchmark that some ranchers have claimed is manipulated, one of the Journal’s sources told the outlet.
BEEF PRICES HIT RECORD HIGHS AS NATIONWIDE CATTLE INVENTORY DROPS TO LOWEST LEVEL IN 70 YEARS
Additionally, the Journal reported that leading beef processors were the subject of an investigation that began in Trump’s first term and continued through Biden’s term, but was closed by the Justice Department weeks before it launched its most recent probe on similar grounds.
Beef prices have surged over the last year amid strong demand from consumers while the U.S. cattle industry is facing a shortage with the cattle supply at its lowest level in over 70 years.
BEEF PRICES IN FOCUS AS TRUMP SIGNS ORDER AIMED AT CONSUMER RELIEF
Drought contributed to the decline in the cattle supply, as it impacted grasslands in states like Texas, Oklahoma, Kansas and parts of the Southeast that were used by cattle ranchers’ herds. The loss of those foraging areas caused ranches to liquidate cows and shrink their herds.
Ranchers are also facing rising overhead costs, as items like feed, labor, fuel and equipment expenses have trended higher.
The Bureau of Labor Statistics’ data from the March release of the consumer price index (CPI) showed that beef and veal prices were up 12.1% over the last year. Within that category, ground beef prices are up 11% while prices for beef steaks have risen 15.2% over that period.
Read the full article here
