WASHINGTON – US Senator Elizabeth Warren called on the Department of Justice (DOJ) to investigate what the lawmaker says are anticompetitive practices that have raised poultry prices for consumers ahead of Thanksgiving.
“The heavily concentrated poultry industry, in which the top four companies (Tyson Foods, Inc. (Tyson), Pilgrim’s Pride, Perdue, and Sanderson Farms) control over half of the market, has seen disproportionate price increases this year,” Warren said in a letter to Assistant Attorney General Jonathan Kanter, of the Antitrust Division. “In May 2021, processed-poultry prices jumped to an all-time high, with consumer prices continuing to increase through October. And with the holidays approaching, American families are feeling these price increases at the grocery counter. The American Farm Bureau reported that the price of turkey increased by 24% over the past year, far outpacing other Thanksgiving foods.”
In testimony before the House Agriculture Committee, Julie Anna Potts, president and chief executive officer of the North American Meat Institute (NAMI), argued that ongoing labor shortages are challenging food supply chains and driving inflation.
Warren called for a broad investigation of the poultry industry and set a deadline of Dec. 20 for the DOJ to respond to questions such as:
- The price of poultry has risen significantly in the last year: chicken prices increased by 7.5% from October 2020 to October 2021 and turkey prices increased 24%. How have (i) price fixing and (ii) increased consolidation in the industry contributed to these rising prices?
- How does the DOJ decide whether to enter non-prosecution agreements (NPAs) or deferred prosecution agreements (DPAs) instead of fully prosecuting criminal violations like price fixing?
- In what ways will the DOJ consider the history of collusion in the poultry industry and others when assessing prospective transactions such as the Sanderson-Wayne deal (in accordance with Section 7.2 of the Horizontal Merger Guidelines)?
Warren’s request comes as a group of 10 poultry company executives and employees stand trial in Denver federal court for their alleged participation in a nationwide conspiracy to fix prices and rig bids for broiler chicken prices. All the defendants have pleaded not guilty. And major poultry processing companies are facing civil lawsuits. Tyson Foods and Pilgrim’s Pride have paid millions of dollars to settle civil lawsuits accusing them of fixing prices for chicken products.
CORRECTION: Sanderson Farms has not settled any litigation. The company has said it will continuously and vigorously defend itself and has denied all allegations.
