High Meat Prices Are Helping Fuel Inflation, And A Few Big Companies Are Being Blamed

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Packages of beef cuts are displayed at a Costco store on May 24 in Novato, Calif. The prices of meats have surged, and the White House is partly blaming the handful of meatpackers that control the industry.

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Agriculture Secretary Tom Vilsack speaks on rising food prices at a press briefing at the White House on Sept. 8. The Biden administration is taking steps to try to bring more suppliers to the meatpacking industry.

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A customer shops for meat at a supermarket in Chicago on June 10. A surge in meat prices is contributing to higher inflation, raising the Biden administration’s concern.

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A customer shops for meat at a supermarket in Chicago on June 10. A surge in meat prices is contributing to higher inflation, raising the Biden administration’s concern.

Scott Olson/Getty Images

Ending sticker shock at the butcher counter

The meatpacking companies argue that in normal times, their giant size makes them more efficient and helps keep prices for consumers low.

In recent decades, that «consumer welfare» argument carried a lot of weight. Government regulators were willing to go along with one merger after another, so long as hamburger was cheap.

But a new generation of anti-trust scholars — and the Biden administration — are more skeptical of super-sized corporate power.

«Between these recent price shocks in the pandemic and ongoing allegations of price-fixing, that [consumer welfare] argument for consolidation is falling apart,» said Claire Kelloway, a researcher at the Open Markets Institute, an anti-monopoly think tank. «There’s increasing evidence and suspicions that this market power has gone too far and is beginning to hurt consumers.»

A ransomware attack on JBS in June that temporarily idled nearly a quarter of the company’s beef-processing capacity also highlighted the risk of having so much of the nation’s food supply in the hands of a few big companies.

Almost exactly a century ago, the federal government passed the «Packers and Stockyards Act,» to crack down on excesses of what was then known as the «Meat Trust.»

The Biden administration is promising beefed up enforcement of that 1921 law. And it may find fresh support from shoppers, facing sticker shock at the butcher counter.

• anti-trust
• meatpackers
• beef
• inflation
• pork
• chicken