A coronavirus-caused bottleneck can explain why prices have gone wonky on either end, but part of the problem is that we have a bottleneck at all.
Ideally, these sort of supply and demand issues should balance themselves out; the fact that they aren’t is leading to scrutiny of the meatpacking industry—pandemic or not. Yesterday,that both the Department of Justice and the USDA are looking into whether the four biggest meat companies—Tyson Foods, JBS, National Beef, and Cargill, which collectively control 85 percent of the beef market—are fixing or manipulating prices.
As reporters Leah Nylen and Liz Crampton point out, the issue isn’t entirely about whether the industry is doing anything wrong right now, but also how we’ve found ourselves in this situation. Politico explains that, one hundred years ago, five companies—called “the Big Five”—controlled 82 percent of the beef market, leading to an antitrust settlement. “There’s greater concentration in meatpacking now,” Thomas Horton, an antitrust professor at the University of South Dakota, told the site.
As a result, even if staff shortages due to COVID-19 explain what’s happening in the beef market, some argue that the coronavirus may have exposed a deeper flaw: Too few companies control too much of our meat supply.
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