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USDA provides update on beef investigation

Investigation began after fire at Tyson's Holcomb plant and expanded to include COVID-19 earlier this year.

Farm Progress Staff

July 22, 2020

2 Min Read
Kondor83/Thinkstock

USDA's Agricultural Marketing Service today released a report on its investigation into the boxed beef and fed cattle price spread following the fire at the Tyson beef packing plant in Holcomb, Kansas, and as COVID-19 disruptions spread through the nation.

"This report, prepared by AMS in coordination with USDA’s Office of the Chief Economist, first summarizes market conditions, fed cattle prices, boxed beef values, and the spread before and after the fire and plant closure at the Tyson Holcomb plant," the report reads. "The report then summarizes market conditions, fed cattle prices, boxed beef values, and the spread before and during the COVID-19 pandemic. It does not examine potential violations of the Packers and Stockyards Act. The investigation into potential violations is ongoing, and therefore, AMS has limited ability to publicly report the full scope and status of the investigation."

"While we’re pleased to provide this update, we assure producers that our work continues in order to determine if there are any violations of the Packers and Stockyards Act," Agriculture Secretary Sonny Perdue said. "If any unfair practices are detected, we will take quick enforcement action.”

“We appreciate the USDA’s thorough examination of the beef markets," said American Farm Bureau Federation President Zippy Duvall. "There’s little doubt that something is wrong when consumers are paying higher prices for meat and at the same time America’s farmers and ranchers are being paid less.

“We are pleased the USDA responded to our call for an investigation, but it’s important to note the scrutiny of the markets is not concluded," Duvall said. "USDA indicates their examination continues and investigations by the Commodity Futures Trading Commission, as well as the Department of Justice, are ongoing."

“Since NCBA initially requested this investigation, this issue has remained a central topic of conversation for NCBA, our state affiliates, and cattle producers throughout the country," said National Cattlemen's Beef Association Vice President of Government Affairs Ethan Lane. "While we are collectively still awaiting the results of the Department of Justice’s ongoing investigation into these issues, the information in this report will be very helpful and timely to the cattle industry’s robust discussion of cattle markets and price discovery.”

While the report does not examine potential violations of the Packers and Stockyards Act, USDA staff have maintained a cooperative relationship with the staff of the Department of Justice (DOJ) Antitrust Division and have discussed allegations of anticompetitive practices in the meat packing industry. Should USDA find a violation of the Packers and Stockyards Act, it is authorized to report the violation to DOJ for prosecution.

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