U.S. House panel seeks information from meat processing firms on rising prices (updated)

Seaboard

25/01/2022 19:05

(Adds details from letter, background on price rise)
    By Kanishka Singh
    Jan 25 (Reuters) - The chairman of the U.S. House of
Representatives subcommittee on economic and consumer policy
sent a letter on Tuesday to major U.S. meat processing
companies, seeking information on rising prices and profits.
    The companies included Tyson Foods  TSN.N , JBS Foods
 JBSS3.SA , National Beef and Seaboard  SEB.A . Representative
Raja Krishnamoorthi, the chairman of the panel, asked for
information about price increases on beef, pork and chicken
products, the panel said on Tuesday.
    "While some companies may claim that the high prices feeding
these outsized profits are explained by higher input costs,
earnings data tell a different story," Krishnamoorthi said on
Tuesday.
    "I am deeply concerned that meat processing conglomerates
may have engaged in predatory business practices, at the expense
of consumers, during the pandemic", he added.
    Krishnamoorthi has asked for information and documents from
each company by Feb. 8, explaining their decision to increase
prices of their products despite rising profits. He also asked
for an explanation from the companies on what they planned to do
to lower prices in the coming year.
     He said that net profit margins for the four biggest
meatpacking companies have shot up over 300% since the start of
the coronavirus outbreak and accused the companies of increasing
their profits "at the expense of the American families".
    White House economics advisers said https://reut.rs/3nZLXwd
 last month that the biggest meat-processing companies, using
their market power in the highly consolidated U.S. market to
drive up meat prices, have tripled their own net profit margins
since the COVID-19 pandemic started.
    The White House, hammered by Republicans over rising
inflation, is scrambling to combat rising prices by clearing
supply chain logjams and tackling what it views as uncompetitive
practices by big companies, which are reporting big profit gains
as consumers suffer.

 (Reporting by Kanishka Singh in Bengaluru; Editing by David
Gregorio)
 ((Kanishka.Singh@thomsonreuters.com; +91 9620300091;))