Why A New Lawsuit Was Filed Against The World's Largest Meat Processors

While some people might associate the question, "Where's the beef?" with old Wendy's commercials, it might take on a different meaning thanks to a new Texas-based lawsuit. As consumers' wallets continue to feel the pinch of rising food costs, some people allege that inflation might not be the only cause for soaring beef prices. As Vox reported, there is concern over price gouging. President Biden has partly blamed monopolistic practices by meat processors for increasing costs. Others, like Nebraska Farmers Union president John Hansen, have a similar view. Amid the squeeze on the meat industry, Sysco is turning to the courts for compensation.

Sysco, a wholesale distributor, is taking the biggest names in beef processing to court. According to Food Dive, the lawsuit alleges that Cargill, JBS, Tyson Foods, and National Beef Packing created a "scheme to artificially constrain" the beef supply that goes all the way back to 2015. Whether Sysco can prove that the collective group conspired to create barriers to entry, manipulate demand, or influence market stability remains to be seen. 

Still, the four beef providers control more than "80% of the domestic cattle market," as reported by Food Business News. That tipping of the scales has some people questioning where price-fixing occurred. For some, maybe the question isn't "where's the beef?" but rather "who hid the beef and caused consumers to pay more?"

With Sysco filing a new lawsuit against four beef processors, it makes sense to wonder about the potential impact. Although many would like to see a downward trend in beef prices, waiting for the scales of justice to weigh in may not immediately help families on a budget. Moreover, there is disagreement over how much impact meat processors have on prices. Tyson Foods has blamed labor and other costs for its increasingly expensive meat. According to Vox, an email sent on behalf of the North American Meat Institute claimed retailers were sitting the sky-high prices. But as lawsuits work their way through the courts, meat purveyors are facing more scrutiny over alleged price-fixing and market manipulations.

Still, recent cases may shed some light on the situation. Previously, JBS settled in beef and pork price-fixing lawsuits and agreed to pay $52.2 million and 24.5 million respectively, as reported by Reuters. Additionally, Smithfield closed its chapter on alleged pork price-fixing with a $42 million settlement. 

However, it's worth noting that neither of these companies would describe their willingness to settle as admissions of wrongdoing (via AP News). While some might see the multimillion-dollar payouts as a positive move forward, how that will ultimately impact consumers' wallets is an unsettled question.