Lawsuit says Tyson, Cargill, JBS conspired to suppress beef prices paid to U.S. ranchers
By Jonathan Stempel (Reuters) - Four of the largest U.S.
By Jonathan Stempel
(Reuters) - Four of the largest U.S. beef-packing companies were accused in a lawsuit on Tuesday of violating federal antitrust law by conspiring to drive down prices they paid ranchers for cattle, even as retail beef prices hovered near record levels.
Tyson Foods Inc, Cargill Inc, the JBS USA unit of Brazil's JBS SA and National Beef Packing Co were accused of colluding since Jan. 2015 to suppress the price of "fed" cattle, which is cattle raised specifically for beef production, with a goal of improving margins and profitability.
The 104-page complaint by the Ranchers Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF) and four cattle-feeding ranchers was filed in Chicago federal court, and seeks compensatory, punitive and triple damages.
It resembles litigation in the same court in which companies, including Tyson and JBS, have been accused of conspiring to fix prices of broiler chickens and pork.
Tyson said the lawsuit was "baseless," and that as in the chicken and pork lawsuits there was no merit to the claim it colluded. "Tyson wants its suppliers to succeed," it added.
The other defendants did not immediately respond to requests for comment.
According to the complaint, Tyson, Cargill, JBS and National Beef conspired to suppress prices through such tactics as importing foreign cattle at a loss, closing slaughter plants, and reducing slaughter and purchase volumes.
The conspiracy "encouraged an apprehension amongst producers that they might not be able to 'get their cattle dead'" unless prices were cut, and led to an artificial 7.9 percent average reduction in fed cattle prices, the complaint said.
Tyson, Cargill, JBS and National Beef controlled more than 81 percent of the market for U.S. fed cattle in 2017, with more than $48 billion of beef sales in that fiscal year, the complaint said.
The lawsuit is meant to "prevent the Big 4 packers from capturing the U.S. cattle market from independent U.S. cattle producers," R-CALF Chief Executive Bill Bullard said in a statement provided by the group's lawyers. "We hope U.S. cattle ranchers can be compensated for years of significant losses."
The case is Ranchers Cattlemen Action Legal Fund United Stockgrowers of America et al v Tyson Foods Inc et al, U.S. District Court, Northern District of Illinois, No. 19-02726.
(Reporting by Jonathan Stempel in New York; editing by Bill Berkrot)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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