State lawmakers join call for beef-processing probe

FRANKFORT, Ky. (WTVQ)State lawmakers have joined a request for an federal investigation into collusion in the beef-processing industry.

Meanwhile, processors continue to explain increased regulations and costs to prevent the spread of coronavirus explain the price dispartities that prompted the complaints.

In a release Wednesday, a bipartisan group of Kentucky legislators joined Agriculture Commissioner Ryan Quarles and Attorney General Daniel Cameron in requesting a federal investigation into possible anti-competitive practices.

The group is led by Interim Joint Committee on Agriculture Co-Chairs Rep. Richard Heath (R-Mayfield) and Sen. Paul Hornback (R-Shelbyville).

They claim the COVID-19 pandemic is worsening the disparity between the price of cattle and the price of processed beef which traslates into customers paying more while farmers make less.

Currently, only four meat processors control more than 80 percent of the American beef market. There have been concerns in the past about bad actors engaging in anticompetitive practices and market manipulation. Those concerns have only been exacerbated by the COVID-19 pandemic and this letter seeks a federal investigation into those four meat packing processors, the lawmakers said in a statement.

“As state legislators, we hear from our constituents across the Commonwealth about the vast disproportion between the price of cattle and the price of processed beef. Some of us have personally witnessed this disconnect in prices,” Heath said.

Kentucky is the largest beef producing state east of the Mississippi River and ranks eighth among all states. Also, small family farms produce much of it. Unfortunately, the state also has one of the lowest median incomes in the country. Kentucky’s farmers and consumers are particularly affected by these price fluctuations, the group stated.

“Since the supply chain for processed beef is fairly linear compared to other commodities, it strikes us that the sharp increase in prices seems to occur in the processing phase. We implore Attorney General Barr to use all appropriate powers granted to him to investigate this disparity and any other matters that may arise from it,” Hornback added.

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