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The Biden administration unveiled a plan Monday to boost competition in the meatpacking industry — and alleviate surging food prices amid skyrocketing inflation.
The plan earmarks $1 billion in funds from the “American Rescue Plan” toward expanding processing capacity for independent meat processing firms, the White House announced.
The sum includes $275 million in capital support for independent firms and $100 million toward job development and training.
The initiative is President Biden’s latest effort to alleviate pressure on Americans as inflation reaches its highest level in decades. Biden and top administration officials argue large companies have stifled competition, exacerbating inflation and higher costs for everyday items such as meat and gas.
As part of the White House’s plan, the Justice Department and the Agriculture Department will launch a joint effort to coordinate actions aimed at anti-competitive behavior.
The Biden administration will also tighten rules governing “Product of USA” meat labels, among other steps.
“Even as farmers’ share of profits have dwindled, American consumers are paying more—with meat and poultry prices now the single largest contributor to the rising cost of food people consume at home,” the White House said in a fact sheet detailing the plan.
“And, when too few companies control such a large portion of the market, our food supply chains are susceptible to shocks,” officials added.
Administration officials say the plan will help to address ongoing supply chain bottlenecks and ease financial pressure for both consumers and competitors. The White House said the four largest meatpacking firms control 85 percent of the beef market, 70 percent of the pork market, and 54 percent of the poultry market.
Outsized control over the marketplace results in a “key bottleneck in the food supply chain,” according to the White House.
President Biden and other top administration officials will discuss the plan with a group of farmers and independent meat processors during a virtual event on Monday.
The US Consumer Price Index rose 6.8 percent in November 2021 compared to the same month one year earlier. The increase was the highest 12-month spike since 1982.
Beef prices rose 21 percent year-over-year in November, according to Labor Department data.
In December, White House Press Secretary Jen Psaki said the spike in prices was due to “the greed of meat conglomerates.”
However, some critics have pushed back on elements of the president’s strategy to combat inflation. Last month, former Treasury Secretary Larry Summers warned that an antitrust crackdown could cause inflation to worsen rather than improve.
“The emerging claim that antitrust can combat inflation reflects ‘science denial,’” Summers wrote on Twitter at the time. “There are many areas like transitory inflation where serious economists differ. Antitrust as an anti-inflation strategy is not one of them.”
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