News Business News Indictments could be a sign of increased antitrust enforcement in farm sector Farmers are cautiously optimistic about federal investigations into alleged antitrust violations in the chicken and beef industries. By Leah Douglas Leah Douglas Leah Douglas (they/them or she/her) is an associate editor and staff writer at FERN. Prior to joining the team, Leah worked for three years as a reporter and policy analyst with the Open Markets Institute researching economic consolidation and monopolization in the food and agriculture industry. Leah founded and wrote Food & Power, a first-of-its kind resource on food sector consolidation. Leah's reporting on corporate power and big business in the food and agriculture sectors has been published in the Guardian, the Nation, the Washington Post, Mother Jones, NPR, Time, Fortune, and other outlets. Leah was the 2020 recipient of the National Farmers Union Milt Hakel Award for excellence in agricultural reporting and a member of the 2019-2020 cohort of the New Economies Reporting Project finance solutions fellowship. Leah has held a variety of jobs in the food system, including working on farms, co-running a CSA, and facilitating the development of rural food buying co-ops. Successful Farming's Editorial Guidelines Published on June 11, 2020 Trending Videos Close this video player Photo: Andrew Howard After years of failed attempts to draw attention to market concentration in the meat sector, farmers are cautiously optimistic about federal investigations into alleged antitrust violations in the chicken and beef industries. And grand jury indictments of four chicken industry executives could be a sign of more antitrust action to come from the Department of Justice, says a former attorney at the agency. The DOJ, which has been conducting a criminal investigation into allegations of price fixing in the poultry industry for nearly a year, announced the first indictments in the case on June 3. Four executives of Pilgrim's Pride and Claxton Poultry were charged with price fixing and bid rigging. All have pled not guilty. The indictments could be a sign that more charges are to come in the agency's investigation, says Peter Carstensen, an emeritus law professor at the University of Wisconsin-Madison and a former attorney in the DOJ's Antitrust Division. "There's a real possibility that this was a shot across the bow of the companies and the other executives," he says, referring to other poultry companies that are being investigated by the agency. The indictments amount to "the government saying they're not blowing smoke." Another indication that the investigation could result in more charges came on Wednesday, when the Wall Street Journal reported that Tyson Foods is cooperating in the DOJ's case under a leniency program that will allow the company to avoid fines and criminal convictions "in exchange for aiding in the continuing probe of other poultry suppliers." As the chicken investigation progresses, the DOJ has also subpoenaed the country's largest beef companies in a separate investigation into alleged antitrust violations in that sector. Several senators and state attorneys general had petitioned the agency to look into the beef market after meatpackers' margins rose during the pandemic even as prices paid to ranchers for cattle fell. Farmers watching these investigations closely have a "sense that this is long overdue," says Patty Lovera, a policy adviser for the Campaign for Family Farms and the Environment, a coalition of groups working on farm issues. For years, farmers and ranchers have argued that consolidation in the meat industry has led to cartel-like behavior among the country's biggest meatpackers, including coordinating to fix prices or suppress amounts paid to farmers. The coronavirus pandemic exposed weaknesses in the supply chain that laid bare the need for federal intervention, Lovera says. "Quite frankly, I think it's gotten so bad you can't ignore it anymore. We had a pretty dramatic illustration of how fragile this system is in the last three months, because it stopped working." At one point in the pandemic, at least 20 meatpacking plants were idled as meatpackers struggled — and in many cases failed — to contain the spread of COVID-19 among meatpacking workers. In response to meat industry pleas, President Trump signed an executive order in April to enlist the Department of Agriculture's assistance in keeping the plants open. In addition to the federal investigation, a civil antitrust suit brought by retailers, restaurants, and other chicken buyers against the nation's major poultry companies is also moving forward. Although discovery in that case was temporarily paused last year to make way for the federal investigation, it has since resumed. In late May, poultry companies argued that remote depositions in the case should be delayed due to the burden companies face in managing the challenges of the COVID-19 pandemic. Carstensen says the DOJ indictments could have implications for the civil suit, at least for the companies that have been charged so far. "I would not be shocked if in the next couple of months, we saw settlements" in that litigation, he says. The DOJ also took action in the dairy sector recently, requiring divestitures from Dean Foods in its bankruptcy sale to the massive dairy cooperative Dairy Farmers of America. And the USDA, prompted by ranchers' concerns, is conducting its own investigation into the beef sector. For producers, the agencies' attention to the sector is a refreshing change after several foiled attempts to enhance antitrust enforcement in agriculture. Many farmers are still bruised by thwarted Obama-era rulemaking, guided by a partnership between the DOJ and USDA, that would have enhanced protections for livestock growers in their relationships with powerful meatpackers. "Finally, somebody is doing something," says Lovera of the agencies' current investigations. "People have been talking about how these markets are not open and competitive for a long time." Was this page helpful? Thanks for your feedback! Tell us why! Other Submit