Agriculture Secretary Sonny Perdue directed USDA’s Packers and Stockyards Division to launch an investigation into beef pricing margins.
The investigation is part of USDA’s efforts to monitor the impact of the Aug. 9 fire at the Tyson beef processing plant in Holcomb, Kansas. Investigators are looking for evidence of price manipulation, collusion, restricted competition or other unfair practices.
“If any unfair practices are detected, we will take quick enforcement action,” Perdue said in a media statement. “USDA remains in close communication with plant management and other stakeholders to understand the fire’s impact to industry.”
Cattle prices tanked following the August fire, which eliminated a livestock buyer, Reuters reported. Farmers are worried that Tyson, Cargill and JBS USA will take advantage of the situation by dropping prices, while at the same time restaurants are dealing with higher prices.
Packer margins are up around $150 from before the fire, according to CanadianCattlemen.ca. The plant killed about 6,000 cattle per day, about 5% of the total U.S. slaughter.