The largest Brazilian meat giant JBS has become the first to offer a $52.5 million settlement in a lawsuit in the United States over illegal price-fixing in the beef industry. Other defendants in this case include meat giants such as Cargill Inc, National Beef Packing Co, and Tyson Foods Inc.
âBig Meatâ in the U.S. limited supply for years in such a way that prices in this multi-billion dollar market were driven up. Two years ago, JBS reached a settlement of over $24 million in a similar case involving price inflation in the pork sector.
JBS agreed to the new multi-million dollar settlement one month after U.S. President Joe Biden announced a plan for new regulations to strengthen competition and to stop âexploitationâ in the meat sector. It is expected that other meat corporations will soon also pay damages to avoid a court verdict.
Lawyers for the complaining supermarkets and consumers called the agreement an âicebreaker.â In a statement, JBS said it does not admit liability but that a settlement was in its interest. The agreement still requires approval by Chief Judge John Tunheim of the federal court in Minneapolis.
President Biden expressed concern shortly after his election that a small group of meat packers was able to dictate the prices of beef, pork, and poultry, causing inflationary pressure due to rising labor and transportation costs and COVID-19-related supply constraints.
In this lawsuit, traders, supermarkets, and buyers accused the global meat giants, who are estimated to control 80% of the U.S. beef market, of conspiring since 2015 to reduce slaughter volumes, resulting in a shortage that smaller companies could not offset.