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Giant corporations have been stealing from farmers and consumers for too long.
Farm Action’s campaign to Stop the Price Gouging is on the move: from investigating and uncovering price gouging in beef, fertilizer, and eggs, to exposing these abuses by garnering worldwide press coverage, to working with members of the U.S. Senate to develop legislation to ban price gouging.
Read on to learn how large corporations are price gouging farmers and consumers, and how Farm Action is fighting back.
For decades, large corporations have been gobbling up independent businesses while our government looked the other way. Now, the few remaining corporations in food and agriculture are unrivaled in size and extremely powerful. These mega corporations use a host of anticompetitive practices to grow their profit margins and maintain their hold on the market — such as price-gouging schemes that hurt farmers, eaters, and the entire economy.
We are fighting for a fair and competitive food and farm system driven by independent businesses: mom and pop shops, family-owned farms, first-time ranchers just starting up. These kinds of businesses feed and employ their community members — instead of squeezing them for every penny they can get to enrich corporate shareholders.
Below are just three recent examples of corporate price gouging, and what we’re doing about it.
In 2022, egg prices more than doubled for consumers — going from $1.32 to $3.95 for a dozen large Grade A eggs. Dominant companies blamed avian flu and inflation for this 300 percent increase, and while these issues caused real problems for farmers and consumers, our team looked closely at the numbers and saw that the math didn’t add up.
According to their own financial statements, Cal-Maine, which controls 20% of the market, increased its gross profit margins five-fold after drastically raising the price of its eggs. Meanwhile, the company reported no cases of avian flu and their production costs had gone up only marginally.
We couldn’t let this brazen price gouging go by unnoticed. We called on the FTC, DOJ, and USDA to coordinate their efforts to investigate and hold accountable any major egg companies engaging in price gouging or other deceptive practices. We also encouraged state attorneys general to take action to protect their consumers against these abusive companies.
Thanks to the coverage that our letter generated on thousands of news outlets — including the Today Show, Reuters, Time, Fox Business, Vice, Yahoo Finance, CNBC, The Hill, AP, The Guardian, and CNN — these companies’ record profits and excuses were exposed.
Soon after, egg prices dropped, and USDA referenced the negative media against the egg industry as one cause.
Farm Action’s letter calling for an investigation into potential price gouging was featured on the Today Show.
Liar, liar, plant’s on fire! It’s been several years since Tyson used a fire at its Holcomb, KS meatpacking plant as an excuse to jack up retail prices and cut payments to cattle producers.
The top four meatpacking companies keep bringing this fire up — most recently at a House Agriculture Committee hearing that was investigating unfair practices in cattle markets. Their defense was that supply chain disruptions had caused record-breaking prices.
However, in the weeks following the fire, the beef industry processed 5,000 more cattle than in the three weeks before it. Clearly, they had the capacity to replace the Holcomb plant’s capacity all along.
After that hearing, we sent a letter to the members of the House Agriculture Committee, setting the record straight and urging them to keep investigating and holding monopoly corporations accountable.
This isn’t the first time Farm Action has called out the meatpacking monopoly for using supply chain disruptions to cover up price-gouging and other anticompetitive behavior. We won’t stop until we’ve shifted power over the food system out of the hands of consolidated corporations.
Months before Russia’s invasion of Ukraine, fertilizer prices spiked to all-time highs. These spikes coincided suspiciously with an increase in income farmers earned from commodity crops like soybeans and corn. When we looked into it, we found that fertilizer corporations’ own financial statements disproved their excuses about higher costs and supply chain issues.
So the Farm Action team called on the DOJ to investigate. We also published a research paper and testified before Congress in our campaign to bring attention to the price gouging.
In June of 2022, we were joined by 23 signing organizations in urging the USDA to create a more competitive fertilizer industry by directing investment away from consolidated corporations, monitoring price-gouging, and by more aggressively preventing corporate mergers.
Farm Action is working on long term solutions to transform the food and farm system, like supporting alternative fertility management systems. If we shift government support toward programs that reward farmers for the use of regenerative practices that use less fertilizer, we can free farmers from under the thumb of consolidated corporations.
Notice some common themes? Large, corporate entities have been hiking up prices under cover of headline-making events for way too long — and the American people are sick of padding corporate wallets.
Here are some ways we can all come together to fight back against corporate greed.
For starters, the DOJ and FTC must robustly enforce the Clayton and Sherman Acts and prosecute corporations found in violation. The Biden Administration’s “whole of government” approach laid out in the Executive Order on Competition directed the FTC, DOJ, and USDA to coordinate investigation efforts and hold accountable any corporations engaging in price gouging or other deceptive practices. Farm Action is closely monitoring the agencies’ progress on their assigned directives.
The FTC and DOJ have the power to challenge mergers that create giant, consolidated, market-controlling behemoths. Farm Action has also urged them to better enforce our nation’s antitrust laws and prioritize competition as they review mergers. Under the Robinson-Patman Act, they could start investigating and exploring the extent of abuses and target their enforcement efforts. Farm Action’s political partner, Farm Action Fund, has also endorsed legislation that would even break up harmful mergers from decades past, including the Strengthening Antitrust Enforcement for Meatpacking Act and the Prohibiting Anticompetitive Mergers Act.
Farm Action Fund has endorsed the Price Gouging Prevention Act and the Competitive Prices Act to provide the antitrust enforcement tools needed to reign in abusive power in the marketplace and bring justice for America’s farmers and consumers.
With your support, the Farm Action team can keep fighting for food system reform.