USDA Targets Corporate Practices on Food Prices
In an effort to quell behavior that drives up food prices, the U.S. Department of Agriculture (USDA) is teaming up with state attorneys general to ban anti-competitive processes in the agricultural sector.
The USDA is working with 32 attorneys general to bring state action on corporate practices it says keep food prices high.Food price inflation is down from 13.5% year-over-year last August, but at 4.7% is still above the overall inflation rate of 3%.The USDA is also working to expand independent processing plants to expand competition.
The(USDA) said it will work with the 31 states and the District of Columbia to target market structures that it says raise prices and limit choices for consumers and producers.
Agriculture Secretary Tom Vilsack said the partnership would address corporate consolidation, especially focusing on unfair competition and increased prices in food, retail and meat and poultry processing. The initiative is designed to help increase the assessment abilities of the attorneys general to bring action in these areas
“By placing necessary resources where they are needed most and helping states identify and address anticompetitive and anti-consumer behavior, in partnership with federal authorities, through these cooperative agreements we can ensure a more robust and competitive agricultural sector,” Vilsack said in a written statement.
Inflation is Higher for Food Items
Like most items, prices for food peaked last summer, reaching a 13.5% year-over-year increase in August 2022.While overall inflation has cooled significantly since then, dropping to 3% in June, prices at the grocery store haven’t come down as much, with prices still 4.7% higher year-over-year.
Prices for some food items have soared over that period. In March, egg prices more than doubled after a bird flu outbreak killed 43 million egg-laying hens in 2022
Some said the bird-flu outbreak showed there was too little competition in the system, as both lawmakers and a farm group have raised questions about the spike in egg prices, seeking to investigate whether corporations are unfairly setting prices.
Other Action to Promote Competition
The USDA action is part of an executive push from President Joe Biden that seeks to promote competition through a range of actions, including promoting clearer guidelines for company mergers.The USDA also has been promoting other methods to help boost competition in agricultural marketplaces. One has been to increase funding to help expand independent meat and poultry processing capacity. The agency is also working on new rules to expand protections to farmers and ranchers.
