Letitia James, the attorney general, asked a state judge in Manhattan to require Tyson to turn over materials including contractual terms, prices, and profit margins for its sales of meat to New York retailers from December 2019 to April 2022.

James said Tyson stopped complying after providing “limited” information, based on the Springdale, Arkansas-based company’s “novel and unfounded argument” that New York’s price gouging law did not apply to meat imported from outside the state.

That argument “can be tested only by examining the very materials that Tyson now refuses to produce,” James said in a court filing.

Tyson declined to comment. It has said it has raised meat prices to offset soaring costs for labor and livestock feed.

According to court papers, Tyson has about one-fifth of the U.S. market for fresh and frozen chicken, beef and pork.

James’ office had no immediate additional comment about her probe.

In March, James launched a rulemaking process to crack down on price gouging, examining whether big companies were using the pandemic and rising inflation as an excuse to stick consumers with higher prices on basic goods.

She said her office has during the pandemic received hundreds of complaints about meat price gouging, reinforced by media reports that average prices rose 20.9 percent for beef, 16.8 percent for pork and 9.2 percent for chicken from November 2020 to November 2021.

James said New York law bans “unconscionably excessive” prices and gives her power to impose civil fines on sellers that charge them on essential goods during market disruptions.

In January, President Joe Biden announced a plan to support independent meat processors and ranchers to address a lack of “meaningful competition” in their sectors.

– Additional reporting by Tom Polansek in Chicago

The post Tyson Foods ignoring subpoena for meat price gouging probe, NY attorney general says appeared first on Grainews.

Futures prices for cattle have tumbled during the outbreak, worrying farmers as the U.S. economy heads into a downturn and fueling questions about whether the market run by CME Group is an effective tool for risk management.

Senator Charles Grassley of Iowa wrote on Twitter that U.S. Department of Agriculture, Department of Justice and Commodity Futures Trading Commission probes may be needed to determine why ranchers did not benefit from soaring meat demand.

“Beef is flying off grocery shelves but farmers are seeing prices go down,” Grassley said. “If packers are illegally manipulating markets during crisis, we need USDA & DOJ & CFTC to investigate + help farmers. Four companies control 80% of market & they’re taking advantage.”

Processors’ margins leapt to more than $600 per head of cattle last week, HedgersEdge.com said (all figures US$). But cattle producers are operating at a net loss, four U.S. senators from South Dakota, North Dakota and Montana told the justice department in a letter that called for a price-fixing investigation.

Cargill said it is a committed buyer in the cash market for cattle, which was less impacted than futures. Tyson said it wants cattle producers to succeed and paid them a premium last week.

“This is an uncertain and unprecedented time, where food service beef demand has come to an immediate and virtual standstill, while retail demand has increased,” Tyson said.

USDA said it was working with CFTC to ensure transparency and integrity in agricultural markets.

Live cattle futures dropped 3.5 per cent on the Chicago Mercantile Exchange over the last three weeks amid worries the virus would shut slaughterhouses, while prices for beef that meat companies ship to wholesale buyers jumped about 20 per cent.

Futures sank as managed funds liquidated long positions, or bets prices will rise, said Cassie Fish, a beef expert who formerly worked for Tyson. It was the market’s biggest event-driven decline in more than 45 years, she said.

“They decided to get out,” Fish said. “It was like a stampede.”

Farmers and processors use futures to offset the risk of producing meat, and futures are intended to reflect the underlying cash market. April cattle futures ended last week at a record $18-$19 under the cash market, according to consultancy AgResource.

CME Group said it is committed to improving its livestock markets.

— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.

The post U.S. senators scrutinize meat packers’ profits during pandemic appeared first on Grainews.

Expected price declines for other foods, however, will limit the impact on the total grocery bill in the country.

In the mid-year update for Canada’s Food Price Report, researchers at Dalhousie in Halifax forecast meat prices will increase by up to nine per cent on the year, which compares to the December 2016 forecast of a four to six per cent increase for meat.

Overall, food inflation is forecast at three to four per cent by the study, which would mark a slight decline from the three to five per cent increase expected in the earlier report.

The fish, dairy, bakery products and vegetable sectors were all revised lower from the annual report. However, on an individual crop basis, lettuce was singled out as a product seeing price spikes.

The rise in lettuce was reportedly tied to a combination of high demand and weather concerns with California’s crop.

The Dalhousie report compares with the official Statistics Canada Consumer Price Index, which indicates a much more modest rate of food inflation.

The post Report sees Canadian meat prices rising at faster pace appeared first on Grainews.

Early yearling sales have mixed steers weighing just over 900 pounds trading at $180 and 810 pound mixed steers averaging $192 in central Alberta. Western Canadian barley prices have dropped approximately $30/mt over the past month which has supported the feeder market. Feedlot margins have moved near breakeven levels and strength in the deferred live cattle futures has improved the outlook for replacements.

Supplies remain high

U.S. feedlot inventories have been running one to two per cent above year-ago levels through the summer months while placements are up three to five per cent. The USDA revised the third-quarter beef production estimate to 6.46 billion pounds, which is a 400 million pound year-over-year increase. Cash cattle prices will likely remain rangebound over the next month because of the larger supplies overhanging the market. Looking forward, the supply situation tends to marginally contract in the fourth quarter but still remains sharply above year-ago levels. In the first quarter of 2017, the market will be contending with the lowest quarterly production for the year.

For the week ending July 30, the Canadian cattle slaughter was up four per cent over year-ago levels. Year-to-date beef output reached 578,489 mt, which reflected a year-over-year increase of 10 per cent. Alberta and Saskatchewan feedlot inventories have been running four to five per cent above 2015 largely due to lower feeder cattle exports. I’m expecting the year-over-year increase in domestic beef production to continue for the remainder of the year and could actually expand further.

The U.S. economy is running on all cylinders with low unemployment levels, strong consumer confidence, and steady consumer spending. Away-from-home food spending continues to reflect a year-over-year increase of 3.5 per cent and per capita disposable income is slowly rising. Retail beef prices have also softened from the spring highs causing overall consumption to increase. U.S. at-home food spending has been hovering at 5.4 per cent above year-ago levels throughout the summer. I’m looking for seasonal trends in demand to influence the cattle market over the next year. We usually see a spike in restaurant spending in late November through December. January and February are very slow months followed by another sharp spike in March.

Better marketing in 2017

Currently, the live cattle futures appear to experiencing bottoming type behaviour as the burdensome supply situation eases. The market is expected to percolate higher in the fourth quarter as supplies decrease and demand improves. I’m expecting a rather stagnant market in January and February and then look for the seasonal highs to occur in mid March. Producers should not be over anxious to forward contract cattle. Once December 2016 comes around, producers can be more aggressive on their contracting program for all of 2017. Producers can leave some cattle that will be marketed in the first quarter unhedged. Keep in mind the futures will turn lower before the cash market.

I’m expecting the lows in the feeder market to be made in August and September. Similar to the fed market, feeder cattle prices are expected to percolate higher during the fall and winter period. Feed grain supplies will be burdensome for the 2016-17 crop year, which will be a major factor driving the feeder market higher. The cost per pound gain will be sharply below year-ago levels so feedlots will have additional buying power for replacement cattle.

The post Lower meat prices attract consumers appeared first on Grainews.