McDonald’s Takes Tyson, JBS, and Major Beef Producers to Court

In May, as McDonald’s battled rumors that the chain was charging an outrageous $18 for a Big Mac at locations across the country, company president Joe Erlinger wrote an open letter to Golden Arches customers trying to clarify the inflationary pressures and rising prices. He pointed to several factors contributing to the increased costs of burgers, fries, and soda, including rising labor, food, and paper expenses.

Now, McDonald’s has filed a lawsuit against four of the largest meatpackers in the world — Tyson, JBS, Cargill, and National Beef Packing — claiming they conspired to inflate beef prices. The lawsuit, submitted in federal court in New York, alleges that the producers breached U.S. antitrust laws by coordinating price increases and slowing production at their plants, which artificially raised prices for McDonald’s and other customers. As the world’s largest buyer of beef and pork, McDonald’s is seeking an undisclosed amount in damages.

Here’s what’s happening ⬇️

McDonald’s lawsuit is the latest in a string of cases accusing JBS, Tyson, Cargill, and National Beef of conspiring to drive up beef prices by restricting supply since 2015. Last year, the Minnesota Court dismissed a similar lawsuit brought by a group of ranchers, stating they lacked legal standing.

In some instances, producers have opted to settle. In 2022, JBS USA agreed to pay $52.5 million to resolve allegations of price-fixing involving grocery stores and wholesalers.

According to McDonald’s 100-page lawsuit, these companies frequently gathered at conferences and trade shows, where executives and key employees allegedly exchanged confidential information to maintain control over beef and cattle prices, ultimately boosting their profits.

🎯 Facts. Firstly, I don’t want to offend anyone, but I’m curious how McDonald’s has the audacity to assert that its hamburgers 🍔 contain beef. Secondly, there’s definitely excessive consolidation in the meat market, with the “big four” meat processing companies controlling nearly 80% of beef production in the U.S., making price fixing a very real issue. That being said, McDonald’s could mitigate its risks by sourcing from smaller suppliers and promoting that it buys from local farmers. Isn’t that what the market is looking for?

The NYT recently addressed this industry issue thoughtfully ⬇️

☝ It’s no secret that rural America is frustrated with the Washington elite. However, some of the logical reasons behind this discontent are less frequently discussed. For too long, family farms have been overwhelmed by the monopolistic power of Big Ag. For decades, politicians from both parties have either ignored the oligopolies dominating rural America or aligned themselves with them.

☝Take the chicken industry as an example. Just four companies control over half of the country’s poultry production, allowing chicken processors to collude, suppress wages, fix prices, and retaliate against farmers who speak out. Poultry farmers have limited options when Big Chicken offers them unfavorable deals. Approximately a quarter of them operate in areas with only one company to partner with, and half are in places with two or fewer.

☝ This situation is not conducive to a healthy democracy — or a healthy food system, for that matter — and rural Americans are well aware of it. According to a poll conducted this year by the Rural Democracy Initiative, a group focused on raising resources for rural communities, about 88 percent of rural residents in battleground states indicated they would be more likely to support a candidate who backs fighting meatpacking monopolies and ensuring local businesses can compete.