The cost of putting food on the table is the highest it has been in 40 years. The largest increases in food prices are in meat, with pork and beef increasing by 14 to 20% compared to a year ago.
Food companies and some economists say pandemic disruptions, inflation and high demand are to blame. But others are wondering if there are more things at stake.
“You’re seeing bigger orders of magnitude benefits that aren’t justified by the real inflation rate or its increased costs,” said Ricardo Salvador, a scientist at the Union of Concerned Scientists, a nonprofit advocacy group. on CBS News.
According to quarterly reports from Tyson, the country’s largest meat processor, the company made $ 3 billion in profits in 2021. It made more than $ 1 billion last quarter, reports said.
This means that profits have increased by a staggering 48% over the first quarter of 2021 compared to the same period in 2022, although inflation is hurting American families.
A big reason for these dizzying benefits: a 31% increase in the price of beef, 20% in chicken and 13% in pork.
In a earnings call last month, Tyson’s CEO said, “We don’t ask customers or consumers to finally pay for our inefficiencies. We ask them to pay for inflation.”
“Economists and industry analysts confirm that current higher meat prices are the direct result of restricted supplies due to labor shortages, higher entry costs for things such as grain , labor and fuel and stronger consumer demand, “Tyson said in a statement to CBS. News.
Other major meat suppliers are also reaping similar benefits. Some analysts like Salvador believe that the figures do not add up.
“They’re clearly taking advantage,” Salvador said. “You know, they’re making a profit, and we’re not the only ones watching.”
“You could call it ‘corporate greed.’ You could call it ‘raising prices during a pandemic.’
Even President Biden intervened, detonating the meat industry in his speech on the state of the Union last week.
“Capitalism without competition is exploitation. It increases profits,” Biden said.
Four companies – Tyson, JBS, Marfrig and Seaboard – control up to 85% of the country’s beef, pork and chicken markets.
“That means they can put in the price they want. And if you want to buy meat, you’re paying that price,” Salvador said.
Jayson Lusk, a senior professor and head of the Department of Agricultural Economics at Purdue University, told CBS News that meat companies are also facing rising production costs.
“Tyson’s case is that while profitability is increasing, so are costs, and they have to pay more for their inputs,” Lusk said. “They have been paying 20% higher wages to their workers since the beginning of the pandemic. And even for inputs such as livestock, livestock prices have risen by about 15% since This is one of the reasons why we are seeing an increase in meat prices, but what we are seeing at the same time is that its profitability has been able to increase because of the increase in demand. of its products has more than offset the cost increases. ”
Tyson adds that one of the reasons last year’s revenue was lower is due to COVID-related costs, including testing, protective equipment and operating disruptions.
For Selina Flores and her family, it’s no longer about stretching the budget, it’s about cutting back. The monthly grocery bill for his family of four has nearly doubled, Flores said.
“It was meat at every meal. Now, maybe it’s two or three days a week,” he told CBS News.
Her family now depends on a monthly donation of food from the Harry Chapin Food Bank of Southwest Florida to Immokalee to reach the end of the month.
“We’re just trying to keep up with everything and prices keep going up,” he said.
Salvador said there was nothing prevent prices from rising as long as “there is no competition to help reduce prices so that they have reason to be really more reasonable.”
That’s why Flores is worried about her children’s future.
“Prices are rising and will continue to rise. There is no upkeep,” he said. “How do I get to this month?”
Add Comment