News Pigs
Meat group buys off production agreements
Smithfield Foods, one of America's largest pig slaughterhouses, has announced it has reached a settlement in a lawsuit over banned pork production agreements. The case was brought by a number of major American food service players, direct customers of Smithfield.
Smithfield Foods (part of the Chinese WH group) is said to have made agreements with other parties to limit the supply on the American pig market. to achieve higher prices. These alleged agreements had already been made in 2009. A Smithfield spokesperson told Reuters that a $83 million settlement has been reached to buy out the case.
It assumes that the 'exposure' to risks in this case has now largely been reduced. The spokesperson does indicate that the company does not plead guilty with surrendering the charges. Smithfield maintains that he acted within the limits of the law. In addition to Smithfield, other major pig slaughterers have also been charged in this case, including Brazil's JBS.
Similar cases are still ongoing
Although the above case appears to have been settled for Smithfield, investigations into prohibited price fixing are also ongoing. This case was also brought by a number of large buyers of pork, as well as a number of large restaurant chains and other companies active in the food service. There is also a similar charge in the American state of California against a number of large chicken slaughterers. These too would have reached prohibited price agreements, with the aim of keeping sales prices artificially high.
Steve Wissink
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.
