Reuters writer Tom Polansek reported last week that, “A group of U.S. chicken farmers sued the country’s biggest poultry processors, including Tyson Foods Inc, for allegedly conspiring to depress their pay, the latest accusation of improper collusion in the sector.
“Tyson, Pilgrim’s Pride Co, Sanderson Farms Inc and other companies illegally agreed to share detailed data on grower pay with one another to keep compensation below competitive levels, according to the civil lawsuit filed last Friday in a federal court in Oklahoma.
“Sanderson Farms said in a regulatory filing on Thursday that the company plans to fight the lawsuit.”
Mr. Polansek noted that, “The companies, which the lawsuit refers to as a ‘cartel,’ frequently shared data on pay with each other to keep compensation lower than it would have been in a competitive market, according to the lawsuit. That allowed the companies to keep more profits, the complaint said.”
The Reuters article added that, “Overall, about 25,000 U.S. farmers have production contracts with chicken processors, according to the National Chicken Council, a trade group. They produce meat to feed consumers who spend about $90 billion annually on chicken.
“Tyson said its average contract farmer has been raising chickens for the company for 15 years. Compensation ‘is set out clearly in contracts the farmers voluntarily enter into,’ according to the company.
“The lawsuit comes after the U.S. Department of Agriculture in December proposed rules it said would make it easier for chicken producers to sue processors if they believed they were being mistreated.”
