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

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“Wholesale beef and pork prices this spring have seen incredible strength,” Canfax said in a market report earlier this month. “Except for last year when wholesale beef prices doubled due to a shortage of supplies, cut-out prices at current levels had not been seen before… and were certainly not expected in the face of record-large North American beef production.”

In the U.S., federal stimulus cheques are boosting incomes and more people are dining out as vaccination efforts pay off.

“People want to pay up for steaks,” said market analyst Ted Seifried of The Zaner Ag Hedge Group. “People want beef.”

Packers are doing very well but feeders are missing out on big profits because of the soaring cost of feed grains, the news agency said.

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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.

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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.

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“When you sell direct to market, there is a lot more involved than production,” said new-venture specialist Kathy Bosse. You also have to manage processing, packaging and delivery and think about consumer demand. “The new Pricing Meat Products: An Introduction fact sheet covers a very important piece of the puzzle, that being pricing your meat products.”

It can be found at agriculture.alberta.ca, by calling 780-427-0391 or emailing publications.office@gov.ab.ca.

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