000438 Senator Asks U.S. Review of Internet Meat Market

Washington - The Justice Department should investigate a plan by six large U.S. meat processors to create an Internet meat exchange and what impact it may have on farmers, according to a request by Senator Paul Wellstone.

A Wellstone aide said there had been no response yet from the department.

This week, six large meat processors said they would pool $20 million to set up an independent company that would be open to buyers and sellers of meat and poultry products. The exchange, expected to open in the summer, would allow faster and direct comparison of products and negotiation on prices.

In a letter to Assistant Attorney General Joel Klein, Wellstone said he was concerned about the impact on livestock producers.

“I believe this case warrants your close attention,” wrote Wellstone, Minnesota Democrat, in requesting the review.

“While this new alliance purports to enhance efficiencies, I am concerned about the market implications of our nation's largest meat agribusinesses sharing marketing information and resources,” Wellstone wrote. “Therefore, I request that the Antitrust Division of the Justice Department initiate a complete and thorough examination of this alliance and its possible implications for our nation's family farmers and consumers.”

Founders of the exchange would be IBP Inc., Cargill Inc., Smithfield Foods Inc., Tyson Foods Inc., Gold Kist Inc. and Farmland Industries Inc. The six companies have combined annual meat and poultry sales of over $40 billion.

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