Consolidated food processers --> inflation

Investment Analysis Clubs Macro Economic Trends and Risks
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https://www.nytimes.com/2026/05/29/opinion/business-economics/groceries-expensive-price-fixing-consolidation.html

This Is Why Your Groceries Are So Expensive

By Sandeep Vaheesan and Claire Kelloway, The New York Times, May 29, 2026

…
A highly concentrated sector has controlled our meat supply for much of the past century. More than 45 percent of all U.S. cattle passed through just 11 meat processing plants in 2025, and the top four packers sold 80 to 85 percent of all domestic beef in 2024…

The entire U.S. food system is remarkably consolidated, exploitative and fragile. Two companies sold half of all fresh bread in 2020; two others controlled an estimated two-thirds of all baby formula in 2022; and two companies produced about 60 percent of all carrots in 2023. Result? Food prices remain elevated after rising about 30 percent between 2019 and 2025, as corporations took advantage of pandemic supply chain disruptions to raise prices and, critically, profits…

Farmers still struggle with rising costs and stagnant prices for their crops and livestock, while consumers face an illusion of choice at a higher price…

In recent years, Brazil’s JBS bought Swift & Company as well as Cargill’s pork business; Tyson bought IBP, Keystone Foods and Hillshire Brands; China’s WH Group acquired Smithfield Foods; and the Kraft-Heinz merger created a grocery behemoth that may have, for once, become too big to even manage…

Without far-reaching change, the government, farmers and consumers will be doomed to fight an endless battle against corporate combines. Consumers will keep paying too much, and farmers will continue to get too little…[end quote]

The rest is recommendations that haven’t been implemented and thus are banned on METAR. I’ll believe it when I see it.

Meanwhile, the USDA’s current forecast projects that overall food prices will settle into a 3.4% average increase for the full year. Because grocery stores have consolidated significantly—leaving fewer corporate players controlling major distribution networks—prices rarely adjust downward even when raw commodity costs pull back.

I shop for meat at Walmart at 8:30 AM on Thursday morning when meat markdowns can be significant. Meat departments typically do heavy restocking ahead of the high-volume weekend rush. To make room for new shipments arriving for Friday, staff are often instructed to audit the cases early Thursday morning and mark down meat nearing its sell-by date.

Wendy

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I gave up factory farmed beef, pork and poultry on or about August 19, 2012 after reading ‘Fast Food Nation’ and a couple of other books that I can’t even recall now. At that time the Big Four meat packers controlled about 70-75% of the market. They were already squeezing farmers out of business at an alarming rate. They were already building their ghastly air and water polluting, dangerous, low wage factories in ‘business friendly’ states. They were already shopping at the state, national and international level for impoverished areas who could provide them with cheap labor and lax environmental and safety laws for their profitable factories.

I would like to see greater support for local, more sustainable farming but I think the major corporations have a stranglehold on the government subsidies, and if you ignore the pollution that they leave behind, they are unbeatable on price.

My one man war against the meat mafia consists of getting my morning protein from sardines 3 times per week on my dumbbell days, and two scrambled local eggs and beans (and onions and peppers sometimes) the other days.

Beans, grains and nuts are some of my vegetarian protein sources. I make pots of steel cut oats and rice and beans on Sunday, and snack on them as well. That is my personal response to the meat mafia - a feeble one man boycott.

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Wendy, your timing strategy is a good one. Have you ever noticed that the protein mark downs are rarely more than 10-15%? Do you have aldi or other options near by?

I ask because I have noticed that the Walmart in my area actually deploys the yellow tag army to attract the seniors (I live in a community with significant tourist traffic, but with an average age resident over 55.)

Walmart’s mark downs seem more like a strategy to entice purchases than a clearance activity.

Aldi regular prices in my area are usually about 20-25% below walmart on common items like:

Sausage
beef
chicken
eggs
dairy
bacon
cold cuts of most varieties
cheeses
produce

I light of this, I buy my toiletries and household items at Walmart then head to Aldi for “food” items. There are exceptions, of course, because Aldi does not stock everything.

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You are not alone in tilting at windmills. It’s a noble pursuit, however small the effect is.

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The CPI shows inflation of 29% between 1/19 and 12/25. This means in real terms that food prices rose 1% over those seven years, a compound growth rate of 0.14% a year. There may be problems in the food industry, but price inflation does not seem to be one of them.

DB2

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I know it’s not accessible to everyone, but you can always check for local ranchers that process their own cattle. Obviously look for someone that abides by the same standards. We bought a 1/2 steer a couple years ago. Only downside, you get 1/2 steer. If you want more ground chuck, or ribeyes, etc., you are SOL. You get what the animal gives you.

Was cheaper than the grocery store and more directly supports a local rancher, but not for everyone.

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@GDavenport I scored a huge ribeye for DH that was marked down from $32 to $15. He deserved a special treat for cleaning the roof gutters the day before. The markdowns vary but are often 20% or better.

We live in a small town and don’t have an Aldi.
Wendy

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Note that poultry is the most concentrated business. Companies control every aspect including breed, feed, and processing. They are raised by individuals who have facilities that meet their standards.

They say pork is moving that direction. Not much market for hogs. Most pre arranged by contract.

Beef is still animal to market. Grass fed and feed lot remains personal choice of grower.

Beef is slower to respond to market. The Biblical 7 years of feast and 7 years of famine seems to apply. Decision to hold heifers for breeding takes that long to deliver marketable beef.

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Men our age should not be climbing ladders to clean roof gutters.

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@WendyBG, I marvel at the differences between same chains/different region (I’m in the south east). If I saw prices approaching 30% cheaper than sticker, I’d load up. That rarely occurs except on fresh seafood.

10% is the norm and, from the abnormally high base price about 25% higher than Aldi for equivalents.

$4.19 at Aldi / $5.48 at WMT for Sausage, etc.

A discount of 15% is still much more expensive than Aldi…

Ground beef at $6.98. Slop 73/27% at $5.98… Even with a sales sticker, this is no deal.

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Unfortunately, you don’t have a Trader Joe’s either (owned by Aldi Nord). Looks like the closest one is in Silverdale. Trader Joe’s has consistently low prices, which it provides by operating the exact opposite way of traditional grocery stores.

TJ’s does not run sales, use coupons, or have a loyalty program. There is no online ordering, it doesn’t do delivery and there is no app. TJ’s doesn’t advertise except the monthly-ish “Fearless Flyer” mailer. Unlike regular grocery store circulars, the FF has no glossy color photos, and of course no coupons or sales to announce. It contains articles about interesting products, along with plenty of unforgivable puns and a crossword puzzle.

Stores typically charge vendors stocking fees. That is, most vendors pay the store place their products on the shelves. TJ’s does not charge stocking fees, which means they can get better pricing from vendors.

Stores typically pay for inventory 30-90 days after delivery. TJ’s pays on delivery, which results in better terms from vendors.

A key part of their model is they don’t carry everything, and they don’t try. You have to shop at other stores occasionally to get what you need. But if you’ve been to TJs, you probably noticed the employees are always stocking the shelves. That’s because they focus on a small number of products that sell in extremely high volume, such that they turn over their entire inventory about five or six days.

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