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The cartel that controls the US meat industry (statecraft.beehiiv.com)
221 points by armanhq on Aug 3, 2023 | hide | past | favorite | 162 comments


A reminder that Tyson is abusing the legal system to force people in the American south into working in their chicken plants for free: https://revealnews.org/article/they-thought-they-were-going-...

I don't know every brand that uses Tyson products, but when I discover something is coming from a Tyson factory I stop purchasing it.


This is pretty awful. I can almost guarantee that if you look into the campaign donors for these judges the chicken farms will there. It reminds me of the judge that used to send kids to prison because he was getting a kick back.

https://www.nbcnews.com/news/us-news/judges-sent-children-pr...

Sometimes those we trust to enforce justice are the biggest criminals of all and we give them essentially unlimited power.

Abuse of power to this extent and the ruining of so many lives should be a death penalty offence.


They produce around 20% of the beef, pork, and chicken in the United States. They also have a range of food products under brands like Tyson, Jimmy Dean, Hillshire Farm, BallPark, Wright, Aidell’s, and State Fair.


I find it more shocking that, despite the terrible reported conditions at the plant, most people stayed there because it was preferable to prison. If that is preferable to their prisons...


I'd rather go to prison. Take the gamble, at least prison has time off for good behavior and over crowding. This program looks like its designed to drain you of everything for as long as possible.


Pretty sure refusing to work when given the option is itself not considered "good behavior." It's one of the ways they coerce inmates into working those $0.12/h jobs.


It's even worse than that. In Texas, refusing to work essentially puts you in solitary confinement! [1]

[1]: https://www.tdcj.texas.gov/faq/cid.html#work


You can get a shot for refusing to work. This can impact good time and will impact your points. Higher points mean you get sent to a higher security (which ironically means less secure/safe for the inmate) facility.


The taste is enough reason to never eat a Tyson chicken.


you don't like chicken that smells like gym socks? i thought i was the only one


If it was free how are the operating costs covered?


I think you misunderstand - prisoners and people that are "diverted" from prison to rehab are being sent to chicken processing plants as part of their sentences. The taxpayer is paying the bills to these institutions and then Tyson is getting labor for free.


[flagged]


wtf is wrong with you


ahh, the most under talked about part of modern slavery. "But they got arrested for a good reason, so of course they need to do labor to repay society". Yup, exactly the kind of narrative a private prison incentivized to detain people wants to spread.

Shame it will take a much more radical change to how people view prisons to truly break this mentality.


Thankyou for sharing this.


Another solid reason to boycott meat.


Wow, this is atrocious


I only saw Simmons Food Inc here, does Tyson do it too?


You seem to have read the article, so it’s odd you didn’t do a search:

“Simmons signed on. Later, Crystal Lake Farms and Tyson Foods Inc. did, too.”


This is horrific.


>McGahey was 23 with dreams of making it big in rodeo, maybe starring in his own reality TV show. With a 1.5 GPA, he’d barely graduated from high school. He had two kids and mounting child support debt. Then he got busted for buying a stolen horse trailer, fell behind on court fines and blew off his probation officer.

Yeah, you weren't going to make it big either in rodeo or anything else.


Id suggest reading the rules of this site and posting something more productive next time.


I was really interested in the figure that shows prices going up while input costs decrease. But this doesn’t reflect all inputs just the price of meat procured. There are many other input costs, mostly labor.

So this diagram is really frustrating as it makes me want to reach a conclusion (wtf, what an unnatural difference) without giving me enough information to know anything.

It would be like showing that household grocery costs decreased while disposable income decreased and then writing an article about the relationship between those two while not revealing that rent increased at the same time.

In general, I don’t know if they answer properly if profits increased because of inflation or if inflation increased because of inflation. Since the cartel existed before the shift, I would like to know what they think made companies suddenly get greedier.


The author arbitrarily picked an outlier looking peak to start the graph vs consumer pricing to severely bias the graphs. May 2020 (graph 100 index) has a price index of 265, but April 2020 is 185 and Jun 2020 is 194.

https://fred.stlouisfed.org/series/WPU0221

*edit April not Feb

*Edit2: Linked wrong graph, but correct graph is like the same trend. Thank you for the correction.


> to severely bias the graphs

How does this bias manifest? It looks like what you linked is comparing something different but I wonder if I am misunderstanding.


The PPI time series they use is indexed to the outlier you see in 2020, although that's the incorrect chart - this should be a better one: https://fred.stlouisfed.org/series/WPU0221

The conclusion is that industry PPI is down 20% since 2020, which is ridiculously misleading.

Speaking of incorrect charts, they used "Meats, poultry, fish, and eggs", which is the time series easily available on FRED, but on this timeframe is mostly about eggs - the one component irrelevant to the article.

The fact that this was written by a "Sr Data Scientist" is laughable, but probably average Silicon Valley economics.


> In general, I don’t know if they answer properly if profits increased because of inflation or if inflation increased because of inflation. Since the cartel existed before the shift, I would like to know what they think made companies suddenly get greedier.

That's my big question too with all this "greed driving inflation" discourse. I don't doubt it at all, in fact, from everything I see it seems like the likeliest story. But ... why now?


From what I understand, price is sticky. It may have been difficult to be greedy as a first mover, and also difficult to cooperate to increase prices. When an external driver (pandemic) occurred, all players found a natural driver of prices and let their instincts take off. My unlearned thoughts.


Wages are sticky. Prices of undifferentiated commodity products are not, which is why Tyson (as an example) has falling ASPs and negative margins on many products.


It's a similar phenomenon to companies waiting until a recession to lay off extra and low performing workers.


> But ... why now?

Because "oh, it's the pandemic" gave them cover for the increases.


>Because "oh, it's the pandemic" gave them cover for the increases.

It might work, but as far as I can tell it doesn't stick. Egg producers had the "it's bird flu excuse" about a decade ago[1]. Profits (as %) went up, but eventually fell back down a few years later[2].

[1] https://en.wikipedia.org/wiki/Avian_influenza#United_States_...

[2] https://www.macrotrends.net/stocks/charts/CALM/cal-maine-foo...


Right, so total profit over the time period is greater than if they didn't raise prices. It doesn't matter if it sticks forever.

See also: gas prices after hurricane Katrina.


Price gouging is immoral, and supposedly, illegal in some cases. And yet...


That's not a better excuse than what they had before. The question is why didn't competition undercut them to keep prices low as it had before. Food company excuses don't matter, people will continue to buy the product they perceive as having the best value.


> The question is why didn't competition undercut them to keep prices low as it had before.

This question is answered by the title of the article.


Didn't that cartel exist in 2020? So, once again, why now?


If you ran a cartel, what would your biggest fear be? If it were me, my biggest fear would be getting regulated out of existence, or maybe even being criminally prosecuted. So you want to keep a low public profile for your cartel activity.

If you start ratcheting up prices without an excuse, eventually people would notice, and at some point "people" would start to include state and federal legislators, who will start asking uncomfortable questions and whom you might not be able to buy off forever.

So instead what you do is set a comfortable minimum price industry wide and use your cartel power instead to aggressively cut costs, so that you have a credible threat of crushing any competition in a price war. This keeps potential competitors in check, thereby tacitly maintaining your preferred price floor.

When an external event does happen that actually raises supply costs, you are best equipped to eat those cost increases while your competitors struggle. Eventually, you sadly announce that you must raise your prices. This price becomes the new price floor for a while, until inflation catches up.

I'm not saying that's what they're doing, but to me that seems like a nice balance between maintaining industry dominance and not being portrayed in the media as Dr. Evil.


The first line of the article is "Since 2020, Americans have experienced rising food prices". The pandemic's effects largely started in March 2020. "Now" is scoped to "that last couple of years", not "last week".


Well, OK, didn't that cartel exist in 2018? 2010? 2000? Why now (for values of "now" that include 2020)?

The cartel explanation, by itself, still doesn't fit the timing.


Again, the cartel(s) existed (and they've long been accused of price fixing of various kinds; BigAg price fixing fines are not new; https://en.wikipedia.org/wiki/Lysine_price-fixing_conspiracy as an example). The handy "it's the pandemic's fault prices are going up everywhere" excuse to get away with big price hikes was new.


They didn't need excuses to raise prices, this explanation still doesn't explain why they waited. Cartel's don't care what their consumers think since they've cornered the market on an inelastic product.


> Cartel's don't care what their consumers think since they've cornered the market on an inelastic product.

They do care about attracting the ire of regulators, which can be triggered by consumers getting fed up with price increases.


So what about regulators is different now than 10 years ago or 20? It seems like the same crappy level of price regulation now as 40 years ago.


Regulators are toothless in this country. I'm not buying the "scared of regulation" angle.


Not really. The article doesn't have any evidence of collusion at all. 4 competitors should be more than enough to prevent abuses of market power.


There's certainly evidence of collusion in the meat industry even pre-COVID.

https://www.atg.wa.gov/news/news-releases/ag-ferguson-s-pric...

> The Attorney General’s Office asserts Tyson Foods and 18 other chicken producers drove up the price of chicken since at least 2008, causing consumers to overpay by millions of dollars. The lawsuit asserts a widespread illegal conspiracy to inflate and manipulate prices, rig contract bids, illegally exchange information and coordinate industry supply reductions to maximize profits.

> The Attorney General’s Office investigation found a coordinated, industry-wide effort to cut production through the exchange of competitively sensitive information, signals during investor calls and direct coordination between players in the industry.


$10.5 million over 14 years? That's what, half a cent per pound? probably less


That's the settlement amount, from one state and for one type of chicken product, and merely one example of how the providers collude.

Until people start going to jail, these sorts of fines/settlements are just part of the cost of doing business. The profits from the scheme tend to outweigh the punishments, especially factoring in the probable times they don't get caught doing it.


Right, but I don't know, that feels kinda thin ... couldn't they have conjured any number of other excuses before?


They've never had so clear an opportunity - what other excuse was available as widespread and impactful as a global pandemic? - and you see it across the board. Daily housekeeping at most hotels is gone forever, "because COVID". They were trying to get away with it pre-pandemic, but people pushed back on the reduced level of service.


Well, another comment in the thread said it's probably because funding sources are drying up and this is an attempt to make up for it, and that sounds likeliest to me now.

Re: housekeeping, in that specific case (and this applies to many other service occupations too), my money is without hesitation on a much sadder cause, i.e. COVID killing people or giving them long-term disabilities, which strongly shrank the workforce.


Exactly. The common refrain from everyday people in idle conversation was 'global supply chain issues'. Easy to believe, organically supported excuses are the easiest ones to lean on because they become socially entrenched in ways that top-down explanations don't.


Why do they need cover for price increases? What was used for cover for price increases before the pandemic? Or why was cover not required for those?

Doesn't add up.


This is correct. Food companies cannot hike prices just because, especially when they are monopolies. If suddenly eggs cost $20/dozen, customers will ask why and if there are no good explanations, there will be a lot of noise. And politicians and regulators who are otherwise not willing to act on monopolies, do not like noise because it threatens their jobs. They will act, and that will not be great for the food companies.


> They will act

Citation needed. Anti-trust enforcement went out with Clinton.


> they will act

They will say “what inflation?” and then tell us that it’s actually a good thing that eggs cost that much.


Or, ya know, they can’t raise prices that high because people will just stop buying eggs and they will stop making money. Eggs are very much an elastic good.

Does no one understand basic economics anymore?


Eggs are a fungible product (well, sort of).

In a working market there are a lot of sellers and buyers and I'd find the lowest ask price and buy it.

In a failed market, the price is locked.

You’re actually advocating for anti-competition and anti-capitalism.


The price of inputs is going up, but so are interest rates (and expected future interest rates). So where money was cheap, it's going to become more expensive. I suspect it's understandable a business would want to increase its margins given the expectation of higher rates -- as opposed to the personified "greed" narrative.


Because businesses are not owned by ppl? And a small amount of those? It's much more reasonable to personify the decisions made by these ppl than to assume that some anonymous law of nature did it


Thank you, that's actually the first interpretation that makes total sense to me. If you know that sources of financing are drying up and will stay that way into the foreseeable future, raising prices to make up for it does seem like the most obvious thing to do.


> Thank you, that's actually the first interpretation that makes total sense to me. If you know that sources of financing are drying up and will stay that way into the foreseeable future, raising prices to make up for it does seem like the most obvious thing to do.

* When you have a monopoly or cartel and you don't face pricing pressure from competitors. In a competitive market they would have to cut margins, not raise prices. Antitrust, now.


> The price of inputs is going up

Except it didn't. That's like, the first thing in the article.


Input costs include labor.


Moving to the country has really opened up my eyes for food production, especially meat.

There are so many small farmers here that are basically shut out from the economy because of impossible USDA guidelines. And we're honestly supposed to believe that mega meat processing plants are somehow better for us? It's delusional.

Call your representative and ask them to support the PRIME act.

https://ij.org/initiatives/food-freedom/prime-act/


100% this. As a small time farmer. I cannot butcher my own animals and sell them to anybody directly. I have to sell them "on the hoof" in a minimum size of a quarter of an animal and then have a custom butcher process the animal. I can't sell any of my meat directly to a person after it's butchered, or to a restaurant. I can only sell in those cases if I go to an FDA certified meat processor, which is 400 miles one way from my property. So essentially I'm limited to selling meat to either friends and family or shipping my animals 400 miles and paying $2 a pound in processing costs.

So no the Prime act isn't a way for corporations to go around the rules, it's so small guys like myself can sell meat to people without having to truck it 800 miles.


Reading from the linked website, it looks like the PRIME act is a way to avoid federal regulation in favor of potentially looser state regulation. Now I have no dog in this fight, but why couldn't we say, push for the house ag committee to get some people from the FDA to explain why these slaughterhouse regs are so onerous? Is passing a bill the best way to get something done?


I would say that anybody who is interested in the system should listen to this. All of the people in this panel, called by both Republicans and Democrats, call out the need for serious reforms of the FDA inspection system. And how the FDA system specifically allows large meat corporations to cut the little guy out of cutting meat. If you think that the current system limits 'bad meat' from entering the system. You need to understand that the FDA is fully captured by the corporations that it's supposed to be governing.

https://www.youtube.com/watch?v=t9xcOkwgdi0&pp=ygURcHJpbWUgY...


Well, this is quite thinly vieled attempt to let corporations hurt people and make a profit doing it!

You've linked to a politically Republican organization's page, where they're promoting legislation that would let companies produce unsanitary and unsafe meat. Do you not understand that the USDA guidelines are (a) easily obtainable and (b) exist to keep people from getting sick or dying from unsanitary meat? Or do you just stand to individually profit from this legislation?


"You've linked to a politically Republican organization's page"

Why does this matter? You could have said "a political organization's" but didn't.


If I did that, I'd be intentionally leaving out critical information that is necessary to understand the context, motivation, and aim of the article.


> a politically Republican organization

Your other arguments aside, why is this surprising or relevant? For whatever else you can say about the broken politics in America, the only party that gives a shit about rural people is the Republicans, so of course any organization focused on rural issues is Republican.


> the only party that gives a shit about rural people is the Republicans

Unfortunately, the Republican party has long outspent its benefit of the doubt.

I'll admit that Republicans say they care about rural people. But, then again, the Republican party says a lot of things, much of it are easily disprovable lies. An easy one to point out is the lie that "the 2020 election was stolen" or that the numerous criminal cases against the former president, backed by tremendous evidence, are "witch hunts". These, and other lies, are constantly pushed by the Republican party, its leadership, and the most vocal advocates of the party.

The Republican party doesn't have any credibility left. So, I'll continue to do the rational thing, which is to ignore the folks that have a long history, and ample evidence in the present, of intentionally lying.

Of course, I could be swayed if you can point to actual laws, executive actions, or judicial rulings made by Republicans -- and in opposition by Democrats -- that resoundly demonstrates that there is "only one party that gives a shit about rural people."


> The Republican party doesn't have any credibility left. So, I'll continue to do the rational thing, which is to ignore the folks that have a long history, and ample evidence in the present, of intentionally lying.

You're making politically motivated reasoning and ignoring the people who are telling you something from the ground. You're free to continue to do so, and this HN subthread is not the right place to re-litigate the entire history of American politics. Just be aware that motivated reasoning is not necessarily the best approach to find the truth.


I wouldn't call this "motivated reasoning." It's rather simple cognitively: I have made observations and only the barest form of logical inference.

I've observing mountains of evidence that clearly shows multiple crimes committed by Mr. Trump. I've also observed how the Republican Party has decided to ignore this evidence and reject truth to rally behind him. Perhaps most notably was the GOP's 2020 platform (more accurately, lack of a platform as they didn't actually publish anything of substance other than a re-iteration of their positions 4 years prior), that included "party's continued support for Trump's America First agenda" [1]

I'm so curious as to what you could possibly mean by:

> who are telling you something from the ground

Because there's only conspiracy theories and outright lies left fueling the fabricated "outrage" in the Republican party.


I would suggest you simply re-read your comments and mine. You are so far down a rabbit hole here that's completely irrelevant to the original thing that was shared you replied to, that I'm not even remotely going to engage in what you are writing. I'd suggest you take a deep breath and read.


lol what? I live in NYC and buy from small upstate farms from my butcher that only sells pastured meats... the USDA doesn't seem to be a problem for them at all


I'm not sure your example disproves OP. Your artisanal butcher can pass on any costs of compliance to you, and people like you who live in wealth-dense NYC and are willing to pay extra for pasture-raised meats. That is not true for much of the population that expects to pay $5 for a Costco rotisserie chicken.


Pasteurized as in the meats are pre-cooked? Or are you possibly meaning pasture-raised?


Pastured. As in, raised in a pasture.


Maybe the caffeine hasn't kicked in yet, but how can this be true:

> Tyson Foods, Cargill, JBS USA Holdings, and National Beef have gained control of roughly _85%_ of the total hog, cattle, and poultry processing market

If the bar chart that follows that has the following information:

> Percent of meat supply processed by the "big 4":

   - Beef: 73%
   - Pork: 67%
   - Chicken: 54%


Possible resolutions are the fact that the size of the processing market is measured in $, not percent of meat processed, as well as Simpson’s paradox.


RFK put out a video explaining how this consolidation occurred in the pork industry: https://twitter.com/RobertKennedyJr/status/16865387973102428...

It was basically a case of a politician, Wendell Murphy, who helped pass 28 laws making it illegal to sue a factory farm, then left office and went into partnership with Smithfield Foods, a Chinese-owned company (which according to Wikipedia was "the largest Chinese acquisition of an American company to date"). Smithfield and Wendell used the factory farming model to undercut and put out of business almost all of the smaller pork farms. They now control 80% of pork US production and put 28,000 independent farmers out of business.

I personally do not understand why China controlling 80% of pork production in the US is not a national security issue. But, that aside, this seems pretty bad for the country.

*Edit, I remembered the video wrong, they control 80% of pork production _in North Carolina_. They control 26% of all US pork processing and 15% of pork production. They also have been found guilty of price fixing: https://www.reuters.com/legal/pork-consumers-75-million-pric...


> It was basically a case of a politician, Wendell Murphy, who helped pass 28 laws making it illegal to sue a factory farm, then left office and went into partnership with Smithfield Foods, a Chinese-owned company

Said politician was in office (NC House/Senate) in the 80s, and his company was bought in 1999 by Smithfield Foods. Smithfield was bought by WH Group, a Chinese company, in 2013.

> They now control 80% of pork US production

This appears to be fiction. The closest I can find is that 6 large companies control 80% of the wholesale market, Smithfield being one of them.


>Smithfield was bought by WH Group, a Chinese company, in 2013.

Correct, Smithfield seems to have consolidated the market _before_ being acquired by WH Group. Which he says in the video. But the fact that they are still controlled by China and that they have a massive market share of the industry is still true.

>This appears to be fiction

I just went back and rewatched the video, sorry my bad. They control 80% of hog production _in North Carolina_.

They control 26% of all US pork processing and 15% of pork production.

It's hard to remember this stuff when posting on here casually during work.

However Smithfield was in fact guilty of price fixing:

https://www.reuters.com/legal/pork-consumers-75-million-pric...

Which means they are big and powerful enough to manipulate markets like this.


I'm not sure I'd want to admit in public that I follow RFK Jr. If he said it, it's unlikely to be true.


I mean, if there's something specific that he says that's untrue in this video I'd love to discuss it, but I think it's possible to listen to what people say with a skeptical ear and an open mind. I don't have to agree with everything he says but sometimes he says some interesting things that are worth thinking about and discussing.


The word "monopoly" implies one dominant company ("mono-" meaning one), but industries with 2 or 3 companies are still unhealthy for a few reasons.

First, it's pretty easy for 2 or 3 companies to price fix, which is against anti-trust laws.

Second, a healthy market requires that it be easy for new companies to enter the market and compete, and if there's only a few dominant companies, then clearly new competitors are not succeeding.

We need more anti-trust enforcement.


I am not too in the weeds on this particular issue, but it seems not that crazy to me that "the biggest four companies" produce 55% of the US's chickens. Presumably that means there is much more than four who register in at above a couple percent nationally and possibly even at a local level different players. Its also for one market. While I eat a lot of chicken, I could substitute it for other foods or meats.

To be clear I think these companies would manipulate prices if they knew how and could get away with it, but having trouble seeing how "four companies control under 60 percent of one food's market" is that alarming. That seems like more competition than at any point in human history.


> That seems like more competition than at any point in human history.

I think your intuition is very wrong on this one. And since there are clear signs of price fixing which you haven't addressed, it's pretty irrelevant.


There really aren't clear signs of price fixing. At least not in this piece.


That's fair. Price fixing is a specific thing, while I was more referring to facts like:

>BigAg’s consolidated power throttles the price discovery process.

and

> Over time the share of feedlot-to-meatpacker sales done via contract has increased to 72%, so BigAg sets the price outright with no price discovery process at all.

I'm tired and can't even think what to call this except 'undue influence', which is too vague. Though that said, I'd still be shocked if there wasn't price fixing going on, given the state of things.

While I'm here, OP seems to miss that this is 4 players controlling "roughly 85% of the total hog, cattle, and poultry processing market", focusing on chicken where the number is lowest. It's really, really bad; and not something to dismiss based on wild historical speculation.


> That seems like more competition than at any point in human history.

What, were the Vikings running a global monopoly on grain or something?


If you were a random person in a town 1600 - how many people do you think you could buy meat form? I honestly dont know. I guess if everyone had subsistence farms with some chickens it in theory could be a lot, but not sure if it would be over 10 or not.

Its not like they had efficient shipping or storage back then.


Our two political parties are a duopoly (at best).

They have used that position to build a huge moat against any possible third party gains for many decades.

So, enforcing anti-trust legislation would actually be kind of hypocritical of them, sad-lol.


It's easier if you paint the company behavior as "monopolistic" rather than the company as being a monopoly.


>We need more anti-trust enforcement.

The medical field is the most urgent on this matter.

Food prices are manageable. Healthcare prices are far far far worse.


I agree. We've also discussed on HN recently that some important medicines are produced in only 1 or 2 factories.


Is there a way to detect price fixing?

For example in a competitive market everyone has the same price. But the same is true with price fixing.


In a competitive market, profit margins are low because sellers are fighting for customers.

If you are price fixing, then obviously you want to earn more profit, and hence profit margins would not be low.


“Oligopoly” is the word you are looking for, carried out by oligarch.


The correct word is in the title: it’s a cartel, in that it’s an association of suppliers that maintain high prices and restrict competition.


I read a story of a Latino immigrant Mom who worked the night shift cleaning a slaughterhouse every night. Wet, slick surfaces and sharp objects everywhere.

The Mom was hired as a contractor through a third party company. She fell and was injured at work, because she wasn't an employee of the bigger company she wasn't entitled to any compensation or help, just fired from the third party company which also provided no assistance.


Given both rules of property owner liability and workplace injury liability, she almost certainly was legally entitled to compensation by one or the other, or both, companies involved for damages (including future lost wages) from the accident.

Of course, companies claiming you aren't entitled to compensation right up until you show them they are unlikely to get away with that by bringing in state authorities (if applicable) or your own lawyers is... very much a cost avoidance technique that is used often in practice. Especially against the Latino immigrant community where even legal immigrants and naturalized citizens are still operating in a culture of reluctance to engage with government or legal process, employers know this and exploit it.


You are confusing her legal entitlement to recover her damages through tort, as opposed to what she might be entitled to a company that didn't have insanely regressive policies. They are similar, but not the same things!


mmm, wouldn't she be able to go after the third party company?


Maybe it was that she was hired as an independent contractor so she had no recourse.

Either way, the story painted a horrible picture of the slaughterhouses who hire disadvantaged workers, and then just discard or ignore them when they are injured.

Also, I think this was in Texas which isn't exactly a worker friendly state.


Yeah, the law is one thing but actually pursuing recourse is a pain itself.


A single Spanish speaking mother with kids and a broken arm is unlikely to be successful in sueing the companies and they know it.


My family raises beef cattle on the side, mostly in the past it was just to help keep the property grazed down (it'll go fallow pretty quick if nothing is on it) and provide local higher quality, cheaper beef for folks in the extended family. At some point, my parents decided they wanted to try expanding the farm and actually selling the beef. They were shocked to learn that two guys control the local cattle markets and pay essentially "what they want" for anything and everything. Pretty much no one got more than $1/LB on the hoof for grass fed healthy cows.

They gave up and went back to a property maintenance sized herd after 10 or so years of that.


There's no broader market for beef? Is there a higher break-even point factoring in transport costs?


The more time they spend in a truck, the higher the risk of "transportation sickness," which is basically animals being stressed out from being in a weird truck going down the highway and being more susceptible to a bunch of stuff. Interesting aside, that's part of what made Roosevelt's ranch more successful, he was supposedly one of the first ranchers to stop transporting live cattle to Chicago for sale, and instead slaughtered on-site and made use of the newly invented refrigerated boxcar.

There's money in direct sales, of course, but you have to a) be inspected for general sales and b) use a butcher who is inspected and licensed for i) in-state and ii) out-of-state sales. If you ever buy a "share" of an animal and pay to have it butchered, you may notice the meat comes in packaging with prominent NOT FOR RESALE markings -- that's why, it's a local butcher not USDA licensed for general public sales.

Buying "shares" is a skirt around the law, but most people don't want to deal with the amount of meat from even 1/4 a carcass, and they're usually hard customers for local butchers ("Your butcher is robbing us! They wouldn't give us T-bones and NY Strip!"). Supposedly if you're found to be doing too much of it, or "automating" it too much for the "shareholders," the USDA will come down on you for it (IMO rightly).

You also then have to market the meat. My wife and I had offered to help set up a canned site to help with it, but my parents were too concerned about the licensing requirements and that it'd be throwing more money into the hole that is subsistence farming!


Revealed: the true extent of America’s food monopolies, and who pays the price [2021]

https://www.theguardian.com/environment/ng-interactive/2021/...


> (2) The Immigration System: that simultaneously enables BigAg to procure cheap migrant labor and can be weaponized to prevent that same migrant labor from organizing for or demanding humane working conditions.

The Jungle all over again ... apparently not much has changed in ~100 years. Fascinating.


Article is about meat, why change the title?


Ok, we've changed it now. Submitted title was "The Cartel That Controls the US Food System".


The title appears to match the one on the article (unless they're doing some title fuzzing)?


Article says "meat industry", HN title says "food industry", unless we're getting AB tested.


For me the title of the article is "The Cartel That Controls the US Meat Industry".


Same. This is about meat, although since a lot of our land is used to grow feed for livestock, subsidies for plant agriculture are indirectly subsidizing inefficient animal agriculture.


Calling meat agriculture inefficient makes no sense, when meat is a vital, and necessary food. Most of the world grazes meat animals, no crop feeding, and do so on land utterly unusable for crops.

If you want to dive into weirdo anti-meat statements, at least be sensible. We could just eat raw vitamins and eat bacteria paste too, instead of "inefficient" fertilizer driven crops.


> meat is a vital, and necessary food

Not true at all.

Plant-based diets were protective against cancers of the digestive system, with no significant differences between different types of cancer, a meta-analysis based on 3,059,009 subjects

https://www.dutchnews.nl/2023/04/meat-tax-would-boost-health...

Meat tax would boost health and cut healthcare spending: research

https://www.foodingredientsfirst.com/news/over-17000-doctors...

Over 17,000 doctors call on White House to shape nutrition policy on plant-based diets

"It is the position of the American Dietetic Association that appropriately planned vegetarian diets, including total vegetarian or vegan diets, are healthful, nutritionally adequate, and may provide health benefits in the prevention and treatment of certain diseases. Well-planned vegetarian diets are appropriate for individuals during all stages of the life cycle, including pregnancy, lactation, infancy, childhood, and adolescence, and for athletes." - American Dietetic Association

"A vegetarian or vegan diet can be suitable for everyone, regardless of their age." - NHS UK

"[I]t is possible to follow a well-planned, plant-based, vegan friendly diet that supports healthy living in people of all ages, and during pregnancy and breastfeeding." - British Dietetic Association.

"For adults, protein from two or more plant groups daily is like to be adequate. " - World Health Organisation

> Most of the world grazes meat animals, no crop feeding, and do so on land utterly unusable for crops

Yep, on deforested lands. 50+% of those pastures used to be forests. That's why we have droughts and climate change ... removing carbon sinks and destroying biodiversity just to have steaks on the table.

No crop feeding? 80% of grown soy is fed to animals. Half of the grains. 35-40% of corn (rest is biofuel, another stupidity). What about alfalfa, the reason why Colorado goes dry?


It is still unclear if the land that is used for grazing could be suitable for growing crop that could be used for human consumption. Where do you think the grazing land comes from? Clearing natural habitat. And no, except for extreme conditions (like people living in extreme cold), meat is not a necessary food. An average human living in a city/village with moderate temperatures (especially when most of their time is spent inside buildings) does not need meat, they only want it.


We don't need those grazing lands for growing food (some nuts forests would be cool, though). We should afforest/rewild it to store maximum carbon in those lands, repair water cycle, enable biodiversity to return (70% of species is lost in the last 50 years or so), and use land for animal feed crops to feed humans instead.

If we'd switch to plant based diets, we'd free an area the size of Africa to return back to nature, storing enough carbon to return to 280ppm, stop biodiversity loss, while feeding comfortably 10+ billion people.

https://ourworldindata.org/land-use-diets

If the world adopted a plant-based diet we would reduce global agricultural land use from 4 to 1 billion hectares

https://pubmed.ncbi.nlm.nih.gov/26231772/

Biodiversity conservation: The key is reducing meat consumption

https://www.eurekalert.org/news-releases/917471

Feeding 10 billion people by 2050 within planetary limits may be achievable

A global shift towards healthy and more plant-based diets, halving food loss and waste, and improving farming practices and technologies are required to feed 10 billion people sustainably by 2050, a new study finds.


Ooh boy the numbers are bigger than I remember. I don't think the world will shift to a completely plant-based diet for the foreseeable future but we really do need to atleast move toward that reality.


About 100% of the livestock land where I come from is capable of crops except for some edge cases. Not sure where you're getting the 'land used for animal meat is "utterly unusable for crops"' talking point. Could you provide some sources on that?

Every third or fourth plot is growing crops already. It seems to be a matter of choice and usually livestock farms here are based in heritage.


There are many reasons to avoid meat that don't apply to vegetables. First off the top of my head is it's a disease vector: both bacterial and viral (think swine and bird flus).

Secondly, water usage for meat is 2-5x the liters-per-kilogram of lentils, tofu, and 10x the rest of the staple vegetables.

Thirdly, every bite of meat on your plate carries an opportunity cost of all the nutritious benefits of eating a variety of vegetables. I could go into this further, but I think it's common knowledge that plant chemicals offer "vital and necessary" nutrition unavailable from meat.

Greenhouse gas emissions are also a factor that favors plant diets over meat.

I love a good prime rib, or a BLT, but the costs grossly outweigh the benefits.


> meat is a vital, and necessary food

And you talk about "weird" statements?


Amazing that they completely ignore the regulatory capture of FDA meat inspection. It is the largest barrier to disrupting the "big 4" for anybody to enter the market. Given the cost and complexity of running an FDA approved meat cutting facility, it makes it nearly impossible for small farms to enter the market and provide an alternative to the big 4.

Instead small farms such as myself are forced to do stupid things like sell the meat to somebody 'on the hoof' and then have it custom cut by a butcher, because getting the meat processed and cut at a FDA inspected facility, if you can get into one, adds $1-3 a pound. This also means I can only sell you a quarter beef or larger. Which most consumers don't have the money or the freezer space to do.


I feel for you. You might enjoy a book from a small farmer called "Everything I Want to Do Is Illegal" by Joel Salatin. He talks about the absurdity of ag regulatory capture and it's effects on small farmers. It's an inspiring call to arms.


See also:

https://www.good.is/Business/food-brands-owners-rp

And:

https://www.cornucopia.org/who-owns-organic/

I am a firm believer that inflation is actually controlled by a few people making phone calls. The FTC needs to grow its teeth and start ripping shit to shreds.


Food system is a technical term and is distinctly different than the meat industry, which it encompasses. These companies certainly do not "control the food system"


That's debatable. If they're able to influence UN FAO and IPCC (among many others I'm sure), and they are, they kinda do.

https://qz.com/ipcc-report-on-climate-change-meat-industry-1...

The meat industry blocked the IPCC’s attempt to recommend a plant-based diet

https://www.researchgate.net/publication/352100490_Emissions...

FAO's work on emissions from animal agriculture may be influenced by the meat industry's interests, potentially affecting their recommendations on reducing meat consumption for environmental reasons.

https://www.pcrm.org/news/blog/meat-and-dairy-subsidies-make...

Meat and Dairy Subsidies Make America Sick

https://www.theguardian.com/science/2022/dec/09/academy-nutr...

Revealed: group shaping US nutrition receives millions from big food industry

https://www.salon.com/2022/11/11/the-meat-industry-is-borrow...

The meat industry is borrowing tactics from Big Oil to obfuscate the truth about climate change

https://www.americanprogress.org/article/why-the-farm-bill-m...

Why the Farm Bill May Be the Highest-Stakes Climate Fight Flying Below the Radar


Interesting to read this and think about how the future of AI might turn out if the google microsoft cartel comes into being like they're trying to.


I wonder why Smithfield did not make the list. https://twitter.com/RobertKennedyJr/status/16865387973102428...


Would US be an ag powerhouse without consolidated scale? IMO US in geopolitical position with respect to land resources that it doesn't need to be, but powerful cartels seem to pretty good at expanding US ag competitive advantages with respect to foreign polciy.


It would be better if people stopped eating as much meat.


Instacartel


i thought centralized economies were communist?


Planned economies are associated with communism, but they're also basically what all corporations do internally, including government owned "corporations" like the police and militaries.

Food gets massive subsidies in the west, because we really don't want shortages, and even massive subsidies are a really cheap way to do that, because most of the consumer cost of food is later in the supply chain than the production.

My gut feeling (I'm neither an economist nor a political student) is that while many small corporations competing with each other is an excellent way to explore the space of supply, demand, and technological changes, when you find a known-good solution it's probably better to merge them into one to get rid of the needless duplication — which happens naturally in capitalism, but then I'd go further and say the government should buy up the shares and take advantage of any dividends to (effectively) be a non-tax based revenue source.


>then I'd go further and say the government should buy up the shares and take advantage of any dividends to (effectively) be a non-tax based revenue source.

Isn't that just a consumption/sales/value added tax with extra steps?


If it is any of those kinds of tax, then so are all divided payments; this is something a corporation could just decide not to pay one year because it wants the money for investing in future growth or whatever else is the usual reason is for not paying dividends to shareholders.


Just more reasons to eat a plant based diet.


You should see the cartel Monsanto has on agriculture

This is just one more reason we should push for sustainable farming, including meat products.

livestock naturally bring nitrogen and other nutrients back into the soil when grazing. Then use that land to grow plants, move the animals where plants pulled the nutrients from the soil, rinse and repeat.

Also reduces the need for harmful fertilizers that impact the ecosystem


"sustainable farming" would require eating less meat though. It would probably be much better quality meat.

Sidenote: Monsanto no longer exists. It's Bayer AG now. You can get a direct flight from St Louis to Frankfurt now thanks to this acquisition.


But animal ag is far from sustainable, unfortunately.

Climate change, resource depletion, deforestation, loss of biodiversity, pollution, overpopulation, soil erosion, and overfishing are all symptoms of ecological overshoot.

Agriculture is a key culprit in most of those symptoms, and animal ag accounts for 80% of all agriculture.

Animal ag is directly responsible for majority of deforestation, is a major driver of biodiversity loss, has twice the greenhouse gas emissions than plant based foods, uses much more fresh water, pollutes the waters and causes dead zones in oceans, overfishing threatens us with empty oceans in 2040's, destroys our soils, etc. etc.. The reforestation potential of animal ag lands is so huge, that we could store our entire 1.5C carbon budget in those lands.

We can free up the area a size of Africa (cca 9 Indias) by switching to plant based diets, and use it for reforesting/rewilding.

If the world adopted a plant-based diet we would reduce global agricultural land use from 4 to 1 billion hectares - https://ourworldindata.org/land-use-diets

Reforestation potential of pastures (and abolishment of animal ag) would allow us to store the entire 1.5C carbon budget by rewilding/afforesting previously forested pastures. It would also stop biodiversity loss, which is a very serious problem in this day and age. - https://www.nature.com/articles/s41893-020-00603-4

Rapid global phaseout of animal agriculture (and reforesting) has the potential to stabilize greenhouse gas levels for 30 years and offset 68 percent of CO2 emissions this century - https://journals.plos.org/climate/article?id=10.1371/journal...

Beef, soy for animal feed and palm oil are responsible for 60+% of tropical deforestation - https://ourworldindata.org/drivers-of-deforestation

Our global food system is the primary driver of biodiversity loss - https://www.unep.org/news-and-stories/press-release/our-glob...

The way we eat could lead to habitat loss for 17,000 species by 2050 - https://www.vox.com/future-perfect/22287498/meat-wildlife-bi...

Livestock and climate change: what if the key actors in climate change are... cows, pigs, and chickens? - ttps://www.semanticscholar.org/paper/Livestock-and-climate-change%3A-what-if-the-key-in-Goodland-Anhang/6704c7a0777c82357704d82b9ae8007c1197cb07?p2df

The global production of food is responsible for a third of all planet-heating gases emitted by human activity, with the use of animals for meat causing twice the pollution of producing plant-based foods - https://www.theguardian.com/environment/2021/sep/13/meat-gre...

Reducing food’s environmental impacts through producers and consumers - https://www.science.org/doi/10.1126/science.aaq0216

Mass Extinctions and Their Relationship With Atmospheric Carbon Dioxide Concentration: Implications for Earth's Future - https://agupubs.onlinelibrary.wiley.com/doi/10.1029/2022EF00...


Lack of sustainability is contingent on increased encroachment of land and emissions, and that is contingent on growing demand overtaking gains in technological efficiency. The demand is growing as a matter of policy: immigration to prop up the GDP. Growing demand for just about anything will increase emissions, pollution and land encroachment - some just exacerbate things faster than others. That does not mean all other products are "sustainable".

The only "sustainability" is where demand does not outstrip the effects of innovation. No one is moving to North America to eschew animal products, vehicles, detached homes, gadgets and other conveniences. Living as we do is what makes it a better life. It's certainly not for the healthcare. Notwithstanding, the bulk of the global increase in demand is coming from East Asia as they lift themselves out of poverty.

In the short-run, marginal changes in consumer habits can have some effect (which matters if there is a sense of urgency for staving off carbon emissions), but in the long run it's a moot point. Seaweed infused feed makes methane a solved problem, and land-use for cattle has been decreasing in the U.S. (it's increased in South America, which exports to China).

This is why govts are rolling out "greener home" grants and the like, there's low-hanging fruit to help lower emissions quickly in effort to meet whatever target they currently have. They could also disincentivize purchasing SUVs, which should not matter that much to manufacturers as they sell the alternatives anyway. More than one way to lower a carbon footprint, some of which are more palatable to consumers. Broadly speaking they are unwilling and unlikely to switch to veganism.


Few assumptions and oversimplifications, let's address them one by one:

> Lack of sustainability is contingent on increased encroachment of land and emissions, and that is contingent on growing demand overtaking gains in technological efficiency.

Sustainability is not solely dependent on one aspect but is the result of a combination of factors, including land use, resource management, environmental impacts, and ethical considerations. Even with improved technological efficiency, the sheer scale of demand for animal products still pose significant sustainability challenges.

> The demand is growing as a matter of policy: immigration to prop up the GDP.

The demand for animal products is influenced by various factors, including cultural preferences, dietary habits, advertising, and economic factors. While GDP growth and immigration can play a role in shaping demand, they are not the only drivers, and sustainability issues related to animal agriculture go beyond immigration policies.

> Growing demand for just about anything will increase emissions, pollution, and land encroachment - some just exacerbate things faster than others. That does not mean all other products are 'sustainable'

Some industries might indeed have more significant environmental impacts, and in the case of animal agriculture, the evidence points to its significant contribution to greenhouse gas emissions, deforestation, and water pollution and biodiversity loss.

You can't solve all of these with algae:

- Greenhouse gas emissions (methane, CO2, N2O)

- Deforestation (50% of pastures used to be forests)

- Land degradation

- Water pollution

- Water overconsumption

- Loss of biodiversity

- Antibiotic resistance

- Ocean dead zones

- Inefficient land and resource use

- Ethical concerns

- Contribution to zoonotic diseases

- Air pollution

- Eutrophication

- Soil erosion

- High energy consumption

- Chemical runoff from pesticides and fertilizers

- Destruction of habitats and ecosystems

- Inequality in global food distribution

- Public health risks from foodborne illnesses

- Nutrient pollution

- Strain on waste management systems

- Overfishing (40-70% of plankton gone, sharks 90% gone, fish almost gone in 2040's)


> not solely dependent on one aspect

That's why I mentioned more than one.

> Even with improved technological efficiency, the sheer scale of demand for animal products still pose significant sustainability challenges.

That is exactly what I said. Demand is outstripping rate of innovation.

> The demand for animal products is influenced by various factors, including cultural preferences

Most immigrants have that cultural preference, dietary habit, etc.

> advertising, and economic factors

Weakly for staple products, but consumers will spend less on meat when finances are tighter.

> While GDP growth and immigration can play a role in shaping demand, they are not the only drivers, and sustainability issues related to animal agriculture go beyond immigration policies.

It is overwhelmingly the strongest driver. It's not even close. So far the U.S. population has grown by 1,706,706 since 2022. What's more likely, that the growing demand for animal products is a cultural shift, or that there are more people demanding animal products?

Clearly the cultural shift among the middle class and affluent has been a) marginal increase in vegan and vegetarian identity, b) recent enthusiasm between both omnivores and vegans/vegetarians for plant-based products. Despite the latter, the actual vegan demographic does not budge much. If it did, demand for animal products would steadily fall - it does not. It grows. This is not because carnivore dieters are deciding to eat an extra steak to spite you.

> You can't solve all of these with algae:

Moot point if the demand is not growing faster than technological innovation.

Immigration and developing countries growing wealthier is inextricably linked to what you deem as unsustainable.


Those sources are cool and all but I like cheese /s


Vegans have cheese. Salty and fatty, melts. You should try it. There is no magic ingredient in cow (dog, giraffe, lion, bat, dolphin) milk that we couldn't get from plants instead.

https://www.youtube.com/watch?v=UcN7SGGoCNI

https://www.vegancheese.co/discover (1700+ cheeses from all over the world)


To call other things "cheese" that aren't cheese is torturing the very definition of the word, much like "milk", which, of course, as a precursor to cheese, has been traditionally understood, inconveniently for you, as excretion from mammary glands.

A lot of of cheesemakers have also traditionally depended upon rennet, a product of animal stomachs, so in the effort to replace it as a coagulant, the definition of "rennet" has itself been tortured to expand as much as possible until vegans are happy with fake, highly-processed, chemically-treated foods.

I was reading the bag of my Chipotle burrito the other night, and it listed all 51 ingredients they use in their restaurant (even water is listed in here), and my eyes alighted on "gypsum". I nearly spit out my steak and pinto beans when I discovered that there's basically drywall in Chipotle's food. It turns out that gypsum (calcium sulfate dihydrate) is a coagulant for soy products, and so if a restaurant doesn't use soy, and doesn't produce fake, highly-processed, chemically-treated vegan foods, then it doesn't need to use drywall.


> To call other things "cheese" that aren't cheese is torturing the very definition of the word, much like "milk"

Yes, if it doesn't have torture, blood, puss, pesticides, antibiotics and estrogens in it, it can't be called milk or cheese. Why torture? How else would you call forced impregnation, year after year, and forced separation of mothers and calves? Just to shorten the cow's life from 25+ years to 5 and then turn her to burgers.

https://www.youtube.com/watch?v=UcN7SGGoCNI

> has been traditionally understood, inconveniently for you, as excretion from mammary glands

Inconveniently for you, soybean, almond, coconut, rice, oat, hemp, even poppy milk was used for centuries, millenia even, all over the world.

> and my eyes alighted on "gypsum"

https://en.wikipedia.org/wiki/Gypsum#Food_and_drink

So you probably don't drink beer, eat baked goods or farmed mushrooms too. Got it.

Btw, there are other coagulants, like nigari, epsom salt, calcium chloride, lemon juice or vinegar ... Not everybody is scared of 1 tbsp of gypsum in several kg of tofu, so that's why they probably use it. In my view it's much better than contents of someone's stomach. But I'm me.

I wonder what other poisonous chemicals were there. Do you have the list? :)

Btw, do you know, that there's l-cystein in most flours on the market, and that's often made from human hair?

https://www.theguardian.com/lifeandstyle/wordofmouth/2013/ma...

Our food industry is so ingenious.


> Salty and fatty,

Almost never protein though. You want good protein for a healthy diet. Of course you can get it through other ingredients, but most of the time, today anyway, you do lose something when just replacing cheese with vegan cheese, unfortunately.

> There is no magic ingredient in cow (dog, giraffe, lion, bat, dolphin) milk that we couldn't get from plants instead.

Agreed.


> Almost never protein though

True.

> You want good protein for a healthy diet. Of course you can get it through other ingredients, but most of the time, today anyway, you do lose something when just replacing cheese with vegan cheese, unfortunately.

That seems like a strange argument to me. Why insist on obtaining the protein specifically from cheese? Not that it would be hard to add some protein powder to it; why has the protein come from the cheese?

If it tastes good, it doesn't matter as long as you get enough protein from somewhere. We already get 63% of protein and 82% of calories from plants. It's not hard to go all the way.


this but unironically


("We" below refers to the US, and an increasing proportion of the world that is adopting US farming practices).

There's a good-natured argument to be made that plant-based diets are more sustainable, because we don't generally farm meat sustainably and ensuring that your meat was farmed sustainably is difficult and expensive.

But it's important to underline that sustainable is an insufficient target in the U.S. in 2023. The motion we need is regenerative.

I don't think regenerative farming can be done efficiently without ethical use of livestock.

This is all to say: if you view the health and quality of our food chain as a higher priority than the ethical concerns of consuming meat, you should reconsider your approach to diet construction.

That being said, it's an expensive lifestyle, and will remain expensive as long as our society continues to subsidize processed foods. If we want to generalize a healthier food chain, we have to change the incentive structures that led us here.


Alan Savory? Regenerative holistic farming? It's mostly bullshit (not my words), apparently.

https://news.ycombinator.com/item?id=36826277


Can you elaborate what you mean by "regenerative"?

I'm anchoring on things like crop rotation for soil nitrogen, but that doesn't feel quite right for your comment, somehow?


It’s a bit of a ramble, but to give you the oeuvre: the problem is that our fruits, vegetables and legumes are not as nutritious today as they were decades ago. The hypothesis motivating regenerative agriculture, is that the explanation for this fact is that we treat soil as a lifeless medium for growing crops, rather than as an organic contributor to a natural ecosystem.

Relevant to this thread, Animals are a core component of a natural ecosystem. This includes grazers, insects and predators. Healthy soil is living soil, full of bacteria that literally digest their environment into free nutrients for a crop to draw from. If we aim to fuel human civilization from the earth, there’s no free lunch — an equal amount of nutrients have to be returned to the earth, and animal husbandry (and consumption) are the historical solutions to this problem.

Regenerative agriculture is agriculture that works in harmony with a living soil and its ecosystem. It means consuming more perennials than annuals, growing polycultures (e.g. the three sisters) instead of monocultures, using crop rotation to let soil lay fallow while it’s used to service the needs of animals.

It’s basically the application of permaculture principles to agronomy.

Other people in this thread have fixated on the climate aspect, and while this is certainly one big motivation for regenerative farming, IMO an equally large one is health — we are fundamentally not as healthy today as our grandparents were at the same age (in terms of cancer incidence, fertility issues, chronic inflammation, diabetes, etc.), and the food chain is an obvious place to scrutinize.

In theory, could you synthesize the perfect cocktail of organic molecules to fertilize soil for healthy crops?

Perhaps, but consider this: would it be less expensive and carry fewer negative externalities than maintaining a herd of animals that have literally co-evolved with these crops for millennia? Especially when you account for the ancillary benefits cattle husbandry (seasonal access to dairy, meat and leather as the herd is culled, etc.)?


Wait until you hear about the real BigAg, the article’s companies only produce beef, chicken, or pork. Patented seeds and farm equipment you can’t repair yourself are a couple plant based diet issues. Not to mention chemicals and fertilizers are terrible for ecosystems.




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