No filters here. Just bad images.
Cargill reached an agreement with the U.S. Department of Agriculture to settle claims the meat giant violated competition law and underpaid cattle sellers by $12.5 million due to faulty beef grading cameras.
The USDA found that Cargill Meat Solutions Corporation of Wichita, Kan., had inaccurately graded more than 300,000 carcasses on a grade and weight basis from various sellers for about seven months, resulting in an underpayment.
The inaccuracies were largely due to video equipment that was installed incorrectly at four processing plants.
Under a recent consent decision, Cargill must “cease and desist” from failing to meet applicable camera grading installation standards established by the National Institute of Standards and Technology at its cattle processing plants. The company was also ordered to stop compensating sellers based on inaccurate grading techniques.
Ultimately, 324,824 carcasses went through faulty processing at four fed cattle plants from August 2021 to March 2022, according to the USDA. Cargill notified the agency of its flawed cameras shortly after the investigation began in March 2022.
Cargill compensated all sellers for any underpayment in May 2022 using corrected yield grades. In addition to the cease and desist orders, the USDA issued a civil penalty of $155,000 to Cargill for the incident.
The USDA fined Cargill under the Packers and Stockyards Act, which was designed to promote fair competition and trade practices, as well as protect farmers, ranchers and consumers from unfair, deceptive, discriminatory or monopolistic practices.
Violations can result in a range of actions and penalties, including business suspensions, injunctions or even jail time. The USDA has been working to strengthen enforcement of the act as the Biden administration looks to crack down on corporate concentration.
