Food & Beverage

Chicken suppliers fall amid allegations of collusion

Key Points
  • US Foods and Sysco have launched lawsuits against major U.S. poultry suppliers, alleging collusion to manipulate supply and prices for their products.
  • The two companies are the largest food suppliers to U.S. restaurants in the country.
  • A Tyson spokesman told CNBC that the claims are "unfounded."
Sysco and US Foods accuse poultry companies of collusion
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Sysco and US Foods accuse poultry companies of collusion

Food suppliers US Foods and Sysco have initiated separate lawsuits accusing numerous large poultry suppliers of colluding to manipulate wholesale chicken prices, The Wall Street Journal reported Wednesday.

The two companies, which are the largest food suppliers to U.S. restaurants in the country, alleged that the poultry processors, including Tyson Foods, Pilgrim's Pride and Sanderson Farms, have artificially limited supplies and inflated prices for years, according to the report.

At the lows, shares of Tyson Foods fell as much as 5 percent on Wednesday. Pilgrim's Pride traded as low as 6 percent, while Sanderson Farms declined as much as 4 percent. Those stocks were last seen edging off their lows.

"Complaints like these are common in antitrust litigation," a Tyson Foods spokesman told CNBC. "Such complaints do not change our position that the claims are unfounded. We will continue to vigorously defend our company."

US Foods, Sysco, Pilgrim's Pride and Sanderson Farms did not immediately respond to CNBC's requests for comment.

This is breaking news. Please check back for updates.

Read the full report from The Wall Street Journal.