DOJ Move to Block Big Sugar Merger Shows How to Use Anti-Monopoly Law to Attack Supply Chain Chokepoints and Dangerous Inflation

 

Garland and Kanter cite need to prevent further consolidation as major factor in merger decision

WASHINGTON— This morning the Antitrust Division of the Justice Department moved to block United States Sugar Corporation’s attempt to buy its direct competitor Imperial Sugar.

From the DOJ’s release:
U.S. Sugar and Imperial Sugar are already multibillion-dollar corporations and are seeking to further consolidate an already cozy sugar industry. Their merger would eliminate aggressive competition in the supply of refined sugar that leads to lower prices, better quality, and more reliable service,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “This deal substantially lessens competition at a time when global supply chain challenges already threaten steady access to important commodities and goods. The department’s lawsuit seeks to preserve the important competition between U.S. Sugar and Imperial Sugar and protect the resiliency of American domestic sugar supply.”

In response, The Open Markets Institute’s Executive Director Barry Lynn released the following statement:

“Today the Justice Department proved it understands the core problem in America’s wide-ranging and highly-dangerous supply chain crisis and the recent surge in inflation – which is the concentration of monopoly power and control over key industrial chokepoints. In blocking the combination of two giant sugar refiners, the DOJ made clear it was taking into account the deal’s potential to worsen ’global supply chain’ disruptions and the public’s interest in ensuring the 'resiliency’ of the supply of this vital product.

“Today’s action is just the beginning. It helps establish a blueprint for using anti-monopoly law and policy to break many of the other chokepoints that threaten the security and the prosperity of the American people. These same arguments can now be used to begin to address the dangerous concentrations of power and control over semiconductors, chemicals, pharmaceuticals and other essential goods and services of our modern society.

“And let’s be clear – today’s move will also deliver lower prices. For four decades, U.S. competition policy has been based on the Orwellian idea that monopolists deliver lower prices. That outrageous lie has resulted in the concentration of vast wealth and power in the hands of the few. Today’s action returns simple common sense to anti-monopoly law and policy.”

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