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Consolidation Creates Dangerous and Fragile Food Systems, Report Argues
Last week, rural sociologist Dr. Mary Hendrickson presented a new report [[link removed]] – commissioned by the Family Farm Action Alliance – on the dangers of consolidating food production into fewer, corporate hands.
From COVID-19 supply chain disruptions to inflated food prices, Hendrickson and her co-authors argue that our consolidated food system vests too much decision-making power in a few private actors who do not have the public interest at heart.
“Consolidation in our food system is a grave threat to our family farmers and rural communities, and this important new report from Dr. Hendrickson reinforces the urgent need for Congress to take action to address corporate concentration and create a food system that is rooted in fairness and opportunity for all,” said Sen. Cory Booker before [[link removed]] a Nov. 19 press briefing on the report [[link removed]], co-hosted by the Open Markets Institute.
A handful of corporations controls critical nodes along the food supply chain, according to new figures from the report. Farmers, for instance, only have a few choices both for purchasing inputs and for selling their crops and livestock. Worldwide, the same three companies sell 46% of all seeds and 53% of all agrichemicals. Just four firms process 80% of all U.S. soybeans, and the four largest corporations buy and slaughter 54% of all chicken, 67% of all pork, and 73% of all beef in the U.S.
Such corporate consolidation has coincided with farm consolidation, the report finds. For instance, in 1987 half of pork came from farms with 1,200 hogs or fewer. By 2017, half of all pork came from farms with 51,300 hogs or more, and more than 70% [[link removed]] of hog farmers went out of business, as large farms replaced small ones. The share of the market controlled by the top four hog processors nearly doubled during this same time period.
Corporate consolidation also harms consumers, Hendrickson argues. Despite an illusion of choice in American grocery stores, just three corporations sell roughly 80% of all soda, two sell nearly half of all bread, and one dominates 45% of salty snacks. Nearly a quarter of all U.S. groceries sales go to one dominant retailer, Walmart.
Food conglomerates argue that consolidation makes them more efficient and lowers prices for consumers. In reality, the report cites numerous lawsuits alleging that chicken, beef, pork, and tuna corporations conspired to increase food prices. Centralized food production can also become quite costly in a crisis such as the COVID-19 pandemic.
When meatpacking plants failed to protect workers from COVID-19, large plant closures took offline anywhere from 10% to 25% of U.S. meat processing capacity. Farmers could not process their animals in time, and because many could not afford to continue feeding them, hundreds of thousands of animals were euthanized. “We think – on the conservative side – possibly 300,000 hogs or more were euthanized,” Hendrickson said at a press briefing. “That means about 29,000 tons of pork did not make it into people’s mouths. … This, I think, shows the fragility of our food chain.”
The report covers many other harms of consolidated food production, from the excess application of chemicals and herbicide resistant weeds [[link removed]] to declining biodiversity and reduced choices for farmers and consumers. The principal issue, Hendrickson argues, is overwhelming corporate power.
“The social and ecological risks associated with our current agrifood system – rising levels of food insecurity and hunger, ecological degradation – are directly related to who has the power to make decisions in food and agriculture,” the report says. “These decisions have increasingly migrated from a more community or public arena into the realm of private decision-making that largely involves those within the biggest firms.”
These corporate actors prioritize their profits over people or the planet. Their financial might translates into political might to lobby for rules and regulations in their favor, superseding even government power to regulate industry. A revolving door between agency officials and the very industries they’re charged with regulating also favors corporate interests over public ones.
The report calls for redistributing power back to a greater diversity of people and types of businesses. “There is no reason that we have to organize the food and agriculture system on a for-profit-based, efficiency specialization-based system,” Hendrickson said. Hendrickson envisions a mix of large and small, for-profit, nonprofit, and public entities serving different roles in the food system. This includes more community-based actors, such as urban farms, more worker- or farmer-owned businesses, such as cooperatives, and more values-based supply chains, such as fair trade.
While the report does not provide specific policy proposals, it does insist that policymakers have the ability to work with farmers, workers, and communities to build a different system. This includes regulations that “prevent monopolistic tendencies in agrifood systems” and “afford more opportunities for communities to develop self-reliance,” especially marginalized communities long denied power and resources.
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Booker Introduces Justice for Black Farmers Act
At Hendrickson’s report briefing last Thursday, Sen. Booker announced a new bill [[link removed]] to reverse centuries of Black land loss in the U.S. “The Justice for Black Farmers Act … would enact reforms within the USDA to finally end discrimination within that agency … protect the remaining Black farmers from losing their land, and provide land grants to create a new generation of Black farmers,” Booker said. Sens. Elizabeth Warren and Kirsten Gillibrand co-sponsored the bill.
The bill aims to address decades of violence and discrimination that prevented Black farmers from acquiring land and that dispossessed 98% [[link removed]] of Black farmland owners, totaling at least 12 million lost acres over the past century. Texas A&M law professor Thomas Mitchell told Mother Jones [[link removed]] that this transfer of land wealth from Black farmers to predominantly white Americans is “conservatively” worth $300 billion.
Black farmers have also been excluded from federal farm supports due to discrimination by the Department of Agriculture [[link removed]] (USDA). Among many transgressions, the USDA historically denied loans to Black farmers, and disparities in federal lending continue today. As recently as 2015, Black farmers received less than 0.2% [[link removed]] of USDA agricultural microloan money despite claims of progress, according to a 2019 investigation [[link removed]] by The Counter.
The bill would establish an oversight board to reform the USDA’s civil rights office and address discrimination within the agency. It would also devote $8 billion annually to the USDA to buy farmland in order to give 20,000 new and existing Black farmers land grants of up to 160 acres every year for more than nine years. It would also create a program of USDA-funded apprenticeships for youth from socially disadvantaged communities.
What We're Reading
Just in time for Thanksgiving, a group of nonprofit farmer, food worker, and animal welfare organizations urged the Federal Trade Commission to investigate Cargill for “false and misleading claims” that their turkeys come from “independent family farmers” and that the private corporation provides a “safe workplace” for employees and “humane treatment” of animals. ( Family Farm Action Alliance Legal Complaint [[link removed]])
A lawsuit revealed that managers and supervisors at Tyson’s Waterloo, Iowa pork processing placed cash bets on how many plant workers would test positive for COVID-19. Tyson has hired former Attorney General Eric Holder to investigate the claim. ( Iowa Capital Dispatch [[link removed]] / Des Moines Register [[link removed]])
A Government Accountability Office report, requested by Sen. Bernie Sanders, found that many low-income individuals relying on federal food and medical assistance are restaurant and retail workers. Their largest employers are profitable giants, including Walmart, Amazon, McDonald’s, and Dollar General. ( The Washington Post [[link removed]] / Government Accountability Office [[link removed]])
BONUS: Revisit Food & Power’s Thanksgiving reading list [[link removed]] on the food monopolists behind your holiday meal.
About the Open Markets Institute
The Open Markets Institute promotes political, industrial, economic, and environmental resilience. We do so by documenting and clarifying the dangers of extreme consolidation, and by fostering discussions of ways to reestablish America’s political economy on a more stable and fair foundation.
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Written by Claire Kelloway
Edited by Michael Bluhm
Open Markets Institute
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