The Food System: Concentration and Its Impacts

A special report to the Family Farm Action Alliance, November 19, 2020.

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Report Highlights

Consolidation is happening across all sectors in the food system, at the national and global levels, and has resulted in a particular set of power relationships. This has resulted in numerous negative impacts on farmers, workers and their communities as well as consumers, who have experienced higher prices and less innovation.

These power relationships impact our food system democracy and are particularly concerning for marginalized voices and communities.

Crop acreage is consolidating in larger farms, while the sales midpoint for livestock has starkly increased between 1987-2017. For hogs, the midpoint of sales has increased from 1,200 to 51,300 and in dairy, the herd size has gone from 80 to 1,300 cows.

New processes of integration are occurring. In U.S. pork production, large pork producers own processors and grain elevators, while supermarket behemoths Walmart and Costco are using backward integration in dairy, beef and chicken. Kroger continues its strategy of backward integration in dairy and is supplying competing retailers. In addition, asset management firms are increasing their investments in food and agriculture, potentially reducing competition via common ownership of most of the leading firms in a number of industries.

In a consolidated system, farmers, workers and the environment are interconnected, meaning that when problems hit one part, they quickly engulf others. For meatpacking, the coronavirus hit workers, and the human tragedy of over 40,000 workers with COVID-19 (189 deaths) quickly became a farm and environmental disaster. Besides the financial hit for farmers who may have euthanized between300,000 to 800,000 hogs and 2 million chickens, the waste of the embodied resources (28,500 tons of pork, .02% of the 2018-2019 corn crop) is stunning. The inability to control the drift of the herbicide dicamba has divided communities, damaged livelihoods and ecologies, and illuminated the inability of agencies to regulate dominant firms.

Agrifood consolidation reduces farmer autonomy and redistributes costs and benefits across the food chain, squeezing farmer incomes. In 2018, farmers whose primary occupation was farming but with sales of less than $350,000 had a median net income of -$1,524. An agriculture system without people has depopulated rural communities causing a collapse in social relationships. Communities of color bear a disproportionate burden of exposure to excessive pesticide use or large animal confinement operations.

Consolidation obscures ownership to the point that farmers and consumers frequently have far fewer options in the market than it appears. For instance, Anheuser-Busch InBev (Belgium) has acquired 17 formerly independent craft breweries since 2011, although these ties are not indicated on the product labels. Seed companies label the same seeds under multiple brands while products from a single processing plant may be sold under as many as 40 different brands.

Because political democracy rests on economic democracy and vice versa, our laser focus in scholarship, praxis and policy must be on democratizing the agrifood system at local, state, regional and national scales. Working together, policy-makers, farmers, workers and communities need to fashion alternatives and policies that can help to curb monopolistic tendencies in the agrifood system, to shine a racial lens in scholarship on agrifood system power and consolidation, to prioritize resilience and redundancy, to rethink core assumptions such as efficiency and property rights, and to encourage the development of alternative production and consumption arrangements.

Illustration of different points of consolidation and control in the agrifood system. There are officially close to two million farms in the U.S., but less than half of them consider farming their primary occupations. Still, these million farmers must buy seeds, fertilizers and chemicals from the same few firms as many farmers around the world do, while selling to just a few food processors and traders who operate in the U.S. and globally, who then move food further down the supply chain until it eventually winds up at retailers where a majority of us purchase our food.

For more see: Hendrickson, Mary M., Philip H. Howard, Emily M. Miller and Douglas H. Constance. 2020. The Food System: Concentration and Its Impacts. A Special Report to the Family Farm Action Alliance.

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