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Not (entirely) USDA-approved

Even USDA researchers are a bit creeped out by corporate control of food

Posted by Tom Philpott at 8:42 PM on 15 Jun 2007

Read more about: food | agriculture | industrial ag

Food production and retailing have gotten so squarely under the heel of a few corporations that even the USDA is raising an eyebrow.

At the top, the agency teems with PR flacks for the agribusiness giants. But that doesn't mean there aren't competent researchers among the rank and file. One of them, Steven W. Martinez, has issued a useful report (PDF) on consolidation in the food industry.

On page 21, a chart reveals that in 1972, the four largest milk processors controlled 17 percent of the market. By 2002, that figure had risen to 42 percent. And as the market consolidated, the few companies who controlled it quietly shuttered processing plants, concentrating production in ever-larger facilities.

In 1972, there were 2,507 milk processing plants across the U.S. By 2002, only 524 remained. That's an 80 percent drop in 30 years. And that means dairy farmers not only had fewer and fewer buyers for their product, but they also had to pay up to have their milk shipped to ever greater distances as nearby processing plants shut down.

It's no wonder that over that same period in the United States, small-scale, grass-based milk production for nearby markets essentially disappeared -- and that mass-scale, confinement dairy farming, reliant on corn, antibiotics, and hormones, took its place.

The USDA document is quite long, and I haven't had a chance to print it out and take a sharp pencil to it. But a heavy skim produced interesting info.

The document contains a wealth of information on what researchers call "CR4" levels in the food industry. CR4 simply tells us the percentage of a market controlled by its four largest players.

When markets become concentrated, the buyers (i.e., food corporations) get tremendous power to influence the prices they'll pay to the sellers (e.g., farmers). As the prices farmers receive from their goods fall, they face pressure to scale up, mechanize, replace hand labor with poisons and synthetic ferilizers, etc.

According to antitrust theory, a market is considered concentrated when CR4 hits 40 percent. Check out this sampling of CR4 levels in food, also from page 23:

Breweries 91
Malt manufacturing 91
Beet sugar 80
Breakfast cereal 78
Other snack food 75
Distilleries 71
Specialty canning 71

Wow! The four biggest beer-makers control more than 90 percent of the market.

There's also a good discussion of hyperconsolidated meat markets. On page 26, for example, it emerges that nationwide, we lost upwards of 20 percent of both our hog and beef-processing facilities between 1994 and 2004. That loss of processing infrastructure will make it much more difficult for small-scale livestock farmers to satisfy rising demand for pastured, local meat.

This document, emerging not from some greenie non-profit but from the USDA, only underlines the case Aimee Witteman made here a few days ago for a competition title in the 2007 farm bill.

It also demonstrates a point I've made again and again: it's time to reinvest in local food processing infrastructure throughout the United States.

Poll
Should the beer trusts be busted?

Hell yes.
Hell no; Bud rules.
Well, there are already so many microbrews, so, no.

Votes: 97
Results

Great Point

About everyone at the USDA not being of the same mind.  At the end of the day we need to change consumer demand and the business activity will follow.

Deliberately
http://deliberately.typepad.com

You can do something about this

The Congress is in the midst of renewing the policies which shape the farm and food system. These policies are already being written NOW and will be voted on probably by the end of the summer.

You can influence this process.

Go to healthyfarmbill.org

There you can write a letter to your Senators and Representatives to support that increase opportunties for farmers who can't compete in the increasingly centralized markets but can compete in local and regional markets.


You can do something else about this ...

... Why not brew your own beer?  It's actually rather easy, and fresh beer tastes great!

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