Two years ago, dairy giant Dean Foods shuttered a milk-processing facility in Wilkesboro, a town at the eastern edge of North Carolina's Appalachian Mountains.
Photo: iStockphoto
Dean processes 35 percent of the fluid milk in the U.S. and Canada -- roughly equal to the combined market share of its three biggest rivals combined. In my area of western North Carolina, it processes 100 percent of the fluid milk. Since there were no other USDA-approved processing plants around, the few remaining dairy farmers in the mountains faced a stark choice: pay to have their milk hauled an additional 55 miles to Winston-Salem, where Dean ran another plant, or exit the business.
In the tiny mountain town of Bethel, N.C. -- 45 miles west of Wilkesboro -- one such farmer took the second option, closing a 50-cow operation he had started in 1959. When he started his farm, Bethel had around a dozen dairy farms. Today it has none.
When I think of consolidation in the food industry -- fewer and fewer companies controlling more and more production -- I think of that small farm in Bethel.
Squeezed to the Last Drop
In many ways, the farm embodied what we think of as sustainable agriculture: The cows there fed on ample, lush pasture in the temperate months, and hay and corn grown on the farm in winter. The farmer rejected growth hormones, and used antibiotics only on sick animals, not as a prophylactic. And rather than letting manure fester in a lagoon, he spread it back on the pasture, fertilizing the next season's grass and feed crops.
And the farm enjoyed broad support within the community. I was among the ranks of people, probably four or five per day, who would show up at the milk house in the afternoon with empty jugs to buy rich, raw milk -- delicious on its own, but even more wonderful in coffee or transformed into yogurt and cheese.
We did so illicitly. Under North Carolina law, unpasteurized milk can only be sold to consumers as animal feed; that's why I'm withholding the farmer's name. He charged us twice what he got per gallon from the processor, and we would have paid more.
Milking ain't what it used to be.
Photo: iStockphoto
Our support provided a nice income stream, but not enough to pay his bills. As in most localities throughout the U.S., demand for local, delicious, responsibly grown food is growing briskly in western North Carolina. Yet only a limited number of people are willing to drive out of their way, bring their own containers, ignore hysterical warnings against raw milk, and defy the law just to support a local dairy. The path of least resistance leads to the supermarket.
So the farmer still relied on Dean Foods for a steady paycheck. He still needed to have his milk trucked away to a facility run by the nation's largest dairy processor, where it would be mixed indiscriminately with milk from much larger, less pasture-based farms, pasteurized, homogenized, bottled, and sent to supermarkets throughout the Southeast.
To market their milk, farmers, not the processor, pay the trucking costs. When the Wilkesboro facility closed, farmers suddenly had to bankroll a trip more than twice as long as before. Around the same time, gas prices were surging, meaning that the farmer not only had to pay for 55 additional miles, but each mile became more expensive, making the operation no longer profitable.
We had growing demand for local, sustainably produced milk and a farmer willing to supply it, but what could have been a thriving enterprise plunged into an abyss.
The Huge Get Bigger
The conditions faced by the Bethel dairy farmer prevail through most of the United States. Like most of the orange juice it produces, the U.S. food system is highly concentrated. The latest study [PDF] from University of Missouri researchers Mary Hendrickson and William Heffernan -- who track market consolidation among food companies -- provides stark evidence.
By 2005, just four companies (Tyson, Cargill, Swift & Co., and National Beef Packing) were slaughtering 83.5 percent of cows. That number has inched up from 81 percent in 2000. In hogs and chicken, the big are getting bigger even faster. In 2001, the top four companies (Smithfield, Tyson, Swift & Co., and Cargill) killed 59 percent of hogs. By 2005, that number had risen to 64 percent. For chickens, just two companies -- Tyson and Pilgrim's Pride -- kill 47 percent of birds. The top four companies control 58.5 percent of the market, up from 50 percent in 2000.
As these few companies engulf market share, they gain increasing power to dictate terms to growers. In meat processing, the companies wield a second weapon: captive herds. Smithfield, for example, is not only the nation's dominant hog processor. In addition to slaughtering 27 million hogs per year, the behemoth also raises 1.2 million hogs of its own -- more than any other operation by a factor of three. It also controls a huge portion of the hogs it slaughters indirectly, through contracts with large-scale growers.
A captive audience.
Photo: USGS.gov
Pork giants Tyson and Cargill also keep large captive herds, and buy most of the rest of the hogs they slaughter under contract. They use their market might to squeeze prices, giving small, independent growers two options. They can get bigger, in hopes of making up in volume what they're losing in price; or they can shut down. The result has been a nearly wholesale obliteration of small hog farms, and an explosion in the size and geographical concentration of operations.
Iowa, the nation's leading hog-producing state, tells the story. The state's pork producer's association informs us that the total number of hog farms plunged from more than 59,000 in 1978 to around 10,000 in 2002, an 83 percent drop. Over the same time span, the total number of hogs raised per year jumped from 19.9 million to 26.7 million. That means the average number of pigs per farm soared from 250 to more than 1,500. And production, which had been broadly distributed across the state, shifted to just a few counties. North Carolina, the nation's No. 2 hog state, shows similar trends.
Conventional vegetable farmers, too, face tightly consolidated markets. Power to influence vegetable prices rests with a few large middlemen selling to huge buyers like supermarkets and fast-food chains. Just five companies, led by Wal-Mart, control nearly half of U.S. supermarket sales. Because of the regionally fragmented nature of the industry, that number understates the situation. In any given region, three or four supermarket chains typically dominate sales, with Wal-Mart typically taking the No. 2 or No. 3 spot. Nationwide, Wal-Mart rang up nearly $100 billion in grocery sales last year, up 48.6 percent since 2004. That's more sales than its two closest rivals, Kroger and Albertson's, combined.
If you're a farmer with, say, 100 acres of tomatoes in Florida, you take the price the big buyers are offering, or watch your crop wither as buyers look south to Mexico for a willing seller.
The Not-So-Free Market
How did a few corporations gain such dominance over food production and retailing? One response is: people want cheap food, and the market gave it to them. If low cost is the main goal of food production, consolidation makes sense. Big operations gain economies of scale. You can't argue with the results -- the U.S. has the world's cheapest food as a percentage of income.
But that reasoning is naïve. Agricultural markets don't operate freely; they're manipulated as a matter of course. The government subsidizes corn and soybean production, allowing farmers to sell at prices that don't even offset production costs. And taking animals off of pasture and confining them in cages -- the dominant production mode for our meat, dairy, and eggs -- only works if there's a cascade of cheap corn and soybeans to feed them.
Moreover, as feedlot and slaughterhouse interests gained economic might, they also began to wield extraordinary political leverage. Local and state governments have been notoriously lax in forcing feedlot operations to clean up their considerable environmental messes. Authorities have also historically looked away from the industry's brazen violations of labor code. The ability to abuse the environment and labor with near impunity acts as a de facto subsidy, allowing industry giants to keep costs down as they gobble market share.
After 50 years of such trends, merely ending feed-crop subsidies and forcing agribusiness giants to clean up their messes won't rebuild more benign food-production networks. Throughout most of the nation, local-food infrastructure has withered away, and the few remaining small farmers aren't making enough spare cash to make the necessary investments.
Over on Gristmill, I'll look at how we might redress the situation in the 2007 farm bill, currently under debate in Congress.
Will Africa’s farmland become a ‘resource curse’?
Kay Hagan (D-N.C.)
Comments
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raevynn Posted 4:01 am
26 Apr 2007
It takes 4200 gallons of water, PER DAY, to support a person consuming the Standard American Diet (SAD), from production, agricultural wastes, etc. It takes 300 gallons of water per day to support a Vegan. Source: http://www.veganpeace.com/veganism/environment.htm
I'm saving the environment. You can, too!
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Swan400 Posted 8:42 am
26 Apr 2007
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bralessliving Posted 9:06 am
26 Apr 2007
Thanks so much for giving me info so that I can continue to be right. That's like my favorite hobby.
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ronwagn Posted 11:27 am
26 Apr 2007
I heard about Chino California dairymen closing up because they didn't want to clean up their dung. They could have easily built a methane digester, and produced their own electricity.
When I was in California recently, I bought fresh produce from a local stand, including flowers. I also visited an ostrich farm. They charged admission, sold us the food to feed their ostriches, sold ostrich meat, empty eggshells, and even charged a quarter for a chip of a broken egg! As we were leaving, I commented that they didn't charge for parking, yet.
Farmers here in Illinois don't bother with anything except corn and soybeans. Maybe a few hogs or cattle. Nobody bothers to sell pork or beef direct.
Ron Wagner
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meander Posted 3:41 pm
26 Apr 2007
Pigs once viewed positively across Iowa may now be viewed negatively. Pigs in rural Iowa were once called 'mortgage lifters' and pig manure odor was the 'smell of money.' But in 2004, the ISU Rural Life Poll found that when rural Iowa residents were asked their preferences about rural development activity, hog confinements ranked below prisons, solid waste landfills, slaughter plants, and sewage treatment plants as desirable rural development.
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Delay And Deny Posted 1:43 am
27 Apr 2007
I'm always chagrined when people talk about the "large corporations" owning things.
But, most corporations have a few people who tightly hold big portions of those assets -- the Top 3% who own 84% of everything.
So, for a story like this, it's not about Wal*mart or conglomerates.
You have to ask the question why people have to work their whole life to buy a $400,000 house on a plot of land that couldn't grow enough food for a ocelot.
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sasquatch Posted 3:35 am
27 Apr 2007
There is ample information available (at least in the US) regarding the policies and internal processes of companies like Tyson, etc. and if people bothered to look, they would most likely make different choices.
But the truth is unpleasant, and causes one to feel bad for the animals and bad for themselves. So instead of adjusting behavior they look away and turn up the ipod. This is not just a corporation problem - its a society-wide issue where consumers do not have to bear the full consequences of their actions (whether its CO2, water use, etc.)
Imagine if we paid the full price of food, water, electricity or transportation, when all of the ecological services were incorporated into the costs of these items.
any ideas on how to do that?
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blueberrysushi Posted 4:15 am
27 Apr 2007
Ginger was a breathing thing, and she used to let me hold her, and when she got hurt, she stopped running around and clawing at the ground and so it was her time.
Just a story.
When consolidation is discussed, it is such a large and intangible problem. Many people seem to discuss it as a given, a fact of the market. But in little ways, as we all know, we can separate ourselves from that market and stop being zombies. We can decide to value things that drive economists mad: the intangibles, the externalities. That is when local markets will work, when the market is no longer an excuse, but an efficient vehicle that actually provides the goods that allow us real options. Unfortunately, that means that some distortions (subsidies for grain and oil) may have to be replaced with other distortions (environmental regulations, land use laws).
Ramble ramble.
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Ron Steenblik Posted 3:54 pm
27 Apr 2007
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Karen Lee Orr Posted 12:41 am
28 Apr 2007
In the November 2006 Muskegon Chronicle article "New ethanol plants spark concerns of factory farms," Michigan Sierra Club legislative director Gayle Miller states that building corn-based ethanol plants in Michigan could trigger a boom in CAFOs and increase water pollution.
Ethanol plants attract dairy CAFOs because a byproduct of distilling corn can be used as a feed supplement for cattle.
Michigan already has about 200 dairy, pig and poultry CAFOs that collectively generate more than 4 billion pounds of liquid manure annually, nearly all of which is spread untreated on farm fields, according to government data.
Four ethanol plants have broken ground in Michigan since 2003, quadrupling the state's production of corn-based fuel, according to state officials. The state also has joined with General Motors, Meijer, and CleanFUEL USA to make ethanol available at more gas stations.
In a July press release, Gov. Jennifer Granholm called the construction of more ethanol refineries and availability of the alternative fuel at more gas stations "important steps to fulfilling Michigan's next great destiny -- making our state and our nation independent of foreign oil."
Gayle Miller said the number of dairy CAFOs increased in Iowa after corn-based ethanol plants sprouted there.
Michigan's largest farm group, the Michigan Farm Bureau, actively promotes CAFOs. Farm Bureau officials claim CAFOs help farmers remain profitable by producing more food products at lower cost; the group also claims CAFOs cause less harm to the environment than smaller farms, according to the article.
All Michigan farms are exempt from the state's air pollution control law, even though huge manure storage lagoons at CAFOs emit ammonia, methane and potentially deadly hydrogen sulfide gas.
The Muskegon Chronicle article is no longer online but these issues are also raised by K. Myers of Wheatfield, Indiana.
Shortly after the Myers family moved next to a wildlife reserve the picture changed with the discovery that a large hog CAFO was moving adjacent to the reserve and less than 2500 feet from their home.
Myers writes about this in her blog post "The Ethanol CAFO Connection:"
http://wahmdiary.blogspot.com/2006/11/ethanol-cafo-connec ...
I stumbled upon that article on the excellent Energy Justice Network website: http://www.energyjustice.net
Y'all might have read the AP report on Tyson, ConocoPhillips teaming up on diesel fuel made from animal fat
The Tyson-Conoco CAFOdiesel project will produce "the next generation of renewable diesel fuel."
"A new biofuel project will mean what's for dinner may also be what goes in the fuel tank with ConocoPhillips and Tyson Foods joining forces to make diesel fuel from animal byproducts
The alliance plans to use beef, pork and poultry by-product fat to create a transportation fuel.
"This fuel will contribute to America's energy security and help to address climate change concerns," the Tyson-Conoco statement said.
http://www.azcentral.com/arizonarepublic/business/article ...
Karen Orr
Gainesville, Florida
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margarita Posted 12:43 am
01 May 2007
Funny that kids aren't taught about agriculture in school--aside from those kids in more rural areas. Divorced as our culture is from the land, perhaps putting these ideas back into the curricula would go a long way towards ensuring that future populations don't make the same mistakes.
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pat pbg fl Posted 9:30 am
01 May 2007
His prediction seems to have borne fruit (pun) and had some meat to it (pun). Can't think of how to pun a veggie. Being 74 now, I don't worry about it too much. And, it would appear that there's not a whole lot of people that do, so far (present company excluded).
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blubird Posted 6:30 am
02 May 2007
"Eating puts us in touch with all that we share with other animals [and plants], and all that sets us apart. It's what defines us."
"To eat with a fuller consciousness of all that is at stake might sound like a burden, but in practice few things in life can afford quite as much satisfaction."
and finally,
"Eating industrial meat [and other industrial produce/products] takes an almost heroic act of not knowing, or, [eventually] forgetting."
- Quotes taken from Michael Pollan in his book, The Omnivore's Dilema, A Natural History of Four Meal (2006)
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amie022 Posted 5:31 am
04 May 2007
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Karen Lee Orr Posted 9:54 pm
06 May 2007
The Treehugger link will take you to the Jeff Tietz article:
http://www.treehugger.com/files/2006/12/boss_hog_rollin_1 ...
"America's top pork producer churns out a sea of waste that has destroyed rivers, killed millions of fish and generated one of the largest fines in EPA history" It is a dire and frightening tale. The first paragraph has perhaps the year's longest run-on sentence, designed to convey the scale of the industry and the analogy to human beings is stunningly effective.
"Smithfield Foods, the largest and most profitable pork processor in the world, killed 27 million hogs last year. That's a number worth considering. A slaughter-weight hog is fifty percent heavier than a person. The logistical challenge of processing that many pigs each year is roughly equivalent to butchering and boxing the entire human populations of New York, Los Angeles, Chicago, Houston, Philadelphia, Phoenix, San Antonio, San Diego, Dallas, San Jose, Detroit, Indianapolis, Jacksonville, San Francisco, Columbus, Austin, Memphis, Baltimore, Fort Worth, Charlotte, El Paso, Milwaukee, Seattle, Boston, Denver, Louisville, Washington, D.C., Nashville, Las Vegas, Portland, Oklahoma City and Tucson."
The article continues in that style, hitting you with statistics and similes. "A lot of pig shit is one thing; a lot of highly toxic pig shit is another. The excrement of Smithfield hogs is hardly even pig shit: On a continuum of pollutants, it is probably closer to radioactive waste than to organic manure. " and 26 million tons of it are discharged each year. Into holding ponds, sprayed on fields, leaking into rivers.
The article is primarily about shit. It briefly touches on animal welfare- "Smithfield's pigs live by the hundreds or thousands in warehouse-like barns, in rows of wall-to-wall pens. Sows are artificially inseminated and fed and delivered of their piglets in cages so small they cannot turn around. Forty fully grown 250-pound male hogs often occupy a pen the size of a tiny apartment. They trample each other to death. There is no sunlight, straw, fresh air or earth." Which doesn't get much of a response from Smithfield Chairman Joseph Luter : "The animal-rights people," he once said, "want to impose a vegetarian's society on the U.S. Most vegetarians I know are neurotic."
It then goes back to looking at what is in pigshit, how it is dealt with, where it goes and how it gets into the environment.
People become vegetarians for various reasons; personal health and concern for animal welfare are big ones. It is likely that environmental concerns are becoming a major cause. The carbon footprint of a hamburger and the water footprint of a pound of meat. Learning about the shit footprint of a pound of pork has put me over the edge. I know what my New Year's resolution is: no more factory farmed meat.
Full Treehugger review and link to "Boss Hog:"
http://www.treehugger.com/files/2006/12/boss_hog_rollin_1 ...
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Karen Lee Orr Posted 3:10 am
07 May 2007
We in the United States are a big part or the problem. Americans consume almost a quarter of all the beef produced in the world.
A growing awareness of the hidden environmental and health costs of beef consumption is leading more Americans adopt a plant based diet.
Beyond Beef prepared a briefing kit about rainforest destruction, resource depletion, global warming, world hunger, human disease, animal suffering and other compelling reasons why more Americans are eating less beef.
Here's the Beyond Beef report:
http://www.mcspotlight.org/media/reports/beyond.html
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