Occupied Pantry: the intersection of agribusiness, finance, and regulatory practices.

This post is in response to last Friday’s Mother Jones article “Foodies, Get Thee to Occupy Wall Street” 

Tom Philpott’s article on the consolidation of wealth and political clout in the food/ agribusiness sector has incredibly valuable information in it, but I’d like to make clearer his somewhat buried premise: the banking/finance and food/agribusiness industries have a comparable grip on public policy.  Further, while Mr. Philpott spends time arguing (not without reason) that the agribusiness situation is worse than the banking sector situation, I focus my vision slightly differently: rather fussing about the hierarchy of horror, the parallels between these industries points out that food and finance are two enormous symptoms of the same larger problem.

If we in the Occupy Movement focus solely on the banking industry without attending to how it impacts (and self perpetuates through this impact) public policy, then we will not uncover the mechanisms that allow industry in general to create imbalanced access to and influence over the executive, legislative, and judicial branches.  Looking at agribusiness is one way to keep our vision sufficiently broad.

Some background: How consolidated is agribusiness?

Start with the inputs (seeds, fertilizers, biocides [the combination of herbicides and pesticides]) (I’m using 2007 numbers)

Seeds:  Four companies own half the world’s seeds.

  1. Monsanto (US)  23%
  2. DuPont (US) 15%
  3. Syngenta (Switzerland) 9%
  4. Groupe Limagrain (France) 6%
  5. Land O’ Lakes (US) 4%
  6. KWS AG (Germany)  3%
  7. Bayer Crop Science (Germany) 2%

(total for the 7 largest  = 62% of the market)

Pesticides: 6 companies own 75% of global pesticides

  1. Bayer (Germany) 19%
  2. Syngenta (Switzerland) 19%
  3. BASF (Germany) 11%
  4. Dow AgroSciences (USA) 10%
  5. Monsanto (USA) 9%
  6. DuPont (USA) 6%
  7. Makhteshim Agan (Israel) 5%
  8. Nufarm (Australia) 4%
  9. Sumitomo Chemical (Japan) 3%
  10. Arysta Lifescience (Japan) 3%

(Total for the 10 largest = 83% of the market)

The seriously problematic detail: 3 companies are on both lists: Monsanto, Syngenta, and Dupont.  This is what is behind most of the GMO pushing in the US, because the pairing of X seed that is resistant to Y pesticide is too lucrative for these companies to resist.  Their lobbyists sling whatever propaganda they think will win over the USDA with idea of protecting the profit potentials, at the cost of allowing responsible science to proceed.

And here’s an extra gross / highly revealing input: 80% of the antibiotics sold in the US go to livestock facilities. (Ew!) I’m getting these numbers from the USDA, btw.


Moving on to consolidation in food processing (again, these are 2007 numbers)

4 companies control 90% of the grain trade:

  1. Cargill
  2. Archer Daniels Midland (ADM)
  3. Bunge
  4. Louis Dreyfus

3 of those 4 process 70% of soybeans in the US, and 40% of the wheat milled into flour.

Also, 3 companies “process” 70+% of beef, 4 companies “process” nearly 60% of all pork and chicken.


Here’s a concept that I need to come back to in another post: Vertical Integration.  Basically, the same folks control the game from planting the seed to selling you a TV dinner.


Distribution: After the food is processed into something, it gets distributed to the consumer, but with the some of the same consolidation issues cropping up (2007 numbers):

Walmart  holds 25% of US grocery market and the 4 largest groceries together control almost 40% of the market.  Together, these mega companies push food prices lower not by doing things smarter or cutting bloated executive pay but by taking it out of their employees.

Employee Pay:  Meat processing worker wages in 1976 averaged just under $5/hour, so the 2008 climb to just under $13/hour seems like progress until you adjust for inflation, in which case we now have the equivalent of 1976 workers being paid $3.50/hour.

Employee Safety: think of dangerous jobs and construction and mining might come to mind, but slaughtering animals for meat tops them both by no small margin, with food manufacturing and even crop production also ranking very very high. (Another possibly surprising pocket of worker health and safety problems: janitorial services.  Chemical fumes?  I’ll have to check into this.)

I sit here and scratch my head and think ‘why don’t these companies protect these workers better? Surely it costs them money to have to keep replacing people’, but then I remember the cost of benefits: If your employees don’t qualify for benefits for 60, 90, or 120 days, then every time someone drops off the roles and needs to be replaced, that’s another 2 to 4 months of benefit-free labor for your profit margin. (Economic Research Service, USDA)


And you know the finance sector is going to muddy this water too: The same banks that were speculating on the housing market are now doing it to grain prices, targeting especially those grains that serve the ethanol markets too.  I am quite sure these are the same speculators because you can watch them move over.  The second the housing bubble burst, Bam!  Up went the grain prices, leaving millions of people to go hungry so they could make a quick buck selling grain futures to each other.

ethanol and speculation drive up food prices leaving millions to starve

From: "The Food Crises: A quantitative model of food prices including speculators and ethanol conversion," New England Complex Systems Institute, 2011.

Do the higher food prices at least help farmers?  No. As the food prices rise, so do the prices on the inputs, leaving farmers squeezed in the middle.  (Of course, if we could help them move to organic production with on-farm input sources, then yes, the higher food prices might actually start trickling back to the folks out there digging in the dirt. Ah, yet more posts on my to-do list.)

In short, yes, there is a lot about the Occupy Movement to interest foodies, locavores, and eaters in general, but no, this is not a separate, parallel fight.  It is the same fight.  Comparing the two industries (financial and agricultural) helps us highlight what needs to change in how day to day business and day to day government is conducted.

Related posts:

3 responses to “Occupied Pantry: the intersection of agribusiness, finance, and regulatory practices.

  1. This is really interesting. Any chance you could connect the money to policy? Like who has got a lot of lobbyists kind of stuff.

  2. I enjoy you because of all of your effort on this site. Its been an motivation for me. I’ve passed this onto a friend of mine.

    • Mark & VDB- for some odd reason, I’m just seeing the comments on this page now. I’m so sorry for the delay! Thank you both for your compliments. Mark, I won’t have the ability to trace the exact link this week (grant deadlines Friday… ack!), but the recommendation of a former Monsanto VP (for public policy- aka lobbyist-in-chief) as policy chief at the Food and Drug Administration cannot possibly come as a result of the guy’s stellar scientific insights or ability to weigh information from an impartial observer’s stance. The high rollers in every field are getting sucked to the top, as if a fat wallet were a merit worthy of scholarships. ~Molly

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