Does it matter if a few powerful companies control meat?
"It may be our last opportunity to fix this."
America’s food supply is like a non-stop variety show for meat eaters. Hillshire Farm deli meats! Jimmy Dean smoked bacon and sausages! Ball Park hot dogs! McDonald’s chicken nuggets!
But, wait...all of those products actually come from the same company, Tyson Foods.
And while you might not care that much if the same meatpacker sells you sliced ham and chicken breasts dressed up in different packaging, a recent report from the Union of Concerned Scientists documented how Tyson’s control of the chicken industry in one state alone—Arkansas—hurts farmers, rural communities, and workers.
The report provides a local snapshot of a national (and really global) phenomenon—a few giant companies now control meat production in the US. According to US Department of Agriculture (USDA) data, four companies control 82 percent of the market in beef, 66 percent in pork, and 54 percent in chicken (and economists point to anything over 40 percent as problematic). Those numbers also underestimate how consolidated everything is, because some of the companies are the same across meat sectors—JBS and Tyson dominate the market in all three industries. And in chicken and pork, most of the companies are vertically integrated, meaning they don’t only control processing, they own other components of the supply chain, like the chicks and feed companies. Recently, these same companies have also been buying up plant- and cell-based meat brands.
For decades, companies have been concentrating their production and power without a hitch. Now, there’s suddenly a lot of attention on what it means for farmers, workers, communities, and the resilience of our food supply as the climate changes, especially in Washington, DC. In June, the Senate Agriculture Committee held a hearing on fairness in cattle markets. In July, the Biden administration said it was taking several steps to tackle consolidation in meatpacking, including investing in regional processors that could boost competition. The administration followed that up with a briefing on how concentration in meat processing is connected to lower prices paid to farmers and higher prices at the supermarket and detailed other actions the USDA is taking to address it, including increasing transparency in cattle markets and cracking down on illegal price fixing. (Multiple lawsuits in the past few years accuse the biggest poultry companies of colluding to fix prices.)
Meanwhile, lawmakers in Congress have introduced multiple bills that address different aspects of the issue, and the National Farmers Union kicked off a policy campaign around monopolies in agriculture called “Fairness for Farmers” last week.
The Family Farm Action Alliance commissioned its own report on concentration throughout the entire food system in 2020, so I talked to its president, Joe Maxwell, to get his take on what this emerging conversation and policy push means. (The interview has been edited for length and clarity.)
The level of attention to consolidation in meatpacking feels unprecedented to me. Is it? I think that’s absolutely true. While myself and other team members have been doing this kind of work for a very long time, I think what has happened is that… the COVID-19 pandemic brought a greater awareness of how the current system failed us and could fail us again. Also, folks like myself and others on my team, we reached out to presidential candidates...and began to educate their campaigns, and they began to have this conversation, and I think that was impactful. Senator Booker, Senator Warren, Senator Sanders, are all about corporate power. I'll miss somebody, but there were a large number of them that began to understand that this was a real issue and that it was resonating with the voters, and I think that helped lift the voices. But the pandemic would be the one thing that we would suggest [provided] hard evidence that what we had been advocating for and educating about was real.
A lot of the attention is directed towards beef, which does have the highest concentration at the top. But the chicken and pork industries are more vertically integrated. Do you think one is a bigger issue than another? I do think that beef is pretty prominent now, especially...because it's the last holdout where a meat sector has not fully vertically integrated, and there are still a lot of independent producers who right now are being squeezed and are yelling about it.
It may be our last opportunity to fix this.
It began with chicken, and we know the harms, and I would not want to take away from the pain and suffering of a contract poultry grower in answering this question. “Chickenization” is a term we use for vertical integration, because we saw it first in the chicken industry. And now those farmers, 71 percent of the contract poultry growers live at or below the federal poverty level. [It] demonstrates that where any vertically integrated food production model winds up is extracting all of the wealth and opportunity it can out of that food system. There's plenty of economic data that clearly shows vertical integration is not about efficiency, it's about control. And what we see in the beef sector is kind of the final holdout of independent family agriculture, right? But the big packers in that area, they're really the same. JBS is a big meatpacker in beef and poultry and pork. So, they’re the same actors, and then they shove [the model] into the next sector.
Right, and we’ve been talking about market consolidation, where meatpackers control processing at the topic. But there’s also consolidation at the farm level, in terms of the physical concentration of animals. There are fewer and fewer farms and the ones that are left are getting bigger. Can you talk about the relationship between those two trends? Yes, they are absolutely linked. The Farm System Reform Act, introduced by Senator Cory Booker and Congressman Ro Khanna captures that very link. You'll see the Packers & Stockyards Act, Country of Origin Labeling… and people say, “Well, why is that moratorium on large CAFOs [concentrated animal feeding operations] in there?” [The bill] recognizes that these big CAFOs are nothing but a tool to have further control of the markets, to be able to do business with one and make a special deal with that one supplier. Maybe that's a huge dairy CAFO, maybe that's a huge feedlot. Whether it’s big hog CAFOs or chicken or eggs, in every industry there is a direct link between the industrialization of the production of poultry and livestock and the industrialization and vertical integration of the marketplace. It's a way to control: drive out the smaller producers, house more animals in one space under one management control. And then of course, we know the abuses. We know farmers get into these contracts and can't get out...and of course then it impacts our environment.
Let me ask you a question on price. I think there’s a common understanding that this industrialization of animal agriculture should increase efficiency and bring costs down. So, given economies of scale, you might assume that bigger farms with more animals and more concentration would lead to lower prices because it's very efficient. But I know that in recent reports there's some information on how concentrated markets can lead to higher prices. How might that happen? We released a paper about the truth of industrial agriculture and how it's propped up by externalizing its costs and the myths that it uses to keep its power. This is one of the big myths: it's more affordable, we're gonna feed the hungry children.
And there is no longer any relationship economically between the price the consumer pays in the grocery store and the price farmers are being paid. The price farmers are being paid goes down, and the price consumers pay goes up, and what has happened over the last couple of years is every quarter it’s record profits for the biggest food processors in the world. They extract all they can off the farmers’ backs and their investments, they extract off of the workers in the plants, and then they gouge the consumer, claiming something big happened and we have no choice but to raise prices. They tell the farmer, “Well, we had to lower the price because something happened,” and they just put all that money, those excessive profits in their coffers.
The evidence is there. We correlate the price of commodities versus the price consumers pay, and it becomes a fixed price. Once it goes up, they don't bring it back down for the consumers. And it's artificially inflated because there's no competition. Further evidence of this is...the Department of Justice fines and the class action lawsuits that have been settled [over price fixing]. They're lying when they tell you they're more affordable and they’ve got efficiency and you're gonna pay less. They're just flat out lying. We were a little kinder in the report, we called it a myth.
Okay, so there are many solutions being proposed. What do you think needs to happen to create meaningful change? First, within the agrifood system, there needs to be a moratorium on large acquisitions and mergers immediately. You have to stop the bloodletting. Next, we have to strengthen and renew the original intent of the Packers and Stockyards Act. The Biden administration has opened that door in their executive order, and Secretary Vilsack has said he will open up a new rulemaking process. The number one priority...is to restore the right of a individual farmer or rancher to bring legal action against the packer for the abuse that operator has experienced without having to show harm to the entire market. Individual farmers and ranchers have to have the right to bring their own case, as well as we have to protect those poultry contract growers...and we’ve got to end the tournament system.
Then we need full transparency and market reporting. And we've got to look back on acquisitions and mergers and determine...if they delivered what they committed to in order for the courts to allow for the merger to go forward. It needs to be assured that they did what they said they would do...and if not, the deal needs to be unwound. But it's not enough to look back and tear apart. We're in such a state that the infrastructure has been disrupted to such a degree because of concentration that we have to invest in competition and building that infrastructure, whether that's meatpacking plants or vegetable processing or distribution. We have to have that investment to help build competition. That is our top line agenda that we are recommending.
Wrapped up, to go
*A few giant companies now control meat production in the US.
*The Biden administration, Congress, and many advocacy groups are all talking about ways to shift the balance of power towards farmers and consumers.
*Consolidation within markets at the top is linked to consolidation at the farm level, and concentrating animals onto larger, fewer farms can impact the environment, animals, and rural communities.
It’s about bringing home the bacon. For Civil Eats, I looked into how the pork industry and its allies are using the language of food equity to push for a delay in animal welfare regulations that would require the industry to eliminate crates used to house pregnant pigs.
Trading places. Last week, I was on the other side of interviewing not once, but twice. Tom Colicchio invited me on his podcast, Citizen Chef, to talk about the real, hidden costs of food. And Harry Rosenblum had me on his Heritage Radio podcast, Feast Yr Ears, to talk about what drives me, my career path, and some of my current reporting.
Money, money everywhere, and not a thing to eat. Joe Fassler’s deep dive into the world of lab-grown meat, published by The Counter, is a must read. He did so much reporting on what these companies are actually capable of, and given how much money they’ve raised, the truth is pretty unbelievable. Let’s just say: If you were really excited to start chewing on cellular chicken soon, I’m sorry. Now imagine what those billions of dollars could have accomplished if we had invested them in practical food system solutions we already know work really fucking well.
Seylou is a truly magical place, and if you’re in Washington DC at any point, please do yourself a favor and go there. I finally got to try their pizzas, made with organic, whole grain flour all sourced from Mid-Atlantic farms, and they were phenomenal. All of the bread is incredible, but I especially loved a special “whole squash” loaf baked with an entire roasted butternut (skins and all).
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