The greatest woes of our food industry can be traced to lax enforcement of antitrust policy and unchecked corporate influence.But by the 1970s, antitrust regulation had become unpopular with wealthy corporate executives, many of whom were politically connected and donated to the campaigns of anti-regulation candidates. The Reagan administration directed federal agencies to decrease enforcement of antitrust regulations and to raise the burden of proof on the potential harms caused by concentration. Concentration became a problem only when the consumer was directly and obviously harmed—stakes that Howard calls a “dramatic change from the intent of [antitrust] legislation” from earlier decades. As a result, mergers and acquisitions that would have been unthinkable in prior decades became commonplace. This trend of deregulation and low antitrust enforcement was as true in the food sector as in many others. Companies became larger and their control over supply chains more comprehensive. Today, we see the pork, beef, and chicken industries each dominated by four companies, the milk industry controlled by two, and the beer industry barreling toward just one monolithic parent. Those companies at the top of the industry wield outsize political power and influence, can dictate unfair terms to producers, and create a less resilient supply chain. Howard takes a wide-lens approach to looking at the effects of food system consolidation. He considers a chicken industry that is built on abusive and secretive contracts with farmers who have little say in how their birds are raised. He highlights how the top four grain companies—ADM, Bunge, Cargill, and Louis Dreyfus—are estimated to control up to 90 percent of the global grain trade. He discusses how the market share of just one milk company, Dean Foods, reaches 70 percent in most cities. And he examines the growing role and importance of venture capital in consolidating the power of individual corporations. Howard also extracts a few lesser-told stories from the annals of food industry concentration. One is in the relative niche of organic food distribution. The largest player in this sector is United Natural Foods, or UNFI, a Providence, Rhode Island–based company that is a primary supplier for Whole Foods and Safeway. In 2002, UNFI and its then competitor Tree of Life (which was bought by KeHE, another distributor, in 2010) controlled about 80 percent of organic food distribution. UNFI’s original competitors, many of whom were cooperatively owned, couldn’t keep up with its aggressive expansion, which was partially funded by Wall Street investors. Between 1982 and 2002, the number of cooperative distributors dropped from twenty-eight to three. Today, many natural and organic food retailers are sourced exclusively by UNFI. While not the most powerful entity in the food industry, UNFI has an “overwhelming dominance” in its supply chain. This power allows it to “make or break” organic food manufacturers, and creates higher barriers to entry to newcomers in the industry. Another lesser-known issue that Howard discusses is concentration in livestock genetics. The livestock genetics industry is fairly small, at about $4 billion a year in global annual sales, one-tenth the size of the pesticide industry. But it is also highly consolidated, which has resulted in a dramatic reduction in animal diversity. Most commercial chickens are one of just four breeds, and just two or three firms control 94 percent of sales. For turkeys, just one breed comprises 100 percent of the global supply. Most pork in the U.S. is Duroc, Hampshire, or Yorkshire, and more than 85 percent of milking cows are Holsteins. Livestock animals are increasingly bred for profitable characteristics, such as a chicken’s breast size or a cow’s milk production, rather than for traits such as resistance to disease. And demand for consistent products has encouraged producers to standardize their flocks. The resulting homogeneity makes livestock animal populations more vulnerable to disease outbreaks such as avian flu. And growing consolidation in genetics firms makes it hard for smaller companies to enter into the industry. In his concluding chapter, Howard does nod to some positive trends combatting monopolization in the food industry. For instance, craft beer has grown to comprise 14 percent of beer sales by revenue, and the two giants in the industry-Anheuser-Busch InBev and SABMiller—have taken on relatively little market share in recent years. This lack of growth has prompted ABI to seek an acquisition of SABMiller. The deal got a green light from Justice Department regulators and awaits shareholder approval. Though Howard is a professor and Concentration and Power in the Food System contains many academic citations, the book avoids slipping into jargon. It’s accessible to any reader interested in learning how political economy can help us understand who really does control what we eat. And as the food industry continues to consolidate, Howard’s work will become increasingly vital to imagining an economy with open, competitive markets for farmers and eaters alike.
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