Big Ag’s Big 4 – Rural America Threatened by Mergers

By Kayla Sargent

America is experiencing ongoing consolidation and the number of small businesses continues to decline. Agriculture is no exception to the trend, in fact, it is one of the most heavily consolidated industries today.

“Our agriculture and food sector have reached alarming levels of corporate concentration — today a small number of giant companies control every link of our food chain,” U.S. Senator and 2020 presidential hopeful Cory Booker (D-NJ) said.

Over the past thirty years, the top four firms took control of 90 percent of the global grain market; 86 percent of corn processing; 85 percent of beef processing; 79 percent of soybean crushing; 71 percent of pork packing; and 64 percent of grain mills. Three companies control 67 percent of the global commodity crop seed market and those same companies control 70 percent of the chemical and pesticide industry.

As consolidation continues, input costs rise for agricultural producers, and marketing opportunities have decreased.  Since 2013, net farm income has been cut in half and farmers now receive roughly 14 cents from each dollar spent at the grocery store.

“These excessive levels of concentration and market power are devastating our independent family farmers and ranchers and hollowing out the rural communities in which they live,” Booker said.  “Farmers and ranchers are being forced to sell into ever more concentrated marketplaces that unfairly reduce the prices they receive for their crops and livestock, and unfairly increase the cost of inputs.”

That’s why Senator Booker and Senator Jon Tester (D-MT) reintroduced The Food and Agribusiness Merger Moratorium and Antitrust Review Act in the U.S. Senate last week. Representative Mark Pocan (D-WI) introduced companion legislation in the House.

The bill would place “an immediate moratorium on acquisitions and mergers in the food and agriculture sector” that combine over $160 million in sales or assets.  The moratorium would then be in place indefinitely until Congress “passes comprehensive legislation addressing the problem of market concentration in the agricultural sector.”

The bill also establishes a commission to study the impacts of consolidation on suppliers, workers, farmers, rural communities, and consumers.  The commission would then recommend any necessary changes to the current federal antitrust laws to Congress and the President within 12 months following their initial meeting.

This bill has already garnered the support of over 200 farm, food, rural, faith, and consumer advocacy groups.  The group of supporters, including National Farmers Union (NFU), Food & Water Watch, Organization for Competitive Markets, and R-CALF USA, penned a letter to Congress urging support of the bill “to give America’s farmers, workers, consumers, and communities a needed break from the merger-mania that has undermined economic security for so many families.”

“Consolidation is one of the greatest threats to rural America,” Senator Tester said. “Less competition means higher prices and fewer choices for small family farmers as they struggle to make ends meet.  This bill will help put family farmers back in control of their futures by improving access to a competitive marketplace.  Rural America cannot afford to see multi-national corporations put family farms out of business.”


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