Simultaneously, disruptions in food supply chains forced farmers to dump milk down the drain, leave produce rotting in fields, and euthanize livestock that could not be processed at slaughterhouses. We estimate that between March and May of 2020, farmers disposed of somewhere between 300,000 and 800,000 hogs and 2 million chickens–more than 30,000 tons of meat.
What role does concentration play in this situation? Research shows that retail concentration correlates with higher prices for consumers. It also shows that when food systems have fewer production and processing sites, disruptions can have major impacts on supply.
Consolidation makes it easier for any industry to maintain high prices. With few players, companies simply match each other’s price increases rather than competing with them. Concentration in the U.S. food system has raised the costs of everything from breakfast cereal and coffee to beer.
The combined share of sales for the top four firms (CR4) for selected U.S. commodities, food processing/manufacturing and distribution/retail channels. (Image credit: Family Farm Action Alliance)
As the pandemic roiled the nation’s food system through 2020, consumer food costs rose by 3.4 percent, compared to 0.4 percent in 2018 and 0.9 percent in 2019. We expect retail prices to remain high because they are “sticky,” with a tendency to increase rapidly but to decline more slowly and only partially.
We also believe there could be further supply disruptions. A few months into the pandemic, meat shelves in some U.S. stores sat empty, while some of the nation’s largest processors were exporting record amounts of meat to China. U.S. Senators Elizabeth Warren (D-MA) and Cory Booker (D-NJ) cited this imbalance as evidence of the need to crack down on what they called “monopolistic practices” by Tyson Foods, Cargill, JBS, and Smithfield, which dominate the U.S. meatpacking industry.
Tyson Foods responded that a large portion of its exports were “cuts of meat or portions of the animal that are not desired by” Americans. Store shelves are no longer empty for most cuts of meat, but processing plants remain overbooked, with many scheduling well into 2021.
Toward a More Equitable Food System
In our view, a resilient food system that feeds everyone can be achieved only through a more equitable distribution of power. This in turn will require action in areas ranging from contract law and antitrust policy to workers’ rights and economic development. Farmers, workers, elected officials, and communities will have to work together to fashion alternatives and change policies.
The goal should be to produce more locally sourced food with shorter and less-centralized supply chains. Detroit offers an example. Over the past 50 years, food producers there have established more than 1,900 urban farms and gardens. A planned community-owned food co-op will serve the city’s North End, whose residents are predominantly low- and moderate-income and African American.
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February 17, 2021 at 04:01PM
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Op-ed: Monopolies In the Food System Make Food More Expensive and Less Accessible - Civil Eats
"expensive" - Google News
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