Thursday, February 11, 2010

How Three Firms Came To Rule The World


"One often hears the statement that agriculture is changing and we must adapt to the changes", says William Heffernan, a professor of rural sociology at the University of Missouri. "Few persons who repeat the statement really understand the magnitude of the changes and the implications of them for agriculture and for the long-term sustainability of the food system. It is almost heresy to ask if these changes are what the people of our country really want or, if they are not what is desired, how we might redirect the change. These changes are the result of notoriously short-sighted market forces and not the result of public dialogue, the foundation of a democracy. Neither are the changes the result of some mystical figure or an 'invisible hand'."

Earlier this year the Farmers' Union hired Heffernan to undertake a study on consolidation in agricultural trade. Heffernan concluded that once you disentangle a web of subsidiaries, mergers, joint ventures, parternships, side agreements, marketing arrangements and alliances you find that "three food chains dominate the global food production system". These chains are: Cargill/Monsanto; ConAgra and Novartis/ADM. Even so, Heffernan notes that because of lax reporting requirements it's difficult to get a fix on precisely what these companies own and how they go about doing business. "Cargill has operations in 70 countries and it's a privately held firm. How do we get all of the necessary information? We've exposed the tip of the iceberg, but exposure only indicates the type of information needed to understand the global food system."

Heffernan points to the Cargill/Monsanto cluster as one of the most dangerous of the new alliances. In 1998 Monsanto and Cargill announced that Cargill had sold its vast seed operation to Monsanto (the world's leading biotech outfit) and entered into an agreement with the chemical company to develop new kinds of crop biotechnology. This alliance presents distinct benefits to both companies but dangers to consumers, farmers and the environment. A case in point is the alliances' so-called terminator gene. "No longer will Monsanto have to depend on access to farmers' fields for collection of tissue samples to make sure farmers do not keep seed from one year's crop to plant the following year", Heffernan warns. "Use of the terminator gene will mean that all crop farmers must return each year to obtain their seed from seed firms, just as corn producers have had to do for the past half-century."

If the press, which rarely mentions agricultural issues anymore, doesn't take this turn of events seriously, the corporate leaders of the agri-conglomerates certainly do. And they are not the least bit bashful about what's at stake. Dwayne Andreas is the politically wired former CEO of Archer Daniels Midland. He recently boasted to Reuters that he wanted to make ADM the world's dominant agriculture firm because, to his way of thinking, there's simply nothing more powerful than controlling the world's food supply. He said agribusiness is more powerful than the oil industry.

"The food business is far and away the most important business in the world," Andreas said. "Everything else is a luxury. Food is what you need to sustain life every day. Food is fuel. You can't run a tractor without fuel and you can't run a human being without it either. Food is the absolute beginning." (read more)

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