Search results: the corporation not me

On January 3, the White House issued a press release to announce “The Biden-⁠Harris Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain.

This came with a Fact Sheet explaining the plan and its rationale.

Even as farmers’ share of profits have dwindled, American consumers are paying more—with meat and poultry prices now the single largest contributor to the rising cost of food people consume at home.

The plan provides $1 billion to increase independent processing capacity: For example, 50 beef slaughter plants owned by just a handful of companies currently process nearly all the cattle in the United States.

• Independent processing plants–$375 million
• Financing for independent producers: $275 million
• Back private lenders to independent processors–$100 million
• Worker development–$100 million
• Technical assistance–$50 million
• Inspection support for small producers–$100 million

How this happened

Let’s start with a report from the White House Competition Council, which sets the tone by beginning with this quote from President Biden:

Capitalism without competition isn’t capitalism; it’s exploitation.  Without healthy competition, big players can change and charge whatever they want and treat you however they want.

The Council’s goal for reducing competition in agriculture: Lowering food prices for consumers and increasing earnings for farmers and ranchers.

The 2021 timeline

July 9  President Biden issues Executive order on promoting competition in the American economy

Robust competition is critical to preserving America’s role as the world’s leading economy. Yet over the last several decades, as industries have consolidated, competition has weakened in too many markets, denying Americans the benefits of an open economy and widening racial, income, and wealth inequality…Consolidation has increased the power of corporate employers, making it harder for workers to bargain for higher wages and better work conditions…Consolidation in the agricultural industry is making it too hard for small family farms to survive.

July 9  The White House presents a Fact sheet on the Executive order

The markets for seeds, equipment, feed, and fertilizer are now dominated by just a few large companies, meaning family farmers and ranchers now have to pay more for these inputs. For example, just four companies control most of the world’s seeds, and corn seed prices have gone up as much as 30% annually.

September 8  The White House issues a report Addressing Concentration in the Meat-Processing Industry to Lower Food Prices for American Families  [Note: this contains many useful charts]

December 10  The White House finds Recent Data Show Dominant Meat Processing Companies Are Taking Advantage of Market Power to Raise Prices and Grow Profit Margins  [Note: I did a blog post on this one]

The meat-processors are generating record profits during the pandemic, at the expense of consumers, farmers, and ranchers…the prices the processors pay to ranchers aren’t increasing, but the prices collected by processors from retailers are going up…At the same time, we have seen some of the top firms in this industry generate record gross profits and their highest gross margins in years.

The Reactions

The North American Meat Institute: Government Intervention in Markets Will Not Help Consumers, Producers 

For the third time in six months, President Joe Biden and his Administration announced the same plans to spend $1 billion to fund government intervention in the market in an attempt to increase prices livestock producers receive while blaming inflation on private industry…The Biden Administration continues to ignore the number one challenge to meat and poultry production: labor shortages.

Washington Post Opinion: Why President Biden is suddenly talking about meat

Now that President Biden has unveiled a plan to combat monopolistic practices in the meat industry, much of the media coverage is treating this effort as little more than an attempt to mitigate the political fallout of inflation by blaming large corporations for it…But the truth is that the White House plan only makes passing mention of inflation. Its primary focus is on the power dynamics of an industry that puts small faWilrmers and ranchers at the mercy of large meatpacking corporations, and the role this plays in causing higher prices and creating other problems.

The Counter: Can $1 billion really fix a meat industry dominated by just four companies?

The Biden administration’s newly announced investment in small, independent processors is intended to level the playing field. But without addressing the root causes [larger plants, union busting] of market concentration, critics fear it may have limited impact.

The Meatrix: the 2.5-minute trailer provides an excellent summary of the issues.  It also comes with a Take Action page

The Hagstrom Report’s list of links

• The White House — Readout of President Joe Biden’s Event with Farmers, Ranchers on his Action Plan for a More Competitive Meat and Poultry Supply Chain
• (video) — Roundtable on Promoting Competition and Reducing Prices in the Meat Industry
• Remarks by President Biden During a Virtual Meeting to Discuss Boosting Competition and Reducing Prices in the Meat-Processing Industry
• What They Are Saying: Bipartisan Members of Congress, Key Agriculture Stakeholders Applaud President Biden’s Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain
• Justice Department and Agriculture Department Issue Shared Principles and Commitments to Protect Against Unfair and Anticompetitive Practices
• Attorney General Merrick B. Garland Delivers Remarks at the Roundtable on Promoting Competition and Reducing Prices in the Meatpacking Industry

Comment: Will any of this do any good in reducing the monopolistic power of Big Meat?  This depends on anti-trust legislation, and for that we must wait and see.  And where is Big Chicken in all of this?  Most of the attention here is on beef production, but the unfair practices of chicken companies need just as much attention.

I was amazed to see this announcement from the White House, of all places: “Recent Data Show Dominant Meat Processing Companies Are Taking Advantage of Market Power to Raise Prices and Grow Profit Margins.”

In September, we explained that meat prices are the biggest contributor to the rising cost of groceries, in part because just a few large corporations dominate meat processing. The November Consumer Price Index data released this morning demonstrates that meat prices are still the single largest contributor to the rising cost of food people consume at home. Beef, pork, and poultry price increases make up a quarter of the overall increase in food-at-home prices last month.

The big concern is consolidation—monopoly power—in the meat industry.

Four large conglomerates control approximately 55-85% of the market for pork, beef, and poultry, and these middlemen were using their market power to increase prices and underpay farmers, while taking more and more for themselves…their gross profits have collectively increased by more than 120% since before the pandemic, and their net income has surged by 500%. They have also recently announced over a billion dollars in new dividends and stock buybacks, on top of the more than $3 billion they paid out to shareholders since the pandemic began.

The bottom line?

The meat price increases we are seeing are not just the natural consequences of supply and demand in a free market—they are also the result of corporate decisions to take advantage of their market power in an uncompetitive market, to the detriment of consumers, farmers and ranchers, and our economy [bold face in original].

Will the Biden Administration be able to do anything about this level of monopoly power?  Stay tuned.

The majority staff of the House Select Subcommittee on the Coronavirus Crisis has issued a scathing report: “Coronavirus Infections and Deaths Among Meatpacking Workers Were Nearly Three Times Higher than Previous Estimates.”

Newly obtained documents from five of the largest meatpacking conglomerates, which represent over 80 percent of the market for beef and over 60 percent of the market for pork in the United States—JBS USA Food Company (JBS), Tyson Foods, Inc. (Tyson), Smithfield Foods (Smithfield), Cargill Meat Solutions Corporation (Cargill), and National Beef Packing Company, LLC (National Beef)—reveal that coronavirus infections and deaths among their meatpacking workers were substantially higher than previously estimated.

The report’s main findings:

• At least 59,000 meatpacking workers were infected with the coronavirus during the first year of the pandemic—almost triple the 22,700 infections previously estimated by the Food and Environment Reporting Network (FERN).
• At least 269 meatpacking workers lost their lives to the coronavirus between approximately March 1, 2020 and February 1, 2021—over three times higher than what was previously estimated by FERN.

• Certain meatpacking plants saw particularly high rates of coronavirus infections during the first year of the pandemic. For example, 54.1 percent of the workforce at JBS’ Hyrum, Utah plant contracted the coronavirus between March 2020 and February 2021.
• Across companies, Tyson saw 29,462 employee infections and 151 employee deaths, and JBS saw 12,859 employee infections and 62 employee deaths.
• Coronavirus Outbreaks in Meatpacking Plants Disproportionately Impacted Minority Workers
• The full extent of coronavirus infections and deaths at these meatpacking companies was likely much worse than these figures suggest.
• OSHA made a political decision not to issue regulatory standards that might require meatpacking companies to take actions to protect workers.

Recall that meatpacking workers were among the first to get sick from Covid-19, causing

• People in their communities to become ill
• Plant closures
• Meat shortages
• Meat companies to succeed in inducing President Trump to issue an executive order to keep the plants open.

The report confirms that Covid-19 in meatpacking workers was and is a national tragedy and scandal, a direct result of corporate consolidation and capture of government.

The report’s recommendations to meatpacking plants, government agencies, and Congress can’t come soon enough.

I read in DairyReporter.com that Danone reports an increased score in it B-Corporation certification.

I am interested in the B-Corporation phenomenon.

B Corporations are required to include social values—along with the usual profit motives—as established goals.

Society’s most challenging problems cannot be solved by government and nonprofits alone. The B Corp community works toward reduced inequality, lower levels of poverty, a healthier environment, stronger communities, and the creation of more high quality jobs with dignity and purpose. By harnessing the power of business, B Corps use profits and growth as a means to a greater end: positive impact for their employees, communities, and the environment.

What is that one unifying goal?  “We envision a global economy that uses business as a force for good.”

Certified B Corporations are a new kind of business that balances purpose and profit. They are legally required to consider the impact of their decisions on their workers, customers, suppliers, community, and the environment. This is a community of leaders, driving a global movement of people using business as a force for good.

B Corporations promise:

• That we must be the change we seek in the world.
• That all business ought to be conducted as if people and place mattered.
• That, through their products, practices, and profits, businesses should aspire to do no harm and benefit all.
• To do so requires that we act with the understanding that we are each dependent upon another and thus responsible for each other and future generations.

Companies are assessed and rated on social value criteria.  They must achieve 80 of 200 points to be certified.

Food companies are among those certified as B corps

I’m not sure how this plays out in practice, but this certainly appears to be a step in the right direction.

If we want to encourage this effort:

• Support food companies that sign up to be B corps.
• Urge other food companies to join.
• Hold them all accountable.

Everybody loves chocolate but there’s a lot about its production that’s not to love.  It is a classic example of an exploited commodity: cocoa is grown in developing countries, sold at low cost, and processed in industrialized countries which reap the profits.

Chocolate producers are under pressure (not enough, in my view) to pay farmers decently and to make sure their kids go to school, not work.

I’ve been seeing a lot of articles about these issues lately.   You can see what the issues are just from their headlines:

• • World Cocoa Foundation says chocolate companies are committed to tackling causes of child labour: President Richard Scobey recognises research from latest NORC report on child labour in Ghana and Cote d’Ivoire’s cocoa regions, but says industry is scaling up its efforts to eradicate farmer poverty…. Read more
  • NORC revises its figures on child labour in West Africa’s cocoa sector after intervention by chocolate industry: Long-awaited US government-funded report from National Opinion Research Center at the University of Chicago (NORC) that assesses progress in reducing child labour in Côte d’Ivoire and Ghana’s cocoa regions shows figures are lower than previously thought (1.56 million compared to estimates of 2.1 million in 2013/14) but it is still a sobering read for the chocolate industry, despite some signs of progress in trying to eradicate the issue…. Read more
  • Mars pledges to protect children with release of its 2020 Cocoa for Generations report: Mars Wrigley has strengthened its commitment to protecting children in at-risk regions of the cocoa sector with the release of its 2020 Cocoa for Generations report detailing progress on its journey toward creating a modern, inclusive and sustainable supply chain…. Read more
  • Mars discloses data map to build on its cocoa supply chain transparency: Mars Wrigley has announced it is building on its cocoa supply chain transparency by releasing an interactive map that discloses data on where it sources its cocoa. Read more
  • Barry Callebaut makes unprecedented move of releasing its direct cocoa sourcing map:  Barry Callebaut Group, one of the world’s largest cocoa manufactures, has released a collection of farmer data in its supply chain by going public with a map of all its cocoa suppliers in West Africa. Read more
  • Industry coalition calls for Ghana and Cote d’Ivoire to support cocoa farmers and protect forests:  A coalition consisting of 350 environmental, human rights, and good governance NGOs has signed an historic letter outlining steps that the Ghanaian and Ivorian governments must take to encourage sustainable cocoa while supporting farmers and protecting forests. Read more
  • Ghana and Cote d’Ivoire cancel Hershey’s sustainability programmes as row over ‘cheap cocoa beans’ intensifies: Ghana and Cote d’Ivoire have carried out their threat to cancel Hershey’s cocoa sustainability schemes in their countries, accusing the US giant of trying to avoid paying the cocoa Living Income Differential (LID) premium aimed at combating farmer poverty – and agreed by the two governments and chocolate companies, including Hershey. Mars denies any similar allegations…. Read more 
  • Cote d’Ivoire lifts ban on Hershey sustainability programmes after company commits to LIDCote d’Ivoire has announced it has lifted its suspension on cocoa sustainability schemes run by Hershey, in the latest twist in the ‘cheap beans’ row that has threatened to jeopardise the delicate relationship between the big chocolate companies and cocoa-growing countries in West Africa…. Read more 
  • Cocoa Barometer 2020 demands industry stops beating about the bush and ends farmer poverty once and for all: After two decades of failed interventions across the cocoa sector, cocoa farming communities are still battling the effects of poverty, child labour and deforestation, the new report highlights…. Read more  
  • A lawsuit claiming that Nestle USA and Cargill Inc. exploited child labor on Ivory Coast cocoa plantations was before the Supreme Court on Tuesday. Justices raised doubts about the case but also sounded reluctant to give corporations immunity for human rights abuses committed overseas, The Wall Street Journal writes.   
  • Cote d’Ivoire’s cocoa exports plummet as COVID and LID disrupt market:  Sales of Cote d’Ivoire’s cocoa crop are the worst in decades, industry sources say, as COVID-19 drives down global demand for chocolate and the controversial Living Income Differential (LID) increases the price of its, and neighbouring Ghana’s, cocoa beans. Hershey issues statement on ‘cheap beans’ row…. Read more  

These are long-standing issues.  They should have been addressed more effectively years ago.   Here is some background reading:

• • Food is Power: Child Labor and Slavery in the Chocolate Industry
  • Washington Post: Cocoa’s child laborers
  • Fortune: Big Chocolate’s Child Labor Problem is Far From Fixed

I am all for making sure that farmers make a decent living but most agricultural subsidies go to Big Ag—the producers of corn and soybeans fed mainly to animals or, in the case of corn, as ethanol for car fuel.

These taxpayer-funded payments are enormous and represent increasing percentages of the income of Big Ag.

For example, see this chart from the Wall Street Journal.

As part of the Trump administration’s effort to get votes from farmers and ranchers, it pledged $37.2 billion to them in the spring and summer with an addition $14 billion in September.

Why is this about the election?  The Washington Post says “Trump’s farmer bailout gave $21 billion to red counties and $2.1 billion to blue ones.”

At a campaign rally in Wisconsin last week, President Trump didn’t mince words about how much his administration had done to bolster the economic fortunes of farmers…I gave $28 billion to the farmers, many of them right here, $28 billion, $12 billion and $16 billion, two years”… That redistribution was facilitated through the Agriculture Department’s Market Facilitation Program. According to data obtained by the Environmental Working Group through a Freedom of Information Act request, that program disbursed more than $23 billion in the 2018 and 2019 program years.

From a report from Agricultural Economic Insights:  USDA’s direct payments to Big Ag will equal 36% of net farm income, up from 22% in 2018=2019.  These payments used to account for around 10% of net farm income.

Check out its map:

Finally, it’s good to review the big picture of what happened to food and farming under Trump.  Civil Eats has an excellent review by Lisa Held.

To offset the effects of the tariffs, in 2018, USDA began distributing cash payments through the Commodity Credit Corporation at unprecedented levels, with no appropriations or oversight from Congress. In 2020, as the pandemic hit the farm economy, it added another source of government payments via the Coronavirus Food Assistance Program (CFAP). Overall, Trump’s USDA has handed out more government dollars to farmers than any administration prior. In both 2019 and 2020, more than 40 percent of farm incomes came from federal assistance—the only thing keeping farm incomes afloat.

Those payments have been controversial because they have almost exclusively benefited the largest farms and agriculture companies. Two-thirds of the trade aid payments went to agriculture producers in the top 10 percent, including corporations, such as the $67 million paid to JBS USA, a subsidiary of the Brazilian-owned meatpacking giant. Small farms, especially diversified operations and those run by socially disadvantaged Black, Indigenous, and People of Color (BIPOC) farmers, have largely been unable to access CFAP assistance.

All of this leaves plenty of room for improvement.

President-elect Biden: get to work!

I.  Expert Opinion on Benefits of Long-Chain Omega-3 Fatty Acids (DHA and EPA) in Aging and Clinical Nutrition, Troesch B, et al.  Nutrients 2020;12(9):2555.

Conclusion: The evidence to date indicates that the provision of DHA and EPA through capsules, oral nutrition supplements, or enteral or parenteral formulas can help to regulate the inflammatory environment in a number of medical conditions and that this is linked in many cases to improved function, clinical course and outcomes.

Here’s progress, and about time too.  This long called for, and long overdue decision has been covered by CNN (6/17), New York Times (6/17), Food Dive (6/17), USA Today (6/18), and Reuters (6/18).

CPG firms review, overhaul black brand mascots:  Following Quaker Oat’s decision to rebrand its Aunt Jemima line, the parent companies of brands Uncle Ben’s, Mrs. Butterworth’s and Cream of Wheat — all of which have black mascots — have plans to change or review the brands’ logos and packaging. “[W]e are committed to evaluating our packaging and will proactively take steps to ensure that we and our brands do not inadvertently contribute to systemic racism,” B&G Foods said about Cream of Wheat’s chef image in a statement.

PepsiCo’s CEO promises a complete overhaul:

So today, I am announcing the next step in PepsiCo’s journey for racial equality: a more than $400 million set of initiatives over five years to lift up Black communities and increase Black representation at PepsiCo. These initiatives make up a holistic effort for PepsiCo to walk the talk of a leading corporation and help address the need for systemic change.

These changes are steps in the right direction.  To make them meaningful, companies must push for a cultural transformation and be willing to openly confront deeply embedded but sometimes unconscious attitudes and behavior.

Let’s hope these promises result in real change.

For some context, take a look at Toni Tipton-Martin’s, The Jemima Code: Two Centuries of African American Cooking, and her article about the retirement of the image in Sunday’s New York Times.

And then there’s this perfect image for food politics (source unknown, alas):

Addition

A reader, who wishes to remain anonymous, writes: “The removal of the Aunt Jemima image reminds me of artist Betye Saar’s 1972 assemblage, “The Liberation of Aunt Jemima.”  I see that Betye Saar has responded: “She’s liberated! Finally at long last!”