In defending farmers against the might of the multinationals, we find ourselves allied to some unlikely fellow travellers
9 May 2003
My diatribe against globalisation last week concluded with a call for farmers to resist its continued and accelerating growth. This week I want to pick up that theme where I left off. Because, since writing it, I have spent a day with a bunch of like-minded people who have added to my certainty that hostility to the trend is necessary and who provided more supporting evidence.
The get-together was entitled "Food in a Failed Market". There were a handful of farmers at the meeting held above the International Solidarity Centre in Reading, but most were the kind of people we "proper" farmers used to call the loony left.
Some of them represented pink and green nongovernmental organisations about which many of us would be instinctively cautious, if not intolerant. The joint organisers, The Family Farmers Association and Grassroots Action on Food and Farming, might even come into that category for some.
I expected a lot of the comments made might be somewhat naïve and, yes, some were. But I came away realising our common causes are greater than our differences and concluding that those of us who consider ourselves proper farmers must ally ourselves with such people, who often have the ear of public and politicians alike and are more likely to be influential than we can possibly be.
Even the biggest farmer is tiny compared with the international conglomerates with whom we have to deal. Big corporations can control governments and ways must be found to counteract that power.
One academic, who was reluctant to be identified, revealed that since the global sourcing trend effectively began about 10 years ago, the number of countries involved with big supermarkets has more than quadrupled, a measure of the speed of development. The same man predicted that within a year, by which time the Safeway takeover battle would be over, almost 65% of UK food retailing will be controlled by three firms.
He quoted a former Somerfield CEO as saying: "If a trade buyer [one of the existing supermarket giants] bought Safeway, terms for suppliers to both would be renegotiated down and further volume discounts demanded. There will not be a 1-2% reduction in prices but 5-10%."
Several speakers confirmed the same story from around the world - that the bigger and fewer the buyers, the worse the deal farmers got. Darrin Qualman of the Canadian NFU, for instance, showed how, over a 30-year period, Canadian retail margins had risen by a factor of seven, while returns to Canadian farmers had remained static or fallen.
"Globalisation will hurt farmers because it increases the power of transnationals," he said. And the most serious decline in Canadian farm incomes could be traced back directly to the start of the North Atlantic Free Trade Agreement with the USA.
Nor is it just the buyers from farmers that are growing because of globalisation. Those companies that sell to farmers were following the same trend and in many cases the same firms both bought and sold.
Mary Hendrickson, a Food Systems and Sustainable Agriculture Associate from the University of Missouri, told how just
- four firms slaughter 81% of US beef;
- four firms own 60% of US grain terminal facilities, with three exporting 81% of US maize and 65% of soya beans;
- four firms own 46% of all the pigs in the US; and
- four firms slaughter 50% of the broiler chickens.
In some cases the same few firms do all of those things and in addition supply the feed for the animals, the fertilisers, seed and sprays for the crops, and so on.
Incredibly, according to Mary Hendrickson, there are only five main seed breeders left in the world and not many more producing plant protection products.
So, the future of the world's food supplies might be at the whim of a handful of people who will determine which research programmes to follow. Those programmes, some say, are likely to be chosen more on the basis of potential profit than the needs of people. Others say the two are bound to coincide and that market forces are the best progenitors of demand.
Can we be sure of that? I wonder. So, globalisation is clearly already with us. In this country it has all but destroyed great chunks of our industry. DEFRA's own figures show that if you use 100 as the profitability index during the period between 1994 and 1997, by 2001/2 it had declined as follows:
Dairy down to 59;
LFA cattle and sheep, 30;
general cropping, 23;
pigs and poultry, 36;
mixed farms, 50;
and the average of all-farm types, 29.
Those are the fruits of globalisation (plus a few other things, perhaps) so far and the British government, along with politicians around the world, wants more of it. And it isn't even helping small farmers in the Third World. A speaker who visits Brazil regularly told the meeting that, to increase cheap exports, small producers are being swallowed up by global traders. All that is left for them is the low-priced domestic market.
A body promoted at the meeting, and designed to tackle all this, is the Agribusiness Accountability Initiative, whose web-site is www.agribusinessaccountability.org It could be worth a visit.