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USA Agriculture & Food

Structure of Agriculture. 2004: about 1% of the USA population were farmers; 1920 : 30%; in 1787 : 90 % 17% of the total labor force work in food-related industries 23 million food-related jobs with 90% of the jobs off farms 17% of the country's GNP. USA Agriculture & Food.

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USA Agriculture & Food

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  1. Structure of Agriculture 2004: about 1% of the USA population were farmers; 1920: 30%; in 1787: 90% 17% of the total labor force work in food-related industries 23 million food-related jobs with 90% of the jobs off farms 17% of the country's GNP USA Agriculture & Food One farmer/rancher provides for 114 people: 92 in the USA and 22 abroad. With off-farm agricultural-related jobs, each farmer feeds only 16! About 90% of farms (total 2 million) are family-owned.

  2. 2% of farms with $500,000 or more sales operate 13% of the land 6% of all landowners control over 50% of farmland [in Venezuela: fewer than 5% of all landowners control over 75% of farmland] 2% of farms with $500,000 or more sales generate 50% of gross farm sales 9% of farms produce 73% of farm sales USA Agriculture & Food

  3. 10% of the largest & richest farms receive 75% of federal farm program payments USA Agriculture & Food

  4. Federal government farm subsidies per capita by county 20% of the largest farms received 80% of federal farm program payments. USA Agriculture & Food

  5. Vertical Integration in Agriculture: production -> consumption • An Example: ConAgra -- vertical integration and contract farming • In the 2004 Presidential election, 82% of ConAgra’s political contributions ($197,252) went to the Republican Party [Source: TheHightower Lowdown, January 2005] • top four firms processing of beef, pork, broilers, sheep, turkeys, and seafood. • second largest food firm in the USA; fourth largest in the world with operations in 32 countries. • D) Retail Brands: Country Pride (fryers), Banquet, Beatrice Food (TV dinners and pot pies) • C) Transportation: owns 1,00 barges, 2,000 railroad cars, 100 grain elevators • B) Feed and Farm Chemical Supplies: • 1) largest fertilizer producer and agricultural chemicals • 2) produces its own poultry and livestock feed • A) Production: • 1) owns and operates chicken hatcheries • 2) contracts with “independent” farmers to raise chickens • 3) processes chickens in its own slaughterhouses USA Agriculture & Food

  6. 4 largest livestock commodity processors’ share of the US market USA Agriculture & Food 10 companies supply more than 50% of all food and drink sold in the USA.

  7. 4 largest plant commodity processors’ share of the US market USA Agriculture & Food

  8. Manipulating Beef Prices: Step 1 USA Agriculture & Food

  9. Manipulating Beef Prices: Step 2 USA Agriculture & Food

  10. Manipulating Beef Prices: Step 3 USA Agriculture & Food

  11. Advertising and Creating Foods • 1) Pringles (first introduced in 1973) by Proctor & Gamble • Problem: what is wrong with potato chips? • 150 marketing research surveys: Consumers did not like broken, irregular, stale, and burnt potato chips • Solution: • use small and irregular potatoes – lower costs; lower value to farmers • combine with 6 chemicals (color, shelf life, etc.) and sugar • mush poured into potato chip-shaped molds • package in tennis-ball like cans (20% of the total product’s cost) • spent $5.4 million in advertisements; captured 75%+ of the market • In 2009, Pringles argued before Britain’s Court of Appeal that the chips did not contain enough potatoes to pay the value-added tax!! In 2012, Pringles was sold for $2.5 billion to Kellogs. It is the fourth largest brand in the world. • 2) Fresh Horizons • advertised as 400% more fiber than standard breads • third largest ingredient is pulverized wood pulp • Canada banned it; FDA is testing if wood pulp is dangerous to health • 3) Miracle Whip, advertised as the taste of mayo with half the fat: now contains less soya oil, which fattening and expensive, and more water, which is slimming and cheap! USA Agriculture & Food

  12. Consequences: farmers received 10¢ in 2004 for each food dollar spent; 35¢ in 1984; 40¢ in 1949 Annual return on investments: for farmers 4-5 percent vs. for food-processors about 20 percent Yet when asked to compare financial rewards received by different levels of USA food production system, 43 percent of the respondents thought food processors received the most, 32 percent thought farmers receive the most, and 24 percent thought supermarkets received the most financial reward. Source: American Farm Bureau Federation USA Agriculture & Food Source: Figures based on Washington-area food prices and the U.S. Department of Agriculture (March 20, 2000) and Small Farm Center.

  13. best value USA Agriculture & Food worst value

  14. Federal government subsidies to food corporations • McDonald got $1.6 million to help advertise their fast food products overseas • Sunkist got $78 million since 1986 to promote orange juice in Asia • All U.S. agribusinessesand food corporations receive about $6.2 billion per year in federal subsidies (direct payments and indirect through federal taxes). • Food and Fun and Health • 1997 giveaway Teenie Beanie Babiesincreased sale for McDonalds’ Happy Meals from 10 million a week to 10 million a day! [What were the health and toy-cost consequences?] • 96% of USA school children can identify Ronald McDonald; only Santa Claus scored higher! [But Joe Camel (cigarettes) was banded because of its association with bad health!Nearly as many six-year olds correctly associated "Joe Camel" with cigarettes as they could link Mickey Mouse to the Disney Channel.] • average four oz. hamburger patty consists of beef or fat tissue from between 55 to 1,082 cattle. • [Source: Colorado State University study, cited in The Economist, 9 March 2002] USA Agriculture & Food

  15. Food Waste around the World 40% of all food produced in the USA was wasted at home, restaurants, and stores –- about 100 kg per person per year or a total of 1 billion tons of food a year (or $165 billion in 2011), equal to 33% of the entire world’s supply of meat! [In India, for example, 40% is wasted on or near farms.] In 1974, USA wasted only 28% of all food. Food Travels In 2000, U.S. food traveled 1,500 to 2,500 miles from farms to consumption (20% more than in 1980) USA Agriculture & Food Source: Food First, Backgrounder, 2004; Coop America Newsletter, 2006; The Economist 2011; The Wall Street Journal, October 2012.

  16. Socially Irrational but privately profitable international food trade • USA exported $20 million of lettuce to Mexico and imported $20 million of lettuce from Mexico. • New York exported $431,000 of California almonds to Italy and imported $397,000 of Italian almonds to the USA. • California sold $18 million of asparagus abroad while importing $39 million of asparagus from other countries. • Socially Irrational but privately profitable international food-water trade • drought-stricken interior California shipped more than 50 billion gallons of water (enough for the annual needs of 500,000 families) to China in the form of alfalfa to feed cattle there. • for every two container ships arriving with manufacturing goods from China, one returns empty. • it costs twice as much ($45/ton) to truck alfalfa from a Southern California farm to a dairy in Central Valley as it does to ship it from Long Beach, CA, to Beijing! USA Agriculture & Food Source: Food First, Backgrounder, 2004; Coop America Newsletter, 2006; The Economist 2011; The Wall Street Journal, October 2012.

  17. overweight hungry The USA is the largest food producer, yet 35 million go hungry and nearly 66 percent are overweight! Wealthier neighborhoods have 2-3 times as many supermarkets as low-income areas. White areas have 4 times more food stores than Black neighborhoods. Source: Food First, Backgrounder, Vol. 10, No.1, Winter 2004. USA Agriculture & Food

  18. USA Agriculture & Food poorer countries richer countries

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