Monday, January 18, 2010

Big Ag Squeezes Value While Farmers and Consumers Lose

December 17, 2009

Food & Water Watch

The government is finally wising up to Monsanto’s industry bullying. The Justice Department’s current investigation of the stranglehold agribusinesses have on the food system reveals the confidential commercial licensing agreements at the heart of Monsanto’s market monopolization.

As companies all along the food chain squeeze value out of the system, farmers and consumers lose out. The farm share of the retail food dollar is declining (now less than 20 cents), but retail grocery prices continue to rise. Last year, consumers faced the highest grocery inflation in 30 years.Farmers are caught in a vice between a handful of companies that sell inputs like seed and fertilizer, and the few companies that buy the bounty of their farms (like grain handlers or meatpackers). In a hyper-consolidated marketplace, farmers buy high and sell low. It is no wonder that half of all operations are not breaking even from their farming alone.

Next year, the Justice Department and USDA will hold long-overdue workshops on concentration in agricultural markets. These meetings should be a foundation for a re-energized effort to restore fairness to agricultural markets that have become warped by consolidated agribusiness market power.

-Wenonah Hauter, Executive Director

Food & Water Watch

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