USA Agriculture & Food
Structure of Agriculture
Since 2004: less than 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
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.
USA Agriculture
& Food
Most U.S. farmers produce crops for feed and fuel
(biofuels) rather than as food directly.
Feed and Fuel
Whereas 45% of the global crops are for feed and
fuel, 73% of U.S. and 82% of Midwest crops are
used for feed and fuel (purple color on the map).
Food
In contracts, whereas 55% of global crops are
produced for direct food consumption, only 27% of
U.S. and 19% of Midwest crops are used for food
(green color on the map).
USA Agriculture & Food
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
10% of the largest & richest farms receive 75% of federal farm program payments
Between 2007 and 2011, 2,300 farm operators, who grew no crops of any kind, received $3 million!
Between 2008 and 2012, $10.6 million was paid to farmers who were dead for over a year!
Overall, farm subsidies account for about $20 billion per year from taxpayers.
In 2014, Congress abolished direct farm payments based on land ownership, but farmers now get
more subsidies crop insurance and new payments based on past crops and productivity!
Things really never do change as long entrenched special interests control Congress.
Notable farm-subsidy recipients
Federal government
farm subsidies per
capita by county
20% of the largest farms
received 80% of federal
farm program payments.
USA Agriculture & Food
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: The Hightower 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
5 largest livestock commodity processors’ share of the US market
10 companies supply more than 50% of all food and drinks sold in the USA.
USA Agriculture & Food
4 largest plant commodity processors’ share of the US market
USA Agriculture & Food
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, which 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
Consequences: farmers received 12¢ in 2012 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
Item
Retail Price
Farmer's Share
levels of USA food production system,
Box of cereal
$3.71
4.6 cents
43 percent of the respondents thought food processors received
Loaf of bread
$1.39
5 cents
the most,
Sirloin steak (1 lb.)
$4.39
68 cents
32 percent thought farmers receive the most, and
Cheddar cheese (1 lb.)
$5.91
$1.05
24 percent
thought
supermarkets
received the most
financial
Potato chips
(9 oz.)
$1.99
3.3 cents
reward.
Head of lettuce
$1.29
9 cents
Source: American Farm Bureau Federation
Bacon (1 lb.)
$3.29
40 cents
Source: Figures based on Washington-area food prices and the U.S. Department of Agriculture and the
Small Farm Center.
USA Agriculture & Food
best value
worst value
USA Agriculture & Food
poorer countries
richer countries
USA Agriculture & Food
Source: “The New Face of Hunger,” National Geographic, August 2014,
http://www.nationalgeographic.com/foodfeatures/hunger/
USA Agriculture & Food
Source: “The New Face of Hunger,” National Geographic, August 2014,
http://www.nationalgeographic.com/foodfeatures/hunger/
USA Agriculture & Food
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. agribusinesses and 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 Babies increased 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
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)
Source: Food First, Backgrounder, 2004; Coop America
Newsletter, 2006; The Economist 2011; The Wall Street
Journal, October 2012.
USA Agriculture & Food
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.
Source: Food First, Backgrounder, 2004; Coop America
Newsletter, 2006; The Economist 2011; The Wall Street
Journal, October 2012.
Socially irrational but privately
profitable international foodwater 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 the
Central Valley as it does to ship it
from Long Beach, CA, to Beijing!
USA Agriculture & Food
Chicken parts
sold around
the world
Source: National
Geographic, October
2014, pp.56-57
USA Agriculture & Food
overweight
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 lowincome areas.
White areas have 4 times
more food stores than
Black neighborhoods.
hungry
Source: Food First, Backgrounder,
Vol. 10, No.1, Winter 2004.