Living on the Earth, January 10, 1997: The Hourglass
A rural sociologist from the University of Missouri, provides a useful image for thinking about the U.S. food system. In a recent article, Professor William Heffernan likens the food system to an hour glass, with about a million farmers producing food at the bottom and over two hundred million eaters consuming food at the top. Connecting the growers and the eaters are the food processors, represented by the neck of the hourglass in the middle.
The strong trend over the past few decades is for that neck in the middle to get longer as food is shipped greater distances, and more narrow as the concentration of corporate control of food processing increases. Professor Heffernan reports that only four corporations control 40 percent or more of the markets for each of many common commodities including poultry meat, beef, pork, sheep, wheat, soybeans, and corn processing. Some of the largest companies are involved in several commodities.
Currently, eighty cents of each dollar spent on food in this country is used to get the food from the farm to the store or restaurant. That 80 cents on the dollar pays for processing, transportation, packaging, advertising and marketing. The farmer gets a mere 20 cents or 20 percent. The firms in the middle get the rest. The USDA recently reported that processed foods represent the largest manufacturing and distribution segment of the U.S. economy and account for one-sixth of total industrial activity.
The report also notes that there is much greater vertical integration with one company producing feed or seed, raising animals or crops and then processing and transporting the final product to market. Vertical integration and contract production, the norm now for raising broilers, turkeys, and some fruits and vegetables in this country, are not beneficial to family farms.
Seedling, the quarterly newsletter of Genetic Resources Action International, provides an informative list of the world's largest food processors and agribusiness companies in its recent issue. Eleven of the top eighteen are based in this country, including the largest (privately-held
Cargill), the third largest (Philip Morris), and the fifth, sixth and seventh largest (Conagra,
Pepsico and Coca Cola, respectively). Other US firms among the eighteen largest include
Archer Daniels Midland, Anheiser Busch, Heinz, Campbell Soup and Kellogg.
Each public company on this list publishes an annual report for its stockholders which is available to anyone free upon request. In these glossy publications, global food corporations brag about their worldwide market share and the year's long list of acquired companies. Philip
Morris boasts of its nearly 50 percent share of the U.S. cheese market, its largest-selling luncheon meats and world leadership in roast and ground coffee. Pepsico reports that it sells over half the snack chips in this country and, with its three fast food chains, has more restaurants than McDonald's or anyone else in the world. Pepsico is also getting more of its fast food into school lunch programs. Nestlé, the second largest food company, is based in Switzerland. It brags that it sells about 55 percent of all the cat food, infant formula and bottled water in the world while it continously takes over smaller companies everywhere.

Increasing control of the flow of food enables these large processors to drive down the prices paid to farmers (which puts more farms out of business) and to raise prices charged to consumers. Enormous corporate size and political power ensure that they can take maximum advantage of a whole range of taxpayer subsidies for grain, energy, manufacturing, distribution and waste disposal.
These annual reports proudly feature hundreds of different sweet, fatty, highly processed and packaged foods that each company produces and markets. It's nearly impossible to find any healthful fresh fruits, vegetables, or whole grains among the products sold by these agribusiness giants. If the flow of food between the soil and our mouths is increasingly dominated by these companies, the long-term prospects for our health are not good.
The hourglass image allows us to see more clearly why eliminating the neck and connecting growers and eaters more directly with gardens, community farms and local agriculture is such a powerful and necessary strategy for a healthy future.