Transnational Corporations & the Globalization of the Food System Hefferman & Constance

Commodity Systems Approach  Focus on particular commodities  Labor relations involved in production  Technological factors (inputs, mechanization)  State policies  The “World Steer” Agri-Food Complex  Created by TNCs as they source beef from Costa Rica, Honduras, etc.  Nation states no longer control commodity trade, rather companies sell to other companies

3 PHASES OF RESEARCH  1.Vertical Integration following WW II  Control of commodities from seed to market  WW II rationing of pork & beef; government subsidized broiler production  Broiler Industry: shift from women’s independent production to confinement operations  Shift to corporate production on Factory Farms, integration of feed production, broiler production, & assembly-line processing

Contract Farming  Contracts:  Firm provides feed, chicks, vet services  Grower provides building, labor, utilities  Firm maintains title to birds  Some growers resisted incorporation  The broiler industry moved South where boll weevil devastated the cotton crop  Desperate farmers signed contracts in order to keep their farms  Workers are often non-union, female, or ethnic minorities

Industry 1960 % 1980 % All Crops IndependentContractCorporate Feed Grains IndependentContractCorporate All Livestock IndependentContractCorporate BroilersIndependentContractCorporate Shift from Independent to Contract to Corporate Control

 2.Conglomerate Integration  Cross-Commodity Conglomerate Analysis  Late 1980s, Crisis of capital accumulation & failing U.S. hegemony  Reagan deregulation: Merger mania  Large conglomerates survived  Ex: ConAgra bought out 56 companies  (Armour, Swift, Banquet, Eckrich Meats, Hunts, Wesson, Orville Redenbacher)  Oligopoly control of inputs & product markets  Family Farms faced a Cost-Price Squeeze  ConAgra, Cargill, ADM, Tyson, etc. dominated market across many commodities

CONAGRACARGILLADM PoultryXX BeefXX PorkXX FeedlotsXX ElevatorsXXX FlourXXX SoybeansXX CornXXX FishX

 3.Global Integration  Analysis of TNCs  Global Agrifood Complex Based on Global Sourcing  Ability of TNCs to obtain inputs & market outputs at various sites around the globe  Cargill (HQ in Minneapolis) trades 103 commodities in 49 countries

Tyson-Japanese Joint Venture  Breast meat is removed for the U.S. fast food industry  Chicken legs shipped to Mexico for processing (de-boning) where labor is $4/day  The chicken is then exported for Japanese consumption

“New Globalization”  TNC vision: Global Food System  New “World Managers” are not accountable  Source from “Have Not” nations to feed “Have Nations”