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Transnational Corporations & the Globalization of the Food System Hefferman & Constance
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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
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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
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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
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Industry 1960 % 1980 % All Crops IndependentContractCorporate82.111.66.376.116.77.2 Feed Grains IndependentContractCorporate99.5.1.492.57.0.5 All Livestock IndependentContractCorporate68.927.53.662.233.04.8 BroilersIndependentContractCorporate1.693.05.41.089.010.0 Shift from Independent to Contract to Corporate Control
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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
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CONAGRACARGILLADM PoultryXX BeefXX PorkXX FeedlotsXX ElevatorsXXX FlourXXX SoybeansXX CornXXX FishX
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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
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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
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“New Globalization” TNC vision: Global Food System New “World Managers” are not accountable Source from “Have Not” nations to feed “Have Nations”
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