Wrecking rural communities

In this four minute clip, Hugh Fearnley-Whittingstall talks to Farms Not Factories about the intensification of meat production.

Big Business Takeover

Factory farming contributes to the decline in farm numbers and total farmers as well as the size of the total labour force by (a) reducing the total number of people needed to produce the same if not more food and (b) through increased competition. By being able to produce a large amount of meat at low cost, smaller farmers frequently have little option but to either intensify their own production or go out of business. Factory farming drives down prices across the sector, making it difficult for farmers to resist intensification – The meat industry’s “Get Big or Get Out” mantra.

Twenty years ago in North Carolina, where we went to film the US footage of Pig Business, there were 27,000 independent family pig farmers. Today there are almost none; instead, there are 2,200 pig factories. Of these, 1,600 are either owned by or contracted to Smithfield, who now controls 75% of all pig production in the state. The factories have created new jobs, but they have displaced three times that number of independent family farmers.

Hog farm density in the US, 2007

Source: Factory Farm Map (A project of Food & Water Watch)

The corporate takeover of the meat industry is accelerating. In 1985, the top four pork-producing companies in the US accounted for 32% of the market; by 1998 they controlled over 56%; by 2007 that share had risen to 66% (Hendrickson & Heffernan; USDA).

These vast corporations operate a system of ‘vertical integration’, which allows them to keep ownership and control of every stage of pig production, from the DNA line and feed right down to the day-to-day management of the end product ­– meat. They own thousands of sows themselves, have contracts with other hog farmers to raise even more sows, and have direct contracts with most of the other hog packers. Thus the small farmer’s access to the open market is drastically reduced.

Four multi-billion-dollar pork-producing companies monopolise the US pig industry

Source: North Carolina in the Global Economy – Hog Farming

Impact on Farmers and Rural Communities

These big corporations contend that these industrialised production methods are more efficient and deliver lower prices to consumers. Although the big corporations have reduced the prices they pay farmers for their livestock, consumers have not seen a reduction in food bills. The real, inflation-adjusted consumer prices for meat steadily rose while the farmers share fell during this period when factory farms became dominant (Factory Farm Nation, 2010).

Economically viable farms are the lifeblood of rural communities. Corporate take over of the meat industry reduces the vitality of rural communities by reducing the amount of local supplies bought by local farmers, draining income from local communities. The loss of local meat packers and processing plants also undercuts rural economies in other ways by reducing employment, investment and stability in rural communities. The social and economic well-being of local rural communities benefit from increasing the number of farmers, not simply increasing the volume of commodity produced (Osterberg and Wallinga 2004). Concentrating economic power into the hands of a few companies effectively “siphons profits out of rural areas and moves them to international financial centres.” (Professor Robert Taylor, Auburn University).

Factory Pig Farming goes Global

The top three US corporations, Smithfield, Tyson and Swift, have set up joint ventures right across the globe, including subsidiaries and partnerships in Southeast Asia, Australia, Europe and South America. Although Canada, China and the US are the leaders in hog farming and pork production, many of the businesses within Canada and China are acquisitions, subsidiaries and partners of some of the leading US companies. Companies like Smithfield have pork subsidiaries in several different countries, including the UK, Poland, Romania, Mexico and China.

Similar trends seen in US rural communities are now developing across the globe, most notably in Europe and China. In 2007, the top ten companies in Europe held about 30% of European pig meat production, but the large firms continue to forge new partnerships and acquire other companies. For example, the biggest pig meat production companies in the UK are not British owned.

European Market Share of Pig Meat in 2007

Source: Meat Processing Global – July/August 2007

Further reading

• Feeding China’s Pigs (IATP, 2011)
  Implications for the Environment, China’s Smallholder Farmers and Food Security

• Old MacDonald HAD a farm (Soil Association & WSPA, 2011)
  The possibility impact of proposed mega dairies and massive pig factories on the small family farm

• The trouble with Smithfield (Food & Water Watch, 2008)
  A corporate profile

• Corporate power in livestock production (Levelling the field, 2006)
  How it’s hurting farmers, consumer and communities – and what we can do about it

• Bringing home the bacon? (Kerr Centre for Sustainable Agriculture)
  The myth of the role of corporate hog farming in rural revitalization

• Contract agreement — Hog farm
  A sample hog contract grower agreement. More and more independent farmers are signing similar contracts with large corporations in order to survive in the business.

• A share in the harvest (Soil Association)
  A feasibility study for Community Supported Agriculture