DOJ Opens Series of Antitrust Workshops to Consider Concentration in Agriculture Sector
The Department of Justice (DOJ) was scheduled to begin a series of antitrust workshops March 12, 2010, in Iowa, to hear from agricultural interests about consolidation and competition in the industry. The workshops have drawn considerable commentary, with some focusing on the biotechnology giants that control most of the patented soybean and corn seeds in the country and others suggesting that small family farms are being excluded from the proceedings.
The consumer advocacy organization Food & Water Watch launched a petition drive calling on supporters to encourage DOJ to “break the monopolies.” According to the organization’s outreach director, four companies process more than 85 percent of U.S. beef cattle, two companies sell 50 percent of U.S. corn seed, one company controls 40 percent of the U.S. milk supply, and five companies “dominate the
grocery sector.”
Focusing on competition in the seed, dairy, poultry, beef, and crop industries, the hearings, which will run through December 2010, have been characterized by The Wall Street Journal as an “unusual step” by “Justice’s tight-lipped antitrust division.” Scheduled to attend the first workshop are Attorney General Eric Holder, his antitrust chief Christine Varney and U.S. Department of Agriculture (USDA) Secretary Tom Vilsack. Varney apparently decided to conduct such hearings when she was nominated for her position and several farm-state legislators expressed concerns about the Bush administration’s approach to agricultural mergers. Vilsack was quoted as saying, “Seed technology is pretty heavily consolidated.” And while noting that he was not “taking sides,” he said, “What I’m really concerned about is farmers getting a fair shake.”
According to one news source, Monsanto has been a DOJ target. At least one of its patented genes is used in 90 percent of the soybeans grown in the United States and in about 80 percent of all U.S. corn. Industry groups deny that consolidation leads to price fixing, although some commentators, such as retired rural sociologist Bill Heffernan, who has been focusing on concentration in agriculture for 20 years, suggests that when fewer than five companies control the majority of a food processing sector, “They don’t have to go down to the lounge to talk about price fixing,” rather they simply follow each others’ lead in what they pay farmers and what they charge retailers and consumers.
Meanwhile, a coalition of grassroots groups and nonprofits were reportedly planning to conduct a town hall the day before the first workshop; they claim that “family farmers, consumer advocates, and organized labor are underrepresented on the panels at the DOJ/USDA anti-trust workshop.” A fourth generation family farmer was quoted as saying, “The corporate control of our food system by multinationals . . . is devastating to consumers, farmers, workers, and the environment.” An advocacy organization known as Pesticide Action Network North America reportedly wrote to Varney on March 8 supporting the workshops, but complaining that “only limited time has been allocated for public comments.” The letter also states, “We believe the current agenda severely limits time for the DOJ and USDA to hear viewpoints from communities directly impacted by growing concentration in the seed industry, vertical integration, lack of market transparency, and shift in buyer power within the agriculture industry.” See Findlaw.com, Associated Press, March 8, 2010; La Vida Locavore, March 10, 2010; The Wall Street Journal, Food & Water Watch Alert, March 11, 2010.
