February 19, 2009
A look into one of the world's largest and unknown food companies.
It's always fascinating to look behind the scenes of our food, and I don't mean sweeping behind the fridge!
Take one of North America's staples; beef. When deconstructing this particular food, we discover a jaw-dropping level of control that one company in particular has assumed over the global food supply. That company is Cargill.
With global operations based in Minnesota and Canadian operations in Winnipeg, since 1865 Cargill has quietly placed itself behind the sustenance of most of the world's population. While the company is well known in rural communities, most urbanites have never heard the name. This low profile has much to do with the company not being publicly traded and thereby not required to publicly communicate the company's financial and strategic positions. Instead, Cargill is one of the largest privately owned companies in the world.
While beef is only one division of Cargill's operations, it's a telling one.
Cargill is involved in beef processing worldwide.
In Canada, three companies control most of processing of cattle. According to Cargill, they process 27,000 head of cattle/week. The Canadian Beef Grading Agency reports that Canada slaughters 3.4 million head per year. This translates to Cargill processing 41% of all beef in Canada. What's even more shocking is that all of that beef comes from two plants; one in Alberta and another in Ontario.
Of course there's more to the production of beef than just the animal itself, and Cargill has ensured a place throughout the chain of inputs.
The majority of cattle processed in Canada spend the remaining months of their lives on feedlots where they are fattened up before being processed. In turn, Cargill operates a division called Nutrena, a feed company that specializes in beef production. The division operates 178 plants in 26 countries.
Making up that feed is often a mixture of grains and Cargill controls a significant percentage of the global trade of grain. In Canada, they control 17% of the grain trade.
The vertical integration of this company becomes clearer.
Cargill has even gone so far as to get involved in the genetic make-up of the grains themselves. Through a partnership with global seed giant Monsanto, Cargill maintains an ownership in Renessen - a company that among other things, develops genetically engineered technologies to produce grains destined for cattle feed.
Of course all of those grains don't just grow on their own. In the age of vast monocultures that have been irresponsibly farmed for decades, most agricultural soils don't maintain enough nutrients to feed the crops. In comes the need for fertilizer and Cargill is a joint owner in MOSAIC - the world's largest processed phosphate producer and the leading miner, processor and distributor of potash - both key ingredients in fertilizer production.
Another key ingredient in fertilizers is nitrogen derived from natural gas and Cargill maintains their Power and Gas Markets division - a leading trader of natural gas.
Any good steak requires salt, and Cargill is the largest marketer of salt products worldwide. The company also produces salt blocks as a mineral supplement for beef production.
Now perhaps you ordered a steak that was a wee too big for your belly, and some of it needs to be taken home. There's a good chance the restaurant uses those new compostable take-out containers made of corn plastic. In comes NatureWorks - a leading producer of such plastics. Lo and behold, Cargill maintains joint ownership in the company!
Danger of such dominance
So what's the danger of such dominance over our food supply? Well the list is extensive.
Perhaps the most visible concern is food safety. When one company handles so much of the food we consume, the risks of massive outbreaks of illness and/or death caused by tainted food only increases.
There are also the economic risks. When one or a few company's exert such control over so many interconnected commodities, the price of those commodities become very much in the control of those companies. To make matters worse, this control can increase the prevalence of dumping, whereby product is pushed into a market at below the cost of production. This undermines the ability of local producers to compete.
The last concern to outline here is what author Frances Moore Lappé calls the "distortion of political systems." When a company assumes such immense control over something as integral as food, they can also maintain a disproportionate influence over democratically elected governments.
In the case of Cargill, it appears that this is indeed their strategy.
Serving as the Vice-President of the United States between 1965-1969, Hubert Humphrey maintained very close ties with Cargill. According to Humphrey, "If you are looking for a way to get people to lean on you and be dependent on you, in terms of their cooperation with you, it seems to me that food dependence would be terrific."
Deconstructing Dinner is heard on radio stations across Canada and is available as a Podcast. A two-part exposé on Cargill can be heard at (www.cjly.net/deconstructingdinner/agribusiness.htm).
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