Concentration in agricultural markets continues to rise according to statistics released by National Farmers Union during its 103rd anniversary convention in Lexington, Ky., over the weekend.
A NFU-commissioned study conducted by Mary Hendrickson and William Heffernan from the University of Missouri Department of Rural Sociology revealed that the top four firms in most agricultural sectors have increased their strong-hold since their last study, which was released in 2002.
The study showed the top four beef packers now dominate 83.5% of the market, four pork packers control 64% of that market, and the top four poultry companies process 56% of the broilers in the United States. Tyson Foods is listed in the top two of all three industries.
â€œThese concentration percentages are significant in themselves,â€ says NFU President Dave Frederickson. â€œYet, when analyzed as part of the complex web of integration among the top firms, the percentage of market control becomes staggering.â€
Frederickson points out that ethanol production was the only agricultural sector in which concentration has steadily decreased. A decade ago, the top four companies owned 73% of the ethanol market. Today, the top four companies control 41% of the ethanol produced.
The Farmers Union president says this was in direct relationship to the high number of farmer-owned ethanol cooperatives that have been built in the United States. Farmer-owned plants account for about 1.3 billion gallons of ethanol production per year, or 37% of the total capacity.
â€œEthanol is a prime example of the impact of and potential for public policies that encourage diversification and discourage monopolization in our food system,â€ Frederickson says. â€œThe 109th Congress must work to address the growing market control that threatens our nation's family farm system of agriculture.â€
Frederickson says the information revealed in the new study provides further rationale for Congress to immediately pass legislation to restore true competition in the marketplace for U.S. farmers and ranchers. â€œIndependent producers cannot succeed in the absence of protection from unfair and anti-competitive practices,â€ he says. â€œWe need comprehensive agricultural competition and concentration policies to restore balance in the marketplace.â€
To view the study, click HERE.