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Agriculture

Frank Garry agricultural column: Where is the monster in corporate food production?

December 15, 2011
Frank Garry

A developing version of conventional wisdom says that corporate monsters somewhere out there are running evil factory farms to produce poisonous fast food intended to harm American consumers.

Is this really true? Are our food and nutrition problems caused by bad guys who scheme to deprive us of wholesome nutritious food?

Last month I pointed out that the overwhelming majority of farms in Colorado and the nation are run by farm families. Some of these farms have grown large because the family wants to increase production and increase profitability. Some family farms may incorporate for legal reasons but the majority of our food is raised by family farms. So where do corporations become involved?

The term food system is used to describe the complete production and delivery cycle of various food products. For example when you consider dairy products you see a food system including many steps. There are primary producers who actually take care of animals and sell their milk. Then there is the movement of milk to a processing facility where it is pasteurized and packaged. Different processes are used to make the wide variety of dairy products we buy, from dry milk to cream, ice cream, cultured products like yogurt, soft and hard cheeses, and so on. These products are then distributed for wholesale or retail. Along the way there are marketers and advertisers and people who check for quality and safety. When you assemble all of these processes, they constitute a food system that delivers a final product to the consumer.

Each step involved in a food system provides a business opportunity. These range from transportation to processing to distribution and each requires equipment, cleaning, oversight and management. Corporations become heavily involved as systems grow large because they can capture efficiencies of size and scale, when a small dairy producer, for example, cannot. Only about 1/4 of what a consumer spends on most types of food is returned to the farmer or producer. The remainder of consumer food cost goes to these other steps in the food system.

Why do food distribution systems grow large? Because most of the American public has a lifestyle that includes living, working and other activities that preclude them raising their own food all year round. Most people want a wide variety of consistent, convenient, safe, affordable food. Big food systems can deliver to the consuming public food that fits these criteria. Food companies have discovered that people like to buy food that is conveniently packaged in different sizes, or that is precooked, or that is already prepared as a complete meal. A large company can provide large quantities that are distributed to many different outlets, even if only a few people buy these products at any individual store. A small-scale farmer producer has trouble supplying such markets.

Modern food corporations have typically developed their processes to continually meet consumer demand. Such businesses started small, made a profit if they satisfied their customers and ran a good business, and then expanded as they found new ways to sell more products. Most family farmers prefer to focus on their farm production and sell their products to food processors and distributors rather than taking the risks of developing their own processing, packaging, distribution and marketing systems.

Farmers don’t have the means, typically, to process and package their product into food items that are often blamed for obesity and health issues, such as fast food. Food systems grew not to harm consumers, but to meet consumer demands because doing so was profitable. If consumers didn’t want certain food products, they wouldn’t buy them. If we want to find someone to blame for the proliferation of processed foods, packaged foods, cheap foods and fast food outlets managed by large corporate entities, then we should turn our eyes to the consumers who wanted to buy these products. While looking for that consumer, we might see ourselves.


Contact: Dell Rae Moellenberg
E-mail: DellRae.Moellenberg@colostate.edu
Phone: (970) 491-6009