Activists warn against growing power of food and agriculture corporations | News | DW | 10.01.2017
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Food industry

Activists warn against growing power of food and agriculture corporations

The growing dominance of international conglomerates in the food and farm industries has been documented by German researchers and journalists. Their "Corporation Atlas 2017" calls for tighter anti-monopoly controls.

The global market for food production and distribution is dominated by an increasingly elite group of multi-national corporations, a consortium of German foundation researchers and journalists has warned.

Their 52-page dossier published Tuesday tracks market concentration and dominance of international corporations in the food and agriculture sectors.

The"Corporation Atlas 2017" (Konzernatlas 2017) was compiled by two foundations closely affiliated with the German Greens party and the German Left party as well asOxfam Germany, Germanwatch, BUND[the German branch of Friends of the Earth] and the periodical "Le Monde diplomatique."

According to their study, five of the twelve biggest mergers between market-listed companies in 2015 and 2016 involved concerns active in the agriculture and food sectors.

The study's authors demand tighter controls on agriculture and food production to protect small-scale farmers and farm workers and uphold the United Nation's goals on environmental sustainability.

Governments "must support reforms in anti-trust law to prevent a further concentration of power along the supply chain," they write.

"The middle class is growing in countries of the developing southern hemisphere and with it consumption and dietary habits. It seems certain that the demand for manufactured foodstuffs will mount. Getting the biggest possible slice from this cake is not only the explicit aim of the agricultural, chemical and food products industry but also the aim of the banking, insurance and information technology sectors," the researchers conclude.

Tea market monopolized

According to their dossier, 50 firms share 50 percent of the worldwide revenue for food products - and market dominance is even more prevalent in certain product categories.

Roughly 80 percent of the global tea market is held by three companies - the Dutch-British concern Unilever, the Indian corporation Tata and Associated British Foods.

Sixty percent of all baby foods and 62 percent of all cereals worldwide are produced by just four companies. In Latin America, this number is even higher - 75 percent for both product lines.

Mergers create mega-corporations

A  new wave of mergers among food producers started around 2010, triggered by the global financial crisis.

This increased market concentration, the authors of the "Corporation Atlas" assert.

They cite the 2015 mergers between US giants Heinz and Kraft and brewing companies Anheuser-Busch and SABMilleras examples for the increasingly oligarchical state of the food and beverage industries.

Agricultural and foodstuff mergers were worth 329 billion euros ($347 billion) in 2015, five times greater than mergers in the pharmaceutical and oil sectors.

Farmers subservient

The guide states that market dominance is even higher among those who supply agricultural commodities, seeds and pesticides to farmers for food production.

The market for farming chemicals and seeds today is dominated by seven companies, but that count could soon be down to four.

Currently, three mergers among the biggest firms in the market are planned: US cooperations DuPont and Dow Chemical want to fuse, ChemChina is planning to buy Swiss firm Syngenta and German Bayer wants to buy Monsanto.

If antitrust authorities in the EU and the US authorize those mergers, the three new companies would hold 60 percent of the market, according to the "Corporation Atlas."

Bayer-Monsanto alone would hold a third of the international market for seeds and a quarter of the market for pesticides.

mb/rt, ipj (dpa, kna)

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