Mega-mergers in the agri-food sector cause alarm bells to ring
Dominant agri-food firms have become too large to feed humanity sustainably and too big to drive the types of innovation needed, according to an influential global food panel.
The International Panel of Experts on Sustainable Food Systems (IPES) has written to the European Commission calling for the imminent merger between Germany pharmaceutical giant Bayer and US-based multinational agrochemical and biotech firm Monsanto to be urgently scrutinised.
Pat Mooney, lead author of the IPES-Food report, said if the deal went ahead 3 firms would control more than 60% of the global seed and pesticide market. “Mergers are increasingly allowing firms to control information flows along the chain and exercise huge power over the trajectory of food systems”.
The report identifies Big Data as a powerful new driver of consolidation, allowing companies to bring satellite data services, input provision, farm-level genomic information, farm machinery and market information under one roof.
Poultry industry
The report also highlights the unprecedented market concentration in a number of agri-food sectors, including the poultry industry. It says 3 companies now supply over 90% of breeding stock for broilers, laying hens and turkeys.
Meanwhile, this week also saw the publication of an Agri-Food Atlas by Friends of the Earth Europe and the Rosa Luxemburg Institute in Germany, which reported that much of the chicken being eaten around the globe is controlled by just a handful of companies.
The report said companies such as the Brazilian firm JBS, Tyson Foods and BRF had been taking full advantage that poultry sector the fastest-growing meat segment globally, in 2017, Brazil, the US and the EU accounted for nearly 77% of the world’s poultry exports.
It said leasing competitor’s facilities and bidding wars were key strategies to get to the top and stay there.
“When the French Groupe Doux – once Europe’s largest poultry producer – floundered in debt in 2012, JBS stepped in to operate Doux’s Brazilian operation, Frangosul. JBS was previously limited to beef in Brazil. This leasing arrangement enabled it to penetrate the Brazilian poultry and pork markets.
“In 2013, after a series of further leases and acquisitions, JBS’s poultry division was significantly strengthened with the creation of JBS Foods. Products from these plants end up in supermarkets in Europe and elsewhere,” the report said.
Government support
It added that the environmental impacts of this industrial meat production system included pathogenic bird flu, antibiotic resistance, land, water and air pollution, as well as climate change. Without government support through public funds and policies that allow these practices to continue, the phenomenal rise of these meat giants would not have been possible.”
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