From Alternative Trade to Corporate Consolidation
Can we maintain our ground amidst dangerous trends in our food system?
By Phyllis Robinson, Citizen-Consumer Member and former Equal Exchange Education and Campaigns Coordinator (2002-2018.)
Above: Rink Dickinson, co-founder and Co-Executive Director of Equal Exchange, giving a tour of the warehouse to a group of Citizen-Consumers in June, 2023.
“Food monopolies are everywhere… and they are growing.”
“An oligopoly is a situation wherein a small number of companies control a large enough share of their respective market to dictate prices and industry standards while minimizing competition and inhibiting emerging businesses.”
On May 1st, 1986, Rink Dickinson, Michael Rozyne and Jonathan Rosenthal officially launched the worker-owned fair trade cooperative, Equal Exchange. The three founders had met while working at a New England food cooperative. Through their experiences, they had come to believe that U.S. shoppers were “dangerously disconnected from the source of their food.” People no longer seemed to know where their food was coming from; who produced it and under what conditions; and most importantly, who was profiting in each step of the supply chain.
This concern, and the desire to transform our food system, led them to create Equal Exchange. It was a radical idea in 1986: to create an Alternative Trade Organization that would help farmers and their families gain more control over their economic futures; educate consumers about trade issues affecting farmers; bring farmers and consumers closer together; and create a company that would be controlled by the people who did the actual work. All while providing high-quality foods that would nourish the body and soul and protect the planet’s natural resources.
It was an exciting time. Equal Exchange was in the vanguard of those attempting to bring the fair trade movement, begun in Latin America and Europe, into the U.S.: a system based on paying a fair price for farmers’ crops; supporting democratically-run small farmer cooperatives; and conducting international trade in an ethical manner, based on fairness rather than exploitation. The company also aligned itself with two important U.S.-based movements: food cooperatives, whose motto was Food for People, Not for Profit; and organics, which recognized the importance of food produced in a manner that protected producer, consumer, and planetary health.
It’s been almost 40 years since the founders dreamed up this radical vision. Together with our allies—ATOs, food cooperatives, independent food companies, religious organizations, and a growing number of citizen-consumers like yourselves—we have made tremendous strides to turn this dream into a reality. We have worked hard to inform and educate about food, agriculture and trade.
Consumers have learned to look for, and buy from, those companies that meet their values and standards. These companies and retailers are trusted for their integrity, sourcing practices, governance structure, working conditions, sustainability focus; all of which show a genuine concern for producers, workers, and consumer well-being.
Sadly, however, our collective hard-won achievements are becoming jeopardized.
Since the deregulation wave of the 1970s and 1980s, and a subsequent one in the late 1990s–2000s, a dangerous trend of corporate consolidation is occurring throughout every sector of the food system. A proliferation of mergers and acquisitions, both within the U.S., and across the globe, is dramatically altering the ways we connect to our food. We now live in a world where an increasingly smaller number of companies own—and continue to acquire—an ever greater market share in every sector; from seeds and agricultural inputs, to farmland, processing, distribution, and retail.
A stunning example of this growing trend occurred in November 2022, when Kroger and Albertsons, two of the U.S.’s largest retail grocery chains, announced plans to implement a $25 billion merger. The proposed deal, one of the largest of its kind in retail history, made front page news and caused shockwaves throughout the industry. Together, these two supermarket chains would own roughly 2500 supermarkets, as well as a number of smaller, regional supermarket chains already under their umbrella. If approved, this merger would elevate their market size to be comparable only to that of Walmart’s, which already on its own, “gobbles up $1 out of every $3 spent at grocery retailers.” (“The Economic Cost of Food Monopolies: The Grocery Cartels,” Food and Water Watch, November 2021)
Despite the fanfare this mega-merger has caused, however, the majority of acquisitions take place out of the limelight. Most shoppers remain in the dark about these back-room deals that are transpiring in every corner of the supply chain. And that’s exactly how it’s intended to be. Because behind this opaque curtain, prices are being set, conditions imposed, choices narrowed, and profits made.
Nor is it in the interests of these corporations to put their company names or logos on the products conscientious shoppers tend to reach for from the grocery shelves. These brands have gained a loyalty base for good reasons and ethically-minded consumers support them. But, today, it’s practically impossible to decipher what’s actually behind the label of the goods we purchase: who owns our most-liked organic, natural, or fair trade products? Which of our favorite companies is still independently-owned? And if not, do we know what they actually stand for anymore?
Who, and what, are we supporting with our consumer dollars?
In his 2016 book, Concentration and Power in the Food System: Who Controls What We Eat?, Phil Howard, sustainable food systems analyst and Associate Professor in the Community Sustainability Department at Michigan State University, wrote:
“At almost every key stage of the food system, four firms alone control 40 percent or more of the market. “Kashi? It’s part of Kellogg. Honest Tea? It’s Coca-Cola now. Stonyfield is part of Dannon, Cascadian Farms reports to General Mills, and Plum Organics shows up on the balance sheet of Campbell’s Soup.”
Consolidation is happening everywhere…and there’s no sign of slowing. In fact, research shows that mega-mergers, such as the proposed Kroger-Albertsons deal, only further accelerate the rate of consolidation, as others are forced to do the same in order to survive in the market. Here’s a few more staggering facts to illustrate the extent of the consolidation throughout the supply chain:
Four corporations—Bayer (formerly Monsanto), Corteva (formerly DuPont), Syngenta and Limagrain—together control more than 50% of the world's seeds, with Bayer and Corteva alone claiming roughly 40%. (Kelloway, Claire, “Consolidation Creates Dangerous and Fragile Food Systems,” Food and Power, November 24, 2020)
The same three companies sold 46% of all the world’s seeds and 53% of all agrichemicals. (Food and Power, 2020)
Four companies process 80% of all U.S. soybeans. (Food and Power)
The four largest corporations buy and slaughter 54% of all chicken, 67% of all pork, and 73% of all beef in the U.S. (Food and Power)
Three corporations sell roughly 80% of all soda, two sell nearly 50% of all bread, and one dominates 45% of salty snacks. (Food and Power)
AB InBev dominates more than 46 percent of the U.S. beer market. (Phil Howard, 2016)
Two companies, Unilever and ConAgra account for more than 68% of all U.S. sales of margarine. (Phil Howard, 2016) Four companies control 75% of all yogurt sales. (Food and Water Watch, 2021.)
Five food retail companies—Walmart, Kroger, Costco, Ahold Delhaize, and Amazon—own about 50% of the retail grocery market. (UBS Financial Services)
Grocery stores in the United States are already on the decline. The number of US grocers fell by roughly 30% from 1993 to 2019. (Food & Water Watch, 2021)
The list goes on and on. According to Food and Water Watch’s November 2021 report, out of 55 grocery categories, “just eight can be called highly competitive markets. In fact, over a third exceed the ‘highly concentrated’ threshold used by the U.S. Department of Justice in merger reviews.”
Above: members of Equal Exchange’s Citizen-Consumer community gather at our headquarters in West Bridgewater, MA in early summer of 2023.
Why should we care?
Antitrust laws were put into place for a reason. The more consolidated our food system becomes and the greater control corporate monopolies exercise, the worse the outcome will be for farmers, workers, consumers, and the planet. At every step throughout the food chain, small farmers, independent food companies, mom-and-pop businesses, and consumers face more limited choices about who they can purchase from, sell to, and under what conditions.
Phil Howard explains, “As companies build market power through consolidation, they use it to drive down the prices they pay employees and suppliers, impose onerous conditions on vendors and demand agriculturally indefensible practices from farmers. They outmarket their small-batch competitors or swallow them whole, to the detriment of the food system.” (Concentration and Power in the Food System: Who Controls What We Eat? (2016))
Nor is it just independent actors who lose. Entire communities in inner cities and rural areas also suffer disproportionately as the number of independent grocers diminish, leaving food deserts in their wake. Consolidated power in the food system causes disruption and harm on the macro level as well. “The social and ecological risks associated with our current agrifood system—rising levels of food insecurity and hunger, ecological degradation—are directly related to who has the power to make decisions in food and agriculture. These decisions have increasingly migrated from a more community or public arena into the realm of private decision-making that largely involves those within the biggest firms.” (The Food System: Concentration and Its Impacts (2020))
It’s an uphill battle, but we are used to fighting against corporate greed and the status-quo. And although the current panorama looks somber, we do not have to accept as inevitable the direction in which the pendulum has swung. As leading food system experts, Mary Hendrickson and her colleagues state, “There is no reason that we have to organize the food and agriculture system on a for-profit-based, efficiency specialization-based system.” She believes that the path forward includes “...a mix of large and small, for-profit, nonprofit, and public entities serving different roles in the food system. This includes more community-based actors, such as urban farms, more worker- or farmer-owned businesses, such as cooperatives, and more values-based supply chains, such as fair trade.” (Farm Action)
For many decades, those of us who care about healthy and accessible food; people and communities; and the environment have been walking this path: creatively developing entrepreneurial models to keep our food system healthy, fair, ethical, and transparent. Despite all our efforts to educate shoppers, support small farmers, and lessen the disconnect between U.S. consumers and their food sources, however, the current realities of our capitalistic food system are making this vision increasingly difficult to attain. We must continue to organize ourselves: it will take every one of us to double down our efforts. We can—and must—bring the food system back into the hands of our communities where it belongs.
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