The Global Food System Part I

Introduction to Global StudiesXIDS 2301

Stuffed . . .

Stuffed . . .

. . . and Starved

SinceWFS

Global Food ProductionThree defining processes:

1) Commoditization

2) Industrialization

3) Globalization

Subsistence Production

Food is produced to be consumed by the producer

Commercial Production

Food is produced to be sold in the market

Commoditization

Two basic types of food production

Subsistence Production

Food is produced to be consumed by the producer

Commercial Production

Food is produced to be sold in the market

Commoditization

The shift from subsistence to commercial farming is known as the commoditization of food production

Commodity—something produced with the intent to sell it

The consumer has direct/non-market access to food

Producer = Consumer

Commoditization

In subsistence food production, producer is motivated by own needs

The consumer has direct/non-market access to food

Consumer access to food is mediated by the market

Producer = Consumer

Commoditization

Commoditization

Producer Consumer

MARKET

In subsistence food production, producer is motivated by own needs

In commercial food production, producer is motivated by market calculations; the need to “satisfy” market imperatives

Increase in productivity

Shift to “cash crops”

Social, ecological costs

CommoditizationHistorical Geography of Food Commoditization

1400s-1600s, England

“the first time and place that a new social dynamic is clearly discernible, a dynamic that derives from the market dependence of the main economic actors”

•Politically unified, centralized•Physically unified by network of roads, water transport•Disproportionate size, growth of London as population and trading center•Land holdings concentrated in hands of few large landlords

•Large-scale, accessible markets emerged•Compelled landholders to increase productivity of land•Could not rely as much on “non-economic” powers (military, judicial, political) as elsewhere in Europe•Thus, sought to increase “economic” means•Led to preoccupation with “improvement” and “enclosure”

CommoditizationHistorical Geography of Food Commoditization

1600s-1900s, Western Europe, North America, colonies in Americas, Africa, Asia

•Emergence of states, merchant class•Colonialism

1980s-2000s, Global South (e.g. Mexico, India, Kenya)

•Liberalization of agriculture•Emergence of agri-business TNCs•Role of global governance institutions (WB, IMF, WTO)

IndustrializationIn general, industrialization is a fundamental transformation of the production process involving:

•Mechanization

•Use of high energy, external inputs (fossil fuel energy, bio-engineered seeds, chemical pesticides and fertilizers)

•Subdivision of process into specialized, sequential tasks, each undertaken by a different individual or firm

Industrialization

Industrialization

Industrialization

Farm

Processing Retailing

Consumer

Processing

Industrialization

Retailing

Consumer

Processing

Transportation and Wholesaling

Farm

Processing Retailing

Industrialization

Farm

Processing Manufacturing

Retailing

Consumer

Transportation and Wholesaling

Transportation and Wholesaling

Industrialization

Industrialized chicken production

IndustrializationFeatures of commoditized, industrialized food production

•Appropriationism•Substitutionism•Intensification•Contract farming

Monopoly in processing through horizontal integration

Farming Farming A

Processing

Manufacturing

Retailing

Farming B Farming C

Farming D

Manufact I

Manufact J

Manufact K

Manufact L

Retailing M

Retailing N

Retailing O

Retailing P

Processing E

Processing G

Concentration within various stages of the food systemProduction stage % mkt share by largest four largest firms

Beef slaughter 87% (IBP, ConAgra, Cargill, Farmland)

Sheep slaughter 73% (ConAgra, Superior, High Country, Denver Lamb)

Broiler slaughter/processing 55% (Tyson, Gold Kist, Perdue Farms, ConAgra)

Flour milling 62% (ADM, ConAgra, Cargill, CFP)

Soybean crushing 76% (ADM, Cargill, Bunge, Ag Processors)

“You get the day olds or you get nothing.” (Perdue Farms rep to North Carolina chicken farmer)

Monopoly in processing through horizontal integration

Farming Farming A

Processing

Manufacturing

Retailing

Farming B Farming C

Farming D

Processing E

Manufact I

Manufact J

Manufact K

Manufact L

Retailing M

Retailing N

Retailing O

Retailing P

Green Revolution1960s and 1970s

Miracle seeds (HYVs)Chemical inputs (fertilizers, pesticides)Irrigation (water access, capital)Tractors (capital, farm size)

Blue Revolution

Began in 1970s

Industrialization of aquatic food production—“fish farming”

Genetically Modified Organisms

Took off in 1990s

GMO = any species whose DNA has been manipulated in a lab setting; using genetic code from other living species

•driven by profit-seeking•“biopiracy”

GlobalizationTwo principal (and related) dimensions to the globalization of food production:

1) Production—organization of production chains across multiple countries

2) Regulation (or governance)—Role of international institutions, the “global free market”, and TNCs

Farm

Processing Manufacturing

Retailing

Consumer

Transportation and Wholesaling

Transportation and Wholesaling

Globalization

Globalization

Country D

Country C

Country A Farming

Processing

Manufacturing

Retailing

Consumption

Country B

Agribusiness Transnational Corporations (Ag TNCs)

• Operate in more than two countries, often via vertically integrated food systems this in essence created the “global” food system

• Ag TNCs produce enormous quantities of food primarily for consumers in the First World

• Ag TNCs play a role in the creation of hunger, primarily in the Third World by motivating a shift from subsistence to commoditized, industrial agriculture

o Shift to cash crops, decline in production of staples

o Indebtedness among farmers

o Loss of peasant access to land

Globalization

GlobalizationStates

• Liberalized agriculture Ag TNCs (very powerful within domestic politics!) pushed for this as they “globalized”

o This does not mean that Ag TNCs were willing to give up government subsidies and various trade “protections”

GlobalizationStates

• Liberalized agriculture Ag TNCs (very powerful within domestic politics!) pushed for this as they “globalized”

o This does not mean that Ag TNCs were willing to give up government subsidies and various trade “protections”

International institutions (WTO, WB, IMF)

• Liberalized agriculture USA, Europe (very powerful within these institutions!) pushed for “openness” in agriculture (specifically, regarding international trade and investment in agricultural commodities)

o Prior to the 1980s, US Ag TNCs wanted less liberalization, and so they pushed for agriculture to be excluded in the broader post WWII push for liberalization and economic integration

• Debt crisis and structural adjustment countries in debt crisis were “helped” by IMF, WB as long as they enabled the liberalization, commoditization, and industrialization of agriculture, among other things

American food aid policy

Globalization

PL-480Title I

• Authorizes “friendly” sale of agricultural commodities to other countries

• How this typically works:

--US gov’t buys food from US farmers/agribusiness

--Sells food to foreign gov’t and provides low-interest loan w/ which to pay for the aid

Title II

• Authorizes food to be given to other countries as a grant

Since 1955, 70% US food aid has been provided through Title I

Globalization

Globalization

The issue of subsidies . . .

FIRST WORLD

THIRD WORLD

Basic Model of the Global Food Economy

Cash Crops

Shift to industrial farming

Decline in subsistence crops

Landless, jobless peasants

Rural-to-urban migration

IMF, WB, WTO

Structural Adjustment

Wealthy consumers

Ag TNCsAg TNCs Investment $$

Food Aid (food surplus)