1.
1999: America's land-owning serfs
Most farmers have heard it, read it and perhaps even said
it during this winter of crushingly low commodity prices and
continued corporate concentration: “If something doesn’t
change, we’ll all be chicken farmers.”
The view is never offered as a compliment. West of the Alleghenies
and north of the Ozarks, “chicken farmer” often
means hired man, debt slave or tiny cog in a massive meat-making
machine built by, run by and ruled by billionaires and billion-dollar
companies.
Come to find out, chicken farmer means the same thing east
of the Alleghenies and south of the Ozarks, too, according
to a three-part expose’ on the poultry industry published
in the Feb. 28 through March 2 editions of the Baltimore Sun.
The stories, the result of an eight-month investigation across
13 states, offer the blunt assessment that contract poultry
growers are “land-owning serfs in an agricultural feudal
system.”
Little wonder many livestock producers--and grain farmers,
too--worry about becoming 21st century serf-chicken farmers.
Each time a farmer suggests that likelihood, I ask if he knows
how the industry operates and how prices poultry growers receive
are calculated. Few do. So here’s how:
At the start, the integrator delivers day-old chicks to your
barn. You must accept the integrator’s word that the
number of chicks it claims to be delivering is accurate. You
can’t count ‘em, weigh or question the baby birds’
breeding or health. If you do, you risk having your contract
yanked.
As the flock matures, the integrator’s feed truck periodically
pulls into your farm. You must accept the integrator’s
word that the pounds and type of feed it claims to be delivering
is accurate. You can’t weigh it, test it or question
its quality. If you do, you risk having your contract yanked.
Should the birds get sick, you can contact the integrator.
It may or may not treat the birds. You cannot treat the birds.
They aren’t yours. If you do, you risk having your contract
yanked.
And while the birds are breathing, the integrator retains
title to them. The second one stops breathing, though, its
title flops to you. Complain and you risk having your contract
yanked.
When the birds are fully grown, the integrator collects them.
You must take the integrator’s word that the number
of chickens it claims to have collected is accurate. You can’t
count ‘em or weigh ‘em. If you do, you risk having
your contract yanked.
A short time later, you receive a settlement sheet for your
work. It contains more data than the blueprints for the Space
Shuttle and is equally incomprehensible. It shows deductions
for things like medication, litter, and processing--even though
you may not have received any litter or medication. If your
competitor-neighbor did, however, you share his cost. Gripe
and you risk having your contract yanked.
And processing? They were never your birds so why are you
charged for processing them? Ask and you risk having your
contract yanked.
The price you receive is an average of three weeks’
prices--usually the average of three consecutive Mondays when
thin trading brings the week’s cheapest prices--on the
New York market. Complain and you risk having your contract
yanked.
Once the base price is determined, your flock’s feed
efficiency, “liveability,” weight, and other factors
are indexed to those of the integrator’s other grower
flocks “settled” that week. All prices paid to
growers then are pro-rated off the “best” flock.
If your flock performed seventh best out of the 15 flocks
settled that week, you receive the seventh-best price.
Complain about how the integrator calculated your price and
you risk having your contract yanked.
Then the check finally arrives. If you’re very, very
good--and you received healthy chicks, the right feed rations,
good weather, and experienced little disease--you may have
finished 52,750 of the 54,000 delivered chicks to an average
weight of 5.25 lbs. apiece. That’s 276,950 lbs. of poultry.
The check for your work amounts to $10,500, or 19.9 cents
per bird. It’s actually less than that because you’ve
yet to pay on the loan for your building, the electricity
used during growing, and other costs.
Nineteen point nine cents per bird.
Ironically that’s nearly the integrator’s exact
cost of the chick it placed in your barn two months ago.
The ugly truth is you’ve raised a 20-cent yellow furball
to a $4.50 per pound boneless chicken breast and the value
of that chick--to you--never went up one a single red cent.
Keep that thought in mind when the integrators and their
clucking shills tell you contract production is an opportunity
for you to eliminate market risk.
And keep another phrase in mind, also: “Land-owning
serfs in an agricultural feudal system.”
2. On the
road in 1998: Finding truth on a Swiss junket
A writer friend often jokes that journalism awards have little
value. According to him, since the human body cannot digest
walnut plaques and brass statuary, awards cannot feed the
family or pay the bills.
To a large degree, he’s right. Awards reflect glories
past; they don’t put supper on the table or write next
week’s column.
But one ag writing award is different. The American Agricultural
Editors’ Assoc. “Writer of the Year” prize
carries an all-expenses-paid, week-long trip to Switzerland
courtesy of its sponsor, Novartis Crop Protection, Inc. (As
well as a non-edible walnut plaque and bicuspid-breaking brass
statue.) Since I somehow stumbled to victory in 1997’s
AAEA writing race, I copped the trophies and the six-star
Swiss junket.
Yet the threat of seven days in Europe’s most picturesque
country with company officials dogging my steps and washing
my brain held little attraction. A pal from Texas, Joe Dan
Boyd, the only two-time winner of the award, encouraged me
to check my cynicism with my luggage and take the trip. It
was excellent advice because the holiday yielded new friends,
new ideas and a new view of the tight box Swiss and European
farmers now find themselves.
And best of all, no Novartis PR-types were seen or heard--not
even during a day-long chatfest at the Swiss giant’s
headquarters in Basel. Instead, company bigwigs treated their
U.S. guests to several hours of refreshingly frank discussions
on global agriculture, the role of biotech and European politics.
For example, Dr. Jost Harr, Novartis director of research
and development strategies, openly worried that a recent countrywide
referendum which endorsed the use of biotech crops in Switzerland
by a 56% to 44% margin was too lopsided a victory to allay
public fears of bio-based food.
“It would have been much better had the vote been closer,
like 52-48,” Harr noted, “because now we have
winners and losers. This will not promote the dialogue we
need if biotechnology is to be adopted slowly, safely and
confidently. Industry and universities are filled with people
who still think what’s ‘do-able’ should
be done. That’s not the way to do it, of course.”
Of course? What a peculiar--and truthful--opinion from a
person and company whose futures are inexorably linked to
genetic biotech.
Two farm visits were equally enlightening. At one, young
Mathias Kleiber explained how he, his wife, father and mother
made their livings on 54 acres (valued at $15,000 per acre)
of fruit crops, wheat and cattle.
Because he participates in a new Swiss farm program which
marries soil conservation to Integrated Pest Management, (the
only country in the world to do so) Kleiber receives about
$500 per acre government subsidy. If he chooses--and he has
the choice--not to go IPM, his subsidy would drop to about
$125/a. Likewise, if he moved from IPM to nearly organic,
his government check would balloon to over $600/a. The Kleibers
like this innovative program that ensures food quality and
their farm’s future.
A second farmer, J. Salvisberg, who rents nearly 170 acres,
large by Swiss standards, plays the IPM game, too, on his
lengthy crop rotation of oats, barley, potatoes, canola, wheat
and pasture. Yet he wants a US-style “freedom to farm”
policy so he can buy land, expand the family’s 26-cow
dairy herd, boost sow numbers from 20 to 60 and grow just
wheat.
“The European Community,” of which Switzerland
is not a member, “will push out our country’s
farm programs sooner or later,” Salvisberg predicts.
“We should do it sooner so farmers like me can be free
to do the best of our farming abilities.”
Over a lingering dinner, Dr. Hans Popp, Switzerland’s
recently retired deputy ag chief, explained the clash of farming
cultures that’s building in both his country and continent.
For the first time in centuries, Popp notes, Europe has had
50 years of continuous peace, so food now is not a key security
issue as it was for previous generations and governments.
Also, the 1995 GATT deal that freed global ag trade has clipped
Swiss farm prices by about 30 percent. In turn, many Swiss
farmers now want to remove restrictive rules on what and how
much to produce to, hopefully, boost income.
Popp, who received his Ph.D. in economics at the University
of Chicago under Nobel Prize-winning Theodore Schultz, believes
Swiss farmers will be integrated--either de facto or by law--into
the EU and the global ag economy within 10 years.
“But that will guarantee them nothing,” he opines,
“other than many, many fewer farmers.” It will
be the same for the rest of Europe, too, he adds.
“It’s called progress, yes?” Popp asks
rhetorically. “Personally, I don’t think it is,
yet it cannot be stopped in your country or mine. But we can
manage it better so people have time to adjust.”
More truth. And that’s always a prize.
© 2002 ag comm
The Final Word comes to you each Friday by special arrangement.
Alan Guebert's regular column, the Farm and Food File, is
published weekly in more than 70 newspapers around the US
and Canada. Contact him at AGuebert@worldnet.att.net.
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