Riding a Sleek Train
through the Food Chain

As highly unlikely experience as riding Amtrak's Empire Builder from Seattle to Chicago would be to see the dire consequences which corporate agribusiness has visited upon rural America, a recent trip on that fast-moving train provided both traveler and tourist such an opportunity.

At the outset, burrowing under downtown Seattle one is reminded that it was here in the Emerald City not quite two years ago that the nations of the world seeking unsuccessfully to resolve their agricultural trade differences unleashed a powerful and still resonating world-wide pro-democracy movement during the week-long meetings of the World Trade Organization (WTO).

Within minutes, as our sleek train emerges into the sunlight, we pass by the Port of Seattle's Pier 86, where a tall grain elevator, currently leased to the multinational grain giant Louis Dreyfus, stands on the waterfront of Elliott Bay.

One cannot view this giant grain storage facility without recalling that when Continental Grain sold it is grain marketing facilities to Cargill Corp., the world's largest commodity trader, last year the latter was instructed by the US Department of Justice's Anti-trust Division to divest itself of the lease of this very same elevator.

In their original "Complaint" the DofJ vividly showed that even prior to the purchase agreement Cargill and Continental were two of a very small number of grain trading companies competing to purchase grain in four key "captive draw areas" including the Pacific Northwest port range, which also included western Minnesota, eastern North Dakota, and northeastern South Dakota, much of the same area our train will cover on its tracks to Chicago.

Aside from brushing aside the genuine concerns of many relative to the monopolistic control of the marketplace by such corporate agribusiness behemoths as Cargill, the DofJ in a vapid effort to make it appear that it was troubled by such monopoly control on the US domestic market ordered Cargill to divest itself of the Seattle elevator's lease, but in doing so only opened the door for increased international monopoly control of the grain trade by an already select few corporations.

While the Louis Dreyfus Corp. would purchase the vacated lease of the Pier 86 elevator, Cargill assumed 50% control of a nearby Tacoma, Wash., port terminal while some 100 miles to the south on the Columbia River, ConAgra, Archer Daniels Midland (ADM) and the Mitsubishi Corp., a leading Japanese trading company, operates the Kalama Export Company LLC, affording western Washington State a very exclusive who's who of the international grain trade.

Soon, we are rolling through the lush Snohomish Valley to the north and east, as small dairy and vegetable farms dot the landscape, struggling to economically survive while at the same time fighting off the encroachment of their rich farm land by the neighboring Microsoft and other high tech instant millionaires desiring suitable "rural living" quarters.

Eastward, winding through the magnificent beauty of the Cascade mountains, we descend on Wenatchee, "the Apple Capital of the World," where although 15% of the nation's apple crop is produced there, we begin to see the undermining affects of "free trade's" recent torrent of cheap apple juice concentrate flooding the US from China.

As the Asian economy struggles to recover, China, which has now become the world's largest apple producer with more than a million acres of apple orchards and produces one billion 42-pound boxes annually, compared with Washington state's 100 million boxes, has been forced to seek other markets and thus has converted its apples into concentrate and exported them to the US. Today, China produces 18 million metric tons of apples compared with the 4.3 MT it produced in 1990. By 2005, China is expected to produce 40% of the world's apples, up from 10% at the beginning of the 1990s.

In years past Washington growers exported a third of their apples abroad. Half of them went to Asia. With the devaluation of Asian currencies and in the face of a stronger dollar making US products less affordable, demand for apples in Asia has dropped dramatically. For example, in recent years countries such as Thailand, Malaysia, Singapore and Indonesia bought 50% to 85% fewer Washington apples than they did in previous years.

Shrinking apple markets at home and abroad have also coincided with a decline in the number of apple producers as 20 years ago, 5,626 Washington apple growers worked 115,244 acres of apple orchards; today, there are about 3,800 growers with 172,000 acres.

On through Idaho, where abundant potato fields await the plow as the state's potato farmers are seeing their numbers dwindle by a third this year, losing half of their number since 1995, as their prices go from $8 to less than $1 per 100 pounds. Meanwhile, giant potato processors like J.R. Simplot and ConAgra build up large inventories and prosper as consumers find they must pay between 39 cents and 69 cents a pound for the potatoes these farmers are getting but one cent for at the farm level.

Into Montana we begin to see long-abandoned farm houses and the remains of small rural communities rotting in the chilly spring sun, victims of a long-standing farm policy that stubbornly refuses to pay the nation's 2.1 million commercial farms a fair price for what they produce, let alone a simple cost-of-production price.

Small lonesome cattle herds can also be seen, all unlikely to earn for their still-independent producers a fair price in the open marketplace, being forced as they are to compete against the enriching captive supplies and the formula pricing of the meat industry's big three -- Tyson Foods' IBP, Cargill's Excel and ConAgra's Monfort Beef -- which slaughter nearly 80% of all US meat.

Across the flat plains of North Dakota our train speeds, passing the weatherbeaten, decaying prairie cathedrals of America's heartland. The onetime locally owned hubs of rural economic activity are now replaced by the large missile-shaped silos, storage elevators of the grain trade's elites. One cannot pause to ponder how these metal silos, storing humankind's "staff of life," so closely resemble other nearby silos buried beneath the rich soil which contain the seeds of the earth's destruction.

On the nearby highways large trucks with familiar food brand logos emblazoned on their sides carry the average unit of food in the US the 1,500 miles between the point it is grown and produced and the point that it is consumed, while long freight trains with their hopper and tank cars carrying grain, foodstuffs and oils adorned with names like Louis Dreyfus, Cargill Foods, and ADM ("Supermarkup to the World") speed by our idling train.

Early morning finds us passing first by the giant flour and cereal mills of Minneapolis, where the PepsiCo's Quaker Oats, General Mills and other large cereal companies and bakeries consistently provide a double digit return on stockholder investment, while farmers receive but a paltry seven cents of each dollar consumers spend on their baked goods and cereals.

We cross over the mighty Mississippi River, now barely beginning its rambling journey through the nation's midsection before emptying its millions of gallons of water and tons of agricultural and industrial polluted runoff into the Gulf of Mexico, adding daily to the Gulf's already thousands of acres of aquatic "dead zone."

Wisconsin's cheese-producing dairy farms soon begin to be seen as our train nears its midwest destination. Here family-farm dairymen and women struggle to retain the purity of their product from the threat of the Monsanto-produced genetically engineered bovine growth hormone (rBGH) as over half of their milk goes into cheese production.

Not only have these dairy farmers become the victims of a complicated national below-cost-of-production pricing scheme, but now exacerbating that struggle in recent years has been the import from abroad of cheap milk protein concentrates (MPCs). Although not a cheese, these MPCs -- a blend of imported dairy ingredients with a 40% casein minimum -- are presently being used in several cheese advertised products manufactured by Philip Morris' Kraft Foods (which currently has 56.8% of the nation's processed cheese market and 62.2% of the "American cheese" market), Land O'Lakes and Dairy Farmers of America.

And they are being used despite the fact that MPC is considered a food adulteration since the Food and Drug Administration (FDA) does not classify it as a Generally Recognized As Safe (GRAS) food ingredient and does not have a standard of identity for it.

As another afternoon sun begins to burn itself across the western horizon for the third time on our Empire Builder cross-country trip, we disappear into the skyscraper canyons of Chicago where the once-bustling and infamous stockyards of Upton Sinclair's The Jungle gave the city with Carl Sandburg's "broad shoulders" a singular place in the nation's folk lore.

Ironically, our journey's terminus lies only a few city blocks from the Chicago Board of Trade and Chicago Mercantile Exchange where the nation's and the world's food future is speculated on, gambled on and where the so-called economic theory of "supply and demand" gives way to the theory of "it's the pits!"

Despite claims to the contrary, actual farmer participation in farm commodity futures programs is limited to a select few. Most farmers have come to have little faith in the system. Wayne Cryts, a Missouri soybean producer who led 150 protesting farmers into the CBOT in 1984, argues that the Board of Trade has failed to acknowledge farmer concern over the unfair trading practices of the speculative seller, as opposed to those who have a legitimate position of ownership of the commodity.

"We have no problem with speculators in the market as long as they have taken a position of production costs similar to that of the farmer, which means they must buy, or be able to produce commodities before they can sell them -- period!"

The fallacy of corporate agribusiness's claim that the so-called "supply and demand" maxim is manifested in the nation's futures markets is suggested by figures obtained from the CBOT and the US Department of Agriculture's Economic Research Service (ERS). They show that for each bushel of wheat produced by the farmer in 2000, 16 bushels were traded on commodity exchanges; for corn the ratio was one to nine bushels, and for soybeans a staggering one bushel produced for every 31 traded.

A critic of this so-called agricultural "paper blizzard harvest," still called by some the "free market" system, Texas farmer David Senter believes that remedial steps are long overdue to curb the manipulation and speculation that affects farmers day-to-day prices of agricultural commodities.

"CBOT speculators are depressing the price of commodities by selling unlimited numbers of futures contracts, regardless of what we can produce or what's in storage. These paper contracts with nothing to back them up should be barred."

Reflecting on this deification of the law of supply and demand, one veteran trader has observed that "it's just a bunch of numbers. And we all know that people use statistics the way dogs use lampposts -- for convenience rather than illumination."

Yet, it is here in the CBOT and CME where the vast majority of America's family farmers believe their long-train of economic abuses originates in what can rightfully be called America's largest and costliest gambling casino.

Our trip now finished, one cannot help but reflect on how many of the train's travelers, as they gazed out of their windows or sat in the train's diner eating three abundant meals a day, actually saw the economic and social brutalization which is currently besetting rural America given the fact that all such sights were constantly framed by the grandeur of our country's Pacific Northwest and the singular beauty of its heartland.

So what is a Calamity Howler? "Sometimes an intended epithet can be turned to good advantage. In the sole surviving issue of the Decatur, Texas, Times, one finds the way Populists not only accepted the label 'calamity howler' but insisted that they had ample reason to howl and would continue to howl until their objectives had been attained." -- The Populist Mind, edited by Norman Pollack

A.V. Krebs operates the Corporate Agribusiness Research Project, P.O. Box 2201, Everett, Washington 98203-0201

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