Shunpiking Online Vo.4 No.4 Maple Leaf forever - The price of pork: who gets what?

ONE of the motive forces behind the mass rally on January 8th that drew about 400 farmers, mainly hog producers, and their allies to the steps of the Nova Scotia legislature was the cost-price squeeze on farmers. There, speaker after speaker demanded immediate assistance from the Tory government. "Now!" farmers shouted. "We need help now!" Instead of rendering account, Agriculture Minister Brooke Taylor turned and retreated into the legislature, his promises of future assistance judged to be rhetoric.

On the surface, it looks like it is higher energy and other costs such as feed and railroad freight that are increasing the financial suffering of farmers and the attack on food processing workers. According to the farmers, it costs them about $172 to raise a pig to market, but they receive only $150 for it. For its part, the oil-soaked media recite without question the claims of the corporations that they must "restructure", that slaughterhouses and processing plants must be "rationalized" and centralized in a few regions, and that the number of "inefficient" farmers must be reduced.

If this confusion sounds eerily familiar, it is: similar disinformation was cold-bloodedly unleashed in the 1990s in the East Coast fisheries. DFO aimed to "rationalize" the fishery, and concentrate production in the hands of a few monopolies. The result was ruinous: over 40,000 fishermen eliminated in Atlantic Canada The self-serving aim of this disinformation is not only to get producers to agree to their elimination but also to keep people in ignorance about how the food system has been monopolized, how the US has come to dominate food production and distribution in virtually every major sphere of the food chain, how producers, farm workers and consumers are being exploited, and to conceal the source of the crisis in rural Canada.

The hog sector provides a valuable reality check to show the "benefits" of reducing the numbers of farmers. The following compares statistical indicators for 1988 to those in 2002.

	1988	2002
Number of hog farmers in Canada	33,760	11,565

Of the farms that were raising hogs in 1988, corporate and government policies have since forced 66 per cent out of production, or two thirds. On hog farms, the number of pigs per farm has more than doubled in just the past five years, while net incomes have declined. On the other hand, hog production in Nova Scotia, geographically located far from the geographic centres of corporate concentration of production, has declined significantly, from some 215,000 hogs in 2000 to 188,000 hogs produced in 2005.

Pork chops: grocery store price

$6.88/kg

$9.54/kg

While corporate and government policies reduced the number of Canadian hog farmers by two thirds, packers and retailers increased grocery store pork chop prices by 39 per cent.

Hogs: farm gate price

$1.44/kg

$1.46/kg

While grocery store pork chop prices are up 39 per cent, farm gate prices are up only 2 per cent. Seen another way, while hog farmers are still receiving about the same $1.44/kg, packers and retailers have increased their margin (the difference between the price they pay to farmers and the price they charge consumers) by a whopping $2.64/kg.

Packing plant pay

$9.38/hr

$9.65/hr

(representative starting wage)

When adjusted for inflation, starting wages at many plants are down sharply. The monopoly packers are using their growing market power to push up retail prices to consumers, push down prices to farmers, and push down wages to workers.

If reducing the number of farmers produces benefits for the economy, those benefits should be apparent in the hog sector where private monopolies [especially Maple Leaf Foods - Ed.] and government policies have expelled two thirds of our farmers in just half a generation.

No such benefits exist, however: consumers are paying more for pork and workers are getting less for packing it.

The real culprits are a handful of giant, mainly US monopolies that are sucking the life blood out of farmers, ranchers and main street businessmen, leaving ruin in our rural communities. Their struggle is to keep the retail price up, and the wholesale prices and wages down to both the farmer and the processing worker with the command, "stand and deliver."

Statistics excerpted from Darrin Qualman and Fred Tait, The Farm Crisis, Bigger Farms, and the Myths of "Competition" and "Efficiency" (Ottawa: Canadian Centre for Policy Alternatives, 2004)