Drs. Mary Hendrickson and Harvey James, University of Missouri, kicked off our #AgJustice member webinar series with a presentation on developing a framework for evaluating the fairness of agricultural markets and resisting consolidation.

1. Power & Fairness in
Agricultural Markets
Mary Hendrickson and Harvey James
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2. 2
Background: Constrained Choice in Agricultural Markets
• To plant GM or not is irrelevant if there is no choice of other
seeds in the marketplace
• To use particular GM traits or not is irrelevant if there is only a
bundled package available
Consolidation in
agricultural markets
“constrains – as in limits or
inhibits – the decisions of
farmers by restricting
choice options or the
types of decisions they
can make. … Second, it
constrains – as in compels or
obliges – the choices of
farmers by forcing them
into the kinds of
decisions that they
otherwise would not
have chosen for ethical
or other reasons”
(Hendrickson and James 2005
p283; see also James and
Hendrickson 2008)
Structure ► Farmers ►Choice
Limiting
Factor
Optimal
Choice

3. 3
Concentration in the Protein Sector in the US
Broilers (51% CR4)* 1. Tyson Foods
2. Pilgrim's (owned by JBS)
3. Sanderson Farms Inc.
4. Perdue
Steer & Heifer
Slaughter (73% CR4)*
1. Tyson
2. JBS
3. Cargill
4. Leucadia (formerly National
Beef)
Pork Slaughter (67%
CR4)*
1.Smithfield/WH Group
2.JBS
3.Tyson
4. Hormel
Source: https://ir.tyson.com/about-tyson/facts/default.aspx
“Tyson Foods is a modern, multi-
national, protein-focused food company
producing approximately 20%
of the beef, pork and chicken
in the United States in addition to
a portfolio of foods under the Tyson®,
Jimmy Dean®, Hillshire Farm®,
BallPark®, Wright®, Aidell’s® and State
Fair® brands.”
Source: https://ir.tyson.com/about-tyson/facts/default.aspx

4. Seed Industry: Big 6 Firms Become Big 4 firms
Control over 60% of global proprietary seed sales
https://philhoward.net/
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Dow/DuPont
• $130 Billion
• Divided into 3 - Corteva
Chemchina/Syngenta
• $43 Billion
Bayer/Monsanto
• $63 Billion
• Bayer’s seeds sold to
BASF for $7 Billion
BASF
Global Meat Packing

5. 5
How do we think about fairness?
Pick our favorite theory?
Fair and competitive markets

6. Battle of Theories
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Think about fairness in ways that is theory neutral

7. 7
Expectations!
A violation of expectations is when we
scream “Unfair”!

8. Fairness in the relative distribution of power within network structures of two or more
parties
• Distribution of power and associated dependencies shape the expectations of fairness
in agricultural markets as well as the actual “liberties”
• Perceptions of fairness become important to the ways that farmers and consumers do
or do not participate in agricultural markets
• Objective observer needs some criteria to use to evaluate the reasonableness of
expectations
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Fairness Expectations Assessment Theory (FEAT)

9. 9
Criteria used to evaluate expectations
Equal
treatment of
equals
Time
consistency

10. 10
Criteria used to evaluate expectations:
Basic Liberties in Agrifood Network Relationships
Freedom to
negotiate and
dictate terms
Freedom to
profit from
exchange
Freedom to
know and to
be informed
Freedom to be
treated
equally
Freedom to
make ethical
decisions

11. Why does this matter?
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Markets
• Efficiency vs Fairness
• Counters argument of efficiency to promote consolidation
Policy
• Anti-trust
• Contract

12. For more information:
• Dr. Harvey James
• Email: hjames@missouri.edu
• Dr. Mary Hendrickson
• Email: hendricksonm@missouri.edu
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