Wiring the Third World Farm Into One World Market
The whole point of an integrated world food system is that one produces not for human need but for "the market." In "the market," whether national or international, if you don't pay, you don't play. Companies who can find paying customers orient demand, and if demand runs to strawberries in February, strawberries will be grown regardless of the pressing food needs of millions of powerless and penniless people. Food systems, even in UDCs, are also fashioned to transform primary, cheap calories (like those eaten in the form of cereals) into more profitable calories (like those found in meat and processed foods).
The Overseas Private Investment Corporation (OPIC) is the US government agency that specializes in "political risk" insurance and equity loans to US firms setting up shop in the UDCs. As of the end of 1977, its roster at least 45 "active" projects concerned with ranching or animal raising in poor countries (there are in addition a great many other projects of this kind considered "paid off"). Industrial chicken raising ventures and beef cattle ranches are especially popular activities for OPIC's loans and insurance.50
While Third World chickens may sometimes eat food suitable for humans, more often their feed is grown on land previously devoted to food crops; in both cases they are niggardly in returning protein consumed, as only about 25% is retained. They are, however, excellent converters of value and especially good customers for processed feeds. Robert Ledogar, in a book which deserves to be widely read 51 describes how Ralston Purina simultaneously sets up feed mills and a chicken industry so that its feed will find a ready market. What goes into the feed mill? In one case, soya and sorghum. Ledogar reports that in one valley in Colombia, before Ralston Purina moved in, sorghum acreage stood at zero and is now over 60,000 acres. Soybeans, which previously covered about 15,000 acres rose to over 140,000. Neither crop is suitable for direct consumption by people. The company's operations have been extremely well-managed: from 1966-71, annual broiler production doubled to 22 million birds; egg production doubled between 1970-73 to two billion, while Ralston Purina in 1973 sold 240,000 tons of feed in Colombia. A remarkably efficient system, except that "for about a quarter of the population, a dozen eggs and a kilogram of chicken cost the equivalent of a weeks' earnings or more."The overall protein deficit in Colombia has grown since the company arrived.
The President of Purina's international operations has a somewhat different perspective and explains that
If we can identify national development objectives and can contribute to them as good corporate citizens, then we will move in in a small way in agribusiness. As these nations develop, we will branch out into other things that we do and which the economy needs ... We bring more efficient agricultural technology to the farmers who supply us with grain inputs and to the livestock producers who use our feeds... For example, in Colombia, when we went in, we found a shortage of carbohydrate raw materials. There wasn't enough to divert from direct human consumption into livestock. We brought in agronomists and grain sorghum seed ... We offered farmers a guaranteed price for the grain.52
Whether or not there was "enough to divert from direct human consumption," human consumption has suffered. Not only can poor people not buy chicken and eggs, but in this same valley the acreage now devoted to feed crops has caused cultivation of dry beans to decline drastically: there are now about 42,000 fewer acres devoted to this staple of the ordinary Colombian's diet than before the arrival of Ralston Purina.
While this particular product goes to middle and upper middle class consumers in Colombia, a lot of the protein that originates in the UDCs heads due North. This is the case for almost all the beef cattle raised on Central American or African ranches and it is also the case for fishing ventures, another favorite area for foreign investment in Third World food systems.
The Latin American Agribusiness Development Corporation (LAAD) whose only stockholders are fifteen or so multinationals like Ralston Purina, Castle & Cooke, Cargill, etc. has invested in a number of projects that concern chicken, hog or beef raising and processing. LAAD explains that:
the world food crisis has dramatized the need to increase food production in the developing countries ... Of the world's developing areas, Latin America offers one of the best potentials to increase food production. Fortunately, most Latin American governments are giving higher priority to food production and rural development than in the past.53
From this, one can only conclude that the "world food crisis" has hit North America especially hard, because that is where the produce grown by LAAD-financed companies invariably goes. The Corporation has also perfected a fool-proof profit making system. First it obtains loans of several million dollars from USAID (that is, from American taxpayers); these loans are long term and carry interest charges of 3-4%. LAAD then reloans the money for agribusiness projects in Central America (adding capital of its own) and is paid back in the short or medium term at "interest not in excess of 9% per annum."54 LAAD's avowed interest is in "non-traditional" export crops which "include beef and beef products, fresh and processed fruits and vegetables; cut flowers, dried flowers, ferns and tropical plant cuttings, semi-processed and finished wood products, seafood and other specialty items." Guatemala is host to the largest number of LAAD projects followed by other Central American countries, but the consortium is also branching out into South America and the Caribbean.
Prior to 1950, practically all the fish eaten in the North was also caught in northern waters. Today, between a third and a half comes from UDCs seaspace. Very little of this commercial catch serves the needs of populations in the southern hemisphere countries. Of the whole Peruvian anchovy catch, 80-90% is exported as fishmeal to provide feed for industrially raised chickens. Many people hoped that aquaculture or "fish-farming" would help to solve food shortages in poorer countries and it is true that in China carp ponds are an important part of village economies. Unfortunately, experts point out that aquaculture requires precise and delicate control over the reproductive and growth cycles and that the species that lend themselves best to existing technologies happen to be those, like shrimp, whose price is prohibitive for all but the best-off consumers.55 Such delicacies will never help feed hungry people. Nevertheless, as the
international market for fish expands, more and more projects of this type are being set up in the Third World, including at least thirteen insured by OPIC.
Ghana is one of the several African countries to have been hard hit by food shortages in 1977-78.56 Thus OPIC assistance to Star-Kist (owned by Heinz) for a tuna venture there is of particular interest. Here again, when we read successive OPIC Annual Reports, we are led to believe that "shortages" especially afflict the rich countries:
What few people recognize is that the growing demand for tuna fish and other seafoods in the United States and elsewhere has placed a strain on available supplies. Thus Star-Kist has embarked on an international program which can help to alleviate future shortages. (1974).
Star-Kist has organized an effective international division of labor for this fishing venture: A large loan from OPIC allowed it to purchase US fishing vessels equipped with the latest Japanese technology:
Currently the daily catch is unloaded at the company's modern refrigeration plant in Tema (Ghana) and then shipped to Puerto Rico for processing and eventual sale in the United States where tuna has been in limited supply. (1975)
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"In the agribusiness international economic order there is every reason that American cats take precedence over West African people, since the former can pay and the latter frequently cannot."
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This was phase one. Phase two of this project has now been completed. An existing Ghanian mackerel cannery (mackerel is a very cheap fish) has been converted to tuna processing. It is fulfilling the expectations of Star-Kist, since it has an:
annual capacity for producing 206,000 cartons of canned tuna and 67,000 cartons of tuna cat food. (1977)
In the agribusiness in
ternational economic order there is every reason that American cats take precedence over West African people, since the former can pay and the latter frequently cannot. The population of the US now stands at 212 million people, but the number of consumers is closer to 277 million, because one must take into account the 30 million cats and 35 million dogs who eat over $2 billion worth of processed food annually. Cheaply produced meats and fish from the UDCs make up a good bit of their menus; dog and cat food are also among the most profitable items agribusiness has to sell and are therefore aggressively promoted.57