April 22, 2016

Contact: Andrew Jerome, 202-314-3106

WASHINGTON (April 22, 2016) – Several industries have been on a decades-long trajectory towards increased market concentration, according to a recent report from the Council of Economic Advisers. Last week, the White House expanded their efforts by issuing an Executive Order, requesting that government agencies recommend opportunities to encourage competition in their respective fields.

National Farmers Union (NFU) is pleased to see the administration take a proactive approach to stimulating competition, an issue the family farm and ranch organization has continuously acknowledged as a mounting challenge for the farm sector.

“Competition drives innovation, motivates integrity and stimulates rural America. I applaud the White House for taking the lead in addressing a concern for many industries, agriculture included. We need to renew competition in the farm sector,” said NFU President Roger Johnson.

Several industry-specific studies have consistently concluded that competition is declining as concentration increases over longer periods of time. Between 1972 and 2002, industry concentration — as measured by the share of revenues held by the top four firms — increased in eight of the nine agricultural industries, according to a Congressional Research Service study.

“What we’ve witnessed in recent history is extreme consolidation of the agriculture supply chain, which has shifted the power to just a few companies. As a result, we’ve seen family farming and rural communities shoulder a lot of the burden, such as increased operating costs for producers and consolidation of farmland,” Johnson reinforced.

He added, “Many of the recent mergers and acquisitions of American food and agribusinesses have perpetuated this trend.”

The Council of Economic Advisers determined further examination of specific factors contributing to increased market concentration, such as market structural changes through the supply chain, could be beneficial to the administration’s efforts to improve competition.

“NFU will continue to support initiatives that work to increase competition in agriculture, and we look forward to any further analysis that could help guide future solutions to this problem,” Johnson concluded.

National Farmers Union has been working since 1902 to protect and enhance the economic well-being and quality of life for family farmers, ranchers and rural communities through advocating grassroots-driven policy positions adopted by its membership.


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