Editor's Note: The opinions expressed in this commentary are those of Kate Miller, and do not necessarily represent the views of Drovers or Farm Journal. Miller, communications director for Stand Up Republic Arkansas, is a third-generation rancher, a tenured meat processing professional and has a development background in global trade.
The other evening, deep into an argument on #AgTwitter, a feature of the debate peaked my interest. My sparring partner, illustrating the monopoly he believed exists within the beef industry, used the decision to purchase a car as an example of choice. Ironically, the day before I traded in a car. This process, being fresh on my mind, I worked through the series of decisions I made to arrive and execute the right deal.
In effect, on the surface, his idea made perfect sense. I could go anywhere to sell and buy a car, an option that does not always exist in production agriculture. But the notion gnawed at me, as it seemed like an oversimplification of a complex market force.
I called the man who sold me my car.
What I heard from him flipped the argument inside out.
Consolidation on Every Corner
My car salesman was a third-generation car dealer, and he had operated the family business for 25 years before selling out to a national brand. This national brand had moved into the market, lowered the sticker price of new vehicles, and then with ease and efficiency signed contracts with local business for fleet vehicles and rental cars that the family dealership had enjoyed for generations.
A few years with profits disappearing and customer attrition, my new friend sold the dealership and went to work for the competition. There were no press releases on his generational family business being sold to a conglomerate. There was no Twitter diatribe about the loss of another piece of the rural economy. His business card changed, and other than his immediate family no one cared.
The story of the family car dealership can be told in every small town in America. The same can be said for automotive parts, where the top three brands dominate the space and Amazon has targeted a 22% cost reduction to erode their market share. The same can be said for local mechanics or autobody shops. The same can be said for automotive brands, which are currently consolidating globally. This can be said of grocery stores where store count declined 2.5% in 2018, and the sector comprises 17% of mergers and acquisitions for the same time period—second only to food manufacturers at 30%.
I cannot name an industry that has not been impacted by consolidation. From our public-school systems to local services such as bakeries and restaurants, even our churches have not escaped consolidating forces.
So why then is much of the political and social capital of rural America is spent saving the ‘family farm’ if the whole of rural America’s economic system and landscape is changing?
The Cry for the Family Farm
Can we define what constitutes a family farm? A multigenerational row crop family in Illinois who farms 15,000 acres would classify themselves as a family farm. A 10,000 cow dairy in Wisconsin would too. So would a 300 cow dairy or an organic vegetable gardener or a feedlot operator.
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