Bloody Chicken: Inside the American Poultry Industry During the Time of COVID

Photograph Source: ben – originally posted to Flickr as Nugget Truck – CC BY 2.0

One effect of the COVID-19 pandemic in the U.S. is the momentary spotlight it shined on the meatpacking industry. Working conditions inside packing plants were exposed in the sheer number of workers who were infected with the virus. Exact numbers are elusive but thousands of cases have been confirmed along with up to 100 deaths. Meanwhile, meatpacking workers were deemed ‘essential.’

On April 28th, President Trump went as far as invoking the Defense Production Act compelling meat processors to remain open. This came two days after the chairman of Tyson Foods, one of the largest meat-producing companies in the world, took a full page ad in several newspapers warning that the ‘food supply chain is breaking’ (this alleged shortage did stop pork exports to China from reaching an all-time high at the same time).

Equally telling is that the two recent executive orders issued by Trump blocking the entry of foreign workers in several visa categories, allegedly in response to the employment crisis of American workers during the pandemic, specifically exempted workers in the food industry, including agricultural workers. For decades immigrants have made up a disproportionate amount of the workforce in packinghouses and on farms. It is an open secret many of these workers are undocumented.

In fact, the last time the meatpacking industry captured the headlines was last August when ICE raided seven poultry plants in rural Mississippi. In what was billed by Mike Hurst, U.S. Attorney for the Southern District of Mississippi, as the largest single-state immigration enforcement in U.S. history, 680 undocumented workers were swept up. Needless to say, the meat companies raided, who often wisely outsource hiring to outside agencies, faced no penalties.

With questions surrounding the meat industry, attention has been turned to the rise of plant-based protein as a more environmental (and animal) friendly alternative. Human consumption of more plants and less animals has obvious benefits but it is impossible to see plant-based protein replacing meat. Whatever the nobility of ethical consumption it often serves as an isolating distraction from the productive side of the economy. It also allows the well-off ‘enlightened’ class to decisively separate itself from the backward rabble. The mission of the Left historically has been to uplift the masses, not separate from them.

It has been a universal truth that the more a society develops economically, the more it consumes meat. Consider that in 1970 the average American ate roughly 200 pounds of meat per year. Today the number is around 20 pounds more, not less. During this time beef consumption has been in decline. It peaked in the mid-1970s. Veal is eaten significantly less than it was two generations ago, and pork has only held steady. It is chicken consumption that has exploded the past 40 years. In that vein, is it notable that the largest poultry producing states are Georgia, Arkansas, Alabama, North Carolina, and Mississippi, most of which are among the poorest states in the country?

There was a time when Americans didn’t eat so much chicken. Running for President in 1928, Herbert Hoover promised a ‘chicken in every pot.’ This reflected not only the banal way most chicken was cooked back then, but also its relative exclusivity (perhaps a modern equivalent would be ‘lobster in every pot’). For example, dining at the posh Blackstone Hotel in Chicago in 1914 one would have come across a menu that featured a dish of Prime Rib for $1.25, Imported Venison Steak at $1.50, Broiled Lobster for $1.60. Chicken was priced at $2.00.

At the time poultry was a local affair with farmers raising small flocks mostly for eggs and home consumption.

It was in the Delmarva Peninsula, which encompasses parts of Delaware, Maryland, and Virginia, where the broiler industry first emerged in the mid-1920s. Located near the major urban markets on the East Coast and filled with farmers looking to escape from the boom and bust of vegetable farming (according to popular history the pioneer was a farmer named Mrs. Wilmer Steele), Delmarva was a perfect place from which to ship live birds. Chickens were slaughtered by local butchers in the cities. By 1934, Delmarva farmers were raising around seven million chickens. Before long the ‘New York-dressed’ method was developed- chickens were slaughtered and defeathered before being shipped on ice with feet and entrails intact, allowing processing to be done near farms and the market base to be expanded.

It was soon realized that a chicken’s physiology had advantages over cattle and hogs. Chickens eat virtually anything and their size makes them easier to transport. Plus they mature quicker than cattle or hogs. Early experiments in genetics and nutrition got results. In 1927, Delmarva broilers went to market at 2.5 pounds in 16 weeks; by 1941, they averaged 2.9 pounds after 12 weeks. Over that same period the amount of feed needed to produce a pound of chicken fell by half a pound.

Like humans, chickens need Vitamin D for proper bone growth, and they need sunlight to synthesize it on their own. Chickens spending part of the day outdoors made them vulnerable to weather and predators (foxes, chicken hawks). An early breakthrough in chicken nutrition was the discovery that adding cod liver oil to feed would allow farmers to raise chickens entirely indoors. Wooden sheds soon gave way to long, low, metal versions that hold thousands of broilers.

As war often serves as an organizing catalyst, World War II had a large influence on the poultry industry. In 1941 the Delmarva Peninsula was producing two-thirds of the country’s chicken, roughly 77 million. A year later it hit 90 million. With the more popular beef and pork rationed for soldiers in the field under the “Food for Freedom” program, chicken was initially left for civilians causing demand to explode. By 1943, the military declared ‘chicken is for fighters first’ and the War Food Administration commandeered the Peninsula’s boilers- the National Guard literally seized chickens off of trucks heading out of Delmarva. Facing a labor shortage, more than 3000 Axis Prisoners of War were imported to work in chicken production (mostly Germans who served Rommel’s Afrika Corps).

Domestic production moved to the South where it has mostly remained. While the South was late to large scale production, it was there that the system that would soon dominate meat production was developed. Known as ‘vertical integration’, it is a system that is designed to be dominated by a few very large companies.

Chicken farming made its way to Ozark Hill country, where golden ages of farming were nonexistent. The soil is low yielding, the land is hilly and was removed from the plantation economy. Cash poor farmers often rented the land, their landlords used a credit system to finance crops upfront for those farmers who needed it. The farmer provided the labor and the ensuing earnings from the crops would be split- i.e. tenant farming.

In the midst of the Great Depression, the federal government passed the Agricultural Adjustment Act in 1933. The idea was to ensure a stable price for wheat and cotton farmers by setting a limit on the number of acres farmers could raise, thereby preventing the market from flooding with crops. The edicts, along with bad weather, including hot winds from Oklahoma, proved devasting for farmers in the Ozarks scratching out a living, thus creating a population of farmers willing to try chickens.

Upcountry Georgia was in similar circumstances. It was also distant from the plantation economy and made up of small farmers. In the midst of devastation after Sherman’s March to the Sea, farmers found themselves in need of credit to get their farms operational. Local creditors, known as ‘furnishing merchants’ demanded a lien on crop in exchange for supplies. This necessitated growing a crop which could be sold in Northern markets. Cotton served this role. Whereas there was little cotton grown in the region prior to the Civil War, farms previously grew mostly grain and raised some meat, cotton became the dominate crop for decades. This exploitative arrangement held steady but prevented any diversification since creditors would advance credit only for cotton. Soil exhaustion became prominent as time went on and tenancy greatly increased. By 1940 tenants and sharecroppers operated two-thirds of farms.

When the Depression completely bottomed out the price of cotton (along with the effect of the Agricultural Adjustment Act) the system there simply shifted to chicken. Another impactful federal initiative was the Rural Electricity Administration passed in 1936. Prior to 1936 over 95 percent of homes in rural Georgia lacked electricity. For poultry production access to electricity, like the advance in feed, eliminated any seasonal limitation (hence the earlier term ‘spring chickens’).

It is important to note that many of the founders of the companies that would grow to dominate the poultry industry (John Tyson, Jesse Jewell, Charles O’Dell Lovette) were not farmers. They were middlemen. John Tyson was exiled from the family farm in Missouri at the age of twenty-five with one half bale of hay and a truck. He moved to Springdale, Arkansas (in the middle of the Ozark Plateau) and starting making his living hauling fruit grown from the richer soil west of the town to markets in St. Louis and Kansas City. By the early 1930s that industry began to decline. Tyson turned to the emerging chicken economy.

Squint hard enough and one could already see how this would take shape. A middleman like Tyson needed a steady supply of birds. With the price of chicken subject to volatility due to the speed with which they reach maturity, leaving prices prone to boom and bust, local farmers couldn’t be counted on to deliver a regular supply. Tenants were already being fronted money for chickens. Tyson simply took it a step further by buying chickens from hatcheries and actually loaning them to farmers to raise and receive a fixed price upon delivery. The next obvious step was to buy a hatchery. From there the remaining variable is the price of feed, so why not make some, sell it to the same farmers, and profit on both ends of the transaction. From there the processing plant; Tyson built his first plant in Springdale in 1958.

The National Chicken Council (NCC), the poultry industry’s DC lobbying arm, describes vertical integrated companies as ‘companies in a supply chain united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to satisfy a common need- in this case, the production of broiler chicken.’ What that translates to is the company owns and hatches the chickens. It owns the feed, trucks, and slaughterhouses. Meanwhile, the farming part still remains a contract affair with birds hatched and delivered to farmers, along with the feed, to raise to maturity with payment on delivery. The beauty of this is farmers are supposed to have a regular, safe supply while there is quality standardization along the whole chain. Well over 90 percent of chickens raised for consumption in the U.S. are produced under this system. According to the NCC, ‘the system has worked well for decades and had kept tens of thousands of families on small farms who otherwise would have had to get out of agriculture altogether.’

The system certainly produces a lot of chicken. If chicken was once an occasional Sunday dinner, now it is omnipresent. According to the North American Meat Institute (NAMI), the American meat industry in 2017 processed 9 billion chickens (equaling 42.2 billion pounds of meat). Despite the silly mythology of the farmer as a cultural buffer against coastal elites, science, much of it having roots in big name universities, has long been a decisive factor in farming. Back in the mid-1920s chicken cost almost $8 a pound ‘live weight’ in today’s dollars. Today’s chickens weigh more than twice as much, mature in half the time, and cost $1 per pound fully dressed. From the 1920s to the 1950s the price of chicken declined steadily and faster than beef and pork. By the late 1980s, the real price of chicken was less than one third of what it cost in 1955.

By the 1970s, with the industry cranking out so much chicken new products and methods of cooking needed to be developed. Paradoxically these run the full gauntlet from being considered healthy to near junk food. Grilled chicken breast has served for decades as a healthier, less fatty, alternative to beef. The anti-cholesterol craze of the 1980s and 1990s gave a big push to chicken’s appeal. Chicken salad does go back a long way but exploded in that context. Of course, there is plenty of chicken of the less healthy variety. McDonalds unleashed the very influential McNugget in 1982 (an order of McNuggets has a higher fat content than the regular burger). It was a short step from there to the universal chicken fingers. Wings covered with skin and dripping with gooey sauces became a staple of bar food and then expanded to restaurants of all kinds, including many places that serve almost nothing else but them. KFC was an early fast food chain with a focus on fried chicken but Chick-fil-A came along in 1967, Popeyes in 1972.

Chicken consumption exploded. In the mid-1920s the average American ate about 14 pounds per year. Between 1976 and 1989 per capita consumption rose by 50 percent. By 1980 that average American was eating roughly 35 pounds of chicken per year. By 1995: more than 50 pounds. 2001: 82 pounds. In 2016, according to the USDA, it was up to nearly 92 pounds.

Farming and processing are the two main pillars of the chicken economy. As we have seen, the industry line is that vertical integration, by supplying farmers with regular shipments of chickens and feed, has stabilized the farming economy keeping small farmers in business. Whatever truth that logic contains, there is the counterbalance of the farmers losing complete control over the entire process. From sales to marketing to the chickens, the corporations run it all. Farmers are paid on the basis of ‘feed conversion’, how many of the chicken delivered to the farmer can be raised and returned for slaughter with as efficient use of feed as possible. Farmers under contract for the same particular company, and there aren’t many such companies given the inherent concentration built into the system- the ten largest poultry companies control about 80 percent of the market, compete with each other under that metric with the winners getting paid more than those ranked lower (the cost of feed deducted from all). Only the company holds all the information. Contracts can be cancelled by the company at any time.

In hindsight it is perhaps difficult to fathom why farmers would allow such a set-up to materialize. An exact inflection point is impossible to uncover. Its origins lay in hundreds of transactions. Well documented in Monica R. Gisolfi’s The Takeover: Chicken Farming and the Roots of American Agribusiness, prior to the early 1950s, there were many variations of what eventually became the conversion contract. Under the ‘open account’ contract, feed dealers retained ownership of birds and shared with the farmers both profit and loss. Both parties were bound by the market. An important variation to that was the ‘no loss contract’. Here integrators still owned the feed and birds but protected the farmers from debt if production costs for a flock exceeded the return on the flock. Essentially the company assumed the debt. The siren song of that allowed the integrators to take more of the sales based on them assuming the risk.

The thing is in the 1930s and 1940s investment requirements to operate chicken farms was relatively low. This would change as technology advanced with ever larger barns equipped with temperature controls and automatic feeders. If the system’s appeal for farmers is supposed to be stability, the charm for the companies is the outsourcing of the least profitable part of the production process. There is a reason the independent feed dealers and truckers are gone but farms remain on the outside: the companies realized the model worked better without them. Greater still, capital investment is outsourced. Farmers make expensive investments and upgrades to their farms, indeed companies force these investments on farmers with the threat of losing the contract- farmers already in debt have little choice but to comply. By the early 1950s, farmers were providing about 50 percent of the capital to run an integrated farm. A government study in 1966 found that ‘growers of a firm slaughtering about 20 million birds per year would have invested nearly three times as much as the firm itself ($6.4 million compared to $2.3 million).’

Meat companies have farmers making capital investments and competing with each other, not in a free market, but in company owned corporate fiefdoms. Thus exists the surreal scenario of farmers owning the means of production while playing the role of serfs on their own farms. Contract farming started with chicken but soon swallowed up hog farming as well. Nearly all hogs are grown under contract farming. As the pork industry integrated 90 percent of hog farms disappeared, and as with chicken farmers, no doubt many left loaded with debt. How often do politicians speak romantically of small farmers?

Ever since Upton Sinclair published The Jungle in 1904, meatpacking has been synonymous with low wage, backbreaking labor. Sinclair’s novel had an effect most novelists could only dream of but didn’t have the effect he intended. He famously quipped ‘I aimed for the public’s heart but by accident hit it in the stomach.’ For decades after The Jungle was published packing house labor remained precarious. Gains in wages, such as during World War I, were always a moment from being taken back, large strikes were unsuccessful. It wasn’t until the emergence of the United Packinghouse Workers of America (UPWA), originally charted by the CIO in October 1937 as the Packinghouse Workers Organizing Committee, that lasting gains were made. In the aftermath of an organizing wave, master agreements for the industry were signed in the 1940s. Where in the past companies were able to divide their workforces along racial lines, UPWA was successful in uniting workers. For a generation meat packing provided a solid living. In 1950 wages for meatpacking were only slightly lower than U.S. manufacturing. By 1960 wages in meatpacking were 15 percent higher, a number that basically held through the 1970s.

At the same time the seeds of this period’s demise were eagerly being planted. With the rise of inter-state trucking, production began to be moved from its traditional strongholds of meatpacking districts in cities such as Chicago, New York, and Kansas City, to rural areas. These meatpacking districts had been centered along railroad lines where livestock was shipped. The industry shift to the country moved packing closer to the livestock saving transport costs while moving away from urban unions. IBP (originally named Iowa Beef Producers) emerged, with a $300,000 grant from the U.S. Small Business Administration, as an industry equivalent of Wal-Mart, pioneering boxed beef (thereby leading to the decline of skilled butchers) and dragging the rest of the industry to extreme cost cutting.

The rise of IBP inspired emulators such as ConAgra and Excell and expanded to chicken and pork production. Older companies were forced to adopt. By the time the anti-union work of the 1980s was done wages in meatpacking were 20 percent lower than manufacturing. By 2002 they were 24 percent lower; today they are 44 percent lower. Regulations were withdrawn and line speeds were once again increased unilaterally by companies. Even by official statistics, injuries surged in the 1980s. Records compiled by the Occupational Safety and Health Administration (OSHA) showed that from 2015 to 2017 there was an average of 17 serious incidents a month, basically one every other day, at U.S. packing plants. These injuries are classified as ‘hospitalizations, amputations or loss of an eye’. In the 1960s meatpacking had one of the lowest turnover rates among industrial jobs. Today the turnover rate is 100 percent.

The meat industry is currently pouring cash into the government, particularly the Republican Attorneys General Association (RAGA), pushing for new liability waiver laws in order to acquire immunity against any wrongful death suits stemming from COVID-19. Smithfield Foods gave RAGA $25,000 in May, three days before the association penned a letter to Congress lobbying for protection for businesses from ‘devastating civil liability litigation concerning baseless COVID-related claims.’ The letter was signed by 21 state Attorney Generals. The lead signee was Christopher Carr, Georgia’s attorney general- Georgia being the largest poultry producing state. Mountaire Farms, one of the largest poultry companies in the country has also dumped substantial amounts of money into RAGA. The company was the target of a brilliant recent investigation in the New Yorker by Jane Mayer that charged the company with concealing the rate of infection of its workers at its poultry plants in North Carolina. Mountaire Farms is facing another federal claim filed by the United Food and Commercial Workers Union, which represents Mountaire’s workers in one of its plants, that the company forced workers to attend anti-union meetings in-person during the pandemic, violating CDC guidelines. The largest meat processing company in the world, JBS SA, is facing a wrongful death lawsuit for failing to provide sufficient protective equipment and forcing employees to work in close proximity and share crowded break areas and restrooms. Senate Majority Leader Mitch McConnell is currently pushing for a national liability shield for businesses.

Food being the basis for existence, it is a given that money will flow from it. The eternal question about money is where it flows. In this case the money hardly appears in the rural areas where packing workers toil, nor to the surrounding farms. As if on the same conveyor belts that churn carcasses inside the plants, the money flows into the coffers of Big Meat. Net income for Tyson Foods has hovered around $2 billion a year the last four years. Pilgrim’s Pride’s net income in 2019 was a reported $455.9 million. Mountaire reportedly earned $2.3 billion in revenue last year.

Soon after The Jungle was published Sinclair lamented ‘I aimed for the public’s heart and by accident hit it in the stomach.’ Over a century later it is clear that the main players again adorn the stage: The Meat Trust, the exploited immigrants, the amputated limbs, now along with bounded farmers. The jungle remains a dark, forbidding place.

Joseph Grosso is a librarian and writer in New York City. He is the author of Emerald City: How Capital Transformed New York (Zer0 Books).