Is the War in Ukraine Driven by International Agriculture Monopolies?

Photograph Source: Discott – CC BY-SA 4.0

Carl Schmitt, the lawyer to Adolf Hitler and legal philosopher for the Nazi Party, tells us that “Nomos comes from nemein – a Greek word that means both ‘to divide’ and ‘to pasture.’ Thus, nomos is the immediate form in which the political and social order of a people becomes spatially visible – the initial measure and division of pasture-land, i.e., the land-appropriation as well as the concrete order contained in it and following from it.” (Nomos of the Earth, pg. 70)

Except for a few marginal news sources, nobody in the mainstream media is reporting on the evidence. Ukraine is important for American and Russian interests because of its rich dark soil, perfect for agriculture (known as “cernozëm”).

As a result of this rich dark soil, Ukraine is responsible for a third of the world’s wheat production, some estimates range from putting Ukraine as the the second to the seventh ranked wheat exporter in the world, and the country produced $27 billion in agricultural production in 2021. According to some statistics Ukraine is the second most productive nation in the world according to agricultural output per acre. Many fertilizer chemicals are produced in Ukraine, along with Russia which is the chief supplier of nitrogen in the world, Ukraine and Russia combine for 28% of the world’s nitrogen-based fertilizer production.

Statistics gathered by the American Farm Bureau Federation, sets Ukraine as the world’s fourth largest exporter of corn, which is a main source of food for beef cattle. Even though cows have naturally evolved to eat grass, the reason “Grass Fed Beef” is a boutique item in many high end organic supermarkets in America is that government corn subsidies have driven down the price of corn to the point where most cattle production relies on corn fed beef, which has been well documented as a cause of E. coli contamination. Due to cost benefit analysis, corporations have decided that it is cheaper for them to use corn than grass as cattle feed. Corn is also in almost every product in most major chain supermarkets.

Economists in the agriculture sector predict an overall 12% increase in fertilizer expenses and a 7% increase in animal purchase expenses by the end of 2022.  There are few facets of farming, if any, that aren’t adversely impacted by the growing conflict in Europe. Supply-chain issues across all industries persist among the rising global tension. Many companies who were just beginning to recoup their losses from the Covid-19 shutdowns now face the uniquely new challenges created by the Russian invasion of Ukraine. The prices of nearly all the world’s most popular raw materials teeter at all-time highs, and energy prices are no different. All the operating costs of farms around the world, from fuel to fertilizer to tractor parts, are spiraling out of control.

For about the last decade and a half, Monsanto, Cargill, and DuPont corporations have slowly taken over many aspects of Ukraine’s agricultural system. This includes circumventing land moratoriums, investing in seed and input production facilities, and acquiring commodity production, processing, and transportation facilities. The Oakland Institute reported that in 2015 1.6 million hectares of land in Ukraine had been sold to these agricultural corporations, taking the total land use to over 2.5 million hectares (or over 6.1 million acres) in Ukraine by western corporate agricultural firms, most of whom supply mainly to the fast food and supermarket retail markets in America.

An analysis by Open Democracy published in October 2021 revealed that ten private companies controlled 71 percent of the Ukrainian agricultural market, including, “in addition to the Ukrainian oligarchy, multinational corporations such as Archer Daniels Midland (ADM), Bunge, Cargill, Louis Dreyfus, and the Chinese state-owned company COFCO.” According to the Oakland Institute’s latest report on the subject, the list now also includes multinational corporations such as Luxembourg-based Kernel, the US holding company NCH Capital, the Saudi-based Continental Farmers and the French AgroGenerations.

Among this long list, European companies particularly stand out, and the role of the EU is increasing, especially after the signing of the economic association agreement between Ukraine and the European Union that came into force in 2017. That agreement, denounced at the time by Russia as a backdoor to facilitating the entry of Western multinationals, includes the promotion of “modern agricultural production … including the use of biotechnologies,” an apparent opening towards GMO crops on Ukrainian (non-EU) fields. Furthermore, agribusiness development in Ukraine and Eastern Europe is part of the European Commission’s strategic plan to boost “protein crops” and reconvert production in those regions to mainly soybean, for which meeting current EU needs is still largely dependent on imports from Argentina and Brazil.

Why is this so crucial to the United States interest in the region? Well, we have to look no further than the rapid development of agricultural monopolies over the last several decades.  If our food choices are any indication, there is very little in the way of free choice in the marketplace. 90% of the money for food purchases by American consumers goes towards processed foods.  Most of which are controlled by a handful of food conglomerates. For a visual aide to help understand how consolidated these monopolies have become, OxFam created this flow chart in 2014.

Consuming approximately 200 pounds of beef per person per year and roughly 50 pounds of fried potatoes per person annually, with only eight companies controlling over two-thirds of the chicken processing plants, and only four beef packing corporations control almost all of the beef supply in the world. Cargill, Tyson (which is also the biggest chicken producer), Brazil’s JBS, and National Beef packing. In pork you would only have to add Smithfield to the equation.

Three separate events in 2019, 2020 and 2021 highlighted the country’s reliance on large beef plants run by the four biggest processors.

First, a large Tyson Foods plant in Holcomb, Kansas, closed for four months following a fire on Aug. 9, 2019, that reduced U.S. beef production and removed a market where farmers could sell their cattle.

The second disruption occurred as COVID-19 spread last year, causing slaughterhouses nationwide to close to contain outbreaks of the virus among workers.  Many of the deaths among meatpacking night cleaning crews are unreported because the jobs are done by undocumented immigrants, and there are many workers who have no healthcare because it would be cost prohibitive to provide health care when the meat packing industry is producing highly contaminated meat products and running the machines faster means more product moves down the lines. Accelerating the production lines also means more accidents occur where animals fall off the grinding machines, and workers lose a grip on their cutting blades, often injuring themselves or others.

As far as control over potato soil, Idaho has lost over half of its potato farmers in the last twenty five years. While at the same time the acreage devoted to potato farming in Idaho has steadily increased. Many companies need to look overseas to find new labor power and new sources of workers to till the soil, as well as new rich sources of soil in which to plant and graze. Most of the American food purchases go to a handful of corporations who control the food supply for supermarket retailers and fast food chains, while the rate of suicide among American farmers has gradually risen to six times higher than the national average among all other professions. Farmers in America are basically being faced with entrapment like conditions to sell their products to a small number of corporations while piling on enormous amounts of debt for themselves in the process, while these corporations make windfall profits. Professor of Agricultural Economics at the University of Idaho, Paul Patterson has described America’s food market as an “oligopsony” where a small number of buyers exert power over a large number of sellers, thereby limiting the choices for where small farmers can take their products, and giving a negotiating advantage where corporations can make heavy handed demands on farmers who have nowhere else to sell their products.

All the while, food subsidies artificially lower the cost of fast food products to the point where, according to David Robinson Simon’s statistical research on the political economy of meat production in Meatonomics, without government subsidies the average Big Mac hamburger would cost approximately $12.75. Plus, if you factor in the health costs of obesity, the American health care industry has a cost of over $160 billion a year in medical bills as a result of health care related costs associated with obesity. Conditions such as heart disease which is the biggest killer in America, and type-2 diabetes which is diet and lifestyle related rather than genetic, wind up costing American taxpayers twice as much as the subsidies that are paid to lower the cost of meat production (roughly $80 billion a year).

What might this mean for upcoming trends and changes in election cycles? Steve Bannon has said that he wants to destroy NATO alliances, and whether this is with another Trump Presidency in the White House in 2024 where we might look forward to more photos like this that use the White House as McDonald’s product placement, or with Trump behind bars, another neo-conservative most likely Ron DeSantis may do just the same as Trump. Only time will tell. The point is that there are dangerous forces connecting that may lead to even more fanatical alliances that could lead to fascism sweeping through Europe. Especially if Marine Lepen takes advantage of the slipping popularity of Emmanuel Macron to make another run for President of France.  Add to this the unlikely event of an upset by Jair Bolsonaro who is currently losing to Luiz Inácio Lula da Silva by 10-13% just a month ahead of the Brazilian elections and the potential support of another of the BRICS Allies (Brazil, Russia, India, China, and South Africa), recently rebranded as the New Development Bank).  This would be a boon to the beef industry which depends on deforestation of the Amazon for cattle grazing, and a steady supply of nitrogen-based fertilizers. As far-fetched as it may sound that Bolsonaro may win, Donald Trump was losing by about 10-13% in polls against Hillary Clinton a week before the election in 2016 and look at what happened.

At the moment of elections, the whole hierarchic network of social relations is in a way suspended, put into parentheses, and society as an organic unity ceases to exist, even if only for a moment. A contingent collection of atomized individuals, of abstract units, in that moment, sometimes deciding on the spot, creates a chain of events that span out into the next few years, predicated on events that are wholly unforeseeable. Some manufactured, or manipulated event, a scandal which erupts a few days before the election, for example, can add that last push of a few percentage points which tilts the future of the country (and the world) in one way or another for the next several years. These contingencies can create irreversible cuts, scars in the economy, and can even be traumatic for the people who suffer at the expense of missteps among those in power. This is a very fragile time in world history. A few mistakes here and there, the Amazon Rainforest might be decimated, global warming might spiral even further out of control, the war in Ukraine might flare up further to the point of overtaking the continent of Europe (with a few allies in surrounding areas and overseas in America). These are indeed savage times. And to think that the pandemic shutdown seems like the good old days when things were peaceful for a while.