Archive for the ‘News From the Field’ Category

Posted on October 7, 2011 - by

Welcome to the Wall Street Ranch

How bankers are defining the future of the world’s food.

The Midwest is no longer the cradle of American agribusiness—Manhattan’s financial district is. And while Wall Street suits may not look like farmers, they now own vast quantities of virtual crops and livestock. Under their control, the global food system has begun to collapse.

Since the bursting of the dot com bubble in 2000 and the housing crisis in 2008, powerful institutional investors have increasingly directed their cash towards commodity index funds. These financial products track the investment value of bundled futures contracts for commodities like wheat, cattle, oil, and base metals. The Commodity Futures Trading Commission set the stage for a speculative binge in 1999 when they de-regulated futures markets, allowing investors who had nothing to do with agricultural production to purchase as many commodity futures as they liked.

And buy they did. According to Olivier de Schutter, the UN’s Special Rapporteur on the Right to Food, holdings in commodity futures mushroomed from 13 to 317 billion dollars between 2003 and 2008. In those same five years the average price of the commodities that compose the index rose by 183 percent.

Many Americans have been insulated from the rising costs, because they spend only 8 to 12 percent of their weekly paycheck on food—compared to the 2 billion people throughout the world who spend more than 50 percent of their income on food. For them, the price hikes have been devastating. The World Bank reports that rising food prices have driven more than 44 million people below the poverty line. More than a billion people—an unprecedented figure—are now food insecure. But the effects of commodity speculation have rippled quietly throughout the United States, too, where the percentage of food-insecure households rose from 11 to 14.5 percent between 2003 and 2011.

The easy explanation for the world food crisis is exploding demand and dwindling supply. Factors that undoubtedly contribute to the squeeze include the conversion of farmland for biofuel production instead of food; the rise in the consumption of meat and processed foods in developing countries; and crop failure due to the changing weather patterns associated with climate change, all combined with a rapidly expanding global population.

But ballooning prices and volatile markets reflect more than market fundamentals, say researchers, UN officials, and even some Wall Street investors. While supply and demand factors may have kindled the global food crisis, it has been stoked by excessive speculation.

Traditionally, speculation in agricultural markets provided a buffer for farmers and millers in an inherently volatile industry. The idea was that a “futures” market would help to stabilize prices and protect farmers by establishing an agreement on price between producers and buyers before the product was even grown. Usually the futures price was lower than the “spot” or current price of the product. If spot prices had dropped by the time the futures contract matured, farmers benefited, because they received the previously-determined, higher price for their product. Increases in spot prices favored the buyer. Until the early 1990s, most of the players in the futures market were directly involved in agriculture, either as farmers, processors, or food corporations.

That all changed when banks entered the business. In 1991, Goldman Sachs developed a derivative that bundled futures contracts for twenty-four commodities into a single expression of investment value that came to be known as the Goldman Sachs Commodity Index (GSCI). With the change in regulations in 1999, GSCI’s pioneering model took off. Between 2003 and 2005, according to figures from the Lehman Brothers, index fund speculation increased by 1,900 percent. More than a third of Goldman Sach’s net earnings now come from commodities markets, while dozens of other banks offer investors a smorgasbord of commodity index funds.

The problem with the commodity futures market is that it distorts the traditional economic model in which prices are shaped by supply and demand. Instead, momentum drives the investment: commodity futures speculators almost always go “long,” meaning they bet that prices will increase. In order to keep herds of cattle from actually being delivered to their new owners on Wall Street, investors roll maturing futures contracts into another bundle, or sell their contracts and invest in new futures, continually feeding the cycle. Unlike consumers, index speculators increase their demand as prices rise. Then, “demand shock” drives up prices yet again.

Investors claim that because they are dealing only in futures and not with the spot market, they have little impact on real market prices. In fact, according to the FAO 98 percent of all futures contracts never result in a real transaction of goods.

Even so, the evidence suggests that by betting on the future, Wall Street is defining the present. A 2010 study by Manuel Hernandez and Maximo Torero for the International Food Policy Research Institute considered price data for corn, wheat, and soybeans, and the dynamic relationship between spot and futures markets. They found that, in general, real market prices do rise to meet commodity futures prices.

The human tragedies that followed the 2008 financial crisis should have shattered the myth that finance occurs on a separate plane from everyday lives. Turning the world’s food into money is filling a few pockets, and emptying millions of stomachs. The speculative bubble has made food inordinately expensive, and people are hungry because they simply can’t afford it.

Representative Barney Frank and the Chairman of the Senate Banking Committee Chris Dodd have proposed financial reform legislation (known as the Dodd-Frank Act) with a section that would require the CTFC to limit the positions held in futures contracts. The CFTC failed to reach an agreement on the limits by last week’s deadline, and the rules have been delayed again. According to Edward Miller in Global Research, leaks from the CTCF indicate that the limits they are weighing focus on oil, not food, and are riddled with loopholes. The Anti-Speculation Act, proposed by Senator Bill Nelson and Representative Peter Welch in late September, takes a stronger position, but given the massive support that both parties receive from the financial industry, Congress is unlikely to move forward on the legislation, particularly while the CFTC continues to stall. And as Frederick Kaufman writes in Foreign Policy, even if regulations were established in the U.S., food derivative markets have expanded globally to the extent that they are “beyond the reach of sovereign power.”

Even if financial regulation couldn’t fully reign in the runaway speculative train, it’s important to acknowledge the defining role commodities futures play in our food system, and for regulatory bodies to distinguish between financial and commodity derivatives. A handful of reporters like Kaufman, Horand Knaup, Michaela Schiessl and Anne Seith for Der Spiegel, and Tom Philpott for Mother Jones, have recently illuminated the costs of the newest investment bubble. But without greater attention, I wonder if we’ll be blindsided, just as we were in 2008, when it bursts.

Meanwhile a billion people are hungry worldwide. Now in its third week, the Occupy Wall Street demonstration has brought thousands of marchers representing labor unions and other organizations, along with ordinary citizens, to Manhattan’s financial district to join the populist protest. Solidarity demonstrations are underway across the United States. Regardless of what you think about the movement, it’s clear that corporate influence in politics effects our food system in many ways. Perhaps the movement is, at its heart, a struggle for our daily bread.

Photo: Flickr/Manu_H


Posted on August 17, 2011 - by

Regulators and Law Enforcement Target Local Foods; Corporations Walk Free

A sting operation targeting a small food club raises questions about food safety, consumer freedom, and the influence of the corporate food system.

Flickr: Kthread

On August 3, armed federal and county agents raided Rawesome Foods, a food club in Venice, CA. They seized computers and cash, loaded a flatbed truck with watermelons and coconuts, and poured out gallons of fresh milk. They arrested James Stewart, Rawesome’s owner, on criminal conspiracy charges. His alleged crime? The production and sale of unpasteurized goat milk, goat cheese, yogurt and kefir.

Stewart was later charged on 13 counts, 12 of them related to the sale of “raw” or unpasteurized milk. Healthy Family Farms owner Sharon Palmer and her employee Victoria Bloch were also arrested on related charges.

The raid was the culmination of a year-long sting operation targeting the club, which began twelve years ago as a collective of raw-milk drinkers who sourced unpasteurized milk from local dairies. While the sale of raw milk is legal in California, retailers are legally required to buy from state-certified dairies. Organic Pastures, which produces milk from Holstein cattle, is the only certified raw-milk dairy in California. Rawesome’s members had been buying uncertified cow, goat, sheep and camel milk from various producers. They did so as a private club of consenting adults, freely choosing raw milk from local sources.

That same day, while prosecutors attempted to set Stewart’s bail at $121,000, food industry giant Cargill issued a voluntary recall of more than 36 million pounds of ground turkey. The meat was contaminated with a strain of antibiotic-resistant Salmonella and had caused at least one death and 76 illnesses. It took Cargill, which sells turkey under multiple brand names and is a major supplier to public school meal programs, more than four months after illnesses surfaced to issue the recall.

Rawesome’s members have been declared criminals, but no one affiliated with Cargill has been charged with a crime. In fact, the USDA can only recommend “voluntary recalls” in cases related to pathogen-contaminated products, leaving companies like Cargill to self-police.

While the austerity-obsessed government struggles to find room in the budget for food safety oversight of massive multinational corporations, American tax dollars are funding multi-agency sting operations directed against neighborhood food co-ops, anti-raw milk ads and press releases, and lawsuits against small-scale farmers.

As the FDA maintains, unpasteurized milk presents a potential health threat because it can carry bacteria such as Salmonella and E. coli. But according to the FDA’s own statistics, sickness related to raw milk only accounts for about 0.00008% of food borne illnesses.

And there’s plenty of other data suggesting that the regulatory crackdown on raw milk is a waste of time and money. According to the CDC, approximately 800 people have become sick from raw milk since 1998. That’s an average of 62 people per year, compared with the 76,000,000 Americans who become ill, the 325,000 who are hospitalized, and the 5,000 who die annually from federally inspected/accepted ‘safe’ foods. Milk, pasteurized or unpasteurized, isn’t even on the list of the ten riskiest foods regulated by the FDA. The number one risk? Leafy greens.

If our regulatory agencies were solely concerned with the potential for food to cause disease, closer scrutiny would be placed on the opaque network of industrial producers that are responsible for deadlier and more frequent outbreaks of foodborne illness. For example, a recent technical review by the USDA acknowledged the connections between antibiotic-resistant bacteria and the prophylactic use of antibiotics on animal farms. But as Tom Philpott reported last week in Mother Jones, the report disappeared from the USDA website after complaints from the meat industry. Regulatory agencies have continually shied away from limiting antibiotic usage in industrial feedlots in spite of a vast body of scientific evidence pointing to the serious health threats related to that practice, like the resistant strain of Salmonella in Cargill’s turkey meat.

So the raw milk debate isn’t really about public health. It’s about the right to choose local, non-corporate foods. Rawesome members signed a form acknowledging the possibility of microbe contamination in the food they received, and records in the Rawesome office would have helped members trace contamination back to the source if illness had ever occurred. In comparison, consumers who eat federally accepted foods have much less information about what they eat, where it comes from, and how it’s produced.

The real health problems caused by the American food system have little to do with raw milk. Sign now to tell the FDA: we have the right to choose what goes into our bodies.


Posted on June 3, 2011 - by

The New Food Pyramid: Where’s the Spark?


Perhaps the lush infographics I’ve been enjoying lately thanks to have me spoiled, but I was distinctly underwhelmed by “My Plate,” the USDA’s latest attempt at a visual representation of a balanced diet. The graphic, released yesterday, replaces the oft-maligned food pyramid,  which was introduced in 1992 as a way to get Americans to eat healthier food but instead became a symbol for much of what is wrong with the American diet: too much grain and carbohydrate, not enough fresh produce.

I understand that the designers were trying to simplify the image as much as possible. It’s meant to be a quick and memorable reference for the population at large, not a definitive guide for food dorks like me. And simplify it they did, to the extent that fats are not shown, sugars are absent, and instead of a recognizable fifth food group, we get the nebulous “protein.” How are we supposed to interpret this category, given that many vegetables, grains, and dairy products are great sources of protein? Where do beans and nuts fit in?

I’m sure the USDA carefully considered these questions and many other nitpicky details in their search for the “right” image, but with simplicity as their guiding principle, opted to focus on pounding a single message home: fruits and vegetables should make up half of what you put on your plate. I love the choice of a plate here (not to be confused with a pie, of course), which people already associate with food, serves as an easy reference point for proportional portion size, and doesn’t place food groups in a hierarchy like the original pyramid did.

Despite its elegance as a symbol, the plate image leaves me cold. It may be easily memorizable, but it isn’t memorable in the way that might inspire healthier, more balanced cooking and eating. It calls to mind math class rather than the dinner table. Until we as a nation stop thinking of healthy eating as a chore and begin to understand it as a source of pleasure, we’re not likely to trim our collective waistline anytime soon.

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Posted on May 20, 2011 - by

Moo-ved to Action on the Right to Raw Milk

Photo: James Buck/The Washington Post

If you happened to walk by the Senate Office Building on Capitol Hill this Monday morning, you might have noticed an unusual guest: a Jersey cow named Morgan munched on the lush grass while volunteers passed out cups of still-warm milk, direct from her teats.

Members of the Grassfed on the Hill buying club, who purchase meat and raw milk of pasture-raised animals from DC-area farmers, brought the farm to Washington to protest the FDA’s attempt to file a permanent injunction against Pennsylvania farmer Dan Allgyer, who sells raw milk to buying club members. If the federal court approves the injunction, Allgyer would be forced to stop selling unpasteurized milk across state lines.

The sale of unpasteurized milk is legal in many states, either in stores or on the farm. Other states allow herd sharing, whereby consumers pay farmers a fee to keep and care for “their” cow, and in return receive a supply of milk. (Use this interactive map from the Farm-to-Consumer Legal Defense Fund to learn more about the legality of raw milk in your state.) However, federal law prohibits interstate sales of raw milk, citing safety concerns about bacteria that may be present in “uncooked” milk, including E. coli, Listeria, Salmonella, and Campylobacter.

Consumers who seek out raw milk do so for a variety of reasons: the fuller taste,  health benefits such as gastrointestinal support, a desire to support local economies, or just for making cheese. Protesters gathered at Monday’s rally carried signs demanding the freedom to choose unpasteurized milk.

Are you a raw milk drinker? Why or why not? How should consumer choice and concern for public health be reconciled in this case? Share your thoughts in the comments!

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Posted on February 28, 2011 - by

Chunky Monkey: Obesity Research on the Modern Diet

Photo: Barbara C. Hansen, University of South Florida via NYT

Meet Fat Albert. Like many in contemporary society, he is overweight, enjoys indulging in a sugary treat or two, and does not get much exercise. Unlike many, he is a lab monkey—living a lifestyle designed to induce weight gain and obesity.

At the Oregon National Primate Research Center, scientists have developed a colony of overweight monkeys to study the effects of diet on weight gain and diabetes (NYT). Director Kevin L. Grove explained, “We are trying to induce the couch-potato style. We believe that mimics the health issues we face in the United States today.”

The monkeys are used to gauge the effects of high fat and sugar diets on health, along with experimental drugs used to treat related illnesses. Studies are being conducted on appetite suppressants and hormonal mechanisms that can be used to treat diabetes. In addition, it is much easier to monitor a monkey’s dietary intake, compared to relying on surveys of human subjects who may fudge their numbers.

To fatten the monkeys, they are fed dried chow pellets with a high fat content contributing to one-third of caloric intake. (This is comparable to the level of fat in the average American diet.) Peanut butter, popcorn and peanuts are also given to the monkeys as snacks, along with a fruity punch that contains as much fructose as a can of soda. To limit movement, the animals are kept in individual cages without access to swings or climbing equipment.

Surprisingly, about 40% of the primates do not gain a lot of weight. Researcher Barbara Hansen suggested that caloric intake was more influential on weight gain than fat. “To suggest that humans and monkeys get fat because of a high-fat diet is not a good suggestion,” Hansen said. Other results hinted that it is the combination of high fructose corn syrup and calories that leads to obesity and diabetes. “It wasn’t until we added those carbs that we got all those other changes, including those changes in body fat,” said Anthony Comuzzie, scientist at the Southwest National Primate Research Center.

Is this research providing valuable insights on diets high in calories, fat and carbohydrates? Or do you think this is a form of animal abuse? Is it any worse than the average confined factory farm operation?

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Posted on February 3, 2011 - by

Nutrition Keys: Full Disclosure in Labeling?

Last week, major U.S. food manufacturers unveiled new, self-imposed labeling requirements for processed foods. The “Nutrition Keys” would be placed on the front of packages, and feature the number of calories, and the amount of saturated fat, sodium and sugars contained in each serving of the product. Manufacturers would also have the option of highlighting additional “nutrients to encourage,” by including two of the following items: potassium, fiber, vitamin A, vitamin C, vitamin D, calcium, iron and protein. The changes will be rolled out over the next few months.

The labeling changes were developed by the Grocery Manufacturers Association and the Food Marketing Institute in response to pressure from the F.D. A. and the Obama administration, who wanted more prominent displays of nutrients that consumers may want to avoid. However, in a point of disagreement with the White House, manufacturers also wanted the option to emphasize other potentially beneficial nutrients on the front of the package.

Are these labels truly an advance in clarity for consumers, or simply another method of subterfuge for junk foods? There is concern that drawing attention to the “nutrients to encourage” could make unhealthy foods look healthier, by highlighting the calcium content in ice cream, for instance. Or, manufacturers could be encouraged to add vitamins and unnecessarily fortify products to make them more label-friendly. The label also doesn’t indicate which nutrients are positive and which are negative for your health, so consumers would have to know that beforehand.

Another point of contention is the inclusion of protein under “nutrients to encourage.” Marion Nestle at Food Politics writes, “Since when does protein need to be encouraged in American diets? We already eat twice the protein we need. The rationale? Vegetarians.  I repeat. Since when don’t vegetarians get enough protein? Never mind, protein makes the products look better.”

If this sounds like a familiar story, that’s probably because it is. Toward the end of 2009, the food manufacturing industry was forced to drop their Smart Choices labeling system after the F.D.A. criticized it for potentially misleading customers into buying processed products over fresh, unprocessed foods. Nutritionists had lambasted the program for being too lax nutritionally, awarding foods like sugar-heavy Fruit Loops and fat-laden mayonnaise the Smart Choice designation.

In the U.K., labels are given a red, yellow or green coding akin to the colors of a traffic light. This allows you to tell at a glance whether the product contains low, medium or high levels of sugar, fat or sodium. So, if the colors are mostly red, then you should enjoy the food once in a while, and if the colors are mostly green, then you can consider the food a healthy choice.

The F.D.A. is considering mandating a similar system for U.S. manufacturers, but the industry is resisting, fearing that the labels will malign food products and drive away business. To which I say, that is the point.

Do you pay attention to nutrition labels? Will these Nutrition Keys will help discourage unhealthy eating habits? What other labeling measures can we use to inform people about what’s in their food?

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Posted on November 9, 2010 - by

Makin’ Groceries by Megan Burns

As a newly transplanted New Orleanian, I am overwhelmed by the amazing food system work underway in the city of re-birth. I moved to New Orleans over a year ago to study Community Public Health as it relates to school and community gardens and, thanks to a new friend, quickly joined forces with a neighborhood group working to build a combination community-schoolyard garden a few blocks from my house.

Before starting graduate school, I studied and worked in the fields of environmental education and organic agriculture. While working on farms and community gardens, it became impossible for me to ignore the patterns of food access and community  health. Growing fresh healthy produce was fulfilling work but I decided to shift gears towards making this food available to everyone. There are so many organizations and individuals in New Orleans who are doing just that. The most inspiring aspect of the food/urban agriculture community’s work here is the commitment to addressing the problems in our food system by bringing everyone to the table to ensure that the movement is not circumscribed by class or race.

I recently attended the Community Food Security Coalition’s annual conference in New Orleans, an amazing event not to be missed by anyone interested in food and community. Among the many, many inspiring speakers was Aba Ifeoma, a founding member of the Detroit Black Community Food Security Network. She posed this question to those in the audience doing community work around healthy food and food justice: Are you working for or are you working with? If we are working for, we lack community engagement and as Aba pointed out, we may be reinforcing traditional roles of power without even being aware of it. If our work lacks community engagement, especially those communities who suffer the most from our broken food system, we will never bring strength to the food movement.

This engagement is not easy and requires time and trust. I am currently working with students at the James Weldon Johnson Elementary School in New Orleans as a New Orleans Albert Schweitzer Fellow to develop and implement a garden program called Makin’ Groceries. (Makin’ Groceries is slang for grocery shopping in New Orleans.) Students at the Johnson School are predominantly African-American (99%) and eligible for free or reduced lunch (98%). The goal of the Makin’ Groceries program is to incorporate families and communities through a school garden program to improve attitudes towards fresh fruits and vegetables and begin a conversation about food accessibility. I developed this program quite blind to community work in New Orleans and the strains young families face these days. I’m positive that I am learning more than anyone else involved in the project!

Although the in-school portion of the Makin’ Groceries program has been successful, the community and family engagement is slow going. Just last weekend I invited all my students to a free children’s event at Hollygrove Market and Farm, an urban farm in the neighboring community. Only one of the thirty-six students in the program attended. I was in the middle of lamenting my recruitment failure to a fellow community gardener when she interrupted- “You had someone come out, that’s great. That’s how it starts!”

We have had some unique engagement successes. In order learn more about their own culinary and agriculture traditions, 3rd graders at Johnson developed questions and conducted interviews with a family or community member. Many students asked about how to make traditional dishes such as yaka mein and jambalaya. Others learned of grandparents and parents who kept large gardens at one time. Students took notes during the interviews and are still in the process of writing up their reports. This
was an authentic way to engage families and communities and honor culture while respecting travel and time constraints faced by these families. We hope to send copies of our final reports along with pictures of the students and their interviewees to First Lady Michelle Obama.

A few ways to begin to address these issues in your city, town, and community:

  • Learn about the work of your local or regional Food Policy Council; if none exists think about creating a coalition to address food policies in your area. Agriculture is intrinsic to culture; work with local media artists, students, and community members to record and document food and agriculture traditions, highlighting variety and diversity.
  • Partner with a community organization working with a low-income community to sponsor a dinner and evening  program to talk about health concerns, food access, and local projects addressing these issues. A screening of FRESH is a perfect kick off to such an event!
  • Join (or start) local efforts to support low income community members to grow their own food through community gardening, garden education, and backyard gardening programs. Make sure your farmers market accepts food stamps.