Can Europe Make It?

The struggle of dairy farmers gives us an opportunity to democratise our world's food system

Governments are pursuing trade policies that harm workers and serve multinationals. Last summer's European dairy farmer uprising shows how farmers and food system workers can unite and fight back.

David Miller
15 February 2016

Flickr/Greensefa. Creative commons.It is no secret that global trade is going through a major transformation. The EU-US TTIP agreement under consideration has been compared in scale by negotiators to the European internal market, while Hillary Clinton has called it an “economic NATO”. In addition, the recently-released TPP deal between a dozen Pacific nations, including the United States, Canada and Mexico, covers an area that generates 40% of the world’s GDP.

This crucial phase of the push to create a new global economic system through proposed free trade deals, on top of policy changes being carried out by existing institutions such as the European Union, will have many effects of a currently uncertain nature. One certainty, however, is that their impact on the global working class will be harsh, especially for workers in the global agriculture system. Recent struggles over dairy pricing demonstrate how some of the people who stand to lose the most from these deals have begun to fight back.

This past summer, Europe was rocked by a wave of dramatic cross-border protests, cows occupying store aisles and clashes between thousands of dairy farmers and Brussels riot police. The actions, led by the European Milk Board, the European Farmers’ Union (Copa), and the European Coordination Via Campesina, were a coordinated response to the European Commission’s elimination of milk supply quotas, in place since 1984. The full repeal at the start of April was followed by a 24% drop in prices over five months, leading much of the press to declare that milk was now “cheaper than water”.

Following two years of rapidly decreasing global demand for milk, and already increasing global supply, the quotas’ end placed major strain on dairy farmers that could yet do great damage to their ability to make a living in the industry. The EU, as the largest dairy-producing region in the world, maintained its commitment to trade liberalisation despite the uproar, and has already begun the process of replacing direct market interventions with US-style subsidies. Meanwhile, the reduction in the cost of milk products greatly benefits large food processing companies like Nestlé by improving their access to cheaper ingredients, at the expense of small producers.

As Europe continued reeling from the summer’s developments, a major point of contention in the TPP negotiations was Canada’s interventionist system of dairy ‘supply management’. Thanks to last-minute concessions, supply management appears to be safe for now, although the included import increases will still pose a hardship for small farmers and yet more will have to be spent on subsidies to counter its ill effects. The comparatively gentle terms of the dairy provisions in the final agreement, and the electoral collapse of the country’s social-democratic NDP opposition in October, mean the issue is likely settled for now, although organised opposition to TPP remains.

While North American dairy farmers may be pacified for the time being, the stakes will be just as high in the battle against TTIP. Dairy is one area of trade where tariffs remain relatively high, and US agribusiness is expected to target economic supports for “non-competitive” farmers in the TTIP – particularly the EU Single Farm Payment. The dairy industry, therefore, remains a major field in the global war on small farmers, agricultural and food production workers, and on the food rights of the world’s poor.

The rampant gangsterism of late-stage food processing companies in the dairy industry is typified by one recent price-fixing scheme: an investigation found that between 2006 and 2012, executives at 90% of French yoghurt and dairy dessert manufacturers, including major player Nestlé-Lactalis, used dedicated mobile phones to arrange “clandestine meetings in hotels” in order to introduce coordinated price increases. Similarly, it is not uncommon for the largest companies to collude while bargaining with smaller ingredient suppliers in order to ensure that their bids remain as uncompetitive as possible,

These are major strategies for large food processing companies in general – unlike many in the manufacturing sector, they depend almost as much upon cheap ingredient prices and the proximity of their facilities to large consumer markets as they do on cheap labour. This is especially true for dairy - a product highly perishable in its fresh form; the insulated transport of liquid milk alone accounts for a third of total production costs.

In the age of global capitalism, these types of costs pose a stubborn geographic impediment that food manufacturers have aimed to eliminate through their political influence. As the Corporate Europe Observatory found earlier this year, agribusiness representatives have held more meetings with TTIP negotiators than has any other industry; in addition to industry groups such as FoodDrinkEurope, both Mondelez International and Nestlé have met with the negotiators on their own, multiple times each.

Under current policies, governments are expected to value free trade over human rights. Since the 1995 WTO Agreement on Agriculture, there has been a concerted push to create a “global agriculture” system and participating governments have agreed to a set of rules which compel them to prioritise trade liberalisation over food security or sustainable development. NGOs, including Oxfam, ActionAid and a number of US faith denominations, have condemned the TPP agreement on this basis. They argue that its provisions “fail to take into account that national food security is a legitimate interest governments must protect,” and that simply increasing national food supplies through trade – with no guarantee of its fair distribution – does not satisfy this standard.

Meanwhile, transnational corporations have utilised existing trade mechanisms and the ongoing negotiations as a central component of a growth strategy based on expanding sales into developing markets, while also running small local competitors out of business. The result is that developing nations become highly dependent on imports and on the food corporations to provide them.

In the face of this decades-long onslaught, organisations including the IUF union federation and anti-poverty NGOs have challenged existing trade goals with an alternative “rights-based” approach to global food production and distribution. The upsurge in farmer militancy is an encouraging sign that others in the food chain are also prepared to fight back when they recognise a mortal threat to their interests. Their approach has the potential to unite masses of farmers with trade unionists throughout the world in pursuit of shared interests against the large corporations that control much of the world’s agricultural policy.

The primacy of food manufacturers within this neoliberal agriculture system threatens not only food access and public health, but also the livelihoods of over a billion people employed in the sector – an entire third of the global workforce. Just as small suppliers have suffered from corporate expansion, the biggest food corporations have concurrently transformed local labour markets. They employ people in appalling conditions throughout most of the world. As an increasingly few companies come to dominate local agriculture in developing markets, they introduce a submissive, easily-threatened, temporary workforce, destroy local producers and promote further impoverishment.

For example, Nestlé, in addition to (allegedly) encouraging trade unionist assassinations in Colombia, avoids permanent employment relationships by classifying large numbers of employees as “non-core”. These workers hold  roles in production, packaging and distribution that may be filled by temps on an indefinite basis. As a result, there are entire countries where most of the company’s workforce is employed through temp agencies. This process is encouraged by a system of intra-regional competition among facilities, tracked with sophisticated IT systems. The elimination of political and regulatory barriers to trade will fit these existing structures of corporate operations, especially given their need to transcend the geographic challenges that are inherent in food production and distribution.

The movement for food sovereignty is a crucial stage in the international struggle for workers’ rights. A trade unionist approach to food justice has the potential to unite a broader coalition in support of the rights of workers and small farmers in developing countries. Last summer’s dairy protests show that such a broad-based movement can meet the challenge. People can still take back control of the food system and in doing so will allow agricultural workers to take control over their livelihoods. As long as international trade is designed in the interests of the large food manufacturers and against those of workers and small producers, we remain on a dangerous path.

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